Diffusion Pharmaceuticals Reports First Quarter Financial Results and Provides Business Update
May 10 2021 - 6:05AM
Diffusion Pharmaceuticals Inc. (NASDAQ:
DFFN) (“Diffusion” or the “Company”), an innovative
biopharmaceutical company developing novel therapies that enhance
the body’s ability to deliver oxygen to areas where it is needed
most, today announced financial results for the first quarter of
2021 and provided a business update.
During the first quarter, Diffusion continued to
focus on progressing the development of its novel oxygen enhancing
therapeutic, trans sodium crocetinate (TSC). The company’s balance
sheet also was fortified through a $34.5 million equity raise.
1Q21 Business and Operational
Highlights
- In March 2021, the Company initiated, enrolled, and completed
dosing of 30 healthy volunteers in a Phase 1 trial evaluating the
pharmacodynamic effects of TSC on peripheral tissue oxygenation
utilizing a transcutaneous oxygen monitoring (TCOM) device. The
Company anticipates its ongoing collection and analysis of data
from the study will be completed and announced by the end of the
second quarter of 2021.
- In February 2021, Diffusion completed dosing and reported
topline results from its Phase 1b trial evaluating TSC in
hospitalized COVID-19 patients. The study evaluated the safety and
tolerability of TSC when administered every six hours for up to 15
days, a dosing regimen previously untested in a clinical trial
setting. Topline results, reported in mid-February 2021, showed
that all doses evaluated were well tolerated and no dose-limiting
toxicities or serious adverse events were observed. The Company
anticipates its ongoing evaluation of secondary endpoint data will
be completed and announced before the end of May 2021.
- In February 2021, the Company raised $34.5 million in gross
proceeds in an offering of its common stock, issuing 33.7 million
shares at a price to the public of $1.025 per share. Combined with
its other cash and cash equivalents as of March 31, 2021, the
Company expects existing cash and cash equivalents to be sufficient
to fund its operations (including its planned clinical trials)
through 2023.
1Q21 Financial Results
- Research and development expenses in the first quarter were
$2.9 million compared to expenses of $1.5 million in the prior year
period. The increase was primarily related to costs associated with
the Company’s TCOM and COVID trials, the manufacture of study
materials related to these studies, and increased headcount.
- General and administrative expenses were $1.7 million during
the first quarter of 2021 versus $1.4 million in the comparable
quarter last year. The increase compared to the prior year period
was primarily attributable to increased salaries, wages,
stock-based compensation, and professional fees related to
increased headcount and costs associated with the separation of
former executives that will not recur in future years.
- As of March 31, 2021, Diffusion had cash and cash equivalents
of approximately $46.6 million as compared to $18.5 million as of
December 31, 2020.
“We met the key milestones we set for ourselves for the first
quarter of 2021, including completing and announcing topline safety
and tolerability results for the COVID-19 Trial, completing
enrollment and treatment of the subjects in the first of the
Oxygenation Trials, the TCOM study, and execution of a significant
capital raise that we believe will enable us to obtain the data
required to demonstrate the clinical value of TSC. For the
remainder of 2021, we are focused on the design and execution of
the remaining two Oxygenation Trials, which are the foundation of
our redefined TSC development strategy announced in November of
2020,” said Robert Cobuzzi, Jr., Ph.D., President and CEO of
Diffusion.
Near-term Clinical Strategy
Data from the TCOM Trial is anticipated to be available later in
the second quarter of 2021 and will be used to guide dose selection
for the two additional Oxygenation Trials the Company plans to
initiate and complete in the second half of 2021, both of which
will be funded with cash-on-hand.
- Induced Hypoxia Trial: This trial
will be a double-blind, randomized, placebo-controlled study which
will evaluate the effects of TSC on maximal oxygen consumption, or
VO2, and partial pressure of blood oxygen, or PaO2, in normal
healthy volunteers subjected to incremental levels of physical
exertion while exposed to hypoxic and hypobaric conditions (i.e.,
simulated altitude). The study will be statistically powered to
evaluate the difference in effect of TSC versus placebo on oxygen
availability and consumption.
- DLCO Trial: This trial will be a
double-blind, randomized, placebo-controlled study which will
evaluate the effects of TSC on the diffusion of carbon monoxide
through the lungs (DLCO) in patients with previously diagnosed
interstitial lung disease who have a baseline DLCO test result that
is abnormal. DLCO will act as a surrogate measure of oxygen
transfer efficiency, or uptake, from the alveoli of the lungs,
through the plasma, and onto hemoglobin within red blood cells. The
study will be statistically powered to evaluate the difference in
effect of TSC versus placebo on improvement in DLCO.
Diffusion anticipates topline results from each study will be
available within two months of their respective completion. The
Company believes positive data from any one or more of the three
Oxygenation Trials, if obtained, would provide evidence of a
definitive effect of TSC on oxygenation. If such positive data are
obtained, the Company expects to announce in the fourth quarter of
2021 up to two hypoxia-related indications in which TSC would be
studied as part of its clinical development strategy aimed at
supporting regulatory approval and commercialization. Diffusion
intends to initiate clinical studies in the identified indications
during the first quarter of 2022.
About Diffusion Pharmaceuticals Inc.Diffusion
Pharmaceuticals Inc. is an innovative biopharmaceutical company
developing novel therapies that enhance the body’s ability to
deliver oxygen to areas where it is needed most. Diffusion’s lead
product candidate, TSC, is being developed to enhance the diffusion
of oxygen to tissues with low oxygen levels, also known as hypoxia,
a serious complication of many of medicine’s most intractable and
difficult-to-treat conditions. In addition to TSC, Diffusion’s
product candidate DFN-529, a novel, allosteric PI3K/Akt/mTOR
Pathway inhibitor, is in early-stage development. For more
information, please visit us at www.diffusionpharma.com.
Forward-Looking StatementsThis press release
includes express and implied forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995, as
amended, including regarding the Company’s anticipated cash runway,
its near-term strategic priorities, and anticipated timelines for
the initiation, completion, and announcement of data from the
Company’s ongoing and planned Oxygenation Trials. The Company may,
in some cases, use terms such as “believes,” “estimates,”
“anticipates,” “expects,” “plans,” “intends,” “may,” “could,”
“might,” “will,” “should,” “approximately,” or other words that
convey uncertainty of future events or outcomes to identify these
forward-looking statements. Although the Company believes that it
has a reasonable basis for each forward-looking statement contained
herein, forward-looking statements by their nature involve risks
and uncertainties, known and unknown, many of which are beyond the
Company’s control, and as a result the Company’s actual results
could differ materially from those expressed or implied in any
forward-looking statement. Particular risk and uncertainties
include, among other things, those related to: the Company’s
ability to design, initiate, enroll, execute, and complete its
ongoing and planned studies evaluating TSC; general economic,
political, business, industry, and market conditions, including the
ongoing COVID-19 pandemic; and the other factors discussed under
the heading “Risk Factors” in the Company’s filings most recent
Annual Report on Form 10-K and other filings with the U.S.
Securities and Exchange Commission. Any forward-looking statements
in this press release speak only as of the date hereof (or such
earlier date as may be identified) and, except as required by
applicable law, rule, or regulation, the Company undertakes no
obligation to update any such statements after the date hereof.
ContactsInvestors: Tiberend
Strategic Advisors, Inc. Maureen McEnroe, CFA/Miriam Weber
Miller (212) 375-2664 / (212)
375-2694 mmcenroe@tiberend.com / mmiller@tiberend.com
Media: Kate
BarretteRooneyPartners (212)
223-0561Kbarrette@rooneyco.com
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