Redwood Pharma AB (publ) Quarterly report January–June 2021
NASDAQ FIRST NORTH GROWTH MARKET:REDW.ST, REDWOODPHARMA.COM
Redwood Pharma AB (publ) Quarterly report
Period 1 January–30 June 2021
- The company’s net revenue for the period totalled kSEK 0 (0).
- Operating profits for the period totalled kSEK -10,916 (-8,026).
- Earnings per share for the period were SEK -0.41 (-0.54).
Period 1 April –30 June 2021
- The company’s net revenue for the period totalled kSEK 0 (0).
- Operating profits for the period totalled kSEK -6,981 (-3,594).
- Earnings per share for the period were SEK -0.34 (-0.24).
Significant events during the period
- Redwood Pharma transferred its share listing from the Spotlight Stock Market to the Nasdaq First North Growth Market, in order to boost visibility among major investors and to prepare for the company’s future growth under the Nasdaq brand.
There have been no significant events after the end of the period.
Comments from the CEO
’’ Redwood Pharma is set to be well-placed with separate first- and second-line therapies. ’’
During the second quarter, Redwood Pharma and its extended team, including consultants and contract laboratories, have continued to focus on advancing and increasing the value of the RP101 and RP501 development programs. In particular, we have invested resources into the future regulatory pathway for RP501 and we now have a better understanding of what the requirements are to bring such a medical device to the market. This is important for a number of reasons, one of which is that RP501 represents a near-term revenue opportunity.
There is a compelling commercial rationale for new differentiated therapies for dry eye disease (DED) and Redwood Pharma is set to be well-placed with separate first- and second-line therapies. Our priority is to continue to move these programs closer to approval and launch with the purpose of providing therapeutic relief to millions of DED sufferers.
Redwood Pharma is continuing discussions with potential partners regarding the further development of RP101, our product candidate for the treatment of moderate to severe dry eye disease in post-menopausal women. RP101’s unique mechanism of action positions the program as potentially the first hormonal therapy for DED targeted to specific underlying biological mechanisms in critical tissues in and around the eye, addressing a large unmet need in a well-defined patient-population suffering from this chronic condition. This process has demanded, and continues to demand, patience and perseverance from Redwood and its shareholders.
We are pleased to report positive news on RP501, an IntelliGel-based therapy under development as a first-line therapy for males and females of all ages suffering from mild DED. Redwood Pharma successfully completed an in vitro study evaluating the compatibility of RP501 with various soft and hard contact lenses. This is very encouraging news from a safety perspective, supporting the use of RP501 by contact lens wearers. Once approved for market use, this would significantly expand the addressable market for RP501. For example, 20% of mild DED sufferers are estimated to use contact lenses in Europe and the US. Based on these results, the company has formally decided to proceed with a clinical trial aimed at supporting future filing of medical device regulatory applications in Europe and the US. Very significant, but not as resource-intensive as the prior RP101 Phase II trial, this trial is designed to help provide the clinical support required by regulatory authorities and prove the safety and efficacy of RP501 in patients with or without contact lenses. More information about this trial will be announced once regulatory approvals for trial start have been issued.
I expect to report further developments on both of our DED programs later this year.
CEO Redwood Pharma
About Redwood Pharma and its market
Redwood Pharma AB develops ophthalmic drugs in areas where considerable medical demand exists. The company has two programs for the development of treatments for people suffering from different forms of dry eye disease (DED).
Our first program, RP101, involves the development of a product for the treatment of moderate to severe chronic dry eye disease in post-menopausal women with an active biological drug substance. Our second program, RP501, is being developed to help patients with mild dry eye disease using treatment with IntelliGel without an active substance. It is likely that IntelliGel can also be used to improve dosages of other established and new ophthalmic drugs. Redwood Pharma focuses on early-stage clinical development.
RP101: a drug treatment for moderate to severe chronic DED in post-menopausal women
The company is developing a low-dose, estrogen-based local eye treatment for chronic dry eye in post-menopausal women who suffer from DED. Currently, no sufficiently reliable treatments exist for women with moderate to severe symptoms. We believe that RP101 will be the first hormone treatment of DED in this patient group. It targets specific underlying biological mechanisms and increases production of tear fluid. RP101 has recorded confirmed results from two previous clinical Phase II trials in the US. And in Redwood Pharma’s recently completed Phase II trial in Europe exhibited safety and efficacy with doses of up to twice a day.
RP501: a treatment for temporary relief for all those suffering from mild DED
With an ageing population and increased screen time in front of computers and mobile devices, people are increasingly suffering from temporary dry eye. Where existing products on the market, such as artificial tears, must be used several times a day to be effective, RP501 has recently been shown in a clinical trial to help those with dry eye problems with just one or two treatments a day. RP501 has the potential to provide temporary relief for men and women of all ages.
Size of the global dry eye disease market
The total global market for DED is estimated at USD 5 billion and is expected to grow to USD 7 billion by 2025 according to TMR 2020.
IntelliGel drug delivery platform
Redwood Pharma owns the global rights to the IntelliGel platform within ophthalmology. IntelliGel is a drug delivery platform that controls the release of a drug and gives its active ingredients the opportunity to act for a longer period which in turn can reduce the number of instillations. The platform also creates additional business opportunities in that several ophthalmic drugs can hopefully be reformulated and dosed more efficiently and in a way that is perceived as more convenient and perhaps also increase the safety of patients.
There are several reasons why the market is expected to grow. The main drivers are the lack of effective drugs that provide patients with effective relief from chronic dry eye disease and an ageing population in which chronic dry eye disease is more prevalent.
There are several types of chronic dry eye and a single medical solution for all types of problems does not currently exist. There are several new products under development. However, these are directed at inflammation in the eye that can be a consequence of too little tear fluid. Product development is also expected to contribute to overall market growth.
Today, there is also a pronounced need for drug formulations that minimize the number of doses per day. As a drug delivery platform, IntelliGel therefore constitutes a market opportunity in and of itself.
The company’s core competence lies within drug development. To develop RP101, RP501, and new ophthalmic drugs, the company uses its extensive network of experts in manufacturing, pre-clinical and clinical development as well as experts in ophthalmology, endocrinology, and women’s health.
The company has completed the RP101 Phase II clinical trial and now intends to identify a commercial partner to maximize value. The company is currently evaluating future strategies regarding RP501.
Through business agreements with major drug companies, the company will receive payments for achieving milestones and as future royalties. Such agreements may mean that the company receives an initial payment upon signing an agreement and subsequently for achieved milestones such as completion of Phase III clinical trials, market approvals, and initial sales. Redwood Pharma is, however, open to other types of agreement to maximize the value of the company.
Revenues and expenses
The company did not generate any revenue between 1 January and 30 June 2021. Reported Other Operating Income refers to Exchange Rate Gains. The company’s expenses are primarily related to development, project-related and administrative costs.
The operating profit for the period 1 January–30 June 2021 amounts to kSEK -10,916
Financial position and liquidity
At 30 June 2021, the company’s liquid assets totalled kSEK 22,240 (6,345). The Equity/assets ratio was 81% (48). The company’s shareholder equity amounted to kSEK 23,510 (6,287).
Cash flow from current operations during the period totalled kSEK -12,072 (-3,980).
During the period 1 January– 30 June 2021, the company did not invest in any tangible or intangible fixed assets.
This interim report has been prepared in line with the Swedish Annual Accounts Act (1995:1554) and Swedish Accounting Standards Board’s BFNAR 2012:1 guidelines, Annual Accounts and Corporate Auditing (“K3”).
Risks and uncertainty
In conjunction with the preferential rights issue that was completed in February 2021, a detailed review was performed of the risks associated with the company’s operations. No new risks have been identified subsequently. Risks and uncertainty are reported in the information memorandum that was prepared in conjunction with the issue and is published on the Redwood Pharma website, www.redwoodpharma.com.
Change in the number of outstanding shares
|Opening balance January 1 2020||14,698,693|
|Share subscription exchange in June||293,716|
|Rights issue registered in November||866,654|
|Closing balance December 31 2020||15,859,063|
|Share subscription exchange in February||4,879,708|
|Closing balance June 30 2021||20,738,771|
This interim has not been audited by the company’s auditors.
For additional information, contact:
Martin Vidaeus – CEO, Tel. +46 70 232 29 29
This information is such information that Redwood Pharma AB is obliged to publish in accordance with the EU Market Abuse Regulation. The information was submitted, through the agency of the above contact person, for publication on 27 August 2021.
About Redwood Pharma
Redwood Pharma develops ophthalmic products for unmet medical needs through novel approaches. In providing commercial partners and their customers with effective medical solutions, the company currently has products in development to treat dry eye disease in different target patient populations. The RP101 program targets moderate-to-severe dry eye disease in postmenopausal women by delivering a low-dose estrogen therapy to the front of the eye. The RP501 program aims to treat milder forms of dry eye in a broader patient population including both men and women. For other potential drug substances and therapeutic areas, the Company can employ the IntelliGel drug delivery platform that enhances patient convenience by controlling dosing and potentially reducing the number of instillations per day and subsequent side-effects. Redwood Pharma leverages its strengths in early clinical development and aims to generate revenues through, among others, licensing agreements with companies that have capabilities to manufacture and sell medical products worldwide.
Redwood Pharma AB (publ) is listed on Nasdaq First North Growth Market (Ticker: REDW.ST, ISIN: SE0008294789)
For additional information: www.redwoodpharma.com