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Sol-Gel Reports First Quarter 2024 Financial Results and Provides Corporate Updates

NESS ZIONA, Israel, May 20, 2024 (GLOBE NEWSWIRE) — Sol-Gel Technologies, Ltd. (NASDAQ: SLGL), a dermatology company, pioneering treatments for patients with severe skin conditions, conducting a Phase 3 clinical trial of SGT-610 (patidegib gel, 2%) for Gorlin syndrome, and with two approved large-category dermatology products, TWYNEO® and EPSOLAY®, today announced financial results for the first quarter ended March 31, 2024 and provided a corporate update.

Q1 2024 and Recent Corporate Developments

Alon Seri-Levy, Ph.D., Chief Executive Officer of Sol-Gel, stated: “We continue to focus on rare indications affecting the skin which have no approved treatments. In this regard, we are continuing to enroll patients for our pivotal Phase 3 clinical trial of SGT-610 for the prevention of new basal cell carcinomas in patients with Gorlin Syndrome, with a potential market estimated at more than $300 million. We also initiated a proof-of-concept study for SGT-210 (topical erlotinib) in patients with Darier disease, with results expected in H1/2025. In addition, SGT-210 is currently being used in a Compassionate use treatment of a pediatric patient suffering from an ultra-rare disease, and given the preliminary highly encouraging response, the treatment with SGT-210 continues, and the company will explore other commercially viable keratoderma indications.”

“We recently signed an agreement with Beimei Pharma for the commercialization of TWYNEO in China, Hong Kong, Macau, Taiwan and Israel. This agreement demonstrates the potential of TWYNEO, and we expect to announce other agreements regarding the commercialization of both our FDA-approved assets, TWYNEO and EPSOLAY, in other territories,” further added Dr. Seri-Levy.

Financial Results for the First Quarter Year Ended March 31st, 2024

Total revenue in the first quarter was $0.5 million, which primarily consisted of licensing revenue from Galderma and Searchlight, compared to $0.3 million revenues for the same period in 2023. As disclosed in connection with the filing of the June 30, 2023, financial statements, in the first quarter of 2023, wholesaler ordering patterns were disrupted ahead of Galderma’s implementation of a new enterprise resource planning system, which impacted its standard forecasting procedures and its quarterly assessment of rebate accruals. As a result, previously reported revenue for the first quarter of 2023 was revised as reflected in the below income statement.

Research and development expenses were $5.3 million compared to $9.4 million for the same period in 2023. The decrease of $4.1 million was primarily attributed to a decrease of $1.8 million in R&D expenses related to SGT-610 and SGT-210, a decrease of $1.4 million in expenses related to clinical development of a generic product candidate, a decrease of $0.3 million in payroll expenses, and a decrease of $0.3 in general R&D expenses.

General and administrative expenses were $1.8 million compared to $2.0 million for the same period in 2023. The decrease of $0.2 million was mainly attributed to a decrease in professional expenses.

Sol-Gel reported a net loss of $6.3 million for the first quarter of 2024 and a loss of $0.23 per basic and diluted share, compared to a net loss of $10.7 million and a loss of $0.43 per basic and diluted share for the same period in 2023.

As of March 31, 2024, Sol-Gel had $16.2 million in cash, cash equivalents, and deposits and US$16.8 million in marketable securities for a total balance of $33.0 million. The Company expects its cash resources to fund operational and capital expenditure requirements into the second half of 2025.

About Gorlin Syndrome and SGT-610

SGT-610, a hedgehog signaling pathway blocker, has the potential to be the first ever treatment for prevention of BCCs in Gorlin syndrome patients, if approved. Gorlin syndrome, an autosomal dominant genetic disorder affecting approximately 1 in 27,000-31,000 people in the U.S., is mostly caused by inheritance of one defective copy of the tumor suppressor patched homolog 1 (PTCH1) gene. Normally, the PTCH1 gene blocks the smoothened, frizzle class receptor (SMO) gene, turning off the hedgehog signaling pathway when it is not needed. Mutations in the PTCH1 gene may cause a loss of PTCH1 function, release of SMO, and may allow BCC tumor cells to divide uncontrollably. Patidegib, the active substance in SGT-610, is designed to block the SMO signal, thus, allowing cells to function normally and reducing the production of new tumors.

About Sol-Gel Technologies

Sol-Gel Technologies, Ltd. is a dermatology company focused on identifying, developing, and commercializing or partnering drug products to treat skin diseases. Sol-Gel developed TWYNEO, which is approved by the FDA for the treatment of acne vulgaris in adults and pediatric patients nine years of age and older, and EPSOLAY, which is approved by the FDA for the treatment of inflammatory lesions of rosacea in adults. both drugs are exclusively licensed to and commercialized by Galderma in the US; and are exclusively licensed to Searchlight in Canada. TWYNEO was purchased and licensed by Beimei Pharma to be exclusively commercialized by them in China, Hong Kong, Macau, Taiwan and Israel.

The Company’s pipeline also includes a Phase 3 clinical trial of Orphan and Breakthrough Drug candidate SGT-610, which is a new topical hedgehog inhibitor being developed to prevent the new basal cell carcinoma lesions in patients with Gorlin syndrome that is expected to have an improved safety profile compared to oral hedgehog inhibitors as well as topical drug candidate SGT-210 under investigation for the treatment of rare hyper-keratinization disorders.

For additional information, please visit our new website:  www.sol-gel.com

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, but not limited to the amounts to be received under the agreement with Beimei, out-licensing Epsolay and Twyneo in additional territories, the potential of Sol-Gel’s assets including Twyneo, Epsolay SGT-610, and SGT-210, and SGT-610’s market value. In some cases, you can identify forward-looking statements by terminology such as “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “expect,” “predict,” “potential,” or the negative of these terms or other similar expressions. Forward-looking statements are based on information we have when those statements are made or our management’s current expectations and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to, a delay in the timing of our clinical trials, the success of our clinical trials, and an increase in our anticipated costs and expenses, as well as the following factors: (i) the adequacy of our financial and other resources, particularly in light of our history of recurring losses and the uncertainty regarding the adequacy of our liquidity to pursue our complete business objectives; (ii) our ability to complete the development of our product candidates; (iii) our ability to find suitable co-development partners; (iv) our ability to obtain and maintain regulatory approvals for our product candidates in our target markets, the potential delay in receiving such regulatory approvals and the possibility of adverse regulatory or legal actions relating to our product candidates even if regulatory approval is obtained; (v) our collaborators’ ability to commercialize our pharmaceutical product candidates; (vi) our ability to obtain and maintain adequate protection of our intellectual property; (vii) our collaborators’ ability to manufacture our product candidates in commercial quantities, at an adequate quality or at an acceptable cost; (viii) our collaborators’ ability to establish adequate sales, marketing and distribution channels; (ix) acceptance of our product candidates by healthcare professionals and patients; (x) the possibility that we may face third-party claims of intellectual property infringement; (xi) the timing and results of clinical trials that we may conduct or that our competitors and others may conduct relating to our or their products; (xii) intense competition in our industry, with competitors having substantially greater financial, technological, research and development, regulatory and clinical, manufacturing, marketing and sales, distribution and personnel resources than we do; (xiii) potential product liability claims; (xiv) potential adverse federal, state and local government regulation in the United States, China, Europe or Israel; and (xv) loss or retirement of key executives and research scientists; (xvi) general market, political and economic conditions in the countries in which the Company operates; and, (xvii) the current war between Israel and Hamas and any deterioration of the war in Israel into a broader regional conflict involving Israel with other parties. These factors and other important factors discussed in the Company’s Annual Report on Form 20-F filed with the Securities and Exchange Commission (“SEC”) on March 13, 2024, and our other reports filed with the SEC, could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Except as required by law, we undertake no obligation to update any forward-looking statements in this press release.

Sol-Gel Contact :
Gilad Mamlok
Chief Financial Officer
info@sol-gel.com
+972-8-9313433

Source: Sol-Gel Technologies Ltd.

SOL-GEL TECHNOLOGIES LTD.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except share and per share data)

(Unaudited)

 

Three months ended
March 31

  

2023

 

2024

LICENSE REVENUES

$

300

   

$

466

 

RESEARCH AND DEVELOPMENT EXPENSES

 

9,386

     

5,345

 

GENERAL AND ADMINISTRATIVE EXPENSES

 

1,977

     

1,833

 

OPERATING LOSS

$

11,063

   

$

6,712

 

FINANCIAL INCOME, net

 

(342

)

   

(368

)

LOSS FOR THE PERIOD

$

10,721

   

$

6,344

 

BASIC AND DILUTED LOSS PER ORDINARY SHARE

 

0.43

     

0.23

 

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED IN COMPUTATION OF BASIC AND DILUTED LOSS PER SHARE

 

24,944,220

     

27,857,620

 
     
SOL-GEL TECHNOLOGIES LTD.        
CONDENSED CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands, except share and per share data)
(Unaudited)
 

December 31,

March 31,

 

2023

2024

Assets

   

CURRENT ASSETS:

   

Cash and cash equivalents         

$

7,513

 

$

11,210

Bank deposits

   

10,012

     

5,012

Marketable securities

   

20,471

     

16,795

Accounts receivables

   

377

     

869

Prepaid expenses and other current assets

   

2,794

     

2,121

TOTAL CURRENT ASSETS         

41,167

 

36,007

         

NON-CURRENT ASSETS:

               

Restricted long-term deposits and cash equivalents

1,284

 

1,264

Property and equipment, net

   

434

     

366

Operating lease right-of-use assets

1,721

 

1,612

Other long-term assets

   

55

     

45

Funds in respect of employee rights upon retirement

626

 

617

TOTAL NON-CURRENT ASSETS

4,120

 

3,904

TOTAL ASSETS

$

45,287

 

$

39,911

Liabilities and shareholders’ equity

       

CURRENT LIABILITIES:

       

Accounts payable

$

154

 

$

582

Other accounts payable

3,921

 

4,257

Current maturities of operating leases

447

 

386

TOTAL CURRENT LIABILITIES

 

4,522

 

5,225

         

LONG-TERM LIABILITIES:

               

Operating leases liabilities

   

1,206

     

1,133

Liability for employee rights upon retirement

915

 

902

TOTAL LONG-TERM LIABILITIES         

2,121

 

2,035

TOTAL LIABILITIES

 

6,643

 

7,260

         

SHAREHOLDERS’ EQUITY:

               

Ordinary shares, NIS 0.1 par value – authorized: 50,000,000 as of December 31, 2023 and March 31, 2024, respectively; issued and outstanding: 27,857,620 and 27,857,620 as of December 31, 2023 and March 31, 2024, respectively

774

 

 

774

Additional paid-in capital

   

258,173

     

258,524

Accumulated deficit

   

(220,303

)

   

(226,647

)

TOTAL SHAREHOLDERS’ EQUITY

   

38,644

     

32,651

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

$

45,287

 

$

39,911

_____________________________

1 All $ amounts are in U.S. dollars


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