News!
RECENT DEVELOPMENTS
Pharmaceutical Trials and COVID-19
Phase 1 (Australia) Trials
The Corporation announced on March 9, 2020, that it received approval from the Ethics Committee of the Alfred Hospital, part of the Alfred Health group of hospitals serving the state of Victoria, Australia, to initiate a Phase 1, randomized, double-blind, placebo-controlled study to evaluate the safety, tolerability and pharmacokinetics of single and multiple ascending doses of ultramicronized-PEA in normal healthy volunteers (the "Alfred Hospital Phase 1 Trials"). The principal researcher of this first-in-human safety and tolerability study is the Chief Medical Officer of Nucleus Network, one of Australia's largest and most experienced Phase 1 clinical research organizations. Studies are being completed in accordance with FDA-approved guidelines.
The Corporation anticipates completion of the Phase 1 clinical trials to secure an IND and, assuming that the results of the Phase 1 clinical trials are within acceptable ranges, to proceed to Phase 2 clinical trials as early as the fourth quarter of 2020.
On June 22, 2020, the Corporation announced favourable top-line results from the Alfred Hospital Phase 1 Trials, with no significant safety concerns found up to the highest dose tested of 2400 mg/day. The Alfred Hospital Phase 1 Trials were a single-site study and were conducted at the Alfred Hospital with 48 healthy adult men and women enrolled. The trial sequentially tested single ascending doses ranging from 600 mg to 2400 mg tablets and multiple ascending doses ranging from 600 mg to 1200 mg tablets administered twice daily for 7 consecutive days. The single ascending dose subjects also were tested for food effect.
The study found FSD-201 to be safe and well-tolerated. Mild and self-limiting side effects were reported and were deemed unlikely to be related to the drug being studied. There were no abnormal laboratory findings or electrocardiograms observed during the study and no serious adverse events were reported. No subjects withdrew due to an adverse event and all eligible subjects completed all doses. The pharmacokinetic profile of FSD-201 utilized in the Alfred Hospital Phase 1 Trials is still being analyzed. The results of the Alfred Hospital Phase 1 Trials are subject to additional audit and verification procedures. See "Risk Factors - Interim, "top-line," and preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data becomes available or as additional analyses are conducted, and as the data are subject to audit and verification procedures that could result in material changes in the final data."
FSD-201 COVID-19 Trials
On June 3, 2020, the Corporation announced that the FDA has given the Corporation permission to submit an IND application to design a Phase 2(a) clinical trial for the use of FSD-201 to treat suspected or confirmed cases of COVID-19, the disease caused by the SARS-CoV-2 virus (the "FSD-201 COVID-19 Trials" and, together with the Alfred Hospital Phase 1 Trials, the "FSD-201 Trials"). Severe COVID-19 is characterized by an over-exuberant inflammatory response that may lead to a cytokine storm and ultimately death. The Corporation is focused on developing FSD-201 for its anti-inflammatory properties to avoid the cytokine storm associated with acute lung injury in hospitalized COVID-19 patients.
Based on FDA feedback, the Corporation anticipates the FSD-201 COVID-19 Trials will be randomized, controlled, double-blind, U.S.-multicenter study to assess the efficacy and safety of FSD-201 dosed at 600mg or 1200mg twice-daily, as well as potentially higher dosage levels, together with standard of care ("SOC") compared to SOC alone in symptomatic patients with clinical presentation compatible with COVID-19. Eligible patients will present with symptoms consistent with influenza/coronavirus signs (fever, dry cough, malaise, difficulty breathing) and/or newly documented positive COVID-19 disease.
The primary objective of the FSD-201 COVID-19 Trials is to determine whether FSD-201 plus SOC provides a significant improvement in the clinical status of patients (e.g., shorter time to symptom relief). Secondary objectives of the FSD-201 COVID-19 Trials include determining whether FSD-201 plus SOC demonstrates additional benefit in terms of safety, objective assessments such as length of time to normalization of fever, length of time to improvement of oxygen saturation and length of time to clinical progression, including time to mechanical ventilation or hospitalization, and length of hospital stay. The exploratory endpoint is cytokine clearance as measured by Enzyme Linked Immunosorbent Assay (ELISA). The treatment period of patients in the FSD-201 COVID-19 Trials is expected to be at least 14 days. All patients who experience clinical benefit are expected to continue to receive their assigned treatment until study completion.
S-12
The Phase 2(a) clinical trial program is subject to successful completion of the Phase 1 clinical study on healthy volunteers, a favourable toxicology study, and successful completion of ongoing laboratory studies, access to additional financing, approval by the FDA of our Phase 2(a) clinical trial design, and review by the FDA of our IND application. The duration and cost of clinical trials can vary significantly depending on multiple factors, including the enrollment rate of volunteers, country in which trials are conducted, and specific trial protocols required. The process of developing pharmaceutical products and receiving the necessary regulatory approvals for commercialization typically takes several years. Accordingly, no near-term revenues from product sales or services are expected from our ultramicronized-PEA candidate(s). The milestones described above represent customary inflection points for financing by clinical-stage biotech companies. However, there is no assurance that the Corporation will be able to achieve these clinical milestones, nor, if successful in doing so, that the Corporation will be able to access additional financing on terms or timing acceptable to the Corporation. See "Risk Factors" in this Prospectus Supplement, the Shelf Prospectus, and in the 2019 AIF.
Assuming that the Corporation's IND application to design a Phase 2(a) trial is approved, the Corporation's planned Phase 2(a) clinical trial is expected to initially focus on suspected or diagnosed cases of COVID-19. Multiple trials, targeting different medical conditions and applications (e.g. other respiratory ailments presently treated with ultramicronized-PEA as a prescribed food supplement in Europe), may ultimately be undertaken depending on results observed and available capital, subject to the requirements of the Epitech License and regulatory approvals as required. See "Risk Factors" in this Prospectus Supplement, the Shelf Prospectus, and in the 2019 AIF.
June Private Placement
On June 4, 2020, the Corporation announced that it entered into definitive agreements with certain institutional investors pertaining to the private placement (the "June Private Placement") by certain placement agents led by A.G.P./Alliance Global Partners (collectively, the "Placement Agents") of an aggregate of 1,500,000 Class B Shares at a price of C$6.75 per Class B Share and warrants (the "June Warrants") to purchase an additional 1,500,000 Class B Shares (the "June Warrant Shares") for aggregate proceeds to the Corporation of approximately C$10,125,000 (before deducting fees payable to the Placement Agents and other estimated offering expenses). The June Warrants have a five-year term and an exercise price of C$9.65 per June Warrant Share. The June Private Placement was completed on June 8, 2020, generating net proceeds to the Corporation of C$9,416,250. In addition, the Corporation granted the Placement Agents an option to arrange for purchases of up to an additional 1,500,000 Class B Shares and June Warrants to purchase an additional 1,500,000 June Warrant Shares on the same terms as the June Private Placement for a period of 30 days following the initial closing of the June Private Placement.
Equity Distribution Agreement
On July 10, 2020, the Corporation entered into an Equity Distribution Agreement with the Placement Agent pursuant to which the Corporation may, at its discretion and from time-to-time during the term of the Equity Distribution Agreement, sell, through the Placement Agent, Class B Shares of the Corporation for aggregate gross proceeds to the Corporation of up to US$20.0 million. No offers or sales of Class B Shares will be made in Canada on the CSE or other trading markets in Canada. As of July 30, 2020, the Corporation has sold an aggregate of 48,317 Class B Shares for aggregate gross proceeds of US$184,626.87.
Approval of Issuance of Share Compensation
On July 24, 2020, the board of directors of the Corporation authorized the issuance of 1,322,927 Class B Shares in the aggregate as compensation to its directors, officers and certain of its employees.
Suspension of FV Pharma Activities
On July 30, 2020, the Corporation announced that it has notified Health Canada of the Corporation's decision to forfeit the Cannabis Act licenses of its wholly owned subsidiary, FV Pharma, Inc. ("FV Pharma"), and suspend all activities by FV Pharma within 30 days of the notification date. The Corporation has begun the process of liquidating all of FV Pharma's assets, including the sale of the its cannabis production facility in Cobourg, Ontario (the "Facility") and/or the adjacent real estate.
USE OF PROCEEDS
The net proceeds to the Corporation from the Offering, after payment of the Placement Agent Fee but before deducting the expenses of the Offering (estimated to be US$375,000), will be US$9,299,996.84.
S-13
The principal business objectives that the Corporation expects to accomplish using the net proceeds from the Offering together with the Corporation's current cash resources and potentially other funding sources, are to finance future growth opportunities including acquisitions and investments, to finance our capital expenditures, for working capital purposes or for general corporate purposes. In particular, the Corporation plans to use the net proceeds from the sale of Offered Shares, if any, to continue advancement of the near-term objectives with respect to its R&D program for the commercialization of ultramicronized-PEA, being the submission of the IND application to the FDA for the FSD-201 COVID-19 Trials and the initiation of the associated Phase 2(a) clinical trials. While the Corporation is specifically working to advance the development of ultramicronized-PEA towards ultimate commercialization, it is also continuously seeking and assessing additional opportunities in the biopharmaceutical space.
Through the next 12 months, the Corporation currently expects to incur cash expenses that exceed, and may significantly exceed, the amounts described in the Shelf Prospectus under "Use of Proceeds", due to the potentially expanded scope of the FSD-201 COVID-19 Trials, as well as the accelerated timing of preparing for and completing such trials. The Corporation expects to fund such expenses from the net proceeds from the Offering, if any, together with the Corporation's current cash resources and potentially other funding sources, which may include the issuance of additional equity, equity-linked or other securities, and which may also include secured or unsecured debt financing. If the Corporation issues notes or incurs any other indebtedness, a portion of the proceeds of this Offering, if any, may be used to make interest and/or principal payments with respect to such notes or indebtedness. The completion of the FSD-201 Trials and the pursuit of the Corporation's other business objectives is subject to the Corporation obtaining sufficient funding. See "Risk Factors" in this Prospectus Supplement, the Shelf Prospectus, and in the 2019 AIF.
we goin back to at least $20 here soon!!
