Adamis Pharmaceuticals Corporation (NASDAQ: ADMP), a
biopharmaceutical company focused on developing and commercializing
products in various therapeutic areas, including opioid overdose,
allergy, respiratory and inflammatory disease, today announced
financial results for the full year ended December 31, 2022, and
provided an update on recent corporate developments.
General Corporate Highlights
Merger Agreement with DMK Pharmaceuticals
- In October 2022, Adamis announced
that it had initiated a process to explore a range of strategic and
financing alternatives and had retained an investment bank to
assist in evaluating certain alternatives focused on maximizing
stockholder value. Potential alternatives to be considered included
a sale, partnership, distribution or other agreement regarding one
or both of the Company’s commercial products, a merger or sale of
the company, and/or seeking additional financing.
- On February 27, 2023, the Company
announced that it had entered into an Agreement and Plan of Merger
and Reorganization with DMK Pharmaceuticals, a private,
clinical-stage biotechnology company at the forefront of
endorphin-inspired drug design focused on developing novel
treatments for opioid use disorder and other neuro-based
diseases.
- Under terms of the merger
agreement, Adamis will acquire DMK, including its library of
approximately 750 small molecule neuropeptide analogues and ongoing
government funding for its development programs.
- At the close of the merger, Eboo
Versi, M.D., Ph.D., the current CEO of DMK, will assume the role of
CEO and chairman of the combined company.
Nasdaq Continued Listing
On February 23, 2023, Adamis announced that Nasdaq had granted
its request to extend the period for the Company to regain
compliance with the $1 minimum bid share price requirement, subject
to the Company evidencing compliance with all applicable criteria
for continued listing, by no later than a final extension date of
June 26, 2023. The Company’s continued listing is subject to the
timely satisfaction of certain interim milestones and undertaking
of certain corporate actions during the compliance period,
including without limitation: (1) the Company executing the merger
agreement with DMK; (2) effecting a reverse stock split of the
common stock; and (3) achieving the minimum closing bid price of at
least $1.00 per share for a minimum of ten consecutive business
days prior to the expiration of the compliance period.
Financing
- On March 14, 2023, Adamis announced it had entered into a
securities purchase agreement with a single, healthcare-focused
institutional investor for the purchase and sale of 16,500,000
shares of its common stock and pre-funded warrants to purchase up
to 7,500,000 shares of common stock, together with warrants to
purchase up to 48,000,000 shares of common stock, at a combined
purchase price of $0.125 per share (and $0.1249 per pre-funded
warrant) and accompanying warrants, pursuant to a registered direct
offering.
- The warrants have an exercise price of $0.138 per share, will
be initially exercisable beginning six months following the date of
issuance and will expire five years and six months from the date of
issuance, and the warrants are not exercisable for six months, and
are subject to other limitations on the ability to exercise.
- The closing of the offering occurred on March 16, 2023, and the
gross proceeds from the offering are approximately $3.0 million,
before deducting fees and other estimated offering expenses. The
Company intends to use the net proceeds from the offering for
general working capital purposes.
- The offering was made pursuant to an effective shelf
registration statement on Form S-3 (File No 333-267365) previously
filed with the U.S. Securities and Exchange Commission (the “SEC”).
A prospectus supplement describing the terms of the proposed
offering will be filed with the SEC and will be available on the
SEC’s website located at http://www.sec.gov.
Full Year 2022 Financial Highlights
- Total net revenue for the twelve months ending December 31,
2022, was approximately $4.8 million compared to approximately $2.2
million for the full year 2021. The increase in revenues was
primarily due to product sales of ZIMHI to US WorldMeds, less an
offset of approximately $310,000 in costs for the completion of the
SYMJEPI recall.
- Selling, general and administrative
expenses for the twelve months ending December 31, 2022 and 2021
were approximately $13.2 million and $16.1 million, respectively.
The decrease was primarily a result of reductions in legal and
compensation expenses which included the elimination of the bonus
accrual and lower stock-based compensation expenses.
- Research and development expenses were lower for 2022 at
approximately $10.4 million compared to $11.3 million in 2021. The
decrease was also primarily related to the elimination of the bonus
accrual and lower stock-based compensation expense.
- Net loss for the combined
(continued and discontinued) operations for the years ended
December 31, 2022 and 2021 was approximately $26.5 million and
$45.8 million, respectively. This decreased loss was primarily
attributable to the cessation of US Compounding’s operations and
the aforementioned reductions in legal and compensation
expenses.
- Cash and cash equivalents at
December 31, 2022, totaled $1.1 million. Additional cash infusions
during the first quarter of 2023 included proceeds of approximately
$832,000 from the sale of certain equipment related to the
discontinued US Compounding operations, proceeds of $875,000 from
Employee Retention Credit (“ERC”) program of the government and
$3.0 million gross proceeds from the sale of equity.
Conference Call Information
Management will host a live webcast/conference call today, March
16, 2023, at 2:00 p.m. PT / 5:00 p.m. ET, during which Company
executives will review financial information for the full year
ending December 31, 2022 and provide a corporate update.
U.S. Dial-in (Toll Free):
1-877-423-9813 Toll/International Dial-in: 1-201-689-8573
A live audio webcast of the conference call will also be
available via this link. If you are unable to participate in the
live call, a replay will be available shortly after the live event.
To listen to the replay please visit the events page of the Adamis
investor relations section of the company website at the following
link.
About Adamis Pharmaceuticals
Adamis Pharmaceuticals Corporation is a specialty
biopharmaceutical company primarily focused on developing and
commercializing products in various therapeutic areas, including
opioid overdose, allergy, respiratory and inflammatory disease.
Company products approved by the FDA include ZIMHI® (naloxone)
Injection for the treatment of opioid overdose and
SYMJEPI® (epinephrine) Injection for use in the emergency
treatment of acute allergic reactions, including anaphylaxis. For
additional information about Adamis Pharmaceuticals, please
visit our website and follow us
on Twitter and LinkedIn.
Forward Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements are identified by terminology such
as “may,” “should,” “expects,” “plans,” “anticipates,” “could,”
“intends,” “target,” “projects,” “contemplates,” “believes,”
“estimates,” “predicts,” “potential” or “continue” or the negative
of these terms or other similar words. Such forward-looking
statements include those that express plans, anticipation, intent,
contingencies, goals, targets or future development and/or
otherwise are not statements of historical fact. These statements
relate to future events or future results of operations, including,
but not limited to statements concerning the following matters: (i)
risks associated with Adamis’ and DMK’s ability to obtain the
stockholder approvals required to consummate the proposed Merger
and the timing of the closing of the proposed Merger; risks that
one or more conditions to closing of the Merger may not be
satisfied within the expected timeframe or at all or that the
closing of the proposed Merger will not occur; (ii) the outcome of
any current legal proceedings or future legal proceedings that may
be instituted against the parties or others, including proceedings
related to the Merger Agreement; (iii) the occurrence of any event,
change or other circumstance or condition that could give rise to
the termination of the Merger Agreement; (iv) unanticipated
difficulties or expenditures relating to the proposed Merger; (v)
whether the Company’s stockholders will approve a reverse split of
the Company’s common stock; (vi) whether the combined business of
DMK and Adamis will be successful; (vii) whether any DMK product
candidates will be successfully developed or commercialized; (viii)
the Company’s review and evaluation of potential strategic
alternatives and their impact on stockholder value; (ix) the
Company’s ability to raise capital to continue as a going concern;
and (x) those risks detailed in Adamis’ most recent Annual Report
on Form 10-K and subsequent reports filed with the Securities and
Exchange Commission (“SEC”), as well as other documents that may be
filed by Adamis from time to time with the SEC. These statements
are only predictions and involve known and unknown risks,
uncertainties, and other factors, which may cause Adamis’ actual
results to be materially different from the results anticipated by
such forward-looking statements. Accordingly, you should not rely
upon forward-looking statements as predictions of future events.
Adamis cannot assure you that the events and circumstances
reflected in the forward-looking statements will be achieved or
occur, and actual results could differ materially from those
projected in the forward-looking statements. Factors that could
cause actual results to differ materially from management’s current
expectations include those risks and uncertainties relating to: our
ability to raise capital; the results of our strategic review
process; the risk of not obtaining stockholder approval for the
proposals required to consummate the Merger or effect a reverse
stock split; risks associated with development of DMK’s drug
product candidates; our cash flow, cash burn, expenses, obligations
and liabilities; the outcomes of any litigation, regulatory
proceedings, inquiries or investigations that we are or may become
subject to; and other important factors discussed in the Company’s
filings with the Securities and Exchange Commission (“SEC”). If we
do not obtain required additional equity or debt funding, our cash
resources will be depleted and we could be required to materially
reduce or suspend operations, which would likely have a material
adverse effect on our business, stock price and our relationships
with third parties with whom we have business relationships, at
least until additional funding is obtained. If we do not have
sufficient funds to continue operations or satisfy out liabilities,
we could be required to seek bankruptcy protection or other
alternatives to attempt to resolve our obligations and liabilities
that could result in our stockholders losing most or all of their
investment in us. You should not place undue reliance on any
forward-looking statements. Further, any forward-looking statement
speaks only as of the date on which it is made, and except as may
be required by applicable law, we undertake no obligation to update
or release publicly the results of any revisions to these
forward-looking statements or to reflect events or circumstances
arising after the date of this press release. Certain of these
risks and additional risks, uncertainties, and other factors are
described in greater detail in Adamis’ filings from time to time
with the SEC, including its annual report on Form 10-K for the year
ended December 31, 2021, and subsequent filings with the SEC, which
Adamis strongly urges you to read and consider, all of which are
available free of charge on the SEC’s website at
http://www.sec.gov.
Additional Information about the Merger and Where to
Find It
Adamis intends to file a proxy statement in connection with the
proposed merger transaction with DMK. Investors and stockholders
are urged to read this filing when it becomes available because it
will contain important information about the transaction. This
press release does not constitute an offer of any securities for
sale or the solicitation of any proxy. BEFORE MAKING ANY VOTING OR
INVESTMENT DECISION, ADAMIS’ STOCKHOLDERS ARE URGED TO READ THE
PROXY STATEMENT REGARDING THE PROPOSED TRANSACTION CAREFULLY AND IN
ITS ENTIRETY WHEN IT BECOMES AVAILABLE BECAUSE IT WILL CONTAIN
IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION AND RELATED
MATTERS. Investors and stockholders may obtain free copies of the
proxy statement and other relevant documents (when they become
available) and other documents filed with the Securities and
Exchange Commission at the Securities and Exchange Commission's
website at: www.sec.gov. In addition, investors and stockholders
may obtain free copies of the documents filed with the Securities
and Exchange Commission by Adamis by contacting David C. Benedicto,
Adamis’ chief financial officer, at (858) 997-2400.
Participants in the Solicitation
Adamis and DMK, and their respective directors and executive
officers, may be deemed to be participants in the solicitation of
proxies from the companies’ stockholders in connection with the
proposed transaction. Information regarding the interests of
directors and executive officers in the transaction will be
included in the proxy statement to be filed by Adamis. Investors
and security holders are urged to read the Company’s proxy
statement and the other relevant materials when they become
available before making any voting or investment decision with
respect to the proposed transaction. Additional information
regarding directors and executive officers of Adamis is also
included in the Company’s annual report on Form 10-K for the year
ended December 31, 2022, filed with the Securities and Exchange
Commission, which is available as described above.
No Offer or Solicitation
This press release is not intended to and shall not constitute
an offer to sell or the solicitation of an offer to buy any
securities or the solicitation of any vote in any jurisdiction
pursuant to the proposed transaction or otherwise, nor shall there
be any sale of securities in any jurisdiction in contravention of
applicable law.
Contact:
Adamis Investor RelationsRobert UhlManaging DirectorICR
Westwicke619.228.5886
|
|
ADAMIS PHARMACEUTICALS CORPORATION AND
SUBSIDIARIES |
CONSOLIDATED STATEMENTS OF OPERATIONS DATA |
|
|
|
|
|
|
|
|
|
Year Ended December 31, |
|
|
2022 |
|
|
2021 |
|
Revenue, net |
|
$ |
4,756,078 |
|
|
$ |
2,208,680 |
|
Cost of Goods Sold |
|
|
6,187,486 |
|
|
|
6,872,131 |
|
Selling, General and
Administrative Expenses |
|
|
13,247,594 |
|
|
|
16,143,585 |
|
Research and Development |
|
|
10,379,964 |
|
|
|
11,262,373 |
|
Loss from Operations |
|
|
(25,058,966 |
) |
|
|
(32,069,409 |
) |
Total Other Income (Expense),
net |
|
|
(1,138,440 |
) |
|
|
(2,530,148 |
) |
Net Loss from Continuing
Operations |
|
|
(26,199,406 |
) |
|
|
(34,600,353 |
) |
Net Loss from Discontinued
Operations |
|
|
(278,867 |
) |
|
|
(11,227,845 |
) |
Net Loss Applicable to Common
Stock |
|
$ |
(26,478,273 |
) |
|
$ |
(45,761,610 |
) |
Basic & Diluted Loss Per
Share |
|
$ |
(0.18 |
) |
|
$ |
(0.32 |
) |
Basic & Diluted Weighted
Average Shares Outstanding |
|
|
149,851,278 |
|
|
|
144,157,229 |
|
|
ADAMIS PHARMACEUTICALS CORPORATION AND
SUBSIDIARIES |
CONSOLIDATED BALANCE SHEET DATA |
|
|
|
|
|
|
|
|
|
December 31, 2022 |
|
December 31, 2021 |
Cash and Cash Equivalents |
|
$ |
1,081,364 |
|
|
$ |
23,220,770 |
|
Total Current Assets |
|
|
9,272,150 |
|
|
|
35,203,622 |
|
Total Assets |
|
|
10,930,840 |
|
|
|
38,297,987 |
|
Total Liabilities |
|
|
11,581,605 |
|
|
|
12,415,209 |
|
Accumulated Deficit |
|
|
(304,564,086 |
) |
|
|
(278,085,813 |
) |
Total Stockholders’
Equity |
|
|
(808,068 |
) |
|
|
25,882,778 |
|
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