Debra BorchardtFSD Pharma Inc. (NASDAQ: HUGE)(CSE: HUGE) filed its audited annual financial results for the fourth quarter and full year ended December 31, 2023. The company has no revenue at this time to report. The net loss for 2023 was $18.2 million, a drop from 2022’s net loss of $23.6 million.
The company’s operating expenses fell to $23 million in 2023 from $27 million in 2022. As of December 31, 2023, FSD Pharma had an accumulated deficit of $ 157.9 million and a working capital surplus of $6.5 million. FSD Pharma has cash and cash equivalents of $2.7 million, which is down from 2022’s year-ending cash balance of $16.9 million. The cash used in operating activities was $10.8 million for 2023.
Two programs
FSD Pharma currently has two significant programs, which are focused on developing treatments for challenging neurodegenerative, inflammatory, and metabolic disorders. They are:
- Lucid-MS: A potential treatment for Multiple Sclerosis with the lead candidate, Lucid-21-302. Lucid-MS is a patented new chemical entity shown to prevent and reverse myelin degradation, the underlying mechanism of multiple sclerosis, in preclinical models
- Novel Treatments for Alcohol Misuse, and related condition
Lucid-21-302
The company presented the results from its first-in-human Phase 1 study of Lucid-MS at the America’s Committee meeting for the treatment and research in multiple sclerosis in February 2024.
The study concluded that Lucid-21-302 is safe and well-tolerated in the dose range of 50-300 mg p.o. administered once, with no difference in pharmacokinetics between the fed and fasted states. Based on its internal review of the Phase 1 data, the company said it believes that the positive results warrant moving to a Phase 2 clinical trial.
Based on the positive results that the Phase-1 study yielded, the Board, on recommendation from the advisory committee, resolved to proceed with completing a Phase II MS-Study on Lucid-MS to get the Lucid-MS to commercialization. The company said it has determined that to get to commercialization it will cost approximately $30 million.
Unbuzzed
FSD Pharma said it relies on its licensing partner on Celly Nu, to develop and promote Unbuzzd, an alcohol misuse product for the retail market. The company said it sees two tracks for this product; one being recreational retail and the other – healthcare; Celly Nu, through the Celly Nu IP License Agreement, will be focusing on the recreational retail sector and the company will be focusing on the healthcare sector.
As of March 28, 2024, the company said it has registered five trademarks with the Canadian Intellectual Property Office and the USPTO and 17 trademarks with the CIPO, relating to novel treatments for alcohol misuse and related conditions, including Unbuzzd and ALCOHOL DEATH, which were licensed to Celly Nu under the Celly Nu IP License Agreement.
Legal entanglements
FSD Pharma has found itself in court many times as of late. GGB Drink Lab is suing the company alleging breach of a mutual non-disclosure agreement and misappropriation of trade secrets valued at $53 million. It is expected to go to trial in November 2024.
Former CEO Dr. Raza Bokhari started five legal actions against the company. In 2022, an arbitrator dismissed his claims, and then on February 6, 2024, the company announced that the Ontario Superior Court of Justice affirmed the judgment and awarded an additional C$5,000 in costs in light of Dr. Bokhari’s failed motion for leave to appeal. According to FSD, the litigation is ongoing.
The company is also being sued by two other former employees. Kevin Cassidy wants C$497,000 for wrongful dismissal and Dr. Sima Salahshor wants $97,000 also for wrongful dismissal.
In August 2023, the company settled with Syneos Health, LLC and Syneos Health UK Limited and paid them $100,000.
