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NeuroBo Pharmaceuticals Reports Year End 2019 Financial Results and Provides Corporate Strategic Update


BOSTON, March 30, 2020 /PRNewswire/ -- NeuroBo Pharmaceuticals, Inc. (Nasdaq: NRBO), a clinical-stage biotechnology company focused on developing and commercializing multimodal, disease-modifying therapies for neurodegenerative and cardiometabolic diseases, today announced financial results for the year ended December 31, 2019 and provided a corporate strategic update.

"The closing of the merger between Gemphire Therapeutics, Inc. and NeuroBo Pharmaceuticals, Inc. at year end 2019 was a pivotal moment for NeuroBo, as it provided increased visibility with a Nasdaq listing and afforded the company a platform to pursue its long-term goals," stated Richard J. Kang, Ph.D., President and Chief Executive Officer of the combined company. "With the current macroeconomic environment, however, including the global health emergency caused by the COVID-19 pandemic, we have recently taken a number of prudent strategic steps to ensure that the company is positioned to weather this unprecedented situation. Specifically, to conserve financial resources, we have decided to postpone the initiation of Phase 3 clinical trials for NB-01, which would be very challenging in the short- or medium-term. Consequently, in the first quarter of 2020, we ceased work on Phase 3 trials for NB-01 and gave notice of termination of all related contract arrangements with our contract research organizations. We are currently re-evaluating alternatives to bring the NB-01 asset to the market through a different regulatory pathway. Development of NB-01 as an orphan drug is among the alternatives we are considering, and we may conduct feasibility studies to identify a rare disease relevant to NB-01. Additionally, we are considering marketing the NB-01 product line as nutraceutical products.

"We remain optimistic about the considerable promise of our second program, NB-02, which, in preclinical studies, has shown potential as a neuroprotective agent, and we believe that the multimodal therapeutic advantages of NB-02 could potentially represent a paradigm shift in the treatment of Alzheimer's disease and other neurodegenerative diseases," continued Dr. Kang. "Although NB-02 is almost ready for the submission of an Investigational New Drug (IND) application to the U.S. Food and Drug Administration (FDA), we intend to postpone our first-in-human clinical trials until market conditions improve. In the interim, we remain very excited about this particular program and, based on the strength of the data generated to date, we are assessing whether to pursue further development of NB-02 as an orphan drug."

Dr. Kang also noted that the company expects a response from the FDA in the second quarter of this year regarding removal of the partial clinical hold for Gemcabene.

With the above-described pause in clinical activity, management noted that the $13.9 million in cash on hand as of December 31, 2019, should be sufficient to fund operations at current levels through December 2020. "We look forward to reinstating the clinical activities of our robust platform of disease-modifying therapies for neurodegenerative and cardiometabolic diseases and we are actively pursuing various financing opportunities in the interim," concluded Dr. Kang.

Overview of Current Clinical Pipeline

NeuroBo Financial and Operating Results Highlights

Although public company Gemphire was considered the legal acquirer in the merger and issued shares of its common stock to effect the merger, the formerly private NeuroBo was considered the accounting acquirer. In accordance with generally accepted accounting principles, the historical financial statements of private company NeuroBo are considered the financial statements of the combined company, with the merger accounted for as an acquisition of the Gemcabene family of related assets on December 30, 2019.  The following highlights therefore represent the operations of NeuroBo as a private company except for the effects of the merger on December 30, 2019 and the combined operations of both companies for the post-merger balance of December 2019.

About NeuroBo Pharmaceuticals

NeuroBo Pharmaceuticals, Inc. is focused on novel treatments for neurodegenerative diseases affecting millions of patients worldwide. The company's multimodal approach has the potential to address the multiple underlying mechanisms of neurodegenerative diseases, alleviate symptoms and slow disease progression. The company's lead drug candidate, NB-01, for the treatment of painful diabetic neuropathy (PDN), has been shown in a Phase 2 study to significantly reduce pain symptoms associated with PDN with a superior safety profile when compared to currently available treatments. NeuroBo's IND-ready second drug candidate, NB-02, is focused on the treatment of Alzheimer's disease and neurodegenerative diseases associated with the pathological dysfunction of tau proteins in the brain.

NeuroBo Pharmaceuticals was jointly founded by Dr. Roy Freeman, professor of neurology at Harvard Medical School and renowned expert in neuropathic pain, and JK BioPharma Solutions, a biotechnology consulting company, to commercialize natural product-based research into ethical medicines. For more information, visit: https://www.neurobopharma.com/.

Forward Looking Statements

Any statements in this press release that are not statements of historical fact constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited to, statements regarding the development of NeuroBo's product candidates and the therapeutic potential, timing and nature of clinical trials and potential regulatory approval of NeuroBo's clinical programs and pipeline. Forward-looking statements are usually identified by the use of words, such as "believes," "anticipates," "expects," "intends," "plans," "may," "potential," "will," "could" and similar expressions. Actual results may differ materially from those indicated by forward-looking statements as a result of various important factors and risks. These factors, risks and uncertainties include, but are not limited to: the occurrence of health epidemics or contagious diseases, such as COVID-19, and potential effects on NeuroBo's business, clinical trial sites, supply chain and manufacturing facilities; NeuroBo's ability to continue as a going concern; the timing of completion of NeuroBo's planned clinical trials; the timing of the availability of data from NeuroBo's clinical trials; NeuroBo's plans to research, develop and commercialize its current and future product candidates, including the potential alternative pathways for NB-01; NeuroBo's ability to successfully collaborate with existing collaborators or enter into new collaborations and to fulfill its obligations under any such collaboration agreements; the clinical utility, potential benefits and market acceptance of NeuroBo's product candidates; the impact of government laws and regulations; NeuroBo's ability to protect its intellectual property position; and NeuroBo's need for additional financing to fulfill its stated goals; and other factors discussed in the "Risk Factors" section of NeuroBo's Annual Report on Form 10-K filed with the SEC on or about the date hereof. In addition, the forward-looking statements included in this press release represent NeuroBo's views as of the date hereof. NeuroBo anticipates that subsequent events and developments will cause its views to change. However, while NeuroBo may elect to update these forward-looking statements at some point in the future, NeuroBo specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing NeuroBo's views as of any date subsequent to the date hereof.

Contacts:

Rx Communications Group
Melody Carey
+1-917-322-2571
[email protected]

Financials

 

NeuroBo Pharmaceuticals, Inc.

Consolidated Balance Sheets

(in thousands)





At December 31,




2019


2018

Assets





Current assets:






Cash

$

13,908

$

2,845


Restricted Cash


15


-


Prepaid expenses


153


929


Other assets


42


34

Total current assets


14,118


3,808


Right-of-use assets and other


150


9


Property and equipment, net


200


3

Total assets

$

14,468

$

3,820







Liabilities, redeemable convertible preferred
stock and stockholders' equity (deficit)





Current liabilities






Accounts payable

$

638

$

170


Accrued liabilities


1,422


49


Lease liability, short-term


22


-

Total current liabilities


2,082


219


Convertible notes-related party


-


118


Lease and other long-term liabilities


94


23

Total liabilities


2,176


360

Commitments and contingencies





Redeemable convertible preferred stock


-


16,746

Stockholders' equity (deficit)






Preferred stock


-


-


Common stock


16


-


Additional paid-in capital


49,130


2,266


Accumulated other comprehensive income


12


2


Accumulated deficit


(36,866)


(15,554)

Total stockholders' equity (deficit)

$

12,292


(13,286)

Total liabilities, redeemable convertible
preferred stock stockholders' equity (deficit)

$

14,468

$

3,820

 

NeuroBo Pharmaceuticals, Inc.

Consolidated Statements of Operations and Comprehensive Loss

(in thousands, except share and per share amounts)






 For the Year Ended

December 31,





2019


2018

Operating expenses:






Research and development

$

5,324

$

5,066


Acquired in-process research and development


12,151


8,815


General and administrative


2,701


1,605



Total operating expenses


20,176


15,486

Loss from operations


(20,176)


(15,486)


Loss on extinguishment


(1,114)


-


Interest (expense) income, net


(22)


(40)


Other income (expense), net


-


(3)

Loss before income taxes


(21,312)


(15,529)

Provision for income taxes


-


-

Net loss



(21,312)


(15,529)

Other comprehensive loss, net of tax


10


2

Comprehensive loss

$

(21,302)

$

(15,527)

Loss per share






Net loss  per share, basic and diluted

$

(4.08)

$

(3.65)

Weighted average common shares outstanding






Basic and diluted


5,224,178


4,251,330

 

SOURCE NeuroBo Pharmaceuticals, Inc.


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