Clinical-stage biopharmaceutical firm Atai Life Sciences (Nasdaq: ATAI) show signs of stability in its fourth quarter and full year 2022 financial results, with more investment behind its core psychedelic research and reduced overall expenses.
The company on Friday reported its fourth quarter and full year 2022 financial results ending December 31, 2022.
Atai lost $45 million in the last quarter and $152.4 million in 2022, versus $88.9 million and $167.8 million in the same periods the previous year.
The company spent more on research and development in 2022, with an increase of $26.3 million compared to the previous year. The rise was mainly due to higher costs for hiring outside organizations to help with research and more staff working on research projects.
On the other hand, general and administrative expenses, which include things like office costs and employee salaries, went down by $22.3 million compared to 2021.
Expenses fell due to lower stock-related costs, smaller taxes, and less money spent on consultants, but this was partly balanced out by higher costs for staff and insurance.
The earnings come off the back of a round of layoffs Atai embarked on earlier this month, cutting approximately 30% of its workforce as part of an effort to reallocate capital toward funding near-term projects and slim down overheads a bit.
Most of the savings will come from labor cuts in nonclinical development as well as general and administrative expenses. The downsizing should extend the company’s operational cash runway, which it expects to maintain into the first half of 2026.
The company’s CEO and co-founder, Florian Brand, expressed optimism about the company’s execution capabilities and the advancement of programs into later-stage clinical studies. The firm is still working on several new treatments for mental health disorders, including drugs for schizophrenia, anxiety, depression, opioid addiction, and PTSD.
Still, the company’s shares slid by more than 40% in January on news that mid-stage results for its ketamine therapy (PCN-101) to treat depression failed to meet the study’s primary endpoint.
Company financials on Friday show that its cash and cash equivalents were $273.1 million at the end of 2022, versus $362.3 million in the previous year. It expects its cash position, combined with access to up to $160 million in additional capital from its term loan facility with Hercules Capital, Inc., will be sufficient to fund the business into the first half of 2026.