Atai Life Sciences (Nasdaq: ATAI), a clinical-stage biopharmaceutical company, released its first-quarter 2023 financial results today and provided updates on corporate developments.
Atai reported that its cash reserves fell from $273.1 million in December 2022 to $249.9 million at the end of the first quarter, driven by net cash used in operating activities and loans to related parties.
Net loss was $33.1 million in the first quarter, a slight improvement from the $36.9 million net loss in the same period last year.
Research and development expenses increased by $3.8 million versus the same period last year, primarily due to increased contract research organization expenses and personnel costs.
General and administrative expenses dropped to $14 million, a $4 million decrease versus the same period in the previous year, mainly due to lower VAT and other nonincome taxes, stock-based compensation, accounting and legal fees, and personnel-related costs.
“We continue to focus on our vision to heal mental health disorders so that everyone, everywhere can live a more fulfilled life,” Florian Brand, co-founder and CEO, said in a Thursday statement.
He added that the first patient was dosed with Atai’s RL-007 in a randomized, placebo-controlled phase 2 study this past quarter.
In addition to RL-007, Atai is also conducting trials on two other drugs, GRX-917 and VLS-01. The first one, GRX-917, is aimed at treating anxiety disorders without the sedative side effects commonly associated with such treatments. The second, VLS-01, uses DMT to tackle severe depression that doesn’t respond to other treatments.
The company is also working on COMP360, a treatment using psilocybin (the active ingredient in magic mushrooms) to treat severe depression, anorexia nervosa, and PTSD, with significant results expected by summer 2024.
The earnings come after a round of layoffs Atai embarked in March, which resulted in cutting approximately 30% of its workforce as part of an effort to reallocate capital toward funding near-term projects. Brand reiterated that the efforts will maintain the company’s operations into the first half of 2026.
Most of the savings will come from labor cuts in nonclinical development as well as general and administrative expenses.
The company’s phase 2a clinical trial results looking at ketamine therapy to treat depression failed to meet its primary endpoint in January. The treatment did not prove enough of a statistically significant change in participants’ baseline depression score after 24 hours versus the placebo.
Still, Brand remained optimistic, stating, “This past quarter we made significant progress, and we look forward to further advancements in our ongoing studies.”