Psychedelic drug company Compass Pathways plc (Nasdaq: CMPS) reported its financial results for the first quarter of 2023 and gave an update on recent progress across its business. Compass Pathways has no revenue at this time to report. It had a net loss of $24.2 million, or $0.57 loss per share (including non-cash share-based compensation expense of $4.1 million), compared with $21.2 million or $0.50 loss per share, during the same period in 2022.
Kabir Nath, Chief Executive Officer, said, “Our phase 3 pivotal trials in treatment-resistant depression are now underway and on track, with treatment being administered to patients across numerous sites. This is significant progress, indicating that with the necessary approvals and licenses in place, these sites can now focus completely on training and recruitment. We have also made important progress in laying the commercial groundwork for COMP360, with the recent acceptance by the American Medical Association of a CPT III code to describe the support services required in its administration. It has been a quarter of steady, strong progress, including productive, ongoing dialogue about the design of our pivotal trials with FDA.”
The company said it ints quarterly filing,
We believe that our existing cash and cash equivalents, together with the net proceeds from sales of the Company’s ADSs through May 10, 2023, will be sufficient for us to fund our operating expenses and capital expenditure requirements for at least the next twelve months.
The company had cash and cash equivalents of $117.1 million at the end of the quarter versus $143.2 at the end of 2022. Second quarter 2023 net cash used in operating activities is expected to be in the range of $22 million to $30 million and the full-year 2023 to be in the range of $85 million to $110 million. An additional $26.9 million in net cash was raised through the ATM facility to date in the second quarter.
The company said in its earnings statement, “We will need substantial additional funding to complete the development and commercialization of our Phase 3 clinical program, and our Phase 2 studies in anorexia nervosa and PTSD. Further, changing circumstances, some of which may be beyond our control, such as heightened or fluctuating inflation and interest rates, could cause us to consume capital significantly faster than we currently anticipate, and we may need to seek additional funds sooner than planned. The Company’s inability to raise capital as and when needed could have a negative impact on its financial condition and ability to pursue its business strategies. There can be no assurance that the current operating plan will be achieved or that additional funding will be available on terms acceptable to the Company, or at all.” The future viability of the company is dependent on its ability to raise additional capital to finance its operations.
Compass said it has incurred total net losses of $24.2 million and $21.2 million for the three months ended March 31, 2023 and 2022, respectively. As of March 31, 2023, it had an accumulated deficit of $285.4 million.
Compass reported R&D expenses were $19.0 million versus $15.4 million during the same period in 2022. The company said the increase was due to $1.4 million in external development expenses as the company continues to investigate COMP360 psilocybin therapy in clinical and pre-clinical trials. $1.2 million due to an increase in personnel expenses, due to increased headcount. A further $0.6 million was attributable to an increase in other expenses primarily related to an increase in external consulting expenses. In addition, non-cash share-based payment compensation increased by $0.5 million, due primarily to increased headcount.
G&A expenses were $12.8 million versus $10.1 million during the same period in 2022. The increase was attributable to an increase of $2.2 million in personnel expenses, due to increased headcount. $0.9 million relates to an increase in facilities and other expenses. A further $0.5 million was attributable to an increase in non-cash share-based compensation, due primarily to increased headcount. This was partially offset by a decrease of $0.9 million in legal and professional fees.
Compass gave investors an update on its drug pipeline for COMP360 psilocybin therapy in treatment-resistant depression (TRD). The Phase 3 program underway, composed of two pivotal trials with an integrated, long-term outcomes component:
- Pivotal trial 1 (COMP 005): single dose monotherapy, n=255, top line data expected summer 2024
- Pivotal trial 2 (COMP 006): fixed repeat dose monotherapy, n=568, top line data expected mid-2025