A Look At PharmaTher And Its Recent Bull Run: Where's The Psychedelics Stock Headed?

This article by Jason Najum was originally published on Microdose Psychedelic Insights and appears here with permission.

The psychedelic medicine industry has been growing at an impressive rate. Big players like Atai have joined the ranks, adding billions of dollars of investor interest; and smaller upstarts like Filament Health and Levitee Labs have made their public debuts, adding a diversity of approaches to the space.

All this expansion makes it easy for some companies to get lost in the shuffle. One such firm going somewhat under the radar is PhamaTher.

But perhaps we should be paying closer attention. As the industry focused on big-name news, PharmaTher PHRRF’s stock price experienced a low-key moon run earlier this year. Between end-April and end-July the company’s stock price soared approx 375% (from $0.24 to a high of $1.14), before settling down in the $0.90-$1.00 range.

Why the sudden jump? What has the market seen in PharmaTher that we should perhaps know about?

Let’s use the company’s recent end-of-year financial highlights to help take a closer look.

PharmaTher’s Business Highlights and Financials

This week PharmaTher PHRRF released business and financial results for its fiscal year ended May 31, 2021. Let’s have a look at some of the highlights (all figures in Canadian dollars and information taken from the company’s press release)

Business Highlights

• Announced the FDA approved the Company’s Investigational New Drug application to proceed with a Phase 2 clinical trial to evaluate the safety, efficacy and pharmacokinetics of ketamine in the treatment of levodopa-induced dyskinesia in patients with Parkinson’s disease.

This seems to be the news that got the stock rolling. Announced in mid-May, this approval to begin Phase 2 clinical trials moved PharmaTher into an elite group of companies in advanced clinical trials. The positive price movement started around this time.

• Closed the sale of PharmaTher’s intellectual property pertaining to psilocybin, via an asset purchase agreement with Revive Therapeutics Ltd. for consideration of up to $10 million satisfied as follows: (i) $3 million in cash (ii) $4 million through the issuance of securities in the capital of Revive and (iii) up to $3 million, in either cash or securities in the capital of Revive for future milestones.

The announcement of this sale seemed to signal that PharmaTher was going to focus on its strengths, which at the moment are its ketamine treatments and delivery technologies. The move gave them a good chunk of cash and was a bold move considering how popular psilocybin development is. So far it seems to have paid off.

• Solidified four exclusive license agreements, including the University of Arizona for the development and commercialization of ketamine in the treatment of Parkinson’s disease; BioRAE, Inc. for the development and commercialization of a novel biocompatible and biodegradable gelatin methacryloyl microneedle delivery technology; National Health Research Institutes for the development and commercialization of a patented combination formulation of ketamine and betaine (KETABET™); The Queen’s University of Belfast for the development and commercialization of a patented hydrogel-forming microneedle delivery technology developed by Professor Ryan Donnelly to deliver ketamine and KETABET™; and The University of Kansas for the development and commercialization of ketamine in the treatment amyotrophic lateral sclerosis (ALS), also known as Lou Gehrig’s disease.
• Formed essential research and development collaborations, including a sponsored research agreement with the Terasaki Institute to develop a novel microneedle patch that aims to deliver psilocybin, MDMA, LSD and DMT; a sponsored research agreement with The Queen’s University of Belfast for the development of a patented hydrogel-forming microneedle patch to deliver ketamine and PharmaTher’s proprietary ketamine formulation, KETABET™; a collaboration agreement with MediSynergics, LLC. to develop patented ketamine derivatives and to investigate drug discovery and development of next-generation psychedelic derivatives; and a co-development agreement with TSRL, Inc. to jointly develop a microneedle array patch with the aim to control the manufacturing and supply of microneedle patches for the Company’s clinical and commercial drug programs.

All of the above are further proof of the company focusing its efforts on advancing its current stable of promising products. While a diverse pipeline is important, so is showing results and getting a product to market.

Here are some other announcements that came after the firm’s year-end:

• Filed a pre-Investigational New Drug (“pre-IND”) meeting request and complete pre-IND briefing package with the U.S. Food and Drug Administration (“FDA”) to support the clinical development of KETABET™ and the proposed Phase 2 clinical study as a potential next-generation treatment for depression.

It seems the company has a good working relationship with the FDA and is taking advantage of the agency’s positive view of ketamine. Another Phase 2 trial for something as big as depression would be major news.

• Announced that the U.S. Food and Drug Administration (FDA) has granted orphan drug designation (ODD) for ketamine in the treatment of Amyotrophic Lateral Sclerosis (ALS), also known as Lou Gehrig’s disease.

From Fabio Chianelli, Chief Executive Officer of PharmaTher: “Receiving FDA orphan drug designation is a massive validation for ketamine as a potential treatment for ALS, and it allows us to confidently proceed in evaluating ketamine in phase 2 clinical study in patients suffering from this life-threatening disease. This designation not only expedites our regulatory, clinical, and product development plans but also validates our belief in the potential of ketamine as a therapeutic solution for neurological disorders.”

Financial Highlights

• Cash and cash equivalents ($2,778,081) and Investment ($3,100,000) for a total of $5,878,081 as of May 31, 2021.
• Net loss was $2,664,196 for the financial year ended May 31, 2021.

Cash on hand gives them about another year of capital (if spending stays relatively the same). This is a bit light and you can probably expect another capital raise soon—something the recent jump in stock price will help with.

Overall it seems PharmaTher is making solid progress, focusing on its best products, and building itself into one of the leaders in ketamine development. And for now, the markets seem to agree.

Perhaps it’s time to keep a closer eye on this company. Stay tuned to Microdose for more.

Interested in more on Ketamine? Check out My Experience Receiving Ketamine Therapy at Field Trip Health in Chicago and Psychedelic Titans with Steven Mandel, MD of Ketamine Clinics Los Angeles