Arctic Bioscience – Q1 2024 Operational update – Progress according to plan

Highlights Q1 2024:

• The HeROPA clinical trial fully recruited in January 2024, and further development is proceeding as planned  
• Available liquidity end of Q1 2024 of NOK 74,6 million
• Above 90 % of the total nutra 2023-revenues already secured in 2024 via sales and received purchase orders
• Strong growth in the Norwegian Romega market in Q1 2024

The HeROPA clinical trial was fully recruited in January 2024. Since then, the clinical trial has progressed according to plan towards 6 months primary end points read-out in second half of 2024.

“As the time for read-out is getting closer, we have continued our positive dialogues with several pharma companies regarding potential partnership deals. We see high interest in our process and candidate. During the year we are also publishing results from our study on Mechanism of Action of HRO350, which will provide additional input to our partnership dialogues going forward”, says CEO Christer L. Valderhaug.

The nutraceutical business has progressed well in 2024. Despite the total sales revenues are slightly lower than the same quarter of 2023, above 90 % of the total 2023-revenues are already secured via actual sales and received purchase orders for 2024. The Norwegian Romega market continues to develop well compared to previous quarters, an effect of solid marketing efforts the last months.   

During the start of 2024, Arctic Bioscience has gained new nutraceutical business partners both in the European and Middle Eastern markets. This lays the foundation for an increased presence in existing markets and opens the opportunity for new customers in new markets. In South Korea, an application process is started together with a partner to get our Romega nutraceutical products approved in this market. An approval is estimated at end of 2024.

“It is encouraging to receive recognition for our nutraceutical products through new collaboration agreements and new market access. A foothold also in the South Korean market will mean significant and expanded opportunities for our Romega products in the large Asian consumer market”, ends Christer L. Valderhaug.       

Financials

Key figures – Q1 2024:

• Revenues from sales: NOK 6,1 million (NOK 7,8 million)
• Gross profit: NOK 1,7 million (NOK 1,2 million)
• Gross margin: 28,8 % (15,0 %)
• Adjusted EBITDA: NOK -12,7 million (NOK -12,1 million)
• Available liquidity end of period: NOK 74,6 million (NOK 130,6 million)

Comparable figures for Q1 2023 in brackets. The consolidated figures for Q1 2024 includes effects from the acquired company Arctic Algae AS.

Sales revenue amounted to NOK 6,1 million in Q1 2024, a decline of NOK 1,7 million compared to the same period in 2023. The Norwegian market accounted for 36 % of total sales in Q1 2024. The B2C segment experienced a growth of 28 % compared to Q1 2023.

Gross margin in Q1 2024 ended at 28,8 %, which is 13,8 percentage points above the gross margin in Q1 2023. The gross margin has also shown a positive development compared to the last quarter of 2023, mainly an effect of a beneficial mix of products sold.

Adjusted EBITDA ended at NOK -12,7 million in Q1 2024, compared to NOK -12,1 million in Q1 2023. The figures of Q1 2024, in contrast to the same figures for Q1 2023, also include costs from operations in Arctic Algae. Based on strategic marketing decisions, the figures in Q1 2024 includes somewhat higher marketing costs than normal, and it is expected that these costs will be reduced in the coming periods.

The liquidity position at the end of Q1 2024 amounts to NOK 74,6 million, which includes an unused credit facility of NOK 30 million.

Outlook

In the second half of 2024 we expect the 6 months primary end points read-out for the HeROPA-study in mild-to-moderate psoriasis (HRO350). Results from the study may lay the foundation for a future phase III study and a following commercialization.

The process of pursuing potential commercial partnerships for HRO350 as part of funding a future phase III, will have continued focus in the forthcoming periods. This process will be combined with preparation of various financing alternatives to secure the future funding of the company’s activities post the 6 months data readout. 

The nutraceutical business is expected to have a positive sales growth in 2024 compared to previous years. This outlook is backed by already completed sales and received purchase orders, combined with further positive sales outlook in new and existing markets.

This information is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.

For further information, please contact:

Christer L. Valderhaug

CEO

Mobile: +47 920 84 601

Email: christer@arctic-bioscience.com

Jone R. Slinning

CFO

Mobile: +47 948 75 469

Email: jone@arctic-bioscience.com

About Arctic Bioscience

Arctic Bioscience is a biotech company developing and commercializing pharmaceutical and nutraceutical products based on unique bioactive marine compounds.

The company is developing HRO350 – a novel oral drug candidate. HRO350 is being developed for treatment of patients with mild-to-moderate psoriasis. This is a large patient group in need of new effective medicines with beneficial safety profile.

Nutraceuticals from Arctic Bioscience are sold globally as bulk ingredients as well as finished goods under the ROMEGA® brand.

Arctic Bioscience is led by a highly skilled team of talents with diverse and highly relevant background.