I'd like to take this opportunity to summarize Sirona Biochem's business and strategic growth over the past 7 months.
In October 2012, Sirona's share price hit a low of 4 cents and our market cap was $3 million CDN. We made the decision to raise money using a debt instrument to avoid a punitive equity financing. We raised $600,000 in debt which gave us the financial runway to grow the value of the company to a high of 14 cents per share and a market cap of more than $11 million on January 18th 2013. February 22, 2013 we announced an equity financing target of $2.7 million and we closed the second tranche of this financing on April 30, 2013 having raised $2.4 million. Our monthly net burn rate is approximately $160,000.
Moving forward, in the public marketplace we intend to fully maximize the value of QX listing by engaging in a professionally designed and executed effort to present the Company to retail and institutional investors and capital raising sources in most major cities in the United States.
The decision was made in November that we would de-risk our business model and simplify our operations. Sirona Biochem committed to a business strategy of: science, patent, partner. The benefit of this model is the following:
- We focus on what we do best, and nothing else.
- We don't risk our treasury or future by trying to develop a compound beyond a new patent
- Our expertise lies in the science and patenting process. We recognize that we do not have the finances, human resources or expertise to take a pharmaceutical compound through clinical studies and regulatory approval.
- In the future, drug development will only be considered with pre-partnered technology where the major economic burden is assumed by the partnering entity.
With this level of strategic focus, we maximize our ability to create and patent innovative compounds which will be licensed and partnered. We also diversify our risk across multiple projects, increase our portfolio size more quickly and continue to build our credibility and reputation as experts in fluorination chemistry.
In November we restructured the company and downsized our corporate head office by one position. In our laboratory in France we assessed every project in development and made the decision to focus our resources on two projects to ensure each would be completed and available for transaction within 6 months. All other projects were assigned a timeline for re-insertion into the development pipeline contingent on the successful completion of our two prioritized projects.
On November 5th we approached the French government to propose a second grant/partnership opportunity, building on the research and development grant we received for the skin lightening program.
On December 6th we approached a second arm of the French government to propose an expansion of our laboratory facilities in the Cosmetic Valley of France. Our business growth relies on creating and patenting new innovative compounds. We will be expanding our scientific team in order to grow the number of projects under way and plan to do so by expanding our facility in the Cosmetic Valley in France.
We selected a new head office location in Vancouver. Our current lease is set to expire and an increase in rent was scheduled upon renewal. Our team worked hard to find another office where we will save money and support our goals for growth over the next 5 years.
We have created the growth plan for our laboratory in France. In the next 24 months we plan to add 19 new employees and almost triple the size of our facility. This growth plan is tied directly to our goal of significantly growing the number of projects we are able to undertake concurrently.
On March 20, 2013 we completed our skin lightening project and announced that both of our skin lightening compounds were successful in industry standard safety tests. This was an important milestone as we now have two compounds to license, doubling the potential value derived from this program.
We concluded development on our SGLT2 Inhibitor and completed the diligence package presenting the distinct advantages our compound has over its competition. The next phase of development for this compound will be led by a partner who has the experience and financial resources to shepherd a pharmaceutical compound through clinical testing, regulatory approval and launch to market.
In order to maximize our ability to connect with leaders in the pharmaceutical and cosmetic markets, we engaged 4 business development individuals on commission-only compensation agreements. These individuals have been introducing Sirona Biochem's technology to targeted businesses around the world. We have received more than 20 qualified introductions for potential licensing, partnership and joint venture opportunities as a result of this business development initiative.
In the last 6 months we have attended and/or presented at the following meetings, conferences and events:
- In Cosmetics Asia (Bangkok)
- In Cosmetics Europe (France)
- Bio Partnering North America
- BIO International Convention (Chicago)
- BIOTECanada CEO Summit
- China (Beijing, Tianjin, Guangzhou)
- France (Rouen, Paris)
- New York
Our strategic process for optimizing the value of our technology is as follows: we connect with as many pharmaceutical, biotech, cosmetic and consumer health companies as possible that may have interest in our technology. Starting all of these discussions in parallel allows us to move the conversations forward within a predictable window of opportunity. These concurrent conversations create a competitive environment for our technology, maximizing its value within the marketplace.
We are extremely proud of having raised $2.4 million in these challenging economic conditions; few other pre-revenue Canadian biotech companies have been able to generate the confidence and economic support that we have earned.
Our SGLT2 Inhibitor compound and our two skin lightening compounds each have multiple companies conducting diligence and our licensing plans are proceeding as per our expectations.
Multiple projects have been presented to us as opportunities for joint ventures and partnerships. Our reputation is growing as a leader in the science of fluorination and large multinational companies continue to communicate the value the benefits of our proprietary fluorination technology.
Moving forward we are strategically and operationally optimized to transition Sirona Biochem to its next phase of growth. Generating revenue and creating joint venture partnerships is our top priority and we are building the business to support these goals on an international scale.
Neil Belenkie, CEO, Sirona Biochem Corporation
About Sirona Biochem Corp.
Sirona Biochem is a biotechnology company developing diabetes therapeutics, skin depigmenting and anti-aging agents for cosmetic use, biological ingredients and cancer vaccine antigens. The company utilizes a proprietary chemistry technique to improve pharmaceutical properties of carbohydrate-based molecules. Sirona Biochem is the parent company of French-based biotechnology company, TFChem. For more information visit www.sironabiochem.com.
Sirona Biochem cautions you that statements included in this press release that are not a description of historical facts may be forward-looking statements. Forward-looking statements are only predictions based upon current expectations and involve known and unknown risks and uncertainties. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of release of the relevant information, unless explicitly stated otherwise. Actual results, performance or achievement could differ materially from those expressed in, or implied by, Sirona Biochem's forward-looking statements due to the risks and uncertainties inherent in Sirona Biochem's business including, without limitation, statements about: the progress and timing of its clinical trials; difficulties or delays in development, testing, obtaining regulatory approval, producing and marketing its products; unexpected adverse side effects or inadequate therapeutic efficacy of its products that could delay or prevent product development or commercialization; the scope and validity of patent protection for its products; competition from other pharmaceutical or biotechnology companies; and its ability to obtain additional financing to support its operations. Sirona Biochem does not assume any obligation to update any forward-looking statements except as required by law.