OTTAWA, CANADA / ACCESSWIRE / July 27, 2020 / Tetra Bio-Pharma Inc. ("Tetra" or the "Company") (TSXV:TBP) (OTCQB:TBPMF), a leader in cannabinoid-derived drug discovery and development, is providing its shareholders with a management update on the Company's Annual General Meeting (AGM) of shareholders commitment to be concentrating 100% of its efforts on its drug development programs with the current focus on ARDS, Plenitude© and Reborn©. Tetra previously announced at the AGM of shareholders on June 5, 2020, management's intent to spinout Lumiera Health Innovations (formerly Tetra Natural Health). On July 23rd Tetra announced the signing of a Letter of Intent (LOI) with Mondias for the sale of this subsidiary.
Tetra's February and May 2020 prospectus financings were primarily focused on raising funds to advance the QIXLEEFTM, CAUMZTM and PPP003 drug development programs closer towards marketing approval. Each of these drugs has the potential to be a billion-dollar revenue asset at peak sales. Importantly, with the regulatory path being pursued by Tetra, the Company will benefit from a minimum of 5 years of market exclusivity for these drugs in the United States, if approved. Every clinical phase successfully achieved reduces the risk of bringing a drug to the market and creates significant value for shareholders. Pharmaceutical drug development is the core business of Tetra.
The decision by Management to divest Lumiera is designed to ensure that Tetra is focused on the development of regulated drug products that have billion-dollar market potentials. Lumiera will be able to focus on the development of OTC and natural health product markets to serve unmet market needs in the areas of pain and inflammatory conditions. Lumiera consists of highly skilled professionals who have the expertise to complete manufacturing of the market-ready retail products, as well as advertising to ensure successful product launches. With cash resources fully allocated to the advancement of drug development programs, Management has decided that investing significant marketing dollars of the Lumiera products at this time was not in the best interest of the Company. Without the significant marketing dollars to support Lumiera's product lines, these products will have a hard time penetrating the market and will not result in significant sales revenue to further support Tetra's operations. To be successful in this market segment, Tetra would have to raise at a minimum $500,000 to support marketing campaigns per product that Lumiera would launch. While this division could ultimately result in millions of dollars of sales revenue if properly funded, management believes that in its current status it does not have the ability to become a billion-dollar business compared to the drug development programs that Tetra is currently developing.
"With the current COVID-19 economy and the highly dilutive nature of equity financing at Tetra's current share price, management implemented a strategy to focus the Company's activities on the potentially billion-dollar prescription drug markets and looked to monetize or suspend all none core activities. Several research analysts have supported Management's goal to focus on Tetra's core priorities. For every million dollars spent on commercialization and marketing of Lumiera's products, Tetra is sacrificing the equivalent of approximately one month of drug development costs, thereby reducing our ability to deliver on priority milestones prior to going back to the market for future financings," commented Mr. Sabino Di Paola, CFO.
The future of Lumiera was careful assessed by Management. Options such as suspending the operations of Lumiera, as well as outright selling the Lumiera's products to other companies were considered. Still, neither of these options were as attractive as the potential divestiture to Mondias, in terms of generating potential value to our shareholders.
"The decision to enter into the LOI with Mondias was the best available option at the time and allows Tetra to use its resources to concentrate on and fund its core drug development programs. Should Tetra and Mondias enter into a definitive agreement and finalize the sale of Lumiera, Mondias will have over $2.3 million to fund the development of the Lumiera assets. This funding will provide Lumiera with the ability to take these products to market in 2020 as well as to launch significant marketing campaigns to properly support a product launch. By taking a significant interest in Mondias common shares of over 15%, Tetra will have an economic benefit from the growth of Lumiera without incurring any costs or dilution to Tetra's current shareholders. The definitive agreement, when entered into, will also provide additional financial incentives to Tetra as part of the sale of Lumiera" stated Mr. Di Paola.
Tetra graduating to the TSX is key to the continued growth of the Company as well as the ability attract new investors that would have otherwise not invested in a TSX Venture listed company. To be successful on the TSX and growing Tetra's investor base at this time involves having a clear mission and vision of a developing drug company," stated Mr. Di Paola, CFO.
About Tetra Bio-Pharma
Tetra Bio-Pharma (TSXV:TBP) (OTCQB:TBPMF) is a biopharmaceutical leader in cannabinoid-based drug discovery and development with a Health Canada approved, and FDA reviewed and approved, clinical program aimed at bringing novel prescription drugs and treatments to patients and their healthcare providers. The Company has several subsidiaries engaged in the development of an advanced and growing pipeline of Bio Pharmaceuticals, Natural Health and Veterinary Products containing cannabis and other medicinal plant-based elements. With patients at the core of what we do, Tetra Bio-Pharma is focused on providing rigorous scientific validation and safety data required for inclusion into the existing bio pharma industry by regulators, physicians and insurance companies.
For more information visit: www.tetrabiopharma.com
Source: Tetra Bio-Pharma
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Some statements in this release may contain forward-looking information. All statements, other than of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding potential acquisitions and financings) are forward-looking statements. Forward-looking statements are generally identifiable by use of the words "may", "will", "should", "continue", "expect", "anticipate", "estimate", "believe", "intend", "plan" or "project" or the negative of these words or other variations on these words or comparable terminology. Forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond the Company's ability to control or predict, that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements. Factors that could cause actual results or events to differ materially from current expectations include, among other things, without limitation, the inability of the Company to obtain sufficient financing to execute the Company's business plan; competition; regulation and anticipated and unanticipated costs and delays, the success of the Company's research and development strategies, including the success of this product or any other product, the applicability of the discoveries made therein, the successful and timely completion and uncertainties related to the regulatory process, the timing of clinical trials, the timing and outcomes of regulatory or intellectual property decisions and other risks disclosed in the Company's public disclosure record on file with the relevant securities regulatory authorities. Although the Company has attempted to identify important factors that could cause actual results or events to differ materially from those described in forward-looking statements, there may be other factors that cause results or events not to be as anticipated, estimated or intended. Readers should not place undue reliance on forward-looking statements. The forward-looking statements included in this news release are made as of the date of this news release and the Company does not undertake an obligation to publicly update such forward-looking statements to reflect new information, subsequent events or otherwise unless required by applicable securities legislation.
For further information, please contact Tetra Bio-Pharma Inc.:
Tetra Bio-Pharma Inc.
Dr. Guy Chamberland, M.Sc., Ph.D.
Chief Executive Officer
Phone: + 1 (833) 977-7575
Alpha Bronze, LLC
Mr. Pascal Nigen
Phone: + 1 (646) 255-0433
Ms. Carol Levine APR, FCPRS
Phone: + 1 (416) 425-9143 ext. 226
Mobile: + 1 (514) 703-0256
SOURCE: Tetra Bio-Pharma