RANGE IMPACT, INC. As used in this discussion and analysis and elsewhere in this Quarterly Report,
the "Company", "we", "us" or "our" refer to
Cautionary Statement
The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with our Unaudited Condensed Financial
Statements and the related notes thereto contained in Part I, Item 1 of this
Quarterly Report. The information contained in this Quarterly Report on Form
10-Q is not a complete description of our business or the risks associated with
an investment in our common stock. We urge you to carefully review and consider
the various disclosures made by us in this Quarterly Report and in our other
reports filed with the
Certain statements made in this Quarterly Report on Form 10-Q constitute
"forward-looking statements" within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the
"Exchange Act"). Forward-looking statements are projections in respect of future
events or our future financial performance. In some cases, you can identify
forward-looking statements by terminology such as "may," "will," "should,"
"intend," "expect," "plan," "anticipate," "believe," "estimate," "predict,"
"potential," or "continue" or the negative of these terms or other comparable
terminology. These statements are only predictions and involve known and unknown
risks, uncertainties and other factors, which may cause our or our industry's
actual results, levels of activity or performance to be materially different
from any future results, levels of activity or performance expressed or implied
by these forward-looking statements. These risks and uncertainties include:
general economic and financial market conditions; our ability to obtain
additional financing as necessary; our ability to continue operating as a going
concern; any adverse occurrence with respect to our business or; results of our
research and development activities that are less positive than we expect; our
ability to bring our intended products to market; market demand for our intended
products; shifts in industry capacity; product development or other initiatives
by our competitors; fluctuations in the availability and costs of raw materials
required in our drug development process; other factors beyond our control; and
the other risks described under the heading "Risk Factors" in our Annual Report
on Form 10-K filed with the
Although we believe that the expectations and assumptions reflected in the forward-looking statements we make are reasonable, we cannot guarantee future results, levels of activity or performance. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those expressed by any forward-looking statements. As a result, readers should not place undue reliance on any of the forward-looking statements we make in this report. Forward-looking statements speak only as of the date on which they are made. Except as required by law, we undertake no obligation to revise or update publicly any forward-looking statements for any reason.
Company Overview
Unless otherwise provided in this Quarterly Report, references to the "Company,"
"we," "us", and "our" refer to
Our corporate headquarters is located in
Graphium Biosciences Overview
Graphium Biosciences is focused on the advancement of pharmaceuticals and innovative technologies that improve the lives of patients. We seek to achieve this objective through the development of novel cannabinoid pharmaceutical prodrugs known as cannabosides. We conduct our operations using our own personnel and facilities with the support of third-party resources to advance our drug development programs.
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Our cannabosides are cannabinoid-glycoside prodrugs, which were discovered through application of the Company's proprietary enzymatic bioprocessing technologies that are converted within the body after administration from an inactive molecule into a pharmacologically active drug. Currently, the Company has produced more than 100 novel cannabosides, including glycosylated tetrahydrocannabinol (THC), cannabidiol (CBD), cannabidivarin (CBDV) and cannabinol (CBN), that are covered by worldwide patent applications for composition of matter, method of production and method of use.
Cannaboside Prodrugs
A prodrug is a compound that, after administration, is metabolized into a pharmacologically active drug. Prodrugs are often designed to improve drug properties and reduce known or expected toxicities and adverse side effects. By using our proprietary enzymatic bioprocessing technologies, our clinical research team has developed a novel family of prodrugs by combining cannabinoid and glucose molecules. The resulting compounds, known as cannabosides, have unique commercial applications and patentable compositions of matter, which are separate and distinct from ordinary cannabinoids. The advantages of cannabosides may include: (i) administration in a convenient oral formulation, (ii) targeted delivery with release in the colon or large intestine, (iii) improved stability with limited degradation or drug metabolism, and (iv) delayed release enabling longer-lasting effects and fewer administrations by patients.
Our proprietary glycosylation process, which results in adding one or more glucose molecules to compounds, may enable our new cannabosides to act as prodrugs that achieve targeted delivery of the bioactive compounds of cannabinoids to the gastrointestinal tract. Glycosylated compounds are generally more stable and water soluble, so upon ingestion, we believe they will remain intact and transit through the esophagus, stomach and upper intestine with limited absorption or degradation from stomach acids. However, once the glycosylated compounds reach the large intestine, we expect them to encounter glycoside hydrolase enzymes secreted by the human intestinal microbiota that will cleave the polar glucose residues and release the active cannabinoid compound primarily in the large intestine or colon.
We have focused our research and development activities on the glycosylation of cannabinoids given their well-known positive effects on the human endocannabinoid system. Our research and development activities originally focused on the glycosylation of CBD and then later expanded into the glycosylation of THC. The use of the cannabinoid THC has been shown to provide substantial anti-inflammatory benefits on the human body, among other benefits, but is limited as a pharmaceutical option given its psychoactive and intoxicating properties. However, by glycosylating THC, we have learned through initial animal studies that the binding of glucose and THC molecules restricts the release of THC into the body's digestive system until the prodrug reaches the large intestine, at which point the glycoside hydrolase enzymes cleave the glucose from the prodrug and the THC is released in a targeted and restricted manner. Further, we have learned through our initial animal studies that this targeted release of THC, which could be provided in very low doses to achieve physiologically beneficial results, serves as an anti-inflammatory agent in the lower gastrointestinal tract and minimizes the amount of THC absorbed into the blood stream, therefore avoiding the psychoactive and intoxicating properties that hinder the broader pharmaceutical use of THC.
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We are developing our THC-glycoside prodrugs for the treatment of gastrointestinal diseases, including inflammatory bowel disease (IBD) and irritable bowel syndrome (IBS) because of the targeted release described previously. IBD is a frequently chronic inflammatory condition where parts of the digestive system become inflamed from an overactive immune response. The disease can lead to irreversible damage to the gastrointestinal tract and may require surgery to remove affected areas of the intestine. Two major forms of the disease are Crohn's disease, which can affect any part of the digestive system, and ulcerative colitis, which often affects the colon or large intestine. The disease is often unpredictable with periods of painful and debilitating symptoms followed by periods of remission with limited symptoms. IBS has similar symptoms to IBD, including abdominal pain, but the underlying disease process is quite different. IBS is a functional gastrointestinal disorder that commonly affects the large intestine and is characterized by abdominal cramping, diarrhea, constipation, and pain. Currently, patients suffering from IBD are frequently prescribed anti-inflammatory drugs such as steroids, biologics and immunosuppressants, and patients suffering from IBS are prescribed antibiotics, antidepressants and gastrointestinal motility compounds, all of which often result in unwanted side effects.
Our most promising THC-glycoside (VBX-100) is being developed as an oral prodrug
for the treatment of IBD and IBS. VBX-100 was selected from our THC-glycoside
portfolio for compatibility with commercial production techniques and the
optimal prodrug delivery profile that maximizes intestinal anti-inflammatory
properties while minimizing psychoactive or intoxicating effects. Initial
pre-clinical studies on the efficacy of VBX-100 in animal models have shown
favorable outcomes, including reduced inflammation of the gastrointestinal tract
and no measurable systemic THC found in tissue examined using highly-sensitive
testing equipment. Our pre-clinical development plan, which includes dose range
finding studies, GLP toxicology studies, pharmacokinetic studies and other
pre-clinical research, is anticipated to be completed during the 2nd half of
calendar year 2022, subject to the Company securing sufficient additional
funding or entering into a strategic partnership. After our satisfactory
completion of all of the prerequisite pre-clinical in vitro and in vivostudies,
an Investigational New Drug (IND) application would be filed with the
In addition to our research and development activities related to our THC-glycoside compounds, we are expanding and diversifying our research and development activities to include the potential safety, efficacy and commercialization of our patented CBD-glycoside compounds. CBD has well-known anti-anxiety, anti-inflammatory and anti-microbial properties, but unlike THC, CBD is non-psychoactive and non-intoxicating. By glycosylating CBD, we can create CBD-glucose compounds that may enable a targeted and concentrated delivery of CBD in the gastrointestinal tract. Currently we are evaluating the optimal CBD-glycoside delivery mechanism, which may include an aqueous drink formulation since our glycosylation process significantly improves the water solubility of the CBD molecule.
Enzymatic Processing Methods
The Company originally developed its proprietary enzymatic bioprocessing technologies to attach glucose molecules to the molecules of stevia as part of our activities in the stevia processing industry. We then expanded the application of this proprietary technology to attach glucose molecules to cannabinoids, including THC and CBD. We may pursue additional opportunities to develop new products utilizing this proprietary technology.
Orphan Drug Designation
In
In
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Accordingly, in
On
Daedalus Ecosciences Overview
Daedalus Ecosciences is focused on new innovations addressing the health and wellness of the planet, with a particular focus on deploying technological innovations and eco-friendly solutions to remedy difficult environmental situations in economically challenged communities. The Company is actively evaluating a number of attractive investment opportunities intended to advance this mission with a particular focus on investments that advance environmental, social and governance principles.
Results of Operations
Three Months Ended
Our net loss during the three months ended
During the three months ended
In addition, during the three months ended
During the three months ended
This resulted in a net loss of
Six Months Ended
Our net loss during the six months ended
During the six months ended
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In addition, during the six months ended
During the six months ended
Liquidity and Capital Resources
We have incurred losses since inception resulting in an accumulated deficit of
As of
Sources of Capital
We do not expect to generate any revenue in the near term. Based on our current
corporate strategy, our total expenditures for the 12 months following
Our estimated total expenditures for the 12-month period ending
Since inception, we have primarily funded our operations through equity and debt financings, and expect to continue to do so for the foreseeable future. However, additional funds may not be available when needed, on acceptable terms, or at all. If we issue equity or convertible debt securities to raise additional funds, our existing stockholders may experience substantial dilution, and the new equity or debt securities may have rights, preferences and privileges senior to those of our existing stockholders. If we incur additional debt, it may increase our leverage relative to our earnings or to our equity capitalization, requiring us to incur additional interest expense. Obtaining commercial loans, assuming those loans are available, would increase our liabilities and future cash commitments. If we pursue capital through alternative sources, such as collaborations or other similar arrangements, we may be forced to relinquish rights to our proprietary technology or other intellectual property and which could result in our receipt of only a portion of any revenue that may be generated from a partnered product or business. Moreover, regardless of the manner in which we seek to raise capital, we may incur substantial costs in those pursuits, including investment banking fees, legal fees, accounting fees, printing and distribution expenses and other related costs.
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We have not generated positive cash flows from operating activities. For the six
months ended
During the six months ended
Net Cash Provided By Financing Activities
During the six months ended
Off-Balance Sheet Arrangements
We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that would be material to stockholders.
Critical Accounting Policies
Our financial statements and accompanying notes included in this report have
been prepared in accordance with
We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from the estimates made by management.
We believe the following critical accounting policies require us to make significant judgments and estimates in the preparation of our consolidated financial statements included in this report:
Use of Estimates and Assumptions
The preparation of financial statements in conformity with
18 Share-Based Payments
The Company periodically issues stock options, warrants, and shares of common stock as share-based compensation to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on FASB ASC 718, Compensation - Stock Compensation (Topic 718) whereby the value of the award is measured on the date of grant and recognized as compensation expense on a straight-line basis over the vesting period. The Company recognizes the fair value of stock-based compensation within its Statements of Operations with classification depending on the nature of the services rendered.
The fair value of the Company's stock options and warrants are estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods. The Company issues stock options and warrants, shares of common stock, and equity interests as share-based compensation to employees and non-employees. The Company accounts for its share-based compensation to employees in accordance with FASB ASC 718, Compensation - Stock Compensation. Stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the requisite service period.
In
Recent Accounting Pronouncements
Please refer to Footnote 1 of the accompanying financial statements for management's discussion of recent accounting pronouncements.
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