EX-99.1 2 ea137914ex99-1_rafaelhold.htm PRESS RELEASE, DATED MARCH 17, 2021, REPORTING THE RESULTS OF OPERATIONS FOR THE FISCAL QUARTER ENDED JANUARY 31, 2021.

Exhibit 99.1

Rafael-Holdings-Logo

 

 

Rafael Holdings Reports Second Quarter Fiscal Year 2021 Results

 

NEWARK, NJ – March 17, 2021: Rafael Holdings, Inc., (NYSE: RFL), reported revenue of $1.0 million and a loss per share of $0.50 for the second quarter of its 2021 fiscal year, the three months ended January 31, 2021.

 

Q2 FY 2021 Consolidated Financial and Operational Highlights

·Revenue of $1.0 million, generated by Rafael Holdings’ real estate portfolio, decreased from $1.2 million in the year-ago quarter due, in part, to the sale of its building in Piscataway, NJ.
·Loss per share of $0.50 compared to a loss per share of $0.08 in the year ago quarter primarily due to a $7.0 million impairment of the company’s interest in Altira, as described below.
·Rafael Holdings’ Board of Directors has appointed Ameet Mallik to become the Company's Chief Executive Office effective May 1, 2021. Howard Jonas, who has served as the company's Chairman and CEO since its inception, will continue as Chairman of the Board and remain an active member of the management team. 
·William "Bill" Conkling has been named Rafael Holdings’ Chief Commercial Officer.
·On December 7, 2020, the Company acquired the economic rights related to a 33.33% membership interest in Altira, adding to the 33.33% interest purchased in fiscal 2020. As in the first such agreement, the purchase gives the Company an indirect right to receive a 1% royalty on potential net sales of certain Rafael Pharmaceuticals’ products.
·On December 7, 2020, Rafael Holdings sold 567,437 shares of the Company’s Class B common stock and warrants to purchase an additional 113,487 shares of the Company’s Class B common stock for an aggregate sale price of $13 million.

 

Q2 FY 2021 – Pharmaceutical Holdings - Recent Developments

Rafael Pharmaceuticals

At January 31, 2021, the Company and its affiliates collectively owned securities representing 51% of the issued and outstanding capital stock of Rafael Pharmaceuticals and approximately 41% on a fully diluted basis including shares beneficially held through its interest in RP Finance, LLC., a funding vehicle. Recent developments announced by Rafael Pharmaceuticals include:

·The U.S. Food and Drug Administration (FDA) has granted Fast Track designation for Rafael Pharmaceuticals’ lead compound, CPI-613® (devimistat), for the treatment of both metastatic pancreatic cancer and acute myeloid leukemia (AML).
·Rafael Pharmaceuticals announced that it will initiate a Phase 2 clinical trial of CPI-613®(devimistat) in combination with hydroxychloroquine in patients with clear cell sarcoma of soft tissue. Rafael Pharmaceuticals will begin enrolling patients in partnership with Sara’s Cure and Sarcoma Alliance for Research through Collaboration (SARC).

 

 

 

The FDA has granted Orphan Drug Designation for CPI-613® (devimistat) for the treatment of soft tissue sarcoma. Rafael Pharmaceuticals’ clinical trial will focus on the treatment of relapsed or refractory clear cell sarcoma.

LipoMedix

At January 31, 2021, Rafael Holdings held 68% of the issued and outstanding ordinary shares of LipoMedix, a development-stage Israeli company focused on the development of an innovative, safe and effective cancer therapy based on liposome delivery.

LipoMedix announced that its lead compound, Promitil® (PL-MLP), will be manufactured in the United States by ForDoz Pharma (ForDoz), a specialty pharmaceutical company focused on the development, manufacturing, and commercialization of value-added sterile and complex injectable products.

Barer Institute

The Barer Institute, a wholly owned subsidiary of Rafael Holdings, has identified and begun to develop new therapeutic compounds, including compounds to regulate cancer metabolism, through internal development and in-licensing. It is working to validate newly discovered biomarkers for resistance and sensitivity within its portfolio compounds and to identify certain novel targetable mechanisms of action.

The Barer Institute announced that it had reached an agreement with Princeton University’s Office of Technology Licensing for an exclusive worldwide license to its SHMT (serine hydroxymethyltransferase) inhibitor program and related intellectual property from the laboratory of Professor Joshua Rabinowitz, Department of Chemistry.

Remarks by Howard Jonas, Chairman and CEO of Rafael Holdings

“The progress being made by our pharma partners is highlighted by our Board’s selection of Ameet Mallik to join as CEO of Rafael Holdings beginning on May 1, 2021. Ameet is an extraordinarily capable and accomplished pharma executive with deep knowledge of oncological drug development and commercialization. Together with Bill Conkling, who has joined our team as Chief Commerical Officer, Ameet will lead our effort to realize the potential of Rafael Holdings including its investments in Rafael Pharmaceuticals, LipoMedix, and the Barer Institute.”

 

About Rafael Holdings, Inc.:

Rafael Holdings is focused on development of novel cancer therapies. The Company is a significant investor in two clinical stage oncology companies, Rafael Pharmaceuticals, Inc. and LipoMedix Pharmaceuticals Ltd. Through its wholly owned Barer Institute subsidiary, the Company is developing a pipeline of compounds focused on the regulation of cancer metabolism. For more information, visit rafaelholdings.com.

 

Contact:

David Polinsky

Chief Financial Officer, Rafael Holdings, Inc.

P: (212) 658-1450

E: invest@rafaelholdings.com

 

 

RAFAEL HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

(unaudited, in thousands, except share and per share data) 

 

   January 31,
2021
   July 31,
2020
 
ASSETS        
CURRENT ASSETS        
Cash and cash equivalents  $6,086   $6,206 
Trade accounts receivable, net of allowance for doubtful accounts of $117 and $218 at January 31, 2021 and July 31, 2020, respectively   124    267 
Due from Rafael Pharmaceuticals   360    118 
Prepaid expenses and other current assets   116    273 
Assets held for sale   -      2,968 
Total current assets   6,686    9,832 
           
Property and equipment, net   43,760    44,433 
Equity investment – RP Finance LLC   383    192 
Due from RP Finance LLC   3,750    -   
Investments – Rafael Pharmaceuticals   79,141    70,018 
Investments – Other Pharmaceuticals   477    1,201 
Investments – Hedge Funds   8,943    7,510 
Deferred income tax assets, net   -      6 
In-process research and development and patents   1,575    1,575 
Other assets   1,534    1,580 
TOTAL ASSETS  $146,249   $136,347 
           
LIABILITIES AND EQUITY          
           
CURRENT LIABILITIES          
Trade accounts payable  $495   $921 
Accrued expenses   643    1,191 
Amount due for purchase of membership interest   9,500    3,500 
Other current liabilities   162    115 
Due to related parties   29    -   
Total current liabilities   10,829    5,727 
           
Other liabilities   33    92 
TOTAL LIABILITIES   10,862    5,819 
           
COMMITMENTS AND CONTINGENCIES          
           
EQUITY          
Class A common stock, $0.01 par value; 35,000,000 shares authorized, 787,163 shares issued and outstanding as of January 31, 2021 and July 31, 2020, respectively   8    8 
Class B common stock, $0.01 par value; 200,000,000 shares authorized, 15,664,476 issued and 15,652,120 outstanding as of January 31, 2021, and 15,034,598 issued and 15,028,536 outstanding as of July 31, 2020   155    149 
Additional paid-in capital   142,746    129,136 
Accumulated deficit   (25,866)   (16,255)
Accumulated other comprehensive income related to foreign currency translation adjustment   3,761    3,762 
Total equity attributable to Rafael Holdings, Inc.   120,804    116,800 
Noncontrolling interests   14,583    13,728 
TOTAL EQUITY   135,387    130,528 
TOTAL LIABILITIES AND EQUITY  $146,249   $136,347 

 

 

 

RAFAEL HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited, in thousands, except share and per share data) 

 

   Three Months Ended
January 31,
   Six Months Ended
January 31,
 
   2021   2020   2021   2020 
REVENUE                
Rental – Third Party  $190   $370   $426    716 
Rental – Related Party   527    527    1,047    1,047 
Parking   122    219    299    443 
Other – Related Party   120    120    240    240 
Total revenue   959    1,236    2,012    2,446 
                     
COSTS AND EXPENSES                    
Selling, general and administrative   2,767    2,221    5,359    4,262 
Research and development   1,568    448    2,083    693 
Depreciation and amortization   441    473    878    939 
Impairment – Altira   7,000    -      7,000    -   
Loss from operations   (10,817)   (1,906)   (13,308)   (3,448)
                     
Interest (expense) income, net   (1)   33    (1)   (31)
Net loss resulting from foreign exchange transactions   -      -      -      (5)
Gain on sale of building   -      -      749    -   
Impairment of investments - Other Pharmaceuticals   -      -      (724)   -   
Unrealized gain on investments - Hedge Funds   2,489    557    3,433    520 
Loss before income taxes   (8,329)   (1,316)   (9,851)   (2,964)
Provision for income taxes   (4)   (12)   (9)   (16)
Equity in earnings of RP Finance   96    -      192    -   
Consolidated net loss   (8,237)   (1,328)   (9,668)   (2,980)
Net loss attributable to noncontrolling interests   (72)   (75)   (57)   (129)
Net loss attributable to Rafael Holdings, Inc.  $(8,165)  $(1,253)  $(9,611)  $(2,851)
                     
OTHER COMPREHENSIVE LOSS                    
Net loss  $(8,237)  $(1,328)  $(9,668)  $(2,980)
Foreign currency translation adjustment   37    (34)   (1)   (28)
Total comprehensive loss   (8,200)   (1,362)   (9,669)   (3,008)
Comprehensive loss attributable to noncontrolling interests   10    (18)   (11)   (16)
Total comprehensive loss attributable to Rafael Holdings, Inc.  $(8,210)  $(1,344)  $(9,658)  $(2,992)
                     
Loss per share                    
Basic and diluted  $(0.50)  $(0.08)  $(0.60)  $(0.18)
                     
Weighted average number of shares used in calculation of loss per share                    
Basic and diluted   16,172,421    15,790,400    15,997,571    15,715,442 

 

 

 

RAFAEL HOLDINGS, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

(unaudited, in thousands) 

 

   Six Months Ended
January 31,
 
   2021   2020 
Operating activities          
Net loss  $(9,668)  $(2,980)
Adjustments to reconcile net loss to net cash used in operating activities          
Depreciation and amortization   878    939 
Deferred income taxes   6    12 
Net unrealized gain on investments - Hedge Funds   (3,433)   (520)
Impairment of investments - Other Pharmaceuticals   724    -   
Impairment – Altira   7,000    -   
Equity in earnings of RP Finance   (192)   -   
Provision for doubtful accounts   104    48 
Stock-based compensation   719    411 
Amortization of debt discount   -      54 
Gain on sale of building   (749)   -   
           
Change in assets and liabilities:          
Trade accounts receivable   39    77 
Prepaid expenses and other current assets   157    181 
Other assets   46    (38)
Accounts payable and accrued expenses   (933)   (252)
Due from Rafael Pharmaceuticals   (242)   -   
Other current liabilities   47      
Due to related parties   29    126 
Other liabilities   (59)   42 
Net cash used in operating activities   (5,527)   (1,900)
           
Investing activities          
Purchase of investment in Altira   (1,000)   -   
Purchases of property and equipment   (205)   (456)
Payments to fund RP Finance   (3,750)   -   
Proceeds from sale of building   3,658    -   
Proceeds related to distribution of Hedge Funds   2,000    -   
Investment in Rafael Pharmaceuticals   (9,123)   -   
Net cash used in investing activities   (8,420)   (456)
           
Financing activities          
Contribution from noncontrolling interest of consolidated entity   912    -   
Proceeds from exercise of options   43    -   
Proceeds from issuance of shares   13,000    -   
Payments for taxes related to shares withheld for employee taxes   (146)   (116)
Net cash provided by (used in) financing activities   13,809    (116)
Effect of exchange rate changes on cash and cash equivalents   18    (30)
Net decrease in cash and cash equivalents   (120)   (2,502)
Cash and cash equivalents, beginning of period   6,206    12,024 
Cash and cash equivalents, end of period  $6,086   $9,522 
           
Supplemental schedule of noncash investing and financing activities          
Conversion of LipoMedix bridge notes  $-     $200 
Conversions of related party convertible notes payable and accrued interest  $-     $15,668 

 

 

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