EX-99.1 2 ea129091ex99-1_rafaelhold.htm PRESS RELEASE

Exhibit 99.1

 

 

 

Rafael Holdings Reports Fourth Quarter and Full Fiscal Year 2020 Results

 

NEWARK, NJ – October 29, 2020: Rafael Holdings, Inc., (NYSE: RFL), reported revenue of $4.9 million and a loss per share of $0.66 for the fiscal year ended July 31, 2020. Fourth quarter revenue was $1.2 million with a loss per share of $0.34.

 

Q4 FY 2020 Consolidated Highlights

 

·Revenue of $1.2 million in Q4 FY2020, generated by Rafael Holdings’ real estate portfolio, was unchanged from the year-ago quarter. The loss per share of $0.34 increased from $0.16 in the year ago quarter largely due to additional investment in the Company’s wholly owned pharmaceutical research venture, the Barer Institute.
·In August after the quarter close, the company sold its commercial real estate property in Piscataway, New Jersey for $3.9 million

Rafael Pharmaceuticals

 

At July 31, 2020, the Company and its subsidiaries collectively owned securities representing 51% of the outstanding capital stock of Rafael Pharmaceuticals and approximately 37% on a fully diluted basis.

 

·The U.S. Food and Drug Administration (FDA) granted Orphan Drug Designation for Rafael Pharma’s lead compound, CPI-613® (devimistat), for the treatment of soft tissue sarcoma. Rafael’s clinical trial will focus on the treatment of relapsed or refractory clear cell sarcoma.
·Ono Pharmaceutical Co., has begun a multicenter, open-label Phase 1 study in Japan for patients with pancreatic cancer. The study is evaluating the efficacy and safety of CPI-613®️ (devimistat) in combination with modified FOLFIRINOX (mFFX).
·Rafael Pharma reached its target enrollment of 500 patients in its pivotal Phase 3 clinical trial for metastatic pancreatic cancer (AVENGER 500). The trial is evaluating the efficacy and safety of CPI-613®️ (devimistat) in combination with modified FOLFIRINOX (mFFX) as first-line therapy. Efficacy data for this trial could be available for analysis as early as the second quarter of calendar year 2021.
·Rafael Pharma has crossed the midpoint to its first interim analysis in enrollment for its pivotal Phase 3 clinical trial (ARMADA 2000) of CPI-613® (devimistat) for relapsed or refractory acute myeloid leukemia (AML). The multicenter, open-label, randomized pivotal trial is evaluating the efficacy and safety of its lead compound devimistat in combination with high dose cytarabine and mitoxantrone (CHAM) in older patients. The efficacy data for this trial couuld be available for interim analysis as early as the second quarter of calendar year 2021.
·Rafael Pharma expanded its Phase 2 clinical trial of CPI-613® (devimistat) for patients with relapsed or refractory Burkitt’s lymphoma/leukemia.
·Rafael Pharma entered into a research collaboration with Roswell Park Comprehensive Cancer Center to evaluate the effects of CPI-613® (devimistat) with or without chemotherapy agents, including oxaliplatin/cisplatin/5-FU/carboplatin/taxol, on esophageal cancer cells.

 

 

 

  

LipoMedix

 

At July 31, 2020, Rafael Holdings held 67% 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. This stake is inclusive of 4 million shares of LipoMedix purchased in May 2020 for $1 million including conversion of outstanding bridge notes.

 

Barer Institute

 

The Barer Institute has identified and begun to evaluate 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. In addition, the Barer Institute has identified several potential lead compounds for clinical development and found combinations that may meaningfully increase the efficacy of certain clinical compounds.

 

Remarks by Howard Jonas, Chairman and CEO of Rafael Holdings

 

“Rafael Holdings’ continued to execute on our strategic vision in the fourth quarter, selling our Piscataway property and further increasing our majority stake in LipoMedix. In August, Rafael Pharma announced a major milestone – fully enrolling its pivotal Phase 3 Avenger 500 study for patients with metastatic pancreatic cancer. Results could be available as early as the second quarter of 2021. The Barer Institute has multiple compounds under development and collaboration programs in process with some of the premier academic centers in the country.”

 

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 compounds focused on the regulation of cancer metabolism. The company also holds commercial real estate assets in New Jersey and Jerusalem. For more information, visit our website at rafaelholdings.com.

 

Contact:
Rafael Holdings

David Polinsky

Chief Financial Officer

P: (212) 658-1450

E: invest@rafaelholdings.com

 

 

 

 

Rafael Holdings, Inc.

Consolidated Balance Sheet

(in thousands except for share and per share data)

 

 

   July 31, 
   2020   2019 
ASSETS        
CURRENT ASSETS        
Cash and cash equivalents  $6,206   $12,024 
Trade accounts receivable, net of allowance for doubtful accounts of $218 and $122 at July 31, 2020 and 2019, respectively   267    450 
Due from Rafael Pharmaceuticals   118    280 
Prepaid expenses and other current assets   273    507 
Assets held for sale   2,968     
Total current assets   9,832    13,261 
           
Property and equipment, net   44,433    48,733 
Equity investment – RP Finance   192     
Investments – Rafael Pharmaceuticals   70,018    70,018 
Investments – Other Pharmaceuticals   1,201    2,000 
Investments – Hedge Funds   7,510    5,125 
Deferred income tax assets, net   6    19 
In-process research and development and patents   1,575    1,575 
Other assets   1,580    1,412 
TOTAL ASSETS  $136,347   $142,143 
LIABILITIES AND EQUITY          
CURRENT LIABILITIES          
Trade accounts payable  $921   $795 
Accrued expenses   1,191    605 
Amount due for purchase of membership interest   3,500     
Other current liabilities   115    27 
Total current liabilities   5,727    1,427 
           
Due to related parties       65 
Convertible debt, net of discount of $0 and $54 - Related Party       14,946 
Other liabilities   92    292 
Accrued interest on convertible debt - Related Party       649 
TOTAL LIABILITIES   5,819    17,379 
           
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 July 31, 2020 and July 31, 2019, respectively   8    8 
Class B common stock, $0.01 par value; 200,000,000 shares authorized, 15,034,598 issued and 15,028,536 outstanding as of July 31, 2020, and 13,142,502 shares issued and outstanding as of July 31, 2019   149    131 
Additional paid-in capital   129,136    112,898 
Accumulated deficit   (16,255)   (5,840)
Accumulated other comprehensive income related to foreign currency translation adjustment   3,762    3,784 
Total equity attributable to Rafael Holdings, Inc.   116,800    110,981 
Noncontrolling interests   13,728    13,783 
TOTAL EQUITY   130,528    124,764 
TOTAL LIABILITIES AND EQUITY  $136,347   $142,143 

 

 

 

 

Rafael Holdings, Inc.

Consolidated Statement of Operations

(in thousands except for share and per share data)

 

 

 

   Year Ended July 31, 
   2020   2019 
REVENUES        
Rental – Third Party  $1,516   $1,452 
Rental – Related Party   2,082    2,125 
Parking   832    874 
Other – Related Party   480    480 
Total Revenue   4,910    4,931 
           
COSTS AND EXPENSES          
Selling, general and administrative   9,118    8,821 
Research and development   2,391    1,027 
Depreciation   1,866    1,779 
Loss from operations   (8,465)   (6,696)
           
Interest (expense) income, net   (32)   469 
Net (loss) gain resulting from foreign exchange transactions   (5)   47 
Gain on sale of marketable securities       330 
Impairment of investments - Other Pharmaceuticals   (799)    
Unrealized gain on investments - Hedge Funds   2,385    907 
Loss before income taxes   (6,916)   (4,943)
(Provision for) benefit from income taxes   (29)   19 
Impairment of equity method investment of Altira   (4,000)    
Equity in earnings of RP Finance   192     
Consolidated net loss   (10,753)   (4,924)
Net loss attributable to noncontrolling interests   (338)   (231)
Net loss attributable to Rafael Holdings, Inc.  $(10,415)  $(4,693)
           
OTHER COMPREHENSIVE LOSS          
Net Loss  $(10,753)  $(4,924)
Foreign Currency Translation Adjustment   (22)   298 
Total Comprehensive Loss   (10,775)   (4,626)
Comprehensive (loss) income attributable to noncontrolling interests   (9)   173 
Total Comprehensive loss attributable to Rafael Holdings, Inc.  $(10,784)  $(4,453)
           
Loss per share          
Basic and Diluted  $(0.66)  $(0.35)
           
Weighted average number of shares used in calculation of loss per share          
Basic and Diluted   15,764,829    13,275,239 

 

 

 

Rafael Holdings, Inc.

Consolidated Statement of Cash Flows

(in thousands)

   Year Ended July 31, 
   2020   2019 
Operating activities        
Net loss  $(10,753)  $(4,924)
Adjustments to reconcile net loss to net cash used in operating activities          
Depreciation   1,866    1,779 
Deferred income taxes   13    (19)
Interest income on Rafael Pharmaceuticals Series D Convertible Note       (848)
Interest income       (37)
Net gain on sale of marketable securities       (330)
Net unrealized gain on investments - Hedge Funds   (2,385)   (907)
Impairment of investments - Other Pharmaceuticals   799     
Impairment of equity method investment of Altira   4,000     
Equity in earnings of RP Finance   (192)    
Provision for doubtful accounts   96    122 
Noncash compensation   684    372 
Amortization of debt discount   54    17 
Write-off of patents       76 
           
Change in assets and liabilities:          
Trade accounts receivable   87    (285)
Prepaid expenses and other current assets   234    (86)
Other assets   (168)   275 
Accounts payable and accrued expenses   713    533 
Other current liabilities   88    3 
Due to related parties   (65)   654 
Due from related parties   162    (280)
Accrued interest - Related Party   19    649 
Other liabilities   82    104 
Net cash used in operating activities   (4,666)   (3,132)
           
Investing activities          
Purchase of investment in Altira   (500)    
Purchases of property and equipment   (534)   (399)
Proceeds from sale and maturity of marketable securities       25,031 
Investment in Rafael Pharmaceuticals       (55,870)
Net cash used in investing activities   (1,034)   (31,238)
           
Financing activities          
Contribution from noncontrolling interest of consolidated entity       4,587 
Repayment of loan from Rafael Pharmaceuticals, including interest       3,335 
Proceeds from exercise of options   29    190 
Proceed from sale of shares       7,777 
Proceeds from issuance of convertible note       15,000 
Payments for taxes related to shares withheld for employee taxes   (125)    
Net cash (used in) provided by financing activities   (96)   30,889 
Effect of exchange rate changes on cash and cash equivalents   (22)   (298)
Net decrease in cash and cash equivalents   (5,818)   (3,779)
Cash and cash equivalents, beginning of year   12,024    15,803 
Cash and cash equivalents, end of year  $6,206   $12,024 
           
Supplemental Schedule of Noncash Investing and Financing Activities          
Adoption effect of ASU 2016-01  $   $39 
Beneficial conversion feature of convertible debt - Related Party  $   $71 
Debt and accrued interest converted to Series D Preferred Stock  $   $10,848 
Related Party deposit utilized to purchase Class B Common Stock  $   $864 
Amount due for purchase of membership interest  $3,500   $ 
Transfer of asset held for sale  $2,968   $ 
Conversion of LipoMedix Bridge Notes  $283   $ 
Conversions of related party convertible notes payable and accrued interest  $15,668   $ 

 

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