Chromocell Therapeutics Corporation (“Chromocell”, or the
“Company”), (NYSE American: CHRO), a pioneer in the development of
non-opioid pain treatment therapeutics, today announced that its
Chief Executive Officer, Frank Knuettel, has issued the following
letter to stockholders:
Dear Fellow Stockholders,
With my inaugural letter to stockholders, I am pleased to
provide an update on our recent initial public offering (“IPO”),
share our mission, outline the current status of our development
programs, and discuss our growth and operational plans.
We successfully closed our IPO on February 21, 2024, raising
gross proceeds of approximately $6.6 million. Notably, almost all
shares of common stock held by 5% holders, directors and officers
of the Company prior to the IPO are subject to formal lock-up
agreements.
Additional key highlights since the close of the IPO
include:
- All pre-IPO outstanding shares of Series A Convertible
Preferred Stock (“Series A Preferred Stock”) were converted into
shares of common stock at a price of $4.98 per share.
- All pre-IPO debt under our senior secured convertible notes, in
the principal amount of approximately $587,000, was converted into
shares of common stock at $4.80 per share.
- We transferred $2.2 million in liabilities to Chromocell
Corporation in exchange for 2,600 shares of Series C Convertible
Redeemable Preferred Stock (“Series C Preferred Stock”). The Series
C Preferred Stock is the only remaining outstanding series of the
Company’s preferred stock, has no dividend or voting rights and is
convertible at a fixed price of $7.50 per share.
- Our CEO has agreed to further defer a considerable portion of
his accrued compensation, affirming the belief in Chromocell’s
mission.
These and other actions the Company have taken since the close
of the IPO have removed approximately $2.7 million of liabilities
from the balance sheet.
We expect that the net proceeds from our IPO will allow us to
focus on accelerating the development of a portfolio of non-opioid
pain treatments and related therapies. Opioids effectively treat
pain, but their use often leads to serious side effects, including
addiction and mortality. Despite the explosive growth of opioid
addiction and the ongoing suffering of many patients, there has
been a lack of new pain treatment therapies. We intend to build a
robust pipeline of products to address several pain indications
with molecules that show no addictive or euphoric properties.
Our core development program targets the NaV1.7 sodium channel,
as well as other receptors in the NaV family. NaV1.7 has been
genetically validated as pain receptors in human physiology, and we
have successfully conducted approximately animal models that
demonstrated that blockage of NaV 1.7 channels showed significant
pain reduction.
We have formally launched two programs as follows:CC8464: Our
lead compound to address certain types of neuropathic pain, CC8464,
has completed Phase I safety trials. We conducted approximately ten
(10) trials which demonstrated efficacy in a variety of different
animal models as well as four Phase I trials involving
approximately 200 patients. The Phase I results demonstrated no
liver or renal toxicity, no central nervous system changes and no
cardiovascular findings. With no central nervous system changes,
patients did not report euphoric responses, indicating little
likelihood of addictive properties and potential abuse.
The only side effect experienced among these four studies was an
incidence of rashes in about 4% of the patients exposed, which
resolved in all cases with topical steroids and/or topical
antihistamines (with the exception of one patient requiring
systemic steroids). As a result, in discussions with the U.S. Food
and Drug Administration (“FDA”), we plan to launch a slow dose
escalation study to further evaluate the incidence of rashes. By
titrating the dose over nine weeks, we anticipate that we will
reduce or eliminate this side effect. We expect that the slow dose
escalation study will also help determine the need for dose
escalation in the final treatment regime. Even if it is ultimately
determined that we will need an escalation period for chronic pain
treatment therapy, which patients could well take for the remainder
of their lives, we do not believe the dose escalation approach is
consequential.
Following the completion of the slow dose escalation study, we
plan to commence a Phase II trial for the treatment of either of
erythromelalgia (“EM”) or a Phase II trial for idiopathic small
fiber neuropathy (“ISFN”). Both are orphan indications for which we
plan to apply for orphan drug designations. The orphan indication
may decrease the scope of the ultimate development program that is
necessary for approval and is associated with a marketing
exclusivity period from the FDA along with some tax advantages.
The potential population for EM in the United States is
estimated to be between 5,000 and 50,000 patients and the potential
population for ISFN in the United States is estimated to be between
20,000 and 80,000 patients. In both instances, we expect patients
would potentially take our drug for the remainder of their lives,
and given the lack of good therapeutic alternatives, we expect to
have a robust, ongoing, and durable market.
CT2000: Our newly launched program is for the potential
treatment of both acute and chronic eye pain.
Current options for the treatment of ocular pain center on the
use of corticosteroids and NSAID based therapeutics. These options
suffer from sight-threatening complications such as Glaucoma and
corneal melting, thus there is a large unmet need for other
approaches. As an example of the potential patient population, we
estimate that there are approximately 5 million cases of corneal
abrasions per year in the United States. In addition, other
potential indications associated with eye pain include:
- side effects from photorefractive keratectomy (PRK) and
pterygium surgery,
- Second eye cataract surgery,
- Severe uveitis and severe iritis/scleritis.
As the NaV1.7 receptor is present on the cornea and is a viable
biological target for treating eye pain, we believe that we have a
sound scientific basis for our ability to treat a multitude of eye
pain indications.
We have recently hired Dr. Simon Chandler, an expert with more
than 30 years of experience in managing ophthalmic drug development
programs and, notably, has gained FDA approvals in ocular pain
indications.
We are in the process of formulating CT2000 eye drops and expect
to move into animal toxicity studies in the second half of 2024.
From there, we intend to move into proof-of-concept studies in
humans in Australia.
Other Indications: We are exploring other exciting delivery
methods and pain indications that we believe might considerably
expand our target market in the pain treatment space.
As a company, we have prioritized fiscal responsibility,
operating leanly with four employees and utilizing consultants and
CROs for additional work as needed. Additionally, we are availing
ourselves of a significant 43.5% tax credit on clinical expenses by
completing as much of our development work and trials in Australia
as possible.
We have launched a strategic initiative to secure non-dilutive,
strategic capital options, including the potential out-licensing
of, or entering into joint ventures for our proprietary drug
compound for certain indications in certain markets. We believe
that an increased focus on pain treatment therapeutics in the
industry, combined with the need amongst generic producers for
proprietary programs, make us an attractive candidate for this type
of relationship.
One final note with respect to our annal audit and the filing of
our Annual Report on Form 10-K for the year ended December 31, 2023
(our “10-K”). The close of our IPO on February 21, 2024, in which
our staff, auditors and lawyers were heavily engaged, was the sole
cause of the delay in the filing of our 10-K by the prescribed due
date. We do not expect any issues with filing our 10-K prior to the
fifteenth day following the prescribed due date, as permitted by
our filing of a Form NT with the SEC and SEC rules. Going forward,
we plan to timely file our quarterly and annual reports for each
reporting period.
We truly feel that our IPO and recent therapeutic development
activities have positioned Chromocell for long term growth and
success. I wish to thank you for your support and remain a resource
to each of you as we move forward.
Sincerely,Frank Knuettel II CEO, Chromocell
Forward-Looking Statements
This press release contains forward-looking statements regarding
the Company’s current expectations. These forward-looking
statements include, without limitation, references to the Company’s
expectations regarding (i) the initiation, timing, progress and
results of preclinical and clinical trials for CC8464, CT2000 and
other clinical programs, (ii) the timing, scope or results of
regulatory filings and approvals, including timing of final FDA
marketing and other regulatory approval of CC8464 and CT2000, (iii)
the Company’s ability to achieve certain accelerated or orphan drug
designations from the FDA, (iv) the Company’s estimates regarding
the potential market opportunity for CC8464 and CT2000, (v) the
Company’s plans and ability to successfully develop and
commercialize compounds, (vi) the Company’s belief that its
portfolio of therapeutics will be suitable for a multitude of eye
pain indications, (vii) the Company’s belief that the market
opportunity in under-served markets is considerable, (viii) the
Company's intent to explore certain compounds for the treatment of
pain indications, (ix) the Company's financial performance, (x) the
impact of laws and regulations, (xi) the Company's ability to
establish and maintain collaborations or obtain additional funding
and (x) the anticipated use of net proceeds from the IPO. These
statements are not guarantees of future performance and are subject
to certain risks, uncertainties and assumptions that are difficult
to predict. Factors that could cause actual results to differ
materially from those set forth in such forward-looking statements
include, but are not limited to, risks and uncertainties related to
(i) the Company expending its limited resources to pursue a
compound or indication and failing to capitalize on different
compounds or indications that may be more profitable or for which
there is a greater likelihood of success and the Company
potentially not being successful in discovering, developing and
commercializing additional compounds, (ii) the Company needing to
establish its market development capabilities to commercialize its
products with the failure to do so potentially resulting in an
inability to generate any revenue, (iii) the Company facing
significant competition and its competitors potentially achieving
regulatory approval before the Company or developing therapies that
are more advanced or effective than the Company’s, which may
adversely affect the Company’s financial condition, (iv) the
Company’s ability to obtain and maintain adequate U.S. and foreign
patent protection for its compounds, the Company facing litigation
or administrative proceedings by a third-party over its patents,
changes in U.S. or foreign patent law or interpretation thereof
diminishing the value of its patents, and the Company’s ability to
protect the confidentiality of its trade secrets, (v) third-parties
instituting patent litigation against the Company in the U.S. or a
foreign jurisdiction asserting that CC8464, CT2000 and/or
additional compounds infringe its patent rights, the outcome of
which would be uncertain and could have a material adverse effect
on the success of the Company’s business, (vi) there being no
guarantee that the results from prior clinical and preclinical
studies will be indicative of the Company’s ability to complete
studies or the results to be obtained in the current or future
studies and clinical trials and (vii) the Company’s ability to
retain key employees and scientific advisors and to attract, retain
and motivate qualified personnel. These and other risks and
uncertainties are described more fully in the section captioned
“Risk Factors” in the Company’s Registration Statement on Form S-1
(SEC File No. 333-269188). Forward-looking statements contained in
this announcement are made as of this date, and the Company
undertakes no duty to update such information except as required
under applicable law.
Chromocell Media and Investor Inquires:
LR Advisors LLC.Jason Assad678-570-6791Jason@Chromocell.com
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