Citius Pharmaceuticals, Inc. Secures $2.4 million through New Jersey Economic Development Program

Rhea-AI Summary

Citius Pharmaceuticals, Inc. (CTXR) secures $2.4 million in non-dilutive capital through New Jersey's NOL Program. The funding will support the advancement of their critical care product pipeline.

Financial Analyst

The infusion of $2.4 million in non-dilutive capital for Citius Pharmaceuticals is a strategic financial maneuver that effectively strengthens the company's balance sheet without impacting shareholder equity. Non-dilutive funding means that the company does not have to issue new shares, which would otherwise dilute existing shareholders' stakes. This is particularly beneficial for Citius as it allows them to fund ongoing operations and development projects while preserving current stockholder value.

From a financial perspective, this capital injection via the NOL Program indicates that Citius has a considerable amount of accumulated net operating losses. While this reflects past challenges in profitability, the ability to monetize these losses is a savvy use of tax benefits provided by the state of New Jersey. Investors may view this positively as it demonstrates management's capability to leverage available resources to secure funding.

However, it's important to note that while non-dilutive capital is advantageous, it does not directly address the underlying issues that led to the net operating losses. Investors should consider the company's trajectory and potential for future earnings as critical factors for long-term growth.

Market Research Analyst

The New Jersey's Technology Business Tax Certificate Transfer Program is designed to support technology and biopharmaceutical companies like Citius Pharmaceuticals by providing an alternative funding route. This program is indicative of a supportive state policy environment that encourages innovation and growth within the biotech sector.

For stakeholders, the program's selection criteria and Citius' qualification for it could signal the company's recognition as a valuable player in the technology and biopharmaceutical landscape. Furthermore, the non-dilutive nature of this capital may enhance Citius' attractiveness to potential partners or acquirers who are looking for investment opportunities without the risk of equity dilution.

In the short term, the capital boost may accelerate the development of Citius' pipeline products, which can lead to significant valuation changes if the products reach commercialization. Long-term implications include the potential for Citius to establish a more robust financial foundation, improving its ability to navigate the costly and lengthy process of drug development.

Biotech Industry Expert

The capital obtained through the NOL Program is particularly significant for a late-stage biopharmaceutical company like Citius Pharmaceuticals. Development and commercialization of first-in-class critical care products often entail high costs and long timelines, with substantial financial risk. Non-dilutive funding provides a cushion that can be critical during the 'valley of death' period, which refers to the gap between initial research funding and profitable commercialization.

Moreover, the ability to convert operational losses into funding highlights a strategic use of tax incentives to support innovation in the biotech industry. This approach can be seen as a lifeline for companies that have promising pipelines but are not yet generating revenue. For Citius, the funds may be allocated towards clinical trials, regulatory processes, or scaling up manufacturing capabilities, each of which is a vital step toward bringing a new drug to market.

While this financial event is a positive development for Citius, it's essential to monitor the company's progress in its clinical trials and any upcoming regulatory milestones. Success in these areas will be the true determinants of the company's future financial health and its ability to deliver on its promises to stakeholders.

Net operating losses converted into non-dilutive capital

CRANFORD, N.J., March 7, 2024 /PRNewswire/ -- Citius Pharmaceuticals, Inc. ("Citius" or the "Company") (Nasdaq: CTXR), a late-stage biopharmaceutical company dedicated to the development and commercialization of first-in-class critical care products today announced that the Company has received $2.4 million in non-dilutive capital through New Jersey's Technology Business Tax Certificate Transfer Program, more commonly known as the Net Operating Loss (NOL) Program, funded through the New Jersey Economic Development Authority (NJEDA).

"Citius is pleased to have been selected to participate, once again, in New Jersey's NOL Program. This program allows us to convert certain losses from operations into non-dilutive funding to continue advancing our pipeline. We are thankful to the NJ Economic Development Authority for their support, and the added financial flexibility these funds provide Citius," stated Jaime Bartushak, Chief Financial Officer of Citius.

About the Technology Business Tax Certificate Transfer Program (NOL Program)

The NOL Program enables participants to sell their New Jersey net operating losses and unused R&D tax credits to unrelated profitable corporations for cash. Up to $75 million is available annually. The NJEDA and the New Jersey Department of Treasury's Division of Taxation jointly administer the NOL Program.

About the New Jersey Economic Development Authority

The New Jersey Economic Development Authority (NJEDA) serves as the State's principal agency for driving economic growth. The NJEDA is committed to making New Jersey a national model for inclusive and sustainable economic development by focusing on key strategies to help build strong and dynamic communities, create good jobs for New Jersey residents, and provide pathways to a stronger and fairer economy. Through partnerships with a diverse range of stakeholders, the NJEDA creates and implements initiatives to enhance the economic vitality and quality of life in the State and strengthen New Jersey's long-term economic competitiveness.

To learn more about NJEDA resources for businesses call NJEDA Customer Care at 609-858-6767 or visit https://www.njeda.com and follow @NewJerseyEDA on Facebook, Twitter, Instagram, and LinkedIn.

About Citius Pharmaceuticals, Inc.

Citius Pharma is a late-stage biopharmaceutical company dedicated to the development and commercialization of first-in-class critical care products. The Company's diversified pipeline includes two late-stage product candidates. At the end of 2023, Citius completed enrollment in a Phase 3 Pivotal superiority trial of Mino-Lok®, an antibiotic lock solution to salvage catheters in patients with catheter-related bloodstream infections. Citius is preparing to resubmit the Biologics License Application for LYMPHIR™, a novel IL-2R immunotherapy for an initial indication in cutaneous T-cell lymphoma, in early 2024, and announced plans to form Citius Oncology, a standalone publicly traded company with LYMPHIR as its primary asset. LYMPHIR received orphan drug designation by the FDA for the treatment of CTCL and PTCL. In addition, Citius completed enrollment in its Phase 2b trial of CITI-002 (Halo-Lido), a topical formulation for the relief of hemorrhoids. For more information, please visit www.citiuspharma.com.

Forward-Looking Statements

This press release may contain "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. Such statements are made based on our expectations and beliefs concerning future events impacting Citius. You can identify these statements by the fact that they use words such as "will," "anticipate," "estimate," "expect," "plan," "should," and "may" and other words and terms of similar meaning or use of future dates. Forward-looking statements are based on management's current expectations and are subject to risks and uncertainties that could negatively affect our business, operating results, financial condition and stock price.  Factors that could cause actual results to differ materially from those currently anticipated are: our need for substantial additional funds; risks relating to the results of research and development activities; our ability to commercialize our products if approved by the FDA; our dependence on third-party suppliers; our ability to procure cGMP commercial-scale supply; the estimated markets for our product candidates and the acceptance thereof by any market; the ability of our product candidates to impact the quality of life of our target patient populations; our ability to obtain, perform under and maintain financing and strategic agreements and relationships; uncertainties relating to preclinical and clinical testing; the early stage of products under development; market and other conditions; risks related to our growth strategy; patent and intellectual property matters; our ability to identify, acquire, close and integrate product candidates and companies successfully and on a timely basis; government regulation; competition; as well as other risks described in our SEC filings. These risks have been and may be further impacted by Covid-19 and could be impacted by any future public health risks. Accordingly, these forward-looking statements do not constitute guarantees of future performance, and you are cautioned not to place undue reliance on these forward-looking statements. Risks regarding our business are described in detail in our Securities and Exchange Commission ("SEC") filings which are available on the SEC's website at www.sec.gov, including in our Annual Report on Form 10-K for the year ended September 30, 2023, filed with the SEC on December 29, 2023, and updated by our subsequent filings with the Securities and Exchange Commission. These forward-looking statements speak only as of the date hereof, and we expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations or any changes in events, conditions or circumstances on which any such statement is based, except as required by law.

Investor Contact:

Ilanit Allen
ir@citiuspharma.com
908-967-6677 x113

Media Contact:

STiR-communications
Greg Salsburg
Greg@STiR-communications.com 

 

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SOURCE Citius Pharmaceuticals, Inc.

How much non-dilutive capital did Citius Pharmaceuticals, Inc. (CTXR) receive through New Jersey's NOL Program?

Citius Pharmaceuticals, Inc. (CTXR) received $2.4 million in non-dilutive capital.

What is the purpose of the funding received by Citius Pharmaceuticals, Inc. (CTXR) through New Jersey's NOL Program?

The funding will support the advancement of Citius Pharmaceuticals, Inc. (CTXR) critical care product pipeline.

Which program provided the non-dilutive capital to Citius Pharmaceuticals, Inc. (CTXR)?

The funding was provided through New Jersey's Technology Business Tax Certificate Transfer Program, also known as the NOL Program.

Who expressed gratitude for the support received by Citius Pharmaceuticals, Inc. (CTXR) through the NOL Program?

Jaime Bartushak, the Chief Financial Officer of Citius Pharmaceuticals, Inc. (CTXR), expressed gratitude for the support.

What is the role of the New Jersey Economic Development Authority in providing the non-dilutive capital to Citius Pharmaceuticals, Inc. (CTXR)?

The New Jersey Economic Development Authority funded the non-dilutive capital through the NOL Program to support Citius Pharmaceuticals, Inc. (CTXR).