Veru Inc. Reports $8.9 Million Net Loss and Sells FC2 Business for $18 Million

Veru Inc. reported a net loss of $8.9 million for the three months ended December 31, 2024, compared to a net loss of $8.3 million for the same period in 2023. The company's total operating expenses increased to $10.9 million from $8.3 million year-over-year, primarily driven by a significant rise in research and development costs, which surged to $5.7 million from $1.7 million. This increase is attributed to the ongoing Phase 2b clinical trial for enobosarm, aimed at augmenting fat loss and preventing muscle loss in older patients receiving GLP-1 receptor agonists. Selling, general, and administrative expenses decreased to $5.2 million from $6.7 million, reflecting reduced corporate personnel costs and a slight decrease in headcount.

In a strategic move, Veru completed the sale of its FC2 female condom business on December 30, 2024, for $18 million in cash, resulting in a loss of $4.2 million on the sale. This transaction is part of a broader strategy to focus on its drug development programs, particularly enobosarm and sabizabulin, which target cardiometabolic and inflammatory diseases. The company also recorded a gain of $8.6 million from the extinguishment of debt related to the termination of the Residual Royalty Agreement, which was settled as part of the FC2 business sale.

Veru's cash, cash equivalents, and restricted cash totaled $26.6 million as of December 31, 2024, up from $24.9 million at the end of September 2024. The company reported working capital of $22 million, a decrease from $23.4 million, primarily due to the impact of discontinued operations related to the FC2 business. The company continues to face challenges in achieving profitability, with substantial capital required to support ongoing drug development efforts. Management has indicated that additional financing will be necessary to fund operations over the next twelve months, raising concerns about the company's ability to continue as a going concern.

Looking ahead, Veru is focused on advancing its clinical programs, particularly the Phase 2b QUALITY trial for enobosarm, which has shown promising topline results. The company plans to request an end-of-Phase 2 meeting with the FDA to discuss the next steps in its development strategy. Additionally, Veru is exploring the potential of sabizabulin as a treatment for inflammation associated with atherosclerotic cardiovascular disease, with plans for a Phase 2 study to assess its efficacy in this area. The company remains committed to its strategic shift towards cardiometabolic indications, which it believes will create significant shareholder value.