Executive Summary

Q1 2024 revenue rose 54% year over year to $7.54M, with gross profit of $2.35M; net loss narrowed to $(1.28)M as Nora Pharma’s new launches and expanded sales drove growth .
Sequential trajectory remains positive versus 2023: Q1’23 $4.89M, Q2’23 $5.56M, Q3’23 $5.96M, Q1’24 $7.54M, though gross margin compressed on higher manufacturing costs and net margin dipped versus Q3’23 .
No formal financial guidance or earnings call was provided; operational updates included Health Canada approval for NIOPEG (biosimilar of NEULASTA) on April 17, 2024, and a $10M gross underwritten offering completed in February (net $8.52M) to support growth .
Balance sheet liquidity strengthened (cash $17.43M at quarter-end) with earn-out payments subsequent to quarter; corporate actions included a 1-for-100 reverse split and warrant adjustments, and auditor change in May 2024—key governance and capital structure developments .

What Went Well and What Went Wrong

What Went Well

Revenue growth: Sales up 54% YoY to $7.54M on new product launches and expanded marketing/sales at Nora Pharma .
Profitability progress: Net loss narrowed to $(1.28)M from $(1.70)M YoY; management reiterated focus on attaining profitability—“We continue to make progress and work diligently toward our goal of attaining profitability” (CEO) .
Pipeline/regulatory: Health Canada approved NIOPEG (biosimilar of NEULASTA) on April 17, 2024, adding a specialty oncology supportive care product to 2024 launches .

What Went Wrong

Margin pressure: Cost of sales increased to 69% of sales vs 63% in Q1’23 due to higher manufacturing costs; gross margin compressed to ~31% from ~37% YoY .
Net margin volatility: Net margin fell to ~−17% in Q1’24, versus ~−11% in Q3’23, reflecting higher COGS and OpEx mix despite revenue growth .
Governance/audit disruption: SEC’s permanent ban of prior auditor (BF Borgers) required a change to Bush & Associates CPA LLC in May 2024, adding execution risk and attention to controls, even as management reported effective disclosure controls .

Financial Results

Metric	Q1 2023	Q2 2023	Q3 2023	Q1 2024
Revenue ($USD)	$4,894,053	$5,560,865	$5,957,668	$7,541,046
Gross Profit ($USD)	$1,828,122	$1,952,747	$1,990,256	$2,354,337
Gross Margin (%)	37.4%	35.1%	33.4%	31.2%
Net Income ($USD)	$(1,702,430)	$(902,108)	$(651,482)	$(1,283,801)
Net Margin (%)	−34.8%	−16.2%	−10.9%	−17.0%
Diluted EPS ($USD)	$(7.73)	$(0.02)	$(0.04)	$(2.00)

Note: EPS figures reflect each period’s filing basis; Q1 2024 10-Q applies the 1-for-100 reverse split retroactively, which differs from earlier 2023 quarter disclosures .

Segment and KPIs

Segment revenue mix (Q1 2024): Generic Pharmaceuticals ~97%, OTC Products ~3%; management deems segment reporting immaterial at these levels .
Operating KPIs:
- Generic drugs on market in Canada: 52
- Additional drugs scheduled (2024–2025): 32
- Health Canada approval: NIOPEG® (filgrastim biosimilar) approved April 17, 2024
- Cash & equivalents (quarter-end): $17,434,208
- Earn-out obligation status: remaining balance ~$354,968 USD after April 24, 2024 payment (CAD $479,207)

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY/Q2 onwards	None issued	None issued	Maintained (no guidance)
Gross Margin	FY/Q2 onwards	None issued	None issued	Maintained (no guidance)
OpEx	FY/Q2 onwards	None issued	None issued	Maintained (no guidance)
Tax Rate	FY/Q2 onwards	None issued	None issued	Maintained (no guidance)
Segment-specific	FY/Q2 onwards	None issued	None issued	Maintained (no guidance)
Dividends	FY/Q2 onwards	No dividends	No dividends	Maintained

Earnings Call Themes & Trends

No Q1 2024 earnings call transcript was available; themes below reflect MD&A and filings across quarters.

Topic	Previous Mentions (Q2 2023)	Previous Mentions (Q3 2023)	Current Period (Q1 2024)	Trend
Pricing/regulatory (Canada)	pCPA-driven pricing dynamics referenced; generic market competitive	pCPA update effective Oct 1, 2023; pricing valid 3 years	PharmaCare bill tabled Feb 29, 2024 (potential shift to federal single-payer)	Stable near-term pricing; medium-term policy watch
Product launches	27+ launches slated across CNS/Cardio/Oncology (2023–2024)	Grouped launches planned through 2024	NIOPEG approval; 32 additional drugs planned 2024–2025	Momentum building; specialty adds
R&D execution	K1.1 mRNA LNP animal testing; PLpro program licensing; Adva-27a IND-enabling ongoing	Adva-27a IND paused Nov 2023; K1.1/PLpro continue	Adva-27a paused; K1.1/PLpro proceeding; targeting injections for PLpro	Mixed: one setback; others progressing
Supply chain/macro	Cost pressures and competitive dynamics noted	Higher COGS % with manufacturing costs	COGS at 69% vs 63% YoY; margin compression	Ongoing cost pressure
Capital/financing	May 2023 private placement ($4.1M net)	Cash $18.85M; stock repurchases	Feb 2024 underwritten offering ($8.52M net); cash $17.43M; 24-month runway target	Liquidity adequate; dilution risk
Governance/audit	—	Tradeable warrant exercise price reduced Oct 2023	Reverse split (Apr 17, 2024); warrant resets; auditor changed (May 2024)	Structural clean-up; oversight focus

Management Commentary

Strategic message: “We continue to make progress and work diligently toward our goal of attaining profitability” (Dr. Steve Slilaty, CEO) .
Commercial: Sales growth driven by new product launches and expanded marketing/sales in Nora Pharma .
Liquidity posture: “We believe our existing cash on hand will be sufficient to fund our pharmaceuticals sales operations and research and development activities for the next 24 months” .
Segment disclosure: Revenues ~97% from Generic Pharmaceuticals and ~3% from OTC; segmentation immaterial at current mix .

Q&A Highlights

No earnings call transcript or Q&A available for Q1 2024; the company furnished an 8-K press release and filed a 10-Q, but did not publish an earnings call transcript in the reviewed period .

Estimates Context

Wall Street consensus (S&P Global) was unavailable during retrieval; comparison to estimates cannot be made reliably at this time (S&P Global daily request limit exceeded). We attempted to pull Q1 2024 revenue and EPS consensus but were unable to complete.
Implication: Without consensus benchmarks, focus remains on demonstrated sequential and YoY growth and margin trajectories from filings .

Key Takeaways for Investors

Growth engine is working: Q1 revenue acceleration (54% YoY) reflects Nora Pharma execution and product launches; watch sustainability as pipeline (including NIOPEG) ramps through 2024–2025 .
Margin management is crucial: COGS at 69% and declining gross margin require tight sourcing and pricing discipline amid Canadian generic price frameworks (pCPA) .
Liquidity supports operations: $17.43M cash and recent offering (net $8.52M) underpin a stated ~24-month operational runway; monitor cash burn, earn-out payments, and working capital needs as launches scale .
R&D portfolio mixed-risk: Adva-27a pause is a setback; K1.1 mRNA and PLpro programs continue and could be upside optionality but are preclinical—commercial impact is medium-term at best .
Corporate housekeeping reduces overhangs: Reverse split, warrant adjustments, and auditor change address listing/compliance and governance; track execution under new auditor and any further capital structure moves .
No guidance/no call: Absence of formal guidance and a call magnifies the importance of quarterly filings; investors should anchor expectations to sequential revenue/margin trends and upcoming product approvals .
Canada policy watch: NIOPEG adds oncology supportive care breadth; monitor PharmaCare legislation and any reimbursement shifts that could affect pricing and volumes .

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