UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-37619 EDESA BIOTECH, INC. (Exact name of registrant as specified in its charter) British Columbia, Canada N/A (State or other jurisdiction ...

During the quarter, the company completed a $15 million equity financing from healthcare-focused institutional investors, existing Edesa shareholders and insiders to support the development of the company's vitiligo drug candidate EB06, anti-CXCL10 monoclonal antibody. The company has subsequently initiated outreach to potential investigators and manufacturing-related activities to support U.S. regulatory approval for a Phase 2 study in moderate-to-severe nonsegmental vitiligo patients. EXHIBIT 99.1 Edesa B ...

Core Viewpoint - Edesa Biotech, Inc. is advancing its clinical-stage biopharmaceutical development, particularly focusing on its vitiligo drug candidate EB06, while reporting financial results that reflect a strategic pivot in operational activities towards this program [1][4]. Financial Overview - For the three months ended March 31, 2025, total operating expenses decreased by $0.6 million to $1.6 million compared to $2.2 million for the same period in 2024 [7] - The company reported a net loss of $1.6 million, or $0.30 per common share, for the quarter, an improvement from a net loss of $1.9 million, or $0.58 per common share, for the same quarter last year [8] - For the six months ended March 31, 2025, total operating expenses decreased by $0.6 million to $3.5 million compared to $4.1 million for the same period in 2024 [9] - The net loss for the six months was $3.2 million, or $0.74 per common share, compared to a net loss of $3.5 million, or $1.12 per common share, for the same period last year [11] Business Development - The company completed a $15 million equity financing to support the development of EB06, an anti-CXCL10 monoclonal antibody for vitiligo [2] - Edesa has initiated outreach to potential investigators and manufacturing activities to support U.S. regulatory approval for a Phase 2 study in moderate-to-severe nonsegmental vitiligo patients [2][6] - The planned Phase 2 study for EB06 is already approved in Canada, with drug manufacturing data expected to be submitted to the FDA in the second half of 2025 [6] Research and Development - Research and development expenses decreased by $0.7 million to $0.5 million for the three months ended March 31, 2025, primarily due to decreased external research expenses related to the investigational drug paridiprubart [9][16] - General and administrative expenses increased by $0.2 million to $1.2 million for the three months ended March 31, 2025, mainly due to increased salaries and related costs [9] Cash Position - As of March 31, 2025, Edesa had cash and cash equivalents of $13.9 million and working capital of $13.5 million [12]

Company Overview - Edesa Biotech, Inc. is a clinical-stage biopharmaceutical company focused on developing host-directed therapeutics for immuno-inflammatory diseases [1][3] - The company has a clinical pipeline targeting two therapeutic areas: Medical Dermatology and Respiratory [3] Medical Dermatology - Edesa is developing EB06, an anti-CXCL10 monoclonal antibody candidate for treating vitiligo, an autoimmune disorder [3] - The company also has EB01 (1.0% daniluromer cream), which is Phase 3-ready for moderate-to-severe chronic Allergic Contact Dermatitis (ACD) [3] Respiratory - The most advanced respiratory drug candidate is EB05 (paridiprubart), currently evaluated in a U.S. government-funded study for Acute Respiratory Distress Syndrome [3] - EB05 has received two funding awards from the Government of Canada to support its development [3] - Edesa is preparing an investigational new drug application (IND) for EB07 (paridiprubart) to conduct a future Phase 2 study in patients with pulmonary fibrosis [3] Upcoming Events - Edesa will participate in the 2024 Bloom Burton & Co. Healthcare Investor Conference on May 5-6, 2025, in Toronto [1][2] - Management is scheduled to present on May 5 at 4:00pm ET [2]

Company Overview - Edesa Biotech, Inc. is a clinical-stage biopharmaceutical company focused on developing host-directed therapeutics for immuno-inflammatory diseases [1][4] - The company is developing innovative treatments in two therapeutic areas: Medical Dermatology and Respiratory [4] Leadership Change - Peter J. Weiler has been appointed as Chief Financial Officer, effective May 1, 2025, succeeding Stephen Lemieux [1][3] - Mr. Weiler has extensive experience in finance and corporate strategy within the biotechnology and pharmaceutical industries, previously serving as President of Exzell Pharma, Inc. and in various roles at Cipher Pharmaceuticals Inc. [2][3] Product Pipeline - Edesa's clinical pipeline includes EB06, an anti-CXCL10 monoclonal antibody candidate for vitiligo, and EB01, a Phase 3-ready asset for moderate-to-severe chronic Allergic Contact Dermatitis [4] - The company's advanced respiratory drug candidate, EB05, is being evaluated for Acute Respiratory Distress Syndrome and has received funding from the Government of Canada [4] - Edesa is preparing an investigational new drug application for EB07 to conduct a future Phase 2 study in patients with pulmonary fibrosis [4]

Financial Performance - For the three months ended December 31, 2024, Edesa Biotech reported a comprehensive loss of $1.6 million, resulting in an accumulated deficit of $60.2 million[23]. - The company had a net cash outflow from operating activities of $1.5 million and ended the quarter with $1.6 million in cash and cash equivalents[23]. - The company reported a net loss per common share of $0.48, an improvement from a loss of $0.54 per share in the previous year[13]. - Net loss for the three months ended December 31, 2024, was $1.6 million, or $0.48 per common share, compared to a net loss of $1.7 million, or $0.54 per common share for the same period in 2023[99]. - Net cash used in operating activities was $1.5 million for the three months ended December 31, 2024, compared to $1.4 million for the same period in 2023[103]. Expenses - Research and development expenses increased to $1.02 million from $0.70 million year-over-year, reflecting a growth of approximately 45%[13]. - General and administrative expenses decreased to $0.88 million from $1.15 million year-over-year, a reduction of about 24%[13]. - Total operating expenses remained unchanged at $1.9 million for both the three months ended December 31, 2024, and December 31, 2023[99]. - Research and development (R&D) expenses increased by $0.3 million to $1.0 million for the three months ended December 31, 2024, primarily due to increased external research expenses[100]. - General and administrative (G&A) expenses decreased by $0.3 million to $0.9 million for the three months ended December 31, 2024, due to a decrease in salaries and related costs[100]. Assets and Liabilities - Total current assets increased to $2.07 million from $1.68 million, a rise of approximately 24%[11]. - Total assets grew to $4.16 million from $3.81 million, marking an increase of about 9%[11]. - At December 31, 2024, the company had an accumulated deficit of $60.2 million and working capital of $0.2 million[111]. Financing Activities - The company issued 220,269 common shares, raising $0.63 million, and received $1.54 million from the issuance of Series A-1 preferred shares and warrants[19]. - The Company entered into a Securities Purchase Agreement to issue Series A-1 Convertible Preferred Shares for up to $5 million, with an initial conversion price of $3.445 per share[43]. - The Company sold 834 Series B-1 Preferred Shares at a purchase price of $10,000 each, generating gross proceeds of approximately $15.0 million[80]. - The company received gross proceeds of $15.0 million from the sale of common shares and Series B-1 Preferred Shares in a private placement subsequent to the quarter[111]. - Net cash provided by financing activities was $2.1 million for the three months ended December 31, 2024, compared to $0.3 million for the same period in 2023, with $1.5 million from the sale of Series A-1 Preferred Shares[115]. Commitments and Contingencies - The Company has commitments for contracted research organizations with approximate future contractual payments totaling $85,000 through September 30, 2029[38]. - The Company is committed to payments of up to $356 million under a license agreement contingent upon meeting certain commercial approval and sales milestones[39]. - The maximum amount repayable under the 2023 SIF Agreement is 1.4 times the original repayable amount, with repayments starting in 2029 based on revenue growth[64]. - The Company has a commitment to pay royalties based on net sales of products containing the Constructs, with no payments made during the three months ended December 31, 2024[39]. Research and Development - The Company plans to provide drug product and technical support for a Phase 2 clinical trial of its drug candidate, EB05, selected by BARDA[42]. - The company is developing EB06 for vitiligo, with regulatory approval from Health Canada for a Phase 2 study and data submission to the FDA anticipated in mid-2025[90]. - The most advanced respiratory drug candidate, EB05, is being evaluated in a U.S. government-funded study for Acute Respiratory Distress Syndrome (ARDS)[91]. - The company plans to commit substantial resources to R&D, clinical trials, and potential product acquisitions to augment its internal development pipeline[112]. Shareholder Information - The weighted average number of common shares outstanding increased to 3,345,135 from 3,128,024, reflecting a growth of approximately 7%[13]. - The total number of shares available for issuance under the 2019 Equity Incentive Compensation Plan is 642,737, with 119,574 shares remaining available for grant as of December 31, 2024[56]. - The remaining balance of restricted share units (RSUs) as of December 31, 2024 was 77,554, all of which vested immediately upon grant[62]. - As of the filing date, the Company believes it has shareholders' equity of at least $2.5 million, satisfying the minimum Nasdaq listing requirement[81]. Legal and Regulatory Matters - The company is not currently a party to any material legal proceedings or claims outside the ordinary course of business[125]. - The company reported no changes in internal control over financial reporting that materially affected its financial reporting during the quarter ended December 31, 2024[122].

Financial Performance - Edesa Biotech reported a net loss of $1.6 million, or $0.48 per common share, for the first quarter of fiscal year 2025, compared to a net loss of $1.7 million, or $0.54 per common share, for the same period last year[6]. - Total operating expenses remained unchanged at $1.9 million for the three months ended December 31, 2024, compared to the same period in 2023[5]. - Total other income increased by $102,000 to $281,000 for the three months ended December 31, 2024, primarily due to increased reimbursement funding from the Canadian government's Strategic Innovation Fund[5]. - Cash and cash equivalents at December 31, 2024, were $1.6 million, up from $1.0 million at the end of the previous quarter[7]. - Edesa's total assets increased to $4.16 million as of December 31, 2024, compared to $3.81 million at the end of the previous quarter[15]. Research and Development - Research and development expenses increased by $0.3 million to $1.0 million for the three months ended December 31, 2024, primarily due to increased external research expenses related to drug manufacturing[7]. - The company anticipates submitting data to the FDA for its anti-CXCL10 monoclonal antibody candidate, EB06, in mid-2025, with topline results expected within 12 to 18 months post-regulatory clearance[3]. Operational Changes - General and administrative expenses decreased by $0.3 million to $0.9 million for the three months ended December 31, 2024, due to reductions in salaries and related costs[7]. - Edesa raised $15.0 million in gross proceeds from an equity financing, strengthening its balance sheet to support the advancement of its vitiligo program[4]. Market Engagement - The company plans to participate in several upcoming conferences, including the American Academy of Dermatology Annual Meeting and BIO Europe Spring 2025, to further its market presence[9].

Core Viewpoint - Edesa Biotech, Inc. is advancing its lead asset, EB06, an anti-CXCL10 monoclonal antibody for vitiligo treatment, with plans for a Phase 2 clinical trial and has reported financial results for Q1 FY2025, indicating a stable financial position and ongoing development efforts [1][2][3]. Financial Performance - Total operating expenses remained unchanged at $1.9 million for the three months ended December 31, 2024, compared to the same period in 2023 [4]. - Total other income increased by $102,000 to $281,000 for the three months ended December 31, 2024, primarily due to increased reimbursement funding from the Canadian government's Strategic Innovation Fund [4]. - Edesa reported a net loss of $1.6 million, or $0.48 per common share, for the quarter ended December 31, 2024, compared to a net loss of $1.7 million, or $0.54 per common share, for the same period in 2023 [5]. Cash Position and Working Capital - As of December 31, 2024, Edesa had cash and cash equivalents of $1.6 million and working capital of $0.2 million [6]. - The company received $15.0 million in gross proceeds from a private placement of preferred and common shares after the quarter ended, strengthening its balance sheet [6]. Research and Development - Research and development expenses increased by $0.3 million to $1.0 million for the three months ended December 31, 2024, primarily due to increased external research expenses related to the manufacturing of EB05 [8]. - Edesa is preparing for a manufacturing campaign for EB06, with data expected to be submitted to the FDA in mid-2025, and anticipates topline results within 12 to 18 months post-regulatory clearance [2][3]. Upcoming Events - Edesa plans to participate in several upcoming conferences, including the American Academy of Dermatology Annual Meeting and BIO Europe Spring 2025, providing opportunities for engagement with investors and stakeholders [9]. Company Overview - Edesa Biotech, Inc. focuses on developing innovative treatments for immuno-inflammatory diseases, with a clinical pipeline that includes EB06 for vitiligo and EB05 for Acute Respiratory Distress Syndrome [10].

Core Viewpoint - Edesa Biotech, Inc. has successfully completed a private placement, raising approximately $15.0 million to advance its clinical programs, particularly the CXCL10 monoclonal antibody for vitiligo treatment [3][10]. Group 1: Private Placement Details - Edesa sold 834 Series B-1 convertible preferred shares at a price of $10,000 each and 3,468,746 common shares at $1.92 each [1][2]. - The offering was led by Velan Capital and included participation from new and existing institutional investors, as well as company insiders [2][10]. - The offering closed on February 12, 2025, and was conducted without a placement agent or underwriter [2]. Group 2: Use of Proceeds - The net proceeds from the offering are expected to fund the advancement of EB06 into a Phase 2 clinical study for nonsegmental vitiligo, along with general corporate purposes [3][10]. - The company aims to fund its CXCL10 antibody program through the end of fiscal 2026 with the raised capital [10]. Group 3: Securities and Regulatory Information - The Series B-1 Preferred Shares are convertible into common shares at a conversion price of $1.92, with ownership limitations set at a maximum of 4.99% or 9.99% for individual holders [4]. - Edesa has agreed to file a registration statement with the SEC to register the resale of common shares and conversion shares within 30 days of the closing [7]. Group 4: Company Overview - Edesa Biotech is a clinical-stage biopharmaceutical company focused on developing treatments for immuno-inflammatory diseases, with a pipeline that includes EB06 for vitiligo and EB01 for allergic contact dermatitis [9][11]. - The company is also developing EB05 for Acute Respiratory Distress Syndrome (ARDS) and preparing an IND for EB07 to conduct a future Phase 2 study in pulmonary fibrosis [9][11].

Drug Development and Clinical Trials - The company is developing EB06, an anti-CXCL10 monoclonal antibody for vitiligo, with regulatory approval for a Phase 2 study in Canada and discussions ongoing with the FDA[21]. - EB05, a first-in-class monoclonal antibody, is being evaluated in a U.S. government-funded study for ARDS, showing a 28-day mortality rate of 7.7% in the treatment group compared to 40% in the placebo group[36]. - The Canadian government has committed up to C$23 million in funding for a Phase 3 clinical study of EB05, with C$5.75 million being non-repayable[39]. - EB07, another product candidate, is being prepared for an IND application to conduct a Phase 2 study in pulmonary fibrosis, targeting a chronic disease with high mortality[45]. - The BARDA-funded study for EB05 has shifted the clinical focus from COVID-19 to general ARDS, potentially increasing the commercial opportunity for the drug[38]. - EB06 is a fully human monoclonal antibody targeting CXCL10, currently in a Phase 2 study for moderate to severe nonsegmental vitiligo, with an expected topline result in 12 to 18 months[52]. - The Phase 2 study will involve approximately 150 subjects, measuring the percentage of patients achieving a ≥50% improvement in facial Vitiligo Area Scoring Index (F-VASI50)[52]. - In a Phase 2b clinical study of EB01, the 1.0% formulation showed a 60% average improvement in symptoms from baseline compared to 40% for placebo (p=0.027)[58]. - Clinical trials must demonstrate safety and efficacy to satisfy regulatory authorities; failure to do so may result in additional costs or delays[201]. - Clinical trials may be prolonged or delayed, leading to additional costs and potential inability to commercialize product candidates on time[207]. - The design of clinical trials is critical, and flaws may not be apparent until trials are well advanced or completed[203]. - The company may need to conduct additional clinical trials if initial results are negative or inconclusive, impacting timelines and costs[210]. - Changes in standard of care or regulatory requirements may necessitate amendments to clinical trial protocols, affecting costs and timelines[211]. Financial and Funding Aspects - The company has received over C$37 million in competitive government grants and funding awards, validating its technology and drug development capabilities[23]. - The company anticipates substantial additional funding will be required to finance operations through regulatory approval of its product candidates, with potential delays or reductions in development if capital is not raised[162]. - The company has entered into the 2023 SIF Agreement with the Government of Canada for up to C$23 million in partially repayable funding for the development of investigational therapy EB05, with a project completion deadline of December 31, 2025[172]. - The company has relied on government grants for the development of EB05, and failure to meet contractual obligations could result in delays or termination of the project[169]. - The company has historically financed operations primarily through equity offerings and has not completed the development of any drug candidates, raising concerns about its ability to sustain operations[158]. - The company estimates that allergic contact dermatitis (ACD) conditions cost up to $2 billion annually in the U.S. due to lost work and medical care[54]. Market Opportunities and Competition - The prevalence of vitiligo is estimated to be between 0.5% to 2% of the global population, indicating a significant market opportunity[46]. - The company plans to maximize the commercial potential of its product candidates through strategic licensing and partnerships, particularly in regions outside North America[30]. - The total addressable patient population for EB01 in the seven major markets and Canada is estimated to be as high as five million[54]. - The company faces competition from various companies in the pharmaceutical and biotechnology industry, including Aclaris Therapeutics, Pfizer, and Eli Lilly, which have greater financial resources[79][80]. - The commercial opportunity in conditions like vitiligo, chronic ACD, ARDS, or pulmonary fibrosis may be smaller than anticipated, adversely affecting future revenue[215]. - The company’s estimates of the patient population for targeted conditions may prove incorrect, impacting financial performance[216]. Regulatory Environment - The company is subject to stringent regulations from agencies like the FDA and Health Canada, requiring substantial time and financial resources for obtaining marketing approvals[84][85]. - The FDA requires an NDA or BLA submission after clinical trials, which includes comprehensive data on product development, human trials, and manufacturing details[88]. - Under PDUFA, each NDA or BLA submission must include a user fee, which is adjusted annually, with waivers available for small businesses[89]. - The FDA aims to review 90% of original standard NDAs or BLAs within 10 months and 90% of original priority NDAs or BLAs within 6 months of submission[90]. - The FDA may require a Risk Evaluation and Mitigation Strategy (REMS) to ensure the benefits of a product outweigh its risks, which must be submitted with the BLA if necessary[92]. - Orphan drug designation can be granted for drugs intended to treat rare diseases, providing marketing exclusivity for seven years if the first approval is obtained[99]. - The FDA has programs like Fast Track and Breakthrough Therapy to expedite the development of drugs addressing serious conditions, allowing for increased interactions during development[101][102]. - Emergency Use Authorizations (EUA) allow for the distribution of unapproved products during public health emergencies, contingent on demonstrating potential effectiveness[108][109]. - The FDA may impose conditions on EUAs to protect public health, including monitoring adverse events and ensuring adequate information dissemination[109]. - The approval process for drugs can take several years, particularly for chronic diseases, requiring extensive safety and efficacy data[97]. - The FDA may deny approval if the NDA or BLA does not meet regulatory criteria, issuing a complete response letter detailing deficiencies[94]. Company Structure and Workforce - The company has 16 full-time employees, with 9 in research and development and 7 in management and administration[132]. - More than 50% of the workforce are women, and over 50% represent underrepresented racial or ethnic groups[133]. - The company was founded in 2007 and operates through wholly owned subsidiaries in Canada and the U.S.[135]. - The company is currently classified as a "smaller reporting company," allowing for simplified disclosures in SEC filings[138]. - The company acquired its Ontario subsidiary through a reverse acquisition in June 2019[135]. Risks and Challenges - The company faces substantial competition in the biopharmaceutical sector, which may hinder its ability to successfully commercialize its product candidates[147]. - The marketing approval process for product candidates is expensive, time-consuming, and uncertain, with potential delays impacting revenue generation[151]. - The company is dependent on third parties for conducting clinical trials, and any failure by these parties could adversely affect the timeline and success of its product development[149]. - The ownership of common shares is highly concentrated, which may limit shareholder influence on corporate decisions and could lead to conflicts of interest[155]. - Future product revenues depend heavily on successful development and commercialization of drug candidates, with many factors influencing this success[177]. - The company faces risks related to economic conditions, including inflation and rising interest rates, which could adversely affect operations[182]. - The company has a limited operating history, making it difficult to evaluate its success and future viability[184]. - The company is exposed to risks related to currency exchange rates, impacting operating results when translated into U.S. dollars[185]. - The company relies on key executives and qualified personnel, and losing them could materially impact its objectives[196]. - Cybersecurity incidents pose a risk to the company's information technology systems, potentially disrupting operations and increasing costs[200].