Sunshine Biopharma, Inc. (NASDAQ:SBFM) is a pharmaceutical company that has been steadily expanding its product offerings and geographic reach. The company operates two wholly-owned subsidiaries: Nora Pharma Inc., a Canadian generic pharmaceuticals company, and Sunshine Biopharma Canada Inc., which develops and sells non-prescription over-the-counter (OTC) products.

Business Overview

Sunshine Biopharma was incorporated in Colorado in 2006 and acquired Sunshine Biopharma, Inc. in a reverse acquisition in 2009. The company then began operating as a pharmaceutical company, focusing on the development of a new anticancer drug called Adva-27a.

In December 2015, Sunshine Biopharma acquired the worldwide patents for Adva-27a. However, in late 2023, the company paused the IND-enabling studies for Adva-27a due to unfavorable in vitro results. The company is now reviewing the data and exploring the possibility of chemical modifications to address the suboptimal performance of the molecule.

Alongside its Adva-27a program, Sunshine Biopharma has been developing other proprietary drugs, including K1.1, an mRNA-based treatment for liver cancer, and SBFM-PL4, a protease inhibitor for SARS-Coronavirus infections. The K1.1 program has shown promising results in animal studies, and the company is seeking to confirm these findings through additional experiments.

Nora Pharma Acquisition and Generic Pharmaceuticals Segment

In October 2022, Sunshine Biopharma acquired Nora Pharma, a Canadian generic pharmaceuticals company. Nora Pharma currently has 52 generic prescription drugs on the market in Canada and is planning to launch an additional 32 products in 2024 and 2025.

The acquisition of Nora Pharma has significantly expanded Sunshine Biopharma's product portfolio and geographic reach. In the first quarter of 2024, the Generic Pharmaceuticals segment, which includes Nora Pharma's operations, accounted for approximately 97% of the company's total revenue, with the remaining 3% coming from the OTC Products segment.

The Canadian generic pharmaceuticals market is valued at $9.7 billion annually, and Sunshine Biopharma believes the addition of new products to Nora Pharma's portfolio will strengthen the company's presence in this market and provide greater access to pharmacies across Canada.

Intellectual Property and Pipeline

Sunshine Biopharma owns the worldwide patents for its Adva-27a anticancer compound, which are covered by PCT/FR2007/000697 and PCT/CA2014/000029. The company also holds four Natural Product Numbers (NPNs) issued by Health Canada for its OTC products.

In addition, Sunshine Biopharma has licensed exclusive worldwide rights from the University of Arizona for three patents related to small molecules that inhibit the Coronavirus protease, PLpro. This technology is being used in the development of the company's SBFM-PL4 antiviral drug candidate.

The company's pipeline also includes the K1.1 mRNA-based treatment for liver cancer, which is currently in animal testing. Sunshine Biopharma filed a provisional patent application in the United States covering the K1.1 mRNA molecules in April 2022.

Financials

In the first quarter of 2024, Sunshine Biopharma reported revenue of $7,541,046, a 54% increase from the $4,894,053 generated in the same period of 2023. This growth was primarily driven by new product launches and expanded marketing efforts by Nora Pharma. Gross profit for the quarter increased to $2,354,337, up from $1,828,122 in the prior-year period. However, the company incurred a net loss of $1,283,801 ($2.00 per share) in Q1 2024, compared to a net loss of $1,702,430 ($7.73 per share) in Q1 2023.

For the full year 2023, Sunshine Biopharma reported annual revenue of $24,092,787, up from $21,445,794 in 2022. Net income for the year was a loss of $4,506,044, compared to a different loss figure in the prior year. Operating cash flow was negative $8,775,111, and free cash flow was negative $9,563,210 in 2023.

Liquidity

In the first quarter of 2024, Sunshine Biopharma reported cash and cash equivalents of $17,434,208, up from $16,292,347 at the end of 2023. The company used $3,185,159 in cash for operating activities during the quarter, compared to $1,850,106 in the same period of 2023. This increase was due to the expanded business activities of Nora Pharma.

The company's current ratio stood at 4.41 as of March 31, 2024, indicating a strong liquidity position. However, Sunshine Biopharma is not generating adequate revenue from its operations to fully implement its business plan, and the company anticipates the need to raise additional capital in the future to fund its research and development activities, as well as the expansion of its generic pharmaceuticals operations.

Risks and Challenges

Sunshine Biopharma faces several risks, including the uncertainty surrounding the future development of its proprietary drug candidates, potential changes in government reimbursement policies for generic drugs in Canada, and the need to raise additional capital to fund its operations and growth initiatives.

Outlook

Despite these challenges, the company's diversified pharmaceutical portfolio and the recent acquisition of Nora Pharma provide a solid foundation for future growth. The launch of 32 new generic drugs in Canada over the next two years, along with the continued development of the company's proprietary drug candidates, could drive improved financial performance in the coming years.

Conclusion

Sunshine Biopharma is a pharmaceutical company with a diversified portfolio of generic and proprietary drugs. The acquisition of Nora Pharma has significantly expanded the company's product offerings and geographic reach, with the Generic Pharmaceuticals segment now accounting for the majority of its revenue.

While the company faces some risks, including the uncertainty surrounding its proprietary drug development programs and the need for additional capital, the launch of new generic drugs and the continued progress of its pipeline could drive improved financial performance in the future. Investors should closely monitor Sunshine Biopharma's progress as it navigates the challenges and opportunities in the pharmaceutical industry.