Willow Biosciences Inc. a leading biotechnology company focused on revolutionizing industrial manufacturing of pure, consistent and sustainable functional ingredients announced today that it has taken additional steps to focus on near-term revenue generation, protect its balance sheet and reduce its cash burn.
Since the early part of the year, the Company has reviewed its market opportunities and its portfolio, using a rigorous evaluation process that has taken into consideration the challenges in the current operating environment. As a result of this review, the Company has taken the following proactive actions
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The Company's business development focus has shifted to near-term revenue generating programs. On May 31, 2022, the Company announced its first partnered program for a pharmaceutical project that has already generated revenue for the Company. A second program was announced in November with Kalsec, a leading global producer of natural taste and sensory, food protection, colors and advanced hops ingredients for the food and beverage industry. The terms for both programs include near-term research and development revenue and milestone payments with the potential for further upside after commercialization. Furthermore, the Company is optimistic that it will be able to announce at least one new additional program in 2023.
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The Company consolidated its R&D operations into one lab, located in Mountain View, California and is pleased to report that key personnel have relocated to the Mountain View site and the transfer of operations was completed with minimal downtime for operations. In addition, Willow was able to ship and repurpose a significant portion of the existing equipment from its prior Burnaby, British Columbia lab location to the Mountain View facility, thereby reducing the overall costs by centralizing lab activities. The lower overhead cost associated with operating a single lab versus two labs is expected to reduce the Company's burn rate.
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The Company remains optimistic on the future opportunity for CBG and other cannabinoids and will be well-positioned to capture that value as the markets develop, but with its new focus on other ingredients will not invest in developing new products without partner funding.
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Willow outsourced its internal Quality Control analytical testing and release requirements, eliminating a number of full-time employee positions in Burnaby.
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The above-mentioned actions combined with an extensive review of the Company's workflows resulted in a total reduction of non-research and development workforce of eight persons, including four management positions, resulting in a current total headcount of 31 of which 77% are in R&D and operations. Willow continues its focus on operating in a lean fashion while maintaining sufficient R&D and operational resources to execute on its partnered programs and continuing to develop its own product portfolio.
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With no debt and a significant cash balance of $18.4 million as of September 30, 2022, the Company intends to approve a fully funded budget which covers the entirety of 2023.
"By optimizing our business and reducing our cash burn we are in a strong position to pursue a strategic focus on development programs that leverage our precision fermentation technology platform for near-term revenue generation and market success," said Dr. Peter Seufer-Wasserthal, Willow's President and CEO. "Looking forward to 2023, we are excited about a number of new options we see to utilize the platform more broadly within the health and wellness, food and beverage and personal care markets, while working hard to realize shareholder value from our existing and future research and development programs and sale of functional ingredients to our customers."
About Willow Biosciences Inc.
Willow develops and produces precision fermented functional ingredients for the health and wellness, food and beverage and personal care markets. Willow's FutureGrownTM biotechnology platform allows large-scale production with sustainability at its core. Willow's R&D team has a proven track record of developing and commercializing bio-based manufacturing processes and products to benefit our B2B partners and their customers.