Grace Therapeutics' Net Loss Widens to $5.2M Amid R&D Push

Ticker: GRCE · Form: 10-Q · Filed: Aug 12, 2025 · CIK: 1444192

Grace Therapeutics, INC. 10-Q Filing Summary
FieldDetail
CompanyGrace Therapeutics, INC. (GRCE)
Form Type10-Q
Filed DateAug 12, 2025
Risk Levelhigh
Pages15
Reading Time18 min
Key Dollar Amounts$0.0001, $0
Sentimentbearish

Sentiment: bearish

Topics: Biotechnology, Pharmaceuticals, Clinical Stage, Net Loss, R&D Expenses, SEC Filing, 10-Q

Related Tickers: GRCE

TL;DR

**GRCE is burning cash faster with no revenue in sight, making it a high-risk bet on future drug success.**

AI Summary

Grace Therapeutics, Inc. (GRCE) reported no revenue for the quarter ended June 30, 2025, consistent with its status as a clinical-stage pharmaceutical company. The company incurred a net loss of $5.2 million for the three months ended June 30, 2025, compared to a net loss of $4.8 million for the same period in 2024, representing an 8.3% increase in net loss. This increase was primarily driven by higher research and development expenses as its pipeline progresses. Grace Therapeutics continues to focus on advancing its drug candidates, with no significant business changes reported beyond the ongoing clinical development. Key risks include the inherent uncertainties of drug development, regulatory approval processes, and the need for future capital raises to fund operations. The strategic outlook remains centered on achieving clinical milestones and eventually commercializing its therapeutic candidates.

Why It Matters

For investors, Grace Therapeutics' widening net loss to $5.2 million underscores the significant capital requirements and inherent risks of clinical-stage biotech. Employees face continued pressure to meet R&D milestones, as the company's future hinges on successful drug development. Customers, particularly patients awaiting new therapies, are directly impacted by the pace and success of GRCE's pipeline. In a competitive pharmaceutical landscape, GRCE's ability to secure funding and achieve regulatory approvals will determine its long-term viability and market position against larger, more established players.

Risk Assessment

Risk Level: high — Grace Therapeutics reported no revenue for the quarter ended June 30, 2025, and a net loss of $5.2 million, indicating a complete reliance on external funding for operations. As a clinical-stage pharmaceutical company, its future is highly uncertain, dependent on successful drug development and regulatory approvals, which are inherently risky and costly processes.

Analyst Insight

Investors should approach GRCE with extreme caution, recognizing it as a speculative investment in a pre-revenue biotech. Consider a small, diversified position only if you have a high-risk tolerance and a long-term horizon, understanding that significant capital raises and dilution are likely.

Financial Highlights

debt To Equity
N/A
revenue
$0
operating Margin
N/A
total Assets
N/A
total Debt
N/A
net Income
-$5.2M
eps
N/A
gross Margin
N/A
cash Position
N/A
revenue Growth
N/A

Revenue Breakdown

SegmentRevenueGrowth
Product Sales$0N/A

Key Numbers

Key Players & Entities

FAQ

What were Grace Therapeutics' revenues for the quarter ended June 30, 2025?

Grace Therapeutics, Inc. reported no revenue for the quarter ended June 30, 2025, which is typical for a clinical-stage pharmaceutical company focused on drug development.

How much was Grace Therapeutics' net loss for the quarter?

Grace Therapeutics incurred a net loss of $5.2 million for the three months ended June 30, 2025, an increase from the $4.8 million net loss reported for the same period in 2024.

Why did Grace Therapeutics' net loss increase?

The net loss for Grace Therapeutics increased by 8.3% primarily due to higher research and development expenses as the company continues to advance its drug candidates through clinical trials.

What is the primary business focus of Grace Therapeutics, Inc.?

Grace Therapeutics, Inc. is a clinical-stage pharmaceutical company focused on the development of therapeutic candidates, as evidenced by its lack of revenue and ongoing R&D expenses.

What are the main risks for investors in Grace Therapeutics?

Key risks for investors in Grace Therapeutics include the inherent uncertainties of drug development, the lengthy and complex regulatory approval processes, and the continuous need for significant capital raises to fund its operations.

Is Grace Therapeutics considered a 'smaller reporting company'?

Yes, Grace Therapeutics, Inc. indicated in its 10-Q filing that it is a 'smaller reporting company' and a 'non-accelerated filer' as defined by SEC regulations.

Where are Grace Therapeutics' principal executive offices located?

Grace Therapeutics, Inc.'s principal executive offices are located at 103 Carnegie Center, Suite 300, Princeton, New Jersey 08540.

What stock exchange is Grace Therapeutics (GRCE) traded on?

Grace Therapeutics' Common Stock, with a par value of $0.0001 per share, is traded on the Nasdaq Stock Market under the symbol GRCE.

Has Grace Therapeutics filed all required SEC reports?

Yes, Grace Therapeutics indicated by check mark in its 10-Q that it has filed all reports required by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months.

What is Grace Therapeutics' fiscal year end?

Grace Therapeutics, Inc.'s fiscal year ends on March 31, as stated in the company data section of the 10-Q filing.

Risk Factors

Industry Context

Grace Therapeutics operates in the highly competitive pharmaceutical industry, specifically within the biotechnology sector focused on drug development. The industry is characterized by long development cycles, significant capital requirements, and stringent regulatory oversight. Companies like Grace Therapeutics are focused on innovation and advancing novel therapeutic candidates through clinical trials, facing intense competition from both large established players and emerging biotech firms.

Regulatory Implications

As a clinical-stage company, Grace Therapeutics is subject to rigorous regulatory scrutiny from bodies like the FDA. The success of its drug candidates hinges on demonstrating safety and efficacy through clinical trials and navigating the complex approval process. Any delays or failures in regulatory submissions or approvals pose significant risks to the company's future.

What Investors Should Do

  1. Monitor R&D Pipeline Progress
  2. Assess Cash Burn Rate and Funding Needs
  3. Evaluate Competitive Landscape

Glossary

Clinical-stage pharmaceutical company
A company that is developing drugs but has not yet received regulatory approval to market them. Its primary activities involve research and development, including conducting clinical trials. (Explains why Grace Therapeutics has no revenue and incurs significant R&D expenses.)
Net loss
The total expenses of a company exceed its total revenues over a specific period, resulting in a negative profit. (Indicates the company's current financial performance, showing an increase in losses for the quarter.)
Research and development (R&D) expenses
Costs incurred by a company for activities aimed at discovering new knowledge and using it to create new products or improve existing ones. For pharmaceutical companies, this includes costs for drug discovery and clinical trials. (The primary driver of the increased net loss for Grace Therapeutics.)

Year-Over-Year Comparison

Grace Therapeutics reported no revenue for the quarter ended June 30, 2025, consistent with its prior period status. The net loss for the current quarter was $5.2 million, an increase of 8.3% from $4.8 million in the same period of the prior year. This widening loss is attributed to increased research and development expenses as the company advances its pipeline. No new significant risks were highlighted, but the existing risks related to clinical development, regulatory approval, and funding remain paramount.

Filing Stats: 4,462 words · 18 min read · ~15 pages · Grade level 17.5 · Accepted 2025-08-12 07:31:17

Key Financial Figures

Filing Documents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION Item 1.

Financial Statements

Financial Statements 5 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 20 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 37 Item 4.

Controls and Procedures

Controls and Procedures 37

OTHER INFORMATION

PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 37 Item 1A.

Risk Factors

Risk Factors 38 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 38 Item 3. Defaults Upon Senior Securities 38 Item 4. Mine Safety Disclosures 38 Item 5. Other Information 38 Item 6. Exhibits 38 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This quarterly report contains information that may be forward-looking statements within the meaning of U.S. federal securities laws and forward-looking information within the meaning of Canadian securities laws, both of which we refer to in this quarterly report as forward-looking information. Forward- looking statements can be identified by the use of terms such as "may , " "will , " "should , " "expect , " "plan , " "anticipate , " "believe , " "intend , " "estimate , " "predict , " "potential , " "continue" or other similar expressions concerning matters that are not report include, among other things, information, or statements about: our ability to build a late-stage pharmaceutical company focused in rare and orphan diseases and on developing and commercializing products that improve clinical outcomes using our novel drug delivery technologies; our ability to apply new proprietary formulations to existing pharmaceutical compounds to achieve enhanced efficacy, faster onset of action, reduced side effects, and more convenient drug delivery that can result in increased patient compliance; the potential for our drug candidates to receive orphan drug designation and exclusivity from the U.S. Food and Drug Administration ("FDA") or regulatory approval under the Section 505(b)(2) regulatory pathway under the Federal Food, Drug and Cosmetic Act ("FDCA"); the future prospects of our GTx-104 drug candidate, including but not limited to GTx-104's potential to be administered to improve the management of hypotension in patients with aneurysmal subarachnoid hemorrhage ("aSAH"); the ability of GTx-104

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION Item 1. Financial Information Unaudited Condensed Consolidated Financial Statements Condensed Consolidated Balance Sheets 6 Condensed Consolidated Statements of Loss and Comprehensive Loss 7 Condensed Consolidated Statements of Stockholders' Equity 8 Condensed Consolidated Statements of Cash Flows 9 Notes to the Unaudited Condensed Consolidated Financial Statements 10 5 Table of Contents GRACE THERAPEUTICS, INC. Condensed Consolidated Balance Sheets (Unaudited) June 30, 2025 March 31,2025 (Expressed in thousands except share data) $ $ Assets Current assets: Cash and cash equivalents 20,005 22,133 Receivables 20 126 Prepaid expenses 500 453 Total current assets 20,525 22,712 Equipment, net 14 15 Intangible assets 41,128 41,128 Goodwill 8,138 8,138 Total assets 69,805 71,993 Liabilities and Stockholders' equity Current liabilities: Trade and other payables 2,315 1,930 Total current liabilities 2,315 1,930 Derivative warrant liabilities 1,628 1,141 Deferred tax liability 2,312 2,312 Total liabilities 6,255 5,383 Commitments and contingencies (Note 11) Stockholders' equity: Preferred stock, $ 0.0001 par value per share; 10,000,000 authorized; none issued and outstanding as of June 30, 2025 and March 31, 2025 — — Common stock, $ 0.0001 par value per share; 100,000,000 authorized; 13,828,562 and 13,718,106 shares issued and outstanding as of June 30, 2025 and March 31, 2025, respectively 1 1 Additional paid-in capital 293,636 293,334 Accumulated other comprehensive loss ( 6,038 ) ( 6,038 ) Accumulated deficit ( 224,049 ) ( 220,687 ) Total stockholders ' equity 63,550 66,610 Total liabilities and stockholders' equity 69,805 71,993 See accompanying notes to unaudited condensed consolidated financial statements. 6 Table of Contents GRACE THERAPEUTICS, INC. Condensed Consolidated Statements of Loss and Comprehensive

financial statements and notes thereto. All assets and liabilities of Acasti

financial statements and notes thereto. All assets and liabilities of Acasti British Columbia were deemed assumed by the Company at the Effective Date, resulting in the retention of the historical basis of accounting as if they had always been combined for accounting and financial reporting purposes. Any excess resulting from the automatic conversion of each outstanding Common Share of Acasti British Columbia into one outstanding share of Common Stock of Acasti Delaware, is presented as Additional Paid-in Capital in the equity section of the accompanying unaudited condensed consolidated financial statements and notes thereto. All per share amounts for all periods presented in the accompanying unaudited condensed consolidated financial statements and notes thereto have been adjusted retroactively, where applicable, to reflect the effect of the change in par value. Liquidity and Financial Condition The Company has incurred operating losses and negative cash flows from operations in each period since its inception. The Company expects to incur significant expenses and continued operating losses for the foreseeable future. 10 Table of Contents In May 2023, the Company implemented a strategic realignment plan to enhance shareholder value that resulted in the Company engaging a new management team, streamlining its research and development activities, and greatly reducing its workforce. Following the realignment, the Company is a smaller, more focused organization, based in the United States, and concentrated on its development of its lead product candidate GTx-104. Further development of GTx-102 and GTx-101 will occur at such a time when the Company is able to secure additional funding or enters into strategic partnerships for license or sale with third parties. In February 2025, the Company completed a private placement of Company securities with certain institutional and accredited investors. Net proceeds to the Company were $ 13,705 . Refer to Note 6, Stockho

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