Good afternoon. Thank you for standing by. Welcome to Kane Biotech's first quarter 2023 earnings conference call. During today's presentation, all parties will be in a listen-only mode. Following the presentation, the conference call will be open to questions. If you have a question, simply press star one one on your telephone. If you would like to withdraw your question, simply press star one one again. This conference is being recorded today, May 25th, 2023. I would now like to turn the conference call over to Nicole, Kane Biotech's investor relations advisor. Please go ahead.
Thank you, operator. Good afternoon, and welcome everyone to Kane Biotech's quarterly earnings conference call. We are delighted to have you join us today. This call will cover Kane's financial and operating results for the first quarter of 2023, along with a discussion of some of our recent highlights and goals for 2023 and beyond. Following our prepared remarks, we will open the conference call to a question-and-answer period.
Our call today will be led by Kane's Chief Executive Officer, Marc Edwards. Before we begin our formal remarks, I would like to remind everyone that some of the statements on this conference call contain certain forward-looking information and statements within the meaning of securities law, which may not be based on historical fact, including without limitation, statements containing the words believes, should, may, plan, will, estimate, predict, continue, anticipate, potential, intends, expects, or other similar expressions.
Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause the actual results, events, or developments to be materially different from any future results, events, or developments expressed or implied by such forward-looking statements. Such factors include, among others, the company's stage of development, lack of product revenues, additional capital requirements, risks associated with the completion of clinical trials, and obtaining regulatory approval to market the company's products, the ability to protect its intellectual property, and dependence upon collaborative partners.
These factors should be considered carefully. Readers are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements are made as of the date hereof. The company disclaims any obligation to update any such factors or to publicly announce the result of any revisions to any of the forward-looking statements contained herein to reflect future results, events, or developments. I will now hand the call over to Chief Financial Officer, Ray Dupuis. Please go ahead, Ray.
Thank you, Nicole. Before I turn the call over to Marc for an update on our commercial activities, I would like to provide a brief summary and update on our first quarter 2023 financial results. To streamline things, all the numbers that I will mention have been rounded and are therefore approximate. The following figures are all in Canadian dollars. Total revenue for the three months ended March 31, 2023, was CAD 678,000, an increase of 20% compared to CAD 565,000 in the three months ended March 31, 2022. License and royalty revenue for the three months ended March 31, 2023, was CAD 138,000, an increase of 66% compared to CAD 83,000 in the three months ended March 31, 2022.
This increase is due primarily to VOHC certification received in the second quarter of 2022, which has had a favorable impact on both license and royalty revenues recognized in subsequent periods. Revenue from product and services sales for the three months ended March 31, 2023, was CAD 539,000, an increase of 12% from CAD 482,000 in the three months ended March 31, 2022. The increase is due primarily to higher demand for contract manufacturing services during the current period. Gross profit for the first quarter, 2023, was CAD 345,000, an increase of 88% compared to CAD 184,000 for the quarter ended March 31, 2022.
This increase is due primarily to higher license and royalty revenue recognized, as well as higher profit margins realized on product sales in the current period. Total operating expenses for the three months ended March 31, 2023, were CAD 1,361,000, a decrease of 4% compared to CAD 1,420,000 for the three months ended March 31, 2022. Contributing to this decrease was salary-related cost reductions that affected the current period. Loss for the 1st quarter of 2022 was CAD 1,245,000, an increase of 8% compared to CAD 1,152,000 for the quarter ended March 31, 2022.
This increase is primarily attributable to higher financing costs in the current period, as well as a higher non-cash fair value adjustment on government loan advances received in the comparative period. Cash at March 31, 2023, was CAD 991,000, compared to CAD 1,105,000 at December 31, 2022. With that, I will now turn the call over to Marc.
Thank you, Ray. Thank you, Nicole. We're having a good day today there. I hope everybody saw our 510(k) clearance announcement this morning. I will definitely get into that a little bit later in my remarks. I think all in all, 2023 so far has been a really, really good year for Kane, with regards to its commercialization. If I start with our animal health business there, we announced recently the licensing of our pet dental care line to Skout's Honor Pet Supply Company or Skout's Honor. I really, truly believe this is gonna greatly accelerate the expansion into the U.S. of our into the U.S. pet retail markets.
Skout's Honor, I was in San Diego on Monday, met with the team there, and they have really built an enviable business, and they've got a clear plan for our dental line. I mean, I'm confident that as soon as there's product available, our... Their dental line, based on our technology, is going to be available in thousands of retailers, retail stores, including some of the very big names in animal health. In San Diego, I was joined with by Dena Mehraban, sorry. I apologize for that, Dena. Who is now leading our animal health business, previously our director of marketing.
We're very excited and really think Dena and the Skout's Honor team are gonna do very, very well at bringing our technology to market through those through that network. I just got back from my meeting at MTEC, and there was an Army Ranger there with his dog. MTEC is a Medical Technology Enterprise Consortium. It's through them that we got our DispersinB funding. I was at this MTEC meeting, and there was an Army Ranger there with his dog, asking about his pet's teeth, and there were four other gentlemen at the table that I didn't know.
They all wanted to know about this product that could really quickly fix their dog's halitosis or bad breath. It always surprises me that nobody really knows that this product is available, and when they do find out that it is available, it's something that they really want and feel that they need. That's very exciting. The other big news, of course, before getting to the clearance, is our distribution agreement for our coactiv+ antimicrobial wound gel with ProgenaCare Global. Bert, Howard, Case, the whole team there at ProgenaCare have a fantastic team. They have a clear vision. We're aligned.
We're gonna work together. Very confident that we're gonna be able to ramp sales up there quickly. Working with them to really disrupt this $200 million U.S. wound gel market there. We've got a differentiated product that fits within Medicare reimbursement, which really is the big driver in the U.S. there. It's a $200 million market, where the agreement provides for some good margins, and we're excited about that and expect their $500,000 payment there before the end of this month. That will be great.
The other thing also with this, with this 510(k) clearance, we've got Salud Pharma that can now move forward and get regulatory approval for our product in Colombia, Panama, and Costa Rica. The more I talk to the gentlemen at Salud Pharma, the more I am confident that they can move a lot of product. I've seen them do it with other companies. They're doing very, very well and expect them to do the same with our product. Should be a high margin, high volume, product for us, for our distribution partners, and an investor should expect to see a number of additional licensing or distribution agreements globally.
Finally, it's our 510(k) clearance that we announced this morning. We got the news late last night, and very, very exciting. This 510(k) clearance was a long fought journey, and we're very excited. As I mentioned, there are a number of countries and geographies that depend either on the U.S. FDA 510(k) clearance or the CE mark in Europe. This really opens up the door to commercialize our gel globally. That's obviously very, very exciting. If I may, I want to take a minute to reiterate.
I don't know if everybody's had a chance to go see our coactivplus.com website, but really a really great triple threat combination of when we look at compare our gel to other gels in vitro in terms of efficacy, we're second to none. The ease of use of the gel is definitely very makes it very compelling. A number of things. It's, first of all, it's a clear gel, so once you apply it, you can still see the wound underneath. And secondly, it's the poloxamer in there has got thermo reversible properties. So as you as it heats up or goes from room temperature to body temperature, it gels even more.
If you cool it down below 16 degrees Celsius or 60 degrees Fahrenheit, it will liquefy. It's not so much that it'll liquefy, but when you apply it will stay on and not run, and that's obviously a big deal. If you've got a sensitive wound and you want to remove the gel, you can do so with cold water, which makes it very easy to use. In particular, very practical for patients suffering from first or second-degree burns. Before I wrap it up, I apologize. I've got a long list, but I can't go without thanking the team there.
The Kane team have worked extremely hard to get us across the finish line here, both getting the licensing agreements and getting this 510(k) clearance. I have to thank Vijay, Mila, Gabriel, Suresh, Patricia, Mangaljit, Rajni, Wendy, Greg Schultz, our CSO. Great to hear him talk at conferences like SAWC. Nanda, who's really been the heart and soul of this company for the past 20 years. Gordy, who we're still very close to. Ray Dupuis, Nicole, Sue, Pauline, all fantastic. Our summer students, Frederick, even, put in some long hours to get this all done.
Last but not least, from the Kane team, I have to mention Lori Christofalos. Lori was instrumental, both from a quality perspective and regulatory perspective, in getting this across the finish line. Fielded hundreds of calls from me, and I really appreciate her patience a lot. Really, the people that are very, very close to us, Al Rigo, our regulatory consultant, Gary Mast, Therese, Jay, our scientific advisory board, Robert Rivka, and then my board, George and Philip. I wanna thank everybody there. Finally, as I mentioned, I was at MTEC this week. We were presenting a poster on our DispersinB wound gel.
Our funding is through MIDRP there in the U.S. Army. It was great to be able to meet a lot of the people that we've been engaged with for a while now in person, and very interesting to see that there's some really good potential for our coactiv+ gel within the U.S. Department of Defense. That's also very exciting. With that, it concludes my remarks, and I'm going to open it up for questions. Jonathan?
Certainly. Ladies and gentlemen, if you do have a question at this time, please press star one one on your telephone. One moment as we put together our queue. I'm not showing any questions from the phone lines at this time. This does conclude the question and answer session as... Oh, one moment.
Yes, David. Go ahead.
One moment,
Oh, sorry.
Our first question-
It's David Kent here, who we know well.
Line of David Kent, ITG.
Hi, Mark. I was just curious as to, you know, what kind of timeframe to expect to see this new 510(k) bear some fruit on the, on the contract side, for wound care.
Really, the rate-limiting step right now, David, is manufacturing. We should start seeing some revenue from this. I'm hoping we'll start seeing some revenue from this in Q4.
Okay.
As we ramp up manufacturing.
All right. Thank you.
Good. Thanks, David.
Thank you. Just once again, if you do have a question at this time, please press star one one. Seeing no further questions at this time, this does conclude the question and answer session as well.