```markdown [PART I—FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%E2%80%94FINANCIAL%20INFORMATION) [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) Clene Inc.'s unaudited consolidated financial statements show a Q3 2022 net loss, reduced cash, and going concern doubt - Management has concluded there is **substantial doubt** about the Company's ability to continue as a **going concern**, as it projects it will **not have sufficient cash** to sustain current operations or meet obligations within the next twelve months[18](index=18&type=chunk)[189](index=189&type=chunk) - To mitigate funding needs, the company is implementing cost-saving initiatives and exploring financing options. In October 2022, an equity offering provided net cash proceeds of **$10.8 million**[19](index=19&type=chunk)[133](index=133&type=chunk)[190](index=190&type=chunk) [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows a significant decrease in total assets and a shift to a stockholders' deficit by Q3 2022 Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | September 30, 2022 | December 31, 2021 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $7,267 | $50,288 | | Total current assets | $21,486 | $54,583 | | **Total Assets** | **$36,004** | **$63,063** | | **Liabilities & Equity** | | | | Total current liabilities | $6,154 | $6,026 | | **Total Liabilities** | **$45,323** | **$50,466** | | **Total Stockholders' Equity (Deficit)** | **($9,319)** | **$12,597** | [Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20(Loss)) The company reported a Q3 2022 net loss of **$11.0 million**, a significant reversal from prior year's income Statement of Operations Summary (in thousands, except per share data) | Metric | Q3 2022 | Q3 2021 | Nine Months 2022 | Nine Months 2021 | | :--- | :--- | :--- | :--- | :--- | | Total revenue | $174 | $110 | $239 | $524 | | Loss from operations | ($9,805) | ($10,450) | ($36,736) | ($35,920) | | Net income (loss) | ($10,976) | $28,944 | ($28,864) | ($14,163) | | Basic Net income (loss) per share | ($0.17) | $0.47 | ($0.46) | ($0.23) | [Condensed Consolidated Statements of Stockholders' Equity (Deficit)](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity%20(Deficit)) Stockholders' equity transitioned from positive to a **$9.3 million** deficit by Q3 2022 due to cumulative net loss - Stockholders' equity shifted from a positive **$12.6 million** at December 31, 2021, to a deficit of **$9.3 million** at September 30, 2022[13](index=13&type=chunk) - The primary driver for the decrease in equity was the net loss of **$28.9 million** recorded during the first nine months of 2022[11](index=11&type=chunk)[13](index=13&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities increased to **$31.3 million**, leading to a **$43.0 million** net decrease in cash Cash Flow Summary (in thousands) | Cash Flow Activity | Nine Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | ($31,295) | ($25,018) | | Net cash used in investing activities | ($12,446) | ($661) | | Net cash provided by financing activities | $875 | $27,130 | | **Net (decrease) increase in cash** | **($43,021)** | **$1,335** | [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail the company's business, going concern issues, accounting policies, debt, and segment performance - The company operates in two segments: "Drugs" (development of therapeutics) and "Supplements" (dietary supplements). The Drugs segment generates **no revenue** and **incurred an operating loss** of **$37.0 million** for the nine months ended Sep 30, 2022, while the Supplements segment generated **$0.2 million** in revenue and **$0.3 million** in **operating income**[47](index=47&type=chunk)[129](index=129&type=chunk) - Subsequent to the quarter end, the company raised gross proceeds of **$0.6 million** under its ATM facility and **$10.8 million** from a registered direct offering in October 2022[132](index=132&type=chunk)[133](index=133&type=chunk) - The company has a **$30.0 million** term loan with Avenue, of which **$20.0 million** was drawn as of September 30, 2022. The loan requires the company to maintain at least **$5.0 million** in unrestricted cash and cash equivalents[82](index=82&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial condition, clinical program developments, increased R&D, and going concern issues - The company's lead drug candidate, CNM-Au8®, **did not meet the primary endpoint** in the Phase 2/3 Healey ALS Platform Trial, but an exploratory analysis of the 30 mg dose showed a **>90% reduction in risk of death**[142](index=142&type=chunk)[143](index=143&type=chunk) - The company has paused its commercial expansion project at its Elkton, Maryland facility until it receives further clarity from the FDA on the regulatory path for CNM-Au8[147](index=147&type=chunk) - The Phase 2 VISIONARY-MS trial for CNM-Au8 **met its primary endpoint** for low-contrast vision improvement (**p=0.056**) and a key secondary endpoint for functional improvement (**p=0.0207**)[148](index=148&type=chunk)[149](index=149&type=chunk) [Results of Operations](index=33&type=section&id=Results%20of%20Operations) Q3 2022 revenue increased, operating loss improved, while nine-month R&D expenses rose and G&A decreased Operating Expense Comparison (Nine Months Ended Sep 30) | Expense Category | 2022 (in thousands) | 2021 (in thousands) | Change % | | :--- | :--- | :--- | :--- | | Research and development | $24,149 | $18,893 | +28% | | General and administrative | $12,807 | $16,739 | -23% | | **Total operating expenses** | **$36,975** | **$36,444** | **+1%** | - The increase in R&D expense for the nine-month period was primarily due to progression of clinical trials for CNM-Au8 (**+15%**) and CNM-ZnAg (**+278%**)[175](index=175&type=chunk)[177](index=177&type=chunk) - The decrease in G&A expense was mainly due to lower legal, finance, and accounting fees after the completion of the Reverse Recapitalization, as well as lower stock-based compensation expense[176](index=176&type=chunk)[178](index=178&type=chunk) [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) The company faces significant liquidity challenges, with insufficient cash and **substantial doubt** about **going concern** - As of Sep 30, 2022, cash, cash equivalents, and marketable securities totaled **$16.2 million**, a sharp decline from **$50.3 million** at Dec 31, 2021[186](index=186&type=chunk) - Management projects that within the next twelve months, the company will **not have sufficient cash** to sustain current operations, raising **substantial doubt** about its ability to continue as a **going concern**[189](index=189&type=chunk) - Net cash used in operating activities for the nine months ended Sep 30, 2022 was **$31.3 million**[197](index=197&type=chunk)[198](index=198&type=chunk) [Critical Accounting Policies and Estimates](index=40&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) Key accounting policies involve significant judgment, including valuation of contingent liabilities and warrants - Critical estimates include the fair value of contingent earn-out liabilities, common stock warrant liability, accounting for convertible notes, income taxes (valuation allowance), and stock-based compensation[214](index=214&type=chunk)[215](index=215&type=chunk)[217](index=217&type=chunk)[218](index=218&type=chunk)[221](index=221&type=chunk)[222](index=222&type=chunk) - The fair value of contingent earn-out liabilities and warrant liabilities are determined using Monte Carlo and Black-Scholes models, respectively, which are sensitive to unobservable inputs like expected stock price volatility[215](index=215&type=chunk)[219](index=219&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=42&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is a smaller reporting company and is **not required to provide information** for this item - As a smaller reporting company, Clene Inc. is **not required to provide information** for this item[224](index=224&type=chunk) [Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were **ineffective** due to **material weaknesses**, with remediation efforts ongoing - Management concluded that disclosure controls and procedures were **not effective** as of September 30, 2022[225](index=225&type=chunk) - The ineffectiveness is due to **material weaknesses** related to the control environment, review of reconciliations and segregation of duties, and IT general controls[228](index=228&type=chunk)[231](index=231&type=chunk) - Remediation efforts are ongoing and include strengthening the accounting team, using external consultants, and implementing a new ERP system[232](index=232&type=chunk)[233](index=233&type=chunk) [PART II—OTHER INFORMATION](index=45&type=section&id=PART%20II%E2%80%94OTHER%20INFORMATION) [Legal Proceedings](index=45&type=section&id=Item%201.%20Legal%20Proceedings) The company reports that it is **not currently a party to any material pending legal proceedings** - The company is **not currently a party to any material pending legal proceedings**[237](index=237&type=chunk) [Risk Factors](index=45&type=section&id=Item%201A.%20Risk%20Factors) **No material changes** to risk factors previously disclosed in the 2021 Annual Report on Form 10-K - There have been **no material changes** to the risk factors disclosed in the 2021 Annual Report on Form 10-K[238](index=238&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=45&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported **no unregistered sales** of equity securities, use of proceeds, or purchases during the period - The company reported **no unregistered sales** of equity securities, use of proceeds, or purchases of equity securities during the period[239](index=239&type=chunk) [Defaults Upon Senior Securities](index=45&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported **no defaults** upon senior securities - The company reported **no defaults** upon senior securities[240](index=240&type=chunk) [Mine Safety Disclosures](index=45&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is **not applicable** - This item is **not applicable**[241](index=241&type=chunk) [Other Information](index=45&type=section&id=Item%205.%20Other%20Information) The company reported **no information** for this item - The company reported **no information** for this item[242](index=242&type=chunk) [Exhibits](index=46&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the report, including CEO/CFO certifications and XBRL data - This section lists exhibits filed with the 10-Q, including CEO/CFO certifications and XBRL files[243](index=243&type=chunk) ```

Corporate Presentation August 2022 clene.com NASDAQ: CLNN crene 2 Forward Looking Statements This presentation contains "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended, which are intended to be covered by the "safe harbor" provisions created by those laws. Clene's forward-looking statements include, but are not limited to, statements regarding our or our management team's expectations ...