Financial Performance - The company reported stockholders' equity of $881,960 as of June 30, 2023, which did not meet the Nasdaq minimum requirement of $2.5 million[145]. - As of June 30, 2024, the company had cash and cash equivalents of approximately $0.7 million and cumulative losses attributable to common stockholders of approximately $187.6 million[159]. - For the three months ended June 30, 2024, the company reported a net loss of approximately $8.8 million, an increase of approximately $4.6 million, or 110%, compared to a net loss of approximately $4.2 million for the same period in 2023[168]. - The net loss for the six months ended June 30, 2024 totaled approximately $3.2 million, a decrease of approximately $5.0 million, or 61%, compared to the net loss of approximately $8.3 million for the same period in 2023[174]. - The company has not generated any revenues to date and has experienced net losses and negative cash flows from its activities[158]. Mergers and Acquisitions - The company completed a merger with ImmunogenX, Inc. in March 2024, focusing on the biologic Latiglutenase for celiac disease treatment[139]. - The company initiated a plan to dispose of certain assets and liabilities of IMGX, including Latiglutenase and CypCel, within 12 months of the merger[139]. - A Letter of Intent was signed with Data Vault Holdings, Inc. for a licensing agreement, contingent upon securing at least $500,000 in strategic investment[157]. Capital and Financing - The company received gross proceeds of approximately $4.0 million from the March 2024 Offering, which included 173,100 shares of Common Stock[141]. - The May 2024 Offering generated gross proceeds of approximately $1.1 million from the sale of 275,000 shares of Common Stock[142]. - The company anticipates needing to raise substantial additional capital in the near term to fund ongoing operations and satisfy existing obligations[159]. - Net cash provided by financing activities for the six months ended June 30, 2024 was approximately $4.1 million, primarily due to net proceeds from registered direct offerings[179]. Expenses and Cost Management - Research and development expenses for the three months ended June 30, 2024, totaled approximately $0.2 million, a decrease of approximately $1.1 million, or 84%, compared to approximately $1.3 million for the same period in 2023[166]. - General and administrative expenses for the three months ended June 30, 2024, totaled approximately $3.2 million, an increase of approximately $0.4 million, or 13%, compared to approximately $2.8 million for the same period in 2023[167]. - The increase in general and administrative expenses was primarily due to $4.0 million of non-cash expense for financial advisor fees related to the IMGX acquisition[171]. - The company reduced its headcount from 15 employees to 11 employees in July 2024 as part of cost reduction measures[149]. - The CEO's annual base salary was reduced to $66,560 effective July 1, 2024, as part of cost-saving initiatives[149]. - The company expects research and development expenses to decrease during the remainder of the fiscal year as it conserves cash[170]. Strategic Initiatives - The company is exploring strategic alternatives for its Niclosamide program, which is currently under a non-binding term sheet for potential sale[140]. - The company has paused development of several drug candidates and is exploring strategic alternatives, including a potential sale or merger[152]. Debt and Obligations - As of June 30, 2024, the aggregate outstanding obligations under the Credit Agreement were $6,997,583, including $5,360,000 in outstanding principal and $1,637,583 of accrued and unpaid interest[155]. - The company received a Notice of Default and Acceleration on August 2, 2024, due to adverse changes in its financial condition[153]. Tax and Cash Flow - A tax benefit of approximately $10.6 million was recorded in the six months ended June 30, 2024 due to the release of a portion of the valuation allowance in connection with the IMGX Merger[173]. - Net cash used in operating activities during the six months ended June 30, 2024 was approximately $7.2 million, primarily due to a non-cash change in deferred tax valuation allowance of $10.6 million and a net loss of $3.2 million[176]. - Total operating expenses for the six months ended June 30, 2024 were approximately $12.5 million, an increase of approximately $4.3 million compared to $8.2 million for the same period in 2023[169].
First Wave BioPharma(FWBI) - 2024 Q2 - Quarterly Report