NRX Pharmaceuticals(NRXP) - 2023 Q4 - Annual Report

Financial Performance - NRx Pharmaceuticals achieved a net loss of $30.2 million for the fiscal year 2023, an improvement from a net loss of$39.8 million in 2022, resulting in an accumulated deficit of $253.1 million as of December 31, 2023[525]. - NRx Pharmaceuticals reported a net loss of$30.15 million for the year ended December 31, 2023, a decrease of $9.6 million compared to a net loss of$39.75 million in 2022[536]. - NRx Pharmaceuticals improved its negative Earnings per Share to ($0.40) in FY 2023, compared to ($0.60) in the prior 12-month period, with management projecting positive cash flow by year-end 2024[512]. - The Company reported a net cash used in operating activities of $21.657 million for the year ended December 31, 2023, compared to$39.755 million in 2022[572]. - Total operating expenses for 2023 were $27.84 million, down from$44.34 million in 2022, reflecting a reduction of $16.5 million[536]. - Research and development expenses decreased to$13.37 million in 2023 from $17.03 million in 2022, primarily due to a$2.1 million reduction in clinical trial costs[537]. - General and administrative expenses fell to $14.22 million in 2023, down from$27.31 million in 2022, a decrease of $13.1 million[538]. - The company has not generated any revenues and continues to incur significant operating losses, relying on equity and debt financing for operations[545]. - The Company has a convertible note payable of$9.161 million as of December 31, 2023, down from $10.525 million in 2022[571]. - Total liabilities increased to$19.048 million in 2023 from $18.407 million in 2022[571]. Capital Raising and Financing Activities - The company successfully raised$9.2 million in new capital during FY 2023, with an additional $7.8 million added to working capital in Q1 2024, contributing to a greater than 50$1.5 million at a price of $0.30 per share[546]. - A private placement in February 2024 generated approximately$1.0 million from the sale of 2.7 million shares at a price of $0.38 per share[549]. - Financing activities provided$6.201 million of cash in 2023, primarily from the issuance of common stock and Series A preferred stock[576]. - For the year ended December 31, 2022, financing activities provided $32.2 million in cash, including$22.7 million from the issuance of common stock and warrants, and $10.0 million from convertible notes payable[577]. - The Company issued 3,866,666 shares of common stock in March 2023, raising approximately$2.5 million[560]. - The Company issued 9,670,002 shares of common stock in June 2023, generating approximately $5.6 million in net cash proceeds[566]. Drug Development and Partnerships - NRx Pharmaceuticals established a drug development partnership with Alvogen, Inc. and Lotus Pharmaceutical Company, which could yield up to$330 million in milestone payments and a double-digit royalty on net sales worldwide[512]. - NRx-101 received Breakthrough Therapy Designation from the FDA, demonstrating a significant reduction in symptoms of depression and suicidality in bipolar patients[518]. - The company has manufactured over 1 million oral doses of NRX-101 to commercial standards, with expectations of five years of room temperature shelf stability[513]. - NRx Pharmaceuticals has identified NRX-101 as a potent antibiotic for treating complicated urinary tract infections, receiving Qualified Infectious Disease Product and Fast Track designations from the FDA[517]. - The Company entered into a License Agreement with Alvogen, allowing for up to $330 million in cash milestone payments, including an initial$10 million[564]. - The Company is eligible to receive $5 million as an advance of the first milestone completion within the Alvogen Agreement as of February 7, 2024[565]. - The company completed patient data collection for a clinical trial studying suicidal bipolar depression, with top-line data expected in April 2024[512]. Compliance and Concerns - NRx Pharmaceuticals received a notice from Nasdaq for non-compliance with the minimum market value of listed securities, requiring a minimum of$50 million for 10 consecutive business days by January 22, 2024[529]. - NRx Pharmaceuticals has concluded that substantial doubt exists about its ability to continue as a going concern for at least twelve months from the issuance of its consolidated financial statements[526]. Accounting and Valuation - The company utilizes the Black-Scholes option-pricing model to estimate the fair value of stock option awards, considering factors such as volatility and expected term[585]. - The fair value of the convertible note payable is estimated using a Monte Carlo simulation model, which incorporates factors like equity volatility and risk-free interest rate[590]. - The company has no significant accounting policies that require subjective estimates and judgments that could materially impact its financial condition[582]. - The company’s convertible promissory note is accounted for at fair value, with changes recorded as non-operating loss in the consolidated statements of operations[589]. - The company has no cash dividends on common stock and does not expect to pay any in the foreseeable future[585]. - The company’s management evaluates estimates and judgments on an ongoing basis, with significant estimates related to earnout cash liability and stock-based compensation[581]. Royalties and Obligations - The company is obligated to pay ongoing royalties of 1% to 2.5% of NRX-101 gross sales to Sarah Herzog Memorial Hospital, along with milestone payments of $0.3 million upon completion of phase 3 trials[579]. - The Company has a Minimum Payment Period until December 31, 2023, with monthly payments of$400,000 to Streeterville[556]. - The milestone payments for developmental and commercial milestones range from $0.1 million to$0.8 million[579].