Serina Therapeutics, Inc.(SER) - 2024 Q1 - Quarterly Results

Business Highlights In Q1 2024, Serina Therapeutics advanced its lead drug candidate SER-252 for Parkinson's Disease, with plans for a Phase 1 trial in 2025. The company completed a merger with AgeX Therapeutics, resulting in a new NYSE American listing under the ticker "SER". Additionally, Dr. Simba Gill was appointed as Executive Chairman to guide strategic growth - The company is advancing its lead drug candidate, SER-252 (POZ-apomorphine), for advanced Parkinson's Disease and anticipates submitting an IND application to the FDA to start a Phase 1 clinical trial in 2025[1] - Completed a merger with AgeX Therapeutics and began trading on the NYSE American market under the ticker "SER" on March 27, 2024[2] - Appointed Dr. Simba Gill as Executive Chairman to leverage his biotech and pharma experience to guide the company's growth and strategic expansion[3] Liquidity and Capital Resources Serina increased its secured line of credit from Juvenescence Limited by a total of $2.925 million across March and May 2024, extending the repayment date to December 31, 2024. As of March 31, 2024, the company held $8.8 million in cash, cash equivalents, and restricted cash, while owing $10.4 million in principal and fees to Juvenescence - The company's line of credit from Juvenescence Limited was increased by $2.4 million on March 26, 2024, and by an additional $0.525 million on May 8, 2024[4] - The repayment date for the Juvenescence line of credit was extended from May 9, 2024, to December 31, 2024[4] Key Liquidity Figures (as of March 31, 2024) | Metric | Amount | | :--- | :--- | | Cash, cash equivalents, and restricted cash | $8.8 million | | Debt to Juvenescence Limited (principal & fees) | $10.4 million | First Quarter 2024 Operating Results For Q1 2024, Serina reported a net loss of $9.4 million, a stark contrast to the $1.7 million net income in Q1 2023. This was driven by operating expenses more than doubling to $2.3 million, due to increased R&D and merger-related G&A costs. A significant $7 million non-cash expense from the change in fair value of convertible promissory notes also heavily impacted the bottom line Q1 2024 vs Q1 2023 Financial Performance (amounts in thousands or millions as specified, except per share data) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Grant Revenues | $5,000 | $30,000 | | Operating Expenses | $2.3 million | $1.0 million | | Net Income (Loss) | ($9.4 million) | $1.7 million | | EPS (Basic & Diluted) | ($3.38) | $0.77 (Basic), $0.20 (Diluted) | - Research and development expenses increased by $0.7 million to $1.1 million, while general and administrative expenses rose by $0.6 million to $1.2 million, largely due to professional services for the merger[8][9] - Net loss was primarily impacted by a $7.0 million charge related to the change in fair value of convertible promissory notes, which were converted to common stock on March 26, 2024[10] Going Concern Considerations The company's management has determined that its current cash reserves and recent borrowings are insufficient to fund operations for the next twelve months. This situation raises substantial doubt about Serina's ability to continue as a going concern - Based on projected cash flows, the company believes its cash, cash equivalents, and recent borrowings are not sufficient to satisfy anticipated operating requirements for the next twelve months[12] - These factors raise substantial doubt regarding the ability of the Company to continue as a going concern[12] Technology and Pipeline Serina's core technology is the POZ Platform™, which uses a synthetic polymer to enhance drug delivery. Its lead candidate, SER-252, leverages this platform for an apomorphine-based therapy for Parkinson's disease, aiming for continuous stimulation with reduced side effects, with clinical trials planned for 2025. The company also pursues partnerships, including a licensing agreement with Pfizer for LNP drug delivery - The lead candidate, SER-252, is an investigational therapy for Parkinson's disease designed to provide continuous dopaminergic stimulation (CDS) and is planned to advance to clinical testing in 2025[13] - The proprietary POZ technology is engineered to offer greater control in drug loading and precision in release rates for subcutaneously injected drugs, aiming to improve therapies with narrow therapeutic windows[14] - Serina intends to advance its POZ platform through partnerships, highlighted by a non-exclusive license agreement with Pfizer, Inc. for use in lipid nanoparticle (LNP) drug delivery formulations[15] Financial Statements This section provides the company's consolidated financial statements, including balance sheets and statements of operations, reflecting its financial position and performance Condensed Consolidated Balance Sheets As of March 31, 2024, Serina's total assets were $10.9 million, while total liabilities stood at $15.2 million, resulting in a stockholders' deficit of $4.3 million. The balance sheet reflects significant changes from year-end 2023, primarily due to the merger and related financing, including a large increase in current liabilities from loans and the conversion of preferred stock Condensed Consolidated Balance Sheets (in thousands) | | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $8,706 | $7,619 | | Total current assets | $8,937 | $7,619 | | Total Assets | $10,856 | $8,968 | | Liabilities & Stockholders' Deficit | | | | Total current liabilities | $14,059 | $1,413 | | Total Liabilities | $15,165 | $4,858 | | Total stockholders' deficit | ($4,309) | ($32,294) | | Total Liabilities & Stockholders' Deficit | $10,856 | $8,968 | Condensed Consolidated Statements of Operations For the first quarter of 2024, Serina reported a net loss of $9.4 million, or ($3.38) per share. This compares to a net income of $1.7 million, or $0.77 per basic share, for the same period in 2023. The significant loss was driven by a higher loss from operations and a $7.0 million non-cash expense from the change in fair value of convertible promissory notes Condensed Consolidated Statements of Operations (in thousands, except per share data) | | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Total revenues | $5 | $30 | | Loss from operations | ($2,321) | ($962) | | Change in fair value of convertible promissory notes | ($7,017) | $294 | | Net Income (Loss) | ($9,437) | $1,658 | | Net Earnings (Loss) Per Share - Basic | ($3.38) | $0.77 | | Net Earnings (Loss) Per Share - Diluted | ($3.38) | $0.20 |