Imunon(US:IMNN)2024-11-07 14:00PART I: FINANCIAL INFORMATION Financial Statements The company reported total assets of $14.4 million and total liabilities of $6.2 million as of September 30, 2024, with a $14.6 million net loss and $14.4 million cash used in operations for the nine months ended September 30, 2024 Condensed Consolidated Balance Sheet Data (Unaudited) | Balance Sheet Items | September 30, 2024 (US$) | December 31, 2023 (US$) | | :--- | :--- | :--- | | Cash and cash equivalents | $10,311,935 | $5,838,566 | | Total current assets | $12,532,406 | $18,240,704 | | Total assets | $14,391,190 | $21,918,069 | | Total current liabilities | $5,441,743 | $7,391,134 | | Total liabilities | $6,199,469 | $8,530,427 | | Total stockholders' equity | $8,191,721 | $13,387,642 | Condensed Consolidated Statements of Operations (Unaudited) | (In thousands, except per share data) | Three Months Ended Sep 30, 2024 (US$ Thousands) | Three Months Ended Sep 30, 2023 (US$ Thousands) | Nine Months Ended Sep 30, 2024 (US$ Thousands) | Nine Months Ended Sep 30, 2023 (US$ Thousands) | | :--- | :--- | :--- | :--- | :--- | | Research and development | $3,293 | $1,981 | $9,407 | $7,735 | | General and administrative | $1,668 | $1,923 | $5,580 | $7,328 | | Loss from operations | $(4,961) | $(3,904) | $(14,986) | $(15,063) | | Net loss | $(4,845) | $(3,477) | $(14,563) | $(14,627) | | Net loss per common share | $(0.34) | $(0.37) | $(1.39) | $(1.64) | Condensed Consolidated Statements of Cash Flows (Unaudited, for the nine months ended Sep 30) | (In thousands) | 2024 (US$ Thousands) | 2023 (US$ Thousands) | | :--- | :--- | :--- | | Net cash used in operating activities | $(14,434) | $(15,250) | | Net cash provided by investing activities | $9,844 | $14,310 | | Net cash provided by (used in) financing activities | $9,064 | $(3,669) | | Net change in cash and cash equivalents | $4,473 | $(4,609) | | Cash and cash equivalents at end of period | $10,312 | $12,884 | Notes to the Condensed Consolidated Financial Statements (Unaudited) The notes detail the company's clinical-stage biotechnology business, disclose a significant going concern uncertainty due to $14.6 million operating losses and capital needs, and highlight a $10.0 million July 2024 stock offering and June 2024 lawsuit dismissal - The company is a clinical-stage biotechnology firm focused on two non-viral DNA technology modalities: TheraPlas® for treating solid tumors and PlaCCine® for developing vaccines for infectious diseases24 - Management has substantial doubt about the Company's ability to continue as a going concern due to significant net losses, including a $14.6 million loss for the nine months ended September 30, 2024, and insufficient capital for the next twelve months3036 - In July 2024, the company raised gross proceeds of $10.0 million through a registered direct offering of 5,000,000 shares of common stock and a concurrent private placement of warrants for an additional 5,000,000 shares3164 - In June 2024, a derivative shareholder lawsuit against the company and certain directors and officers, related to alleged statements about ThermoDox, was dismissed without prejudice87 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's TheraPlas® and PlaCCine® platforms, highlighting positive Phase II OVATION 2 results for IMNN-001, completed Phase I enrollment for IMNN-101, increased R&D expenses, and reiterates going concern uncertainty despite recent financing Overview and Technology Platform Imunon is a clinical-stage biotech company developing treatments using its non-viral DNA technology, with TheraPlas® for solid tumors and PlaCCine® for infectious disease vaccines, emphasizing efficiency, cost-effectiveness, and a favorable safety profile - The company's technology platform has two main modalities: TheraPlas for treating solid tumors and PlaCCine for developing vaccines against infectious diseases90 - The technology platform is based on non-viral DNA delivery, considered a viable alternative due to its versatility, biocompatibility, and favorable safety profile9293 THERAPLAS MODALITY: IMNN-001 DEVELOPMENT PROGRAM The IMNN-001 program for advanced ovarian cancer reported positive Phase II OVATION 2 results, showing an 11.1-month increase in median Overall Survival, with plans for an FDA meeting in Q4 2024 and a Phase III trial in Q1 2025, alongside an ongoing Phase I/II combination study - Positive topline results from the Phase II OVATION 2 study showed an 11.1-month increase in median Overall Survival (OS) in the intent-to-treat (ITT) population for patients receiving IMNN-001 plus standard-of-care122 - The hazard ratio for OS in the OVATION 2 study's ITT population was 0.74, indicating a 35% improvement in survival for the IMNN-001 treatment arm122 - The company plans an End-of-Phase II meeting with the FDA in Q4 2024 and anticipates initiating a Phase III trial in Q1 2025124 - A Phase I/II trial in collaboration with Break Through Cancer, evaluating IMNN-001 with bevacizumab, has enrolled eight patients in its Phase I portion as of September 30, 2024125128 PLACCINE DNA VACCINE MODALITY: IMNN-101 The PLACCINE DNA vaccine program is advancing with IMNN-101, a seasonal COVID-19 booster, which received FDA clearance in April 2024, fully enrolled 24 participants in its Phase I trial, and expects topline data by year-end 2024, seeking future partnerships - The company received FDA clearance in April 2024 to begin a Phase I clinical trial for its seasonal COVID-19 booster vaccine, IMNN-101149 - As of September 2024, all 24 participants in the Phase I study have been inoculated with IMNN-101150 - Topline safety and immunogenicity data from the Phase I trial are anticipated by year-end 2024, after which Imunon plans to seek partnership opportunities for future development150151 Financial Review The net loss for Q3 2024 increased to $4.8 million due to a 66.2% rise in R&D expenses, while the nine-month net loss remained stable at $14.6 million, with R&D expenses up 21.6% and G&A expenses down 23.9% Operating Expenses Comparison (Three Months Ended Sep 30) | (In thousands) | 2024 (US$ Thousands) | 2023 (US$ Thousands) | Change (US$ Thousands) | % Change | | :--- | :--- | :--- | :--- | :--- | | Research and development | $3,293 | $1,981 | $1,312 | 66.2% | | General and administrative | $1,668 | $1,923 | $(255) | (13.3)% | | Total operating expenses | $4,961 | $3,904 | $1,057 | 27.1% | Operating Expenses Comparison (Nine Months Ended Sep 30) | (In thousands) | 2024 (US$ Thousands) | 2023 (US$ Thousands) | Change (US$ Thousands) | % Change | | :--- | :--- | :--- | :--- | :--- | | Research and development | $9,407 | $7,734 | $1,673 | 21.6% | | General and administrative | $5,580 | $7,328 | $(1,748) | (23.9)% | | Total operating expenses | $14,987 | $15,062 | $(75) | (0.5)% | - The increase in R&D expenses for Q3 2024 was primarily driven by costs for the PlaCCine vaccine trial ($0.5 million) and other clinical/regulatory costs ($0.8 million)178 - The decrease in G&A expenses for the first nine months of 2024 was mainly due to lower non-cash stock compensation ($0.3 million), legal expenses ($0.6 million), and employee-related expenses ($0.5 million)186 Financial Condition, Liquidity and Capital Resources As of September 30, 2024, the company had $10.3 million in cash and $7.1 million working capital, with $14.4 million cash used in operations, leading management to conclude substantial doubt about going concern despite $9.1 million net financing, necessitating further capital - As of September 30, 2024, the company had cash and cash equivalents of $10.3 million and net working capital of $7.1 million188 - Net cash used in operating activities was $14.4 million for the first nine months of 2024, while net cash from financing activities was $9.1 million189 - Management has determined there is substantial doubt about the Company's ability to continue as a going concern, as current cash resources are insufficient to fund operations for the next twelve months156157194 - The company raised gross proceeds of $10.0 million from a registered direct offering and concurrent private placement of warrants, which closed on August 1, 2024190 Quantitative and Qualitative Disclosures about Market Risk As a smaller reporting company, Imunon, Inc. is not required to provide quantitative and qualitative disclosures about market risk - The company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk196 Controls and Procedures As of September 30, 2024, the company's disclosure controls and procedures were concluded to be effective at a reasonable assurance level, with no material changes to internal control over financial reporting identified during the quarter - Management, including the CEO and CFO, concluded that as of September 30, 2024, the company's disclosure controls and procedures are effective at the reasonable assurance level197 - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, these controls198 PART II: OTHER INFORMATION Legal Proceedings A derivative shareholder lawsuit filed in February 2021, alleging breach of fiduciary duty regarding ThermoDox, was dismissed without prejudice by the U.S. District Court in June 2024 - A derivative shareholder lawsuit filed in February 2021 was dismissed without prejudice in June 202487201 Risk Factors No material changes to the company's risk factors have occurred since those disclosed in its Annual Report on Form 10-K for the year ended December 31, 2023 - No material changes to risk factors have occurred since the filing of the 2023 Annual Report on Form 10-K202 Unregistered Sales of Equity Securities and Use of Proceeds On July 30, 2024, the company issued unregistered warrants to purchase 5,000,000 shares of common stock in a private placement, with an exercise price of $2.00 per share and a five-and-a-half-year term, exempt from registration - On July 30, 2024, the company issued unregistered warrants to purchase 5,000,000 shares of common stock in a private placement203 - The warrants have an exercise price of $2.00 per share and are exercisable for a term of five and one-half years203 - The proceeds from the offering are intended for working capital and general corporate purposes204 Other Information During the third quarter of 2024, no directors or executive officers entered into, modified, or terminated any Rule 10b5-1 trading plans - No directors or executive officers entered into, modified, or terminated Rule 10b5-1 trading plans during the quarter ended September 30, 2024206 Exhibits The report includes key exhibits such as the Form of Warrants and Securities Purchase Agreement from the July 2024 financing, a separation agreement with a former executive, and required Sarbanes-Oxley Act certifications - Key exhibits filed include the Form of Warrants and the Securities Purchase Agreement from the July 30, 2024 offering208 - A separation agreement dated August 9, 2024, with Sébastien Hazard, M.D. was filed as an exhibit209 - Required Sarbanes-Oxley Act certifications from the CEO and CFO (Sections 302 and 906) are included as exhibits209210