ProMIS Neurosciences (PMN) - 2024 Q4 - Annual Report

PART I Business A clinical-stage biotech firm developing therapies for neurodegenerative diseases via a proprietary computational platform - ProMIS utilizes a patented computational technology platform to discover and develop antibody therapies and vaccines for neurodegenerative diseases by selectively targeting toxic misfolded proteins[25][26][27] Product Pipeline Overview | Category | Product Candidate | Target Protein | Disease Indication(s) | Stage | | :--- | :--- | :--- | :--- | :--- | | Antibody | PMN310 | Amyloid-Beta | Alzheimer's Disease (AD) | Phase 1 | | | PMN267 | TDP-43 | Amyotrophic Lateral Sclerosis (ALS) | Pre-Clinical | | | PMN442 | Alpha-Synuclein | Multiple System Atrophy (MSA) | Pre-Clinical | | Vaccine | PMN440 | Alpha-Synuclein | Multiple synucleinopathies | Discovery | | | PMN311 | Amyloid-Beta | Alzheimer's Prevention | Discovery | | Discovery | - | Tau | FTLD, PSP, CBD | Discovery | | | - | RACK1 | ALS, HD | Discovery | | | - | DISC1+Interactome | Schizophrenia | Discovery | - The company's lead candidate, PMN310 for Alzheimer's Disease, initiated a Phase 1a clinical trial in November 2023 and a Phase 1b study in December 2024[56][57][58] - Key objectives for 2025 include advancing patient enrollment for PMN310, expanding corporate visibility, and evaluating partnership opportunities[32][34] Risk Factors The company faces risks from its early-stage products, need for funding, going concern uncertainty, and potential Nasdaq delisting - The company has incurred losses since inception, raising substantial doubt about its ability to continue as a going concern without additional financing[295] - The business is heavily dependent on its lead candidate, PMN310, which is in early clinical development in a historically challenging field[14][248][285] - As of January 3, 2025, the company was not in compliance with Nasdaq's $1.00 minimum bid price requirement, risking delisting[477] - The company relies on third parties for manufacturing, research, and clinical trials, posing risks of development delays[14][315] - Management identified that the company's internal controls over financial reporting are not effective, which could adversely affect the business[20][498] Unresolved Staff Comments The company has no unresolved staff comments from the Securities and Exchange Commission - There are no unresolved staff comments[532] Cybersecurity A cybersecurity program is in place with board oversight, and no material incidents have been identified to date - The company has a cybersecurity risk management program with oversight provided by the Board's Audit Committee[533][536] - No cybersecurity incidents have been identified that are reasonably likely to have a material effect on the business[534] Properties The company does not own or lease any material properties - The Company does not own or lease any material properties[537] Legal Proceedings The company is not currently a party to any material legal proceedings - The Company is not a party to any legal proceedings expected to have a material adverse effect on its business[538] Mine Safety Disclosures This section is not applicable to the company - Not applicable[539] PART II Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The company's common shares trade on Nasdaq, and no dividends are planned as funds are reinvested into operations - The company's common shares are listed on the Nasdaq Capital Market with 103 holders of record as of March 29, 2025[541][542] - No dividends have been paid in the last five years, and none are expected in the foreseeable future[543][544] - In July 2024, the company completed a PIPE offering, raising gross proceeds of approximately $27.7 million[549] Reserved This item is reserved Management's Discussion and Analysis of Financial Condition and Results of Operations The operating loss increased to $16.8 million in 2024, and there is substantial doubt about the company's ability to continue as a going concern Results of Operations (Years Ended December 31) | Metric | 2024 | 2023 | Change | | :--- | :--- | :--- | :--- | | Research and development | $10,637,976 | $7,883,165 | $2,754,811 | | General and administrative | $6,189,502 | $6,379,568 | $(190,066) | | Loss from operations | $(16,827,478) | $(14,262,733) | $2,564,745 | | Other income (expense) | $19,606,351 | $1,050,251 | $(18,556,100) | | Net income (loss) | $2,778,873 | $(13,212,482) | $(15,991,355) | - The increase in operating loss was driven by a $3.5 million increase in spending on the lead program, PMN310[576] - Management concluded there is substantial doubt about its ability to continue as a going concern as cash of $13.3 million is insufficient[567][588] Cash Flow Summary (Years Ended December 31) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | $(27,182,095) | $(10,843,676) | | Net cash provided by financing activities | $27,875,809 | $17,748,800 | | Net increase in cash | $693,021 | $6,722,350 | Quantitative and Qualitative Disclosures About Market Risk The company is primarily exposed to credit and liquidity risks, while foreign currency and inflation risks are not material - The company's primary financial risks include credit risk and significant liquidity risk, as it relies on external financing[600][601][602] - Foreign currency and inflation risks are not believed to have had a material impact on financial results in 2024 or 2023[603][604] Financial Statements and Supplementary Data The auditor's report highlights a "Going Concern Uncertainty" due to the company's history of net losses and negative cash flows - The independent auditor's report includes a "Going Concern Uncertainty" paragraph due to accumulated deficits and net losses[608] Consolidated Balance Sheet Highlights (as of Dec 31) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Cash | $13,291,167 | $12,598,146 | | Total Current Assets | $18,911,456 | $13,619,145 | | Total Current Liabilities | $2,218,425 | $9,349,662 | | Total Liabilities | $2,423,280 | $9,865,849 | | Accumulated Deficit | $(90,687,073) | $(93,465,946) | | Total Shareholders' Equity | $16,488,176 | $3,753,296 | Consolidated Statement of Operations Highlights (Year Ended Dec 31) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Total operating expenses | $16,827,478 | $14,262,733 | | Loss from operations | $(16,827,478) | $(14,262,733) | | Net income (loss) | $2,778,873 | $(13,212,482) | | Net income (loss) per share, basic | $0.11 | $(1.07) | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure There were no changes in or disagreements with the company's accountants - None[745] Controls and Procedures Disclosure controls were deemed ineffective due to a material weakness in internal control over financial reporting - Management concluded that disclosure controls and procedures were not effective as of December 31, 2024, due to a material weakness[747][754] - A material weakness was identified related to insufficient review controls over fair value calculations for the PIPE Warrant Liability[753] - The company has initiated remediation measures to address the material weakness[755] Other Information No directors or officers adopted, terminated, or modified a Rule 10b5-1 trading arrangement in Q4 2024 - No directors or officers adopted, terminated, or modified a Rule 10b5-1 trading arrangement during Q4 2024[758] Disclosure Regarding Foreign Jurisdictions that Prevent Inspections This section is not applicable to the company - Not applicable[759] PART III Directors, Executive Officers and Corporate Governance This information is incorporated by reference from the company's 2025 definitive proxy statement - Information for this item is incorporated by reference from the registrant's 2025 Proxy Statement[761] Executive Compensation This information is incorporated by reference from the company's 2025 definitive proxy statement - Information for this item is incorporated by reference from the registrant's 2025 Proxy Statement[765] Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters This information is incorporated by reference from the company's 2025 definitive proxy statement - Information for this item is incorporated by reference from the registrant's 2025 Proxy Statement[766] Certain Relationships and Related Transactions, and Director Independence This information is incorporated by reference from the company's 2025 definitive proxy statement - Information for this item is incorporated by reference from the registrant's 2025 Proxy Statement[767] Principal Accountant Fees and Services This information is incorporated by reference from the company's 2025 definitive proxy statement - Information for this item is incorporated by reference from the registrant's 2025 Proxy Statement[768] PART IV Exhibits and Financial Statement Schedules This section lists the financial statements and exhibits filed as part of the Annual Report - This item lists the financial statements and exhibits filed with the Form 10-K; all schedules are omitted[769] Form 10-K Summary This section is not applicable - Not applicable[771]