Financial Performance - The company reported a net loss of approximately $7.3 million for the year ended June 30, 2024, compared to a net loss of $11.1 million for the same period in 2023, indicating a reduction in losses [591]. - The company has an accumulated deficit of approximately $19.5 million as of June 30, 2024 [580]. - As of June 30, 2024, the company reported a net cash used in operating activities of approximately $16.1 million, primarily due to a net loss of $7.3 million and a decrease in accounts payable [604]. Expenses - Research and development expenses decreased to approximately $4.1 million for the year ended June 30, 2024, from $10.5 million in 2023, primarily due to lower service fees with Eureka [588]. - General and administrative expenses increased significantly to approximately $3.2 million for the year ended June 30, 2024, compared to $0.7 million in 2023, driven by higher professional fees and stock-based compensation [590]. - The company anticipates significant increases in expenses related to ongoing research and development, regulatory approvals, and public company operations [594]. Cash and Financing - As of June 30, 2024, the company had cash of approximately $4.2 million, with ongoing operations dependent on cash reserves and future financing [592]. - The business combination with UPTD on September 29, 2023, resulted in net proceeds of approximately $20.1 million after transaction expenses and share redemptions [595]. - The company raised approximately $20 million in net proceeds from the Business Combination, with financing activities providing approximately $12.8 million for the year ended June 30, 2024 [608]. - The company plans to raise additional capital in the future, but the ability to do so is subject to market conditions and other uncertainties [603]. Revenue Generation - The company has not generated any revenue to date and does not expect to do so for at least the next few years until regulatory approvals are obtained [593]. Clinical Development - The company is advancing the Phase I/II STARLIGHT-1 Clinical Trial for its product candidate EB103, which targets CD19 [577]. - The company has paid approximately $11.2 million to Eureka for services and milestone achievements related to its T-cell therapies [580]. - The company remitted approximately $9.3 million to Eureka upon the consummation of the Business Combination, with expectations to use remaining net proceeds for preclinical and clinical development and compliance costs [596]. - The company has a total fee obligation of $33 million to Eureka for achieving milestones related to the Phase I/II clinical trial of EB103, with $3.5 million already expensed as of June 30, 2024 [597][615]. Stock and Equity - As of June 30, 2024, the closing price of the company's Common Stock was $1.05 per share, significantly lower than the exercise price of $11.50 for the Warrants, making it unlikely for warrant holders to exercise their Warrants [600]. - The company has not issued any Equity Line Shares under the Common Stock Purchase Agreement, which allows for up to $50 million in aggregate gross purchase price of newly issued shares, pending stockholder approval [601][616]. - The company has fully paid the license fee to Eureka, including a milestone payment of $50,000 related to the submission of EB103 to the FDA [612]. Risks and Compliance - The company is subject to various risks that could impact future operations, including competition, regulatory approval, and the success of R&D programs [599]. - The company has no off-balance sheet arrangements as of June 30, 2024 [609]. Accounting and Valuation - Financial statements are prepared in accordance with U.S. GAAP, requiring estimates and judgments that affect reported amounts of assets, liabilities, revenues, and expenses [618]. - Stock-based compensation costs are recognized as an expense over the requisite service period based on fair value measurements using the Black-Scholes-Merton option-pricing model [620]. - The fair value of stock options is estimated at the grant date and amortized on a straight-line basis over the vesting period [620]. - Different assumptions in the Black-Scholes-Merton model could materially impact stock-based compensation expense in future periods [621]. - Compensation expense for awards with graded vesting is recognized over the requisite service period, generally equal to the vesting term [623].
TRADEUP ACQUISIT(UPTD) - 2024 Q4 - Annual Report