INmune Bio(INMB) - 2025 Q1 - Quarterly Report

PART I – FINANCIAL INFORMATION Financial Statements The company reported a reduced net loss of $9.7 million for Q1 2025, but faces going concern uncertainty due to insufficient cash and reliance on capital raises Condensed Consolidated Balance Sheets Total assets decreased to $37.8 million by March 31, 2025, driven by reduced cash, while liabilities slightly rose and equity declined Condensed Consolidated Balance Sheets (in thousands) | | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | ASSETS | | | | Cash and cash equivalents | $19,337 | $20,922 | | TOTAL CURRENT ASSETS | $20,960 | $22,662 | | TOTAL ASSETS | $37,801 | $39,562 | | LIABILITIES AND STOCKHOLDERS' EQUITY | | | | TOTAL CURRENT LIABILITIES | $7,927 | $7,221 | | TOTAL LIABILITIES | $8,128 | $7,465 | | TOTAL STOCKHOLDERS' EQUITY | $29,673 | $32,097 | | TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $37,801 | $39,562 | Condensed Consolidated Statements of Operations and Comprehensive Loss Net loss decreased to $9.7 million in Q1 2025, primarily due to a reduction in research and development expenses Condensed Consolidated Statements of Operations (in thousands, except per share data) | | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | REVENUE | $50 | $14 | | General and administrative | $2,316 | $2,338 | | Research and development | $7,639 | $8,693 | | Total operating expenses | $9,955 | $11,031 | | LOSS FROM OPERATIONS | ($9,905) | ($11,017) | | NET LOSS | ($9,739) | ($11,025) | | Net loss per common share – basic and diluted | ($0.43) | ($0.61) | Condensed Consolidated Statements of Cash Flows Operating cash outflow decreased to $6.8 million, while financing activities provided $5.3 million, ending the quarter with $19.3 million cash Condensed Consolidated Statements of Cash Flows (in thousands) | | For the Three Months Ended March 31, 2025 | For the Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($6,824) | ($7,476) | | Net provided by (used in) financing activities | $5,274 | ($2,500) | | NET DECREASE IN CASH AND CASH EQUIVALENTS | ($1,585) | ($9,846) | | CASH AND CASH EQUIVALENTS AT END OF PERIOD | $19,337 | $26,002 | Notes to the Unaudited Condensed Consolidated Financial Statements Notes detail the company's product platforms, a significant going concern warning, and recent capital raises and manufacturing commitments - The company is a clinical-stage biotech focused on three product platforms: DN-TNF (XPro for Alzheimer's/Depression), CORDStrom (for RDEB), and INKmune (for cancer)[27] - There is substantial doubt about the Company's ability to continue as a going concern due to significant losses, negative cash flows, and insufficient liquidity to sustain operations for the next year[29] - In Q1 2025, the company sold 649,860 shares of common stock under its ATM program, raising net proceeds of approximately $5.3 million[84] - Subsequent to quarter end, from April 1 to May 8, 2025, the company sold an additional 279,966 shares for net proceeds of $2.1 million through its ATM program[97] - In April 2025, a subsidiary entered into a two-year lease for manufacturing space in the UK, with commitments of a $0.5 million deposit, $0.2 million upfront payment, and minimum payments of $1.3 million in year one and $2.6 million in year two[98] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses clinical program progress, a reduced net loss driven by lower R&D, and reiterates going concern uncertainty due to insufficient liquidity Description of Business The company focuses on developing treatments for innate immune system dysfunction, with key clinical programs in Alzheimer's, RDEB, and cancer progressing - XPro for Alzheimer's Disease (AD) has completed enrollment in its Phase II trial, with data expected in June. The company plans to start a pivotal Phase III trial after an end-of-phase II meeting with the FDA[101][106] - CORDStrom for RDEB has completed a pivotal trial, and the company plans to file a Biologics License Application (BLA) with the FDA in the first half of 2026[101] - The FDA granted CORDStrom Rare Pediatric Disease Designation (RPDD) and Orphan Drug Designation (ODD), making it eligible for a Priority Review Voucher (PRV) and seven years of market exclusivity upon approval[116][117] - The INKmune program is in an open-label Phase II trial for metastatic castrate-resistant prostate cancer (mCRPC), with the first patient enrolled in December 2023[101][119] Results of Operations Net loss decreased by $1.3 million to $9.7 million in Q1 2025, primarily driven by a $1.1 million reduction in R&D expenses Results of Operations Comparison (in thousands) | | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Revenues | $50 | $14 | $36 | | Research and development | $7,639 | $8,693 | ($1,054) | | General and administrative | $2,316 | $2,338 | ($22) | | Loss from operations | ($9,905) | ($11,017) | $1,112 | | Net loss | ($9,739) | ($11,025) | $1,286 | - The decrease in R&D expenses was largely due to incurring $1.5 million less in costs related to the Alzheimer's clinical program as it nears completion, partially offset by higher compensation costs and a smaller R&D rebate[136] Liquidity and Capital Resources The company faces substantial doubt about its going concern ability, with $19.3 million cash insufficient for the next year, relying on future financing - The company had cash and cash equivalents of $19.3 million as of March 31, 2025[139] - Recurring net losses and negative cash flows have raised substantial doubt about the company's ability to continue as a going concern, as current cash is projected to be insufficient to sustain operations for the next year[143] - The company is exploring financing strategies including public or private sales of equity, debt financing, collaborations, and licensing arrangements to fund future operations[145] Quantitative and Qualitative Disclosures About Market Risk As a 'smaller reporting company,' the company is not required to provide quantitative and qualitative disclosures about market risk - As a 'smaller reporting company,' the Company is not required to provide the information for this item[152] Controls and Procedures Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes in internal control - Management concluded that as of March 31, 2025, the company's disclosure controls and procedures were effective[154] - There were no changes in internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[156] PART II – OTHER INFORMATION Legal Proceedings The company is not currently involved in any pending legal proceedings expected to materially adversely affect its business or financial condition - The company is not currently a party to any pending legal proceedings that it believes will have a material adverse effect on its business or financial conditions[158] Risk Factors Disclosure of risk factors is not required for the company as it qualifies as a smaller reporting company - Disclosure of risk factors is not required for smaller reporting companies[159] Other Information No directors or officers adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter - No directors or officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement or other non-Rule 10b5-1 trading arrangement during the fiscal quarter[163] Exhibits This section lists filed exhibits, including a license agreement, a loan termination letter, and officer certifications - Filed exhibits include a License Agreement with Great Ormond Street Hospital, a Termination Letter for the loan with Silicon Valley Bank, and officer certifications[164]