Lantern Pharma(LTRN) - 2025 Q1 - Quarterly Report

Forward-Looking Statements The report contains forward-looking statements regarding strategy and operations, which are subject to significant risks and uncertainties - This report contains forward-looking statements concerning the company's strategy, future clinical and research activities, financial position, and management objectives[7] - Key forward-looking statements cover the RADR® A.I. platform's potential, drug candidate advancement, clinical trial timelines, and future funding needs[8] - The company cautions against undue reliance on these statements, as actual results may differ materially due to factors in the 2024 Form 10-K[9][10] PART I – FINANCIAL INFORMATION Financial Statements For Q1 2025, the company reported a net loss of $4.54 million and a decrease in total assets to $21.1 million, reflecting ongoing R&D investment without revenue Condensed Consolidated Balance Sheets Total assets decreased to $21.1 million as of March 31, 2025, driven by a reduction in cash and marketable securities Condensed Consolidated Balance Sheet Highlights (Unaudited) | Balance Sheet Item | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $6,377,602 | $7,511,079 | | Marketable securities | $13,344,049 | $16,501,984 | | Total Assets | $21,096,335 | $25,571,792 | | Total Liabilities | $4,319,850 | $4,384,018 | | Total Stockholders' Equity | $16,776,485 | $21,187,774 | Condensed Consolidated Statements of Operations The company's Q1 2025 net loss improved to $4.54 million from $5.44 million year-over-year, primarily due to lower R&D expenses Condensed Consolidated Statements of Operations (Unaudited) | Line Item | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | General and administrative | $1,510,077 | $1,481,215 | | Research and development | $3,263,955 | $4,250,786 | | Loss from operations | ($4,774,032) | ($5,732,001) | | Net Loss | ($4,536,783) | ($5,440,810) | | Net loss per share, basic and diluted | ($0.42) | ($0.51) | Condensed Consolidated Statements of Cash Flows Net cash used in operating activities was $4.38 million in Q1 2025, with a net decrease in cash of $1.13 million Cash Flow Summary (Unaudited) | Cash Flow Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($4,375,610) | ($3,068,523) | | Net cash provided by (used in) investing activities | $3,239,331 | ($556,168) | | Net cash provided by financing activities | $0 | $54,716 | | Change in Cash and Cash Equivalents | ($1,133,477) | ($3,579,805) | Notes to Condensed Consolidated Financial Statements Notes detail the company's A.I.-driven oncology focus, funding sufficiency for 12 months, and key accounting policies and commitments - The company is an A.I.-focused firm developing cancer therapies with three clinical-stage product candidates: LP-300, LP-184, and LP-284, and an Antibody Drug Conjugate (ADC) program[27][30] - Existing cash, cash equivalents, and marketable securities of approximately $19.7 million as of March 31, 2025, will be sufficient to fund operations for at least the next 12 months[34] - Expenses for License, Strategic Alliance, and Research Agreements totaled approximately $1.18 million for the three months ended March 31, 2025, a decrease from $2.10 million in the same period of 2024[55] - As of March 31, 2025, the company has 70,000 warrants outstanding and exercisable to purchase common stock at a weighted-average exercise price of $18.75 per share, which expire on June 10, 2025[66] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses its A.I.-driven drug development strategy, a 23% decrease in Q1 2025 R&D expenses, and capital sufficiency for the next 12 months - The company's strategy is to use its proprietary A.I. platform, RADR®, which has nearly 200 billion data points, to identify and develop new and 'rescued' oncology drug candidates, aiming to reduce development time and cost[81][83] - The clinical portfolio includes LP-300 (Phase 2 for NSCLC), LP-184 (Phase 1A for solid tumors), and LP-284 (Phase 1A for hematological cancers)[82][86] - The company believes its existing cash, cash equivalents, and marketable securities will fund operating expenses and capital requirements for at least 12 months from the filing date of this Form 10-Q[107] Results of Operations R&D expenses decreased by 23% to $3.26 million in Q1 2025 compared to Q1 2024, driven by lower costs for the LP-184 program Research and Development Expenses by Project (Unaudited) | Project | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | LP-300 | $1,007,908 | $1,051,904 | | LP-184 | $1,361,464 | $2,232,602 | | LP-284 | $456,471 | $462,423 | | Total R&D Expenses | $3,263,955 | $4,250,786 | - The 23% decrease in R&D expenses was primarily driven by a $963,000 reduction in research services, mainly from lower CRO and clinical site costs for LP-184[100] - General and administrative expenses increased by 2% due to higher professional fees and salaries, partially offset by a decrease in business development expenses[99] Liquidity and Capital Resources The company holds $16.5 million in working capital, sufficient for 12 months, but anticipates needing substantial future funding for clinical trials - The company has working capital of approximately $16,537,000 as of March 31, 2025, and believes it can fund operations for at least the next 12 months[107] - Net cash used in operating activities increased in Q1 2025 compared to Q1 2024, mainly due to less favorable changes in accounts payable and prepaid expenses in the current period[104] - The company expects to incur increasing operating losses and will need to obtain substantial additional funding, potentially through equity or debt financing, which could dilute existing stockholders[108][110] Quantitative and Qualitative Disclosures About Market Risk As a Smaller Reporting Company, the company is exempt from this item but notes minor interest rate and foreign currency risks - As a Smaller Reporting Company, Lantern Pharma is exempt from the requirements of Item 3[118] - The company's primary market risk is interest rate sensitivity on its marketable securities and has minor foreign currency risk from its Australian subsidiary but does not engage in hedging[112][116] Controls and Procedures Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal controls - Based on an evaluation as of March 31, 2025, the CEO and CFO concluded that the company's disclosure controls and procedures were effective at the reasonable assurance level[120] - No changes occurred in the company's internal control over financial reporting during the quarter ended March 31, 2025, that have materially affected, or are reasonably likely to materially affect, internal controls[121] PART II – OTHER INFORMATION Risk Factors The company is exempt from the requirements of this item as it qualifies as a Smaller Reporting Company - As a Smaller Reporting Company, Lantern Pharma is exempt from the requirements of Item 1A[125] Exhibits This section lists filed exhibits, including Sarbanes-Oxley certifications and Inline XBRL documents - The exhibits filed include CEO and CFO certifications pursuant to Sarbanes-Oxley Sections 302 and 906, along with various Inline XBRL files[126] Signatures The report was duly signed and authorized by the CEO and CFO on May 15, 2025 - The report was duly signed and authorized on May 15, 2025, by Panna Sharma, Chief Executive Officer, and David R. Margrave, Chief Financial Officer[128][129]