Reviva Pharmaceuticals (RVPH) - 2025 Q1 - Quarterly Report

Part I Item 1. Financial Statements (unaudited) The company reported a net loss of $6.4 million for Q1 2025, with a $5.3 million working capital deficit and cash, raising going concern doubts Condensed Consolidated Balance Sheets Total assets decreased to $7.1 million, liabilities to $11.5 million, and stockholders' equity shifted to a $4.5 million deficit by March 31, 2025 Condensed Consolidated Balance Sheet Highlights (Unaudited) | Balance Sheet Item | March 31, 2025 ($) | December 31, 2024 ($) | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | 5,289,404 | 13,476,331 | | Total current assets | 6,257,325 | 14,683,367 | | Total Assets | 7,077,046 | 15,503,088 | | Liabilities & Equity | | | | Total current liabilities | 11,509,254 | 14,601,506 | | Total Liabilities | 11,537,070 | 14,690,516 | | Total stockholders' equity (deficit) | (4,460,024) | 812,572 | Condensed Consolidated Statements of Operations Net loss for Q1 2025 was $6.4 million ($0.13/share), an improvement from $7.4 million in Q1 2024, driven by reduced R&D expenses Condensed Consolidated Statements of Operations (Unaudited) | Operating Item | Three Months Ended March 31, 2025 ($) | Three Months Ended March 31, 2024 ($) | | :--- | :--- | :--- | | Research and development | 4,113,537 | 5,783,865 | | General and administrative | 2,424,630 | 2,138,241 | | Total operating expenses | 6,538,167 | 7,922,106 | | Loss from operations | (6,538,167) | (7,922,106) | | Net loss | (6,432,840) | (7,433,608) | | Net loss per share (Basic and diluted) | (0.13) | (0.25) | Condensed Consolidated Statements of Cash Flows Net cash used in operations decreased to $8.2 million in Q1 2025, with cash and cash equivalents falling to $5.3 million by quarter-end Condensed Consolidated Statements of Cash Flows Highlights (Unaudited) | Cash Flow Item | Three Months Ended March 31, 2025 ($) | Three Months Ended March 31, 2024 ($) | | :--- | :--- | :--- | | Net cash used in operating activities | (8,194,198) | (11,725,809) | | Net cash provided by financing activities | 7,271 | 332,000 | | Net decrease in cash and cash equivalents | (8,186,927) | (11,393,809) | | Cash and cash equivalents, end of period | 5,289,404 | 11,973,647 | Notes to Condensed Consolidated Financial Statements Notes detail a significant working capital deficit, accumulated deficit, and limited cash, raising substantial doubt about the company's going concern ability - The company is a late-stage pharmaceutical firm focused on developing therapies for central nervous system (CNS), inflammatory, and cardiometabolic diseases[20] - As of March 31, 2025, the company had a working capital deficit of $5.3 million, an accumulated deficit of $170.7 million, and cash of $5.3 million, raising substantial doubt about its ability to continue as a going concern for one year[25][26] - The company's current cash is only sufficient to cover operations through the end of the second quarter of 2025, and it will need to raise additional funds during the third quarter of 2025[26] - For Q1 2025, three vendors accounted for 53%, 18%, and 12% of total research and development expenses, indicating a high concentration of vendor risk[30] - Stock-based compensation expense increased to approximately $0.9 million in Q1 2025 from $0.4 million in Q1 2024, with $2.7 million of unrecognized stock-based compensation expense as of March 31, 2025[56] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses positive Phase 3 trial results for brilaroxazine, but highlights precarious financial condition with cash only through Q2 2025 and a $6.4 million net loss Company Overview and Recent Developments Reviva, a late-stage pharma company, achieved positive Phase 3 results for brilaroxazine in schizophrenia and plans a second trial contingent on financing - The company's primary focus is completing the clinical development of brilaroxazine for the treatment of acute and maintenance schizophrenia[80] Phase 3 RECOVER-1 Trial Topline Results (Brilaroxazine 50mg vs. Placebo at Week 4) | Endpoint | Point Reduction/Improvement | Cohen's d Effect Size | P Value | | :--- | :--- | :--- | :--- | | PANSS Total Score (Primary) | 10.1 | 0.6 | < 0.001 | | Positive Symptoms | 2.8 | 0.5 | < 0.001 | | Negative Symptoms (NS) | 2.0 | 0.4 | 0.003 | | Personal & Social Performance | 6.3 | 0.5 | < 0.001 | - The Open Label Extension (OLE) trial is complete, with the full data set expected in Q2-2025, showing sustained efficacy and good tolerability over one year[88][89] - The company plans to initiate the registrational RECOVER-2 Trial in mid-2025, with a topline readout anticipated in Q3 2026, subject to receiving additional financing[86] Financial Overview and Results of Operations Q1 2025 net loss was $6.4 million, an improvement from $7.4 million in Q1 2024, primarily due to reduced R&D expenses, with a $5.3 million working capital deficit - As of March 31, 2025, the company had an accumulated deficit of $170.7 million and expects to incur significant operating losses for the next several years[101] Comparison of Results for the Three Months Ended March 31 | Item | 2025 ($) | 2024 ($) | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Research and development | 4,113,537 | 5,783,865 | (1,670,328) | (28.9)% | | General and administrative | 2,424,630 | 2,138,241 | 286,389 | 13.4% | | Net loss | (6,432,840) | (7,433,608) | 1,000,768 | (13.5)% | - The decrease in R&D expenses was primarily due to a reduction in external clinical research costs as the OLE Trial winds down[114] Liquidity and Capital Resources Liquidity is critically low with $5.3 million cash, sufficient only through Q2 2025, raising substantial doubt about going concern, necessitating Q3 2025 fundraising - The company's existing cash of approximately $5.3 million will not be sufficient to complete the development of its product candidates[122] - Management believes it has adequate cash to cover outlays only through the end of the second quarter of 2025 and will need additional fundraising during the third quarter of 2025[122] - The company's financial condition and need for additional capital raise substantial doubt about its ability to continue as a going concern[122] Key Financial Position Data | Balance Sheet Data | March 31, 2025 ($) | December 31, 2024 ($) | | :--- | :--- | :--- | | Cash and cash equivalents | 5,289,404 | 13,476,331 | | Working (deficit) capital | (5,251,929) | 81,861 | | Total stockholders' equity (deficit) | (4,460,024) | 812,572 | Item 3. 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, Reviva is not required to provide the information called for by this item[131] Item 4. Controls and Procedures Management concluded disclosure controls were ineffective as of March 31, 2025, due to material weaknesses in control environment, personnel, and IT general controls, with remediation underway - Management, including the CEO and CFO, concluded that as of March 31, 2025, the company's disclosure controls and procedures were not effective at the reasonable assurance level[133] - The company identified several material weaknesses, including an ineffective control environment due to an insufficient number of knowledgeable personnel[134] - Specific material weaknesses include ineffective IT general controls related to change management and access controls, and ineffective process-level controls affecting substantially all accounts[135] - The company has started remediation, including hiring a third-party consulting firm to enhance IT general controls and realigning personnel to strengthen financial reporting oversight[137] Part II Item 1. Legal Proceedings The company is not currently involved in any material legal proceedings or aware of any significant pending claims - The company is currently not aware of any legal proceedings or claims that may be, individually or in the aggregate, material to the company[143] Item 1A. Risk Factors New risk factor highlights Nasdaq non-compliance due to minimum bid price, potentially leading to delisting if not resolved by November 10, 2025 - On May 13, 2025, the company received a notice from Nasdaq for non-compliance with the minimum bid price requirement of $1.00 per share[145] - The company has an initial period of 180 calendar days (until November 10, 2025) to regain compliance, with failure potentially resulting in the delisting of its common stock from Nasdaq[145][147] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds No unregistered sales of equity securities occurred during the reporting period - There were no unregistered sales of equity securities during the quarter ended March 31, 2025[149] Item 5. Other Information Discloses Nasdaq non-compliance notice for minimum bid price, with a November 10, 2025 deadline for compliance, and no Rule 10b5-1 trading plan changes - On May 13, 2025, the company received a written notice from Nasdaq because its common stock closing bid price was below $1.00 for 30 consecutive business days[152] - The company has 180 calendar days, until November 10, 2025, to regain compliance with the Nasdaq minimum bid price requirement[153] - During the quarter ended March 31, 2025, no officers or directors adopted or terminated a Rule 10b5-1 trading arrangement[156] Item 6. Exhibits Lists exhibits filed with Form 10-Q, including CEO and CFO certifications and Inline XBRL data files