Cadrenal Therapeutics(CVKD) - 2025 Q2 - Quarterly Report

PART I. FINANCIAL INFORMATION Financial Statements (Unaudited) The unaudited financial statements for the period ended June 30, 2025, show decreased cash and total assets, an increased net loss of $7.5 million, and higher cash used in operations Balance Sheets As of June 30, 2025, total assets decreased to $6.0 million from $10.1 million, driven by reduced cash, with liabilities and equity also falling Balance Sheet Summary (Unaudited) | Account | June 30, 2025 ($M) | December 31, 2024 ($M) | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $5.57M | $10.02M | | Total current assets | $5.97M | $10.11M | | Total assets | $5.98M | $10.12M | | Liabilities & Equity | | | | Total current liabilities | $1.68M | $2.68M | | Total liabilities | $1.68M | $2.68M | | Accumulated deficit | $(33.24M) | $(25.72M) | | Total stockholders' equity | $4.30M | $7.44M | Statements of Operations and Comprehensive Loss Net loss for the six months ended June 30, 2025, increased to $7.5 million, driven by higher operating expenses, particularly General and Administrative costs Operating Results (Unaudited) | Metric | Three Months Ended June 30, 2025 ($M) | Three Months Ended June 30, 2024 ($M) | Six Months Ended June 30, 2025 ($M) | Six Months Ended June 30, 2024 ($M) | | :--- | :--- | :--- | :--- | :--- | | General and administrative expenses | $2.66M | $1.21M | $4.91M | $2.34M | | Research and development expenses | $1.08M | $1.25M | $2.75M | $1.88M | | Loss from operations | $(3.73M) | $(2.47M) | $(7.66M) | $(4.22M) | | Net loss | $(3.67M) | $(2.39M) | $(7.51M) | $(4.06M) | | Net loss per share (basic and diluted) | $(1.87) | $(2.24) | $(3.95) | $(3.80) | Statements of Cash Flows Net cash used in operating activities more than doubled to $7.7 million for the six months ended June 30, 2025, resulting in a $4.4 million net decrease in cash Cash Flow Summary (Unaudited) | Cash Flow Activity | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :--- | :--- | :--- | | Net cash used in operating activities | $(7,674,557) | $(3,365,624) | | Net cash used in investing activities | $(3,251) | $0 | | Net cash provided by financing activities | $3,230,596 | $298 | | Net change in cash and cash equivalents | $(4,447,212) | $(3,365,326) | | Cash and cash equivalents – end of period | $5,570,730 | $5,037,174 | Notes to Financial Statements Notes highlight tecarfarin development, going concern uncertainty, a 1-for-15 reverse stock split, and recent ATM equity sales - The company is a biopharmaceutical firm developing tecarfarin, a novel oral anticoagulant, for cardiovascular conditions like end-stage kidney disease with atrial fibrillation (ESKD+AFib) and for patients with left ventricular assist devices (LVADs)[21][22] - The company's cash balance of approximately $5.0 million as of August 6, 2025, is expected to fund operations for at least the next twelve months[27] However, additional funding is necessary for further late-stage clinical trials, including a Phase 3 trial for tecarfarin[28] - A 1-for-15 reverse stock split was effected on August 20, 2024[63] All share and per-share data have been retroactively adjusted to reflect this split[63] - During the six months ended June 30, 2025, the company sold 186,294 shares through its at-the-market (ATM) facility, generating net proceeds of approximately $3.2 million[73] - Subsequent to the quarter end, from July 1 to July 14, 2025, the company sold an additional 39,741 shares via its ATM facility, raising net proceeds of approximately $499,000[90] Management's Discussion and Analysis of Financial Condition and Results of Operations Management focuses on tecarfarin for niche cardiovascular conditions; H1 2025 operating expenses increased, requiring additional capital for future clinical trials - The company is pursuing a 'pipeline-in-a-product' approach for tecarfarin, targeting niche cardiovascular conditions where DOACs have failed or are unproven, such as in patients with ESKD and AFib, or those with LVADs[97][98] - On August 5, 2025, the company announced plans to initiate a clinical trial for tecarfarin in patients with ESKD transitioning to dialysis, with enrollment expected to begin later in the year[100] - As of August 11, 2025, the company had approximately $5.0 million in cash and cash equivalents, which is expected to fund operations for at least the next twelve months[113] However, additional funding is needed for any further clinical trials, including a Phase 3 trial for tecarfarin[113] Results of Operations Total operating expenses increased to $7.7 million for the six months ended June 30, 2025, driven by significant increases in G&A and R&D Comparison of Operating Expenses (Six Months Ended June 30) | Expense Category | 2025 ($) | 2024 ($) | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | General and administrative | $4,910,970 | $2,338,430 | $2,572,540 | 110% | | Research and development | $2,745,379 | $1,882,736 | $862,643 | 46% | | Total operating expenses | $7,662,267 | $4,222,233 | $3,440,034 | 81.5% | - The $2.6 million increase in G&A expenses for the six-month period was primarily due to a $1.3 million rise in public company costs, a $0.6 million increase in stock-based compensation, and a $0.2 million increase in personnel-related expenses[110] - The $0.9 million increase in R&D expenses for the six-month period was mainly attributed to a $0.5 million increase in CMC expenses, a $0.3 million increase in personnel costs (severance), and a $0.1 million increase in clinical trial preparation costs[111] Liquidity and Capital Resources The company funds operations through equity sales; cash used in operations increased to $7.7 million in H1 2025, partially offset by $3.2 million from financing Cash Flow Summary (Six Months Ended June 30) | Activity | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Cash used in operating activities | $(7,674,557) | $(3,365,624) | | Cash provided by financing activities | $3,230,596 | $298 | | Net change in cash | $(4,447,212) | $(3,365,326) | - Cash used in operating activities for the first six months of 2025 was $7.7 million, driven by a net loss of $7.5 million (which included $1.1 million of non-cash expenses) and a $1.3 million use of cash from changes in operating assets and liabilities[113][115] Quantitative and Qualitative Disclosures About Market Risk This section is not applicable as the company qualifies as a smaller reporting company - The company is a smaller reporting company and is not required to provide these disclosures[121] Controls and Procedures Management concluded disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - Based on an evaluation as of June 30, 2025, the Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective at the reasonable assurance level[123] - No changes in internal control over financial reporting occurred during the quarter ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, internal controls[124] PART II. OTHER INFORMATION Legal Proceedings The company is not currently subject to any material legal proceedings - The company is not currently a party to any material legal proceedings[126] Risk Factors There have been no material changes to the risk factors previously disclosed in the company's Annual Report - There have been no material changes from the risk factors disclosed in the company's Annual Report[127] Unregistered Sales of Equity Securities and Use of Proceeds On June 29, 2025, the company issued 10,000 shares of restricted common stock to a consultant, exempt from registration under Section 4(a)(2) - On June 29, 2025, the company issued 10,000 shares of restricted common stock to a consultant for services, exempt from registration under Section 4(a)(2) of the Securities Act[129] Other Information On May 9, 2025, the CEO and CFO entered into Rule 10b5-1 stock selling plans for up to 50,600 and 33,333 shares, effective August 2025 - On May 9, 2025, the CEO and CFO entered into Rule 10b5-1 stock selling plans[135] - The plans allow for the sale of a maximum of 50,600 shares by the CEO and 33,333 shares by the CFO, with the selling period beginning in August 2025 and ending in November 2025[136] Exhibits This section provides an index of exhibits filed or furnished as part of the Quarterly Report on Form 10-Q - The report includes an Exhibit Index listing all documents filed or furnished with the Form 10-Q[137]