Altimmune(ALT) - 2025 Q2 - Quarterly Report

PART I. FINANCIAL INFORMATION Item 1. Financial Statements The company presents its unaudited consolidated financial statements, detailing significant changes in assets, liabilities, equity, and cash flows Consolidated Balance Sheets Consolidated Balance Sheet Highlights (in thousands): | Metric | June 30, 2025 | December 31, 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $183,105 | $36,926 | $146,179 | 396% | | Short-term investments | $— | $94,965 | $(94,965) | (100)% | | Total current assets | $188,422 | $137,254 | $51,168 | 37% | | Total assets | $190,350 | $139,306 | $51,044 | 37% | | Total current liabilities | $9,220 | $10,468 | $(1,248) | (12)% | | Term loan, noncurrent | $14,332 | $— | $14,332 | N/A | | Total liabilities | $28,983 | $15,798 | $13,185 | 83% | | Total stockholders' equity | $161,367 | $123,508 | $37,859 | 31% | Consolidated Statements of Operations and Comprehensive Loss Consolidated Statements of Operations and Comprehensive Loss Highlights (in thousands): | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenues | $5 | $5 | $10 | $10 | | Research and development expenses | $17,236 | $21,155 | $33,063 | $42,642 | | General and administrative expenses | $5,691 | $5,595 | $11,684 | $10,907 | | Loss from operations | $(22,922) | $(26,745) | $(44,737) | $(53,539) | | Total other income (expense), net | $776 | $2,105 | $2,335 | $4,505 | | Net loss | $(22,146) | $(24,640) | $(41,721) | $(49,034) | | Net loss per share, basic and diluted | $(0.27) | $(0.35) | $(0.53) | $(0.69) | - Net loss decreased by 10% for the three months ended June 30, 2025, and by 15% for the six months ended June 30, 2025, compared to the respective prior-year periods[10] - Research and development expenses decreased by 19% for the three months and 22% for the six months ended June 30, 2025, primarily due to reduced MASH trial enrollment and manufacturing costs[10] Consolidated Statements of Changes in Stockholders' Equity Changes in Stockholders' Equity (in thousands) for Six Months Ended June 30, 2025: | Item | Amount | | :--- | :--- | | Balance at December 31, 2024 | $123,508 | | Stock-based compensation | $7,581 | | Issuance of common stock in at-the-market offerings, net | $72,571 | | Net loss | $(41,721) | | Balance at June 30, 2025 | $161,367 | - Total stockholders' equity increased from $123.5 million at December 31, 2024, to $161.4 million at June 30, 2025, primarily driven by proceeds from at-the-market offerings and stock-based compensation, partially offset by net loss[12] Consolidated Statements of Cash Flows Consolidated Statements of Cash Flows Highlights (in thousands) for Six Months Ended June 30: | Activity | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Net cash used in operating activities | $(36,190) | $(34,465) | $(1,725) | | Net cash provided by (used in) investing activities | $96,006 | $(43,217) | $139,223 | | Net cash provided by (used in) financing activities | $86,363 | $(307) | $86,670 | | Net increase (decrease) in cash and cash equivalents and restricted cash | $146,179 | $(77,989) | $224,168 | | Cash, cash equivalents and restricted cash at end of period | $183,147 | $57,169 | $125,978 | - Significant shift in investing activities from cash usage to provision, primarily due to proceeds from sales and maturities of short-term investments ($143.6 million in 2025 vs $33.5 million in 2024)[17] - Financing activities provided substantial cash in 2025 ($86.4 million) due to at-the-market offerings ($72.6 million) and a new term loan ($15.0 million)[17] 1. Nature of Business and Basis of Presentation - Altimmune, Inc. is a late clinical-stage biopharmaceutical company focused on developing novel peptide-based therapeutics for liver and cardiometabolic diseases[18][19] - The company's lead program is pemvidutide, a GLP-1/glucagon dual receptor agonist, for the treatment of MASH, Alcohol Use Disorder (AUD), Alcohol-Associated Liver Disease (ALD), and obesity[19] - Altimmune has not generated any revenues from product sales to date and finances operations through equity, debt, and research grants[19] 2. Summary of Significant Accounting Policies - No significant changes to the company's accounting policies during the six months ended June 30, 2025, compared to the Annual Report on Form 10-K for December 31, 2024[23] - A discrete tax benefit of approximately $0.7 million was recorded during the six months ended June 30, 2025, related to Maryland carryback claims[25] - The recently enacted One Big Beautiful Bill Act (OBBBA) is being assessed but is not expected to materially impact the estimated annual effective tax rate in 2025[26] 3. Fair Value Measurements - As of June 30, 2025, the company had no assets and liabilities measured at fair value on a recurring basis, a change from December 31, 2024[28] - Recognized approximately $0.1 million realized net loss from sales of available-for-sale debt securities during the six months ended June 30, 2025[28] Fair Value Measurement at December 31, 2024 (in thousands): | Category | Total | Level 1 | Level 2 | Level 3 | | :--- | :--- | :--- | :--- | :--- | | Cash equivalents - money market funds | $27,279 | $27,279 | $— | $— | | Short-term investments | $94,965 | $— | $94,965 | $— | | Total | $122,244 | $27,279 | $94,965 | $— | 4. Accrued Expenses Accrued Expenses and Other Current Liabilities (in thousands): | Category | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Accrued professional services | $695 | $401 | | Accrued payroll and employee benefits | $1,828 | $3,079 | | Accrued research and development | $5,424 | $6,443 | | Lease obligation, current portion | $239 | $279 | | Accrued interest and other | $183 | $55 | | Total | $8,369 | $10,257 | - Total accrued expenses and other current liabilities decreased by $1.9 million, or 18%, from December 31, 2024, to June 30, 2025, primarily due to decreases in accrued payroll and R&D[35] 5. Term Loan - On May 13, 2025, the company entered into a Loan and Security Agreement with Hercules Capital, Inc. for up to $100.0 million in term loans[36] - The first tranche of $15.0 million was drawn on the closing date; additional tranches are subject to milestones and lender approval[37][39] - The Term Loan matures on January 1, 2029, bears interest at a rate based on prime plus 2.45% (or a floor of 9.95% until Dec 31, 2025, then 9.45%), and has an effective interest rate of 14.4%[40][44] Term Loan Details (in thousands) as of June 30, 2025: | Item | Amount | | :--- | :--- | | Term loan principal amount | $15,000 | | End of term charge | $937 | | Unamortized discount and issuance costs | $(1,605) | | Total term loan, net of current portion | $14,332 | 6. Other Noncurrent Liabilities Other Noncurrent Liabilities (in thousands): | Category | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Research and development incentive credit | $3,981 | $3,746 | | Lease obligation, long-term portion | $1,278 | $1,402 | | Conditional economic incentive grants | $160 | $160 | | Other | $12 | $22 | | Total | $5,431 | $5,330 | - Total other noncurrent liabilities increased slightly by $0.1 million, or 2%, from December 31, 2024, to June 30, 2025, primarily due to an increase in research and development incentive credit[47] 7. Stockholders' Equity - As of June 30, 2025, the company had 85,076,300 shares of common stock issued and outstanding, out of 200,000,000 authorized shares[48] - During the six months ended June 30, 2025, the company sold 8,052,064 shares under the 2025 at-the-market (ATM) offering, generating approximately $42.4 million in net proceeds[50] - An additional $106.2 million remained available to be sold under the 2025 ATM Agreement as of June 30, 2025[50] - The 2023 ATM Agreement was terminated in February 2025, having sold 4,467,866 shares for approximately $30.2 million in net proceeds during the six months ended June 30, 2025[51] 8. Stock-Based Compensation - On January 1, 2025, the Omnibus Incentive Plan increased by 3,193,659 shares of common stock[52] - During the six months ended June 30, 2025, the company granted 1,954,950 stock options and 481,700 Restricted Stock Units (RSUs)[53][55] Stock-based Compensation Expense (in thousands) for Six Months Ended June 30: | Category | 2025 | 2024 | | :--- | :--- | :--- | | Research and development | $3,329 | $3,249 | | General and administrative | $4,252 | $4,712 | | Total | $7,581 | $7,961 | 9. Net Loss Per Share - Basic and diluted net loss per share are the same for the three and six months ended June 30, 2025 and 2024, due to the company reporting a net loss[58] - All unvested RSUs and stock options are excluded from the computation of diluted weighted-average shares outstanding as they are anti-dilutive[59] Anti-Dilutive Potential Common Shares (Six Months Ended June 30): | Security Type | 2025 | 2024 | | :--- | :--- | :--- | | Common stock options | 8,128,505 | 6,328,463 | | Restricted stock units | 1,039,950 | 786,102 | 10. Commitments and Contingencies - The company has contingent payment obligations of up to $80.0 million related to the Spitfire acquisition upon achievement of specified worldwide net sales milestones[61] - A shareholder derivative complaint filed in June 2024 was dismissed without prejudice on February 3, 2025[63] - A new class action complaint was filed on August 5, 2025, alleging securities law violations related to pemvidutide and the IMPACT Phase 2b trial, which the company intends to vigorously defend[64] 11. Segment Information - The company operates as a single segment, a late clinical-stage biopharmaceutical company focused on developing novel peptide-based therapeutics[66] - The chief operating decision maker assesses performance and allocates resources based solely on consolidated net loss[67] 12. Subsequent Events - During July 2025 and through the issuance date of the financial statements, the company raised an additional $12.8 million in net proceeds by issuing 3,141,233 shares of common stock through its 2025 at-the-market offering[68] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses financial performance, liquidity, capital resources, and recent business updates including positive MASH trial results Overview - Altimmune, Inc. is a late clinical-stage biopharmaceutical company focused on developing novel peptide-based therapeutics for liver and cardiometabolic diseases[73] - The lead program, pemvidutide, is a GLP-1/glucagon dual receptor agonist for MASH, Alcohol Use Disorder (AUD), Alcohol-Associated Liver Disease (ALD), and obesity[73] Recent Business Update MASH - On June 26, 2025, topline results from the IMPACT Phase 2b trial in MASH were released, showing statistically significant MASH resolution without worsening of fibrosis[74][75] MASH Resolution without Worsening Fibrosis (24 weeks, ITT analysis): | Pemvidutide Dose | MASH Resolution Rate | Placebo Rate | p-value | | :--- | :--- | :--- | :--- | | 1.2 mg | 59.1% | 19.1% | < 0.0001 | | 1.8 mg | 52.1% | 19.1% | < 0.0001 | - An AI-based analysis demonstrated statistically significant reductions in fibrosis, with 30.6% of subjects on pemvidutide 1.8 mg achieving a 60% or more reduction compared to 8.2% on placebo (p<0.001)[76] Mean Weight Loss (24 weeks): | Pemvidutide Dose | Mean Weight Loss | Placebo Weight Loss | p-value | | :--- | :--- | :--- | :--- | | 1.2 mg | 5.0% | 1.0% | < 0.001 | | 1.8 mg | 6.2% | 1.0% | < 0.001 | - Pemvidutide demonstrated favorable safety and tolerability with low overall treatment discontinuation rates (0.0% for 1.2 mg and 1.2% for 1.8 mg due to adverse events, versus 2.4% for placebo)[78] AUD and ALD - The company is pursuing two additional indications for pemvidutide: Alcohol Use Disorder (AUD) and Alcohol-Associated Liver Disease (ALD)[79] - The RECLAIM Phase 2 trial for AUD enrolled its first subject on May 19, 2025, targeting 100 subjects to evaluate changes in alcohol consumption[80] - The RESTORE Phase 2 trial for ALD enrolled its first patient on July 9, 2025, targeting 100 patients to evaluate changes in liver stiffness[81] Recent Global Events - Global tariffs and counter-tariffs are causing uncertainties in global markets, potentially leading to inflationary pressures, supply chain disruptions, and volatility in capital markets, foreign exchange rates, and interest rates[82] Results of Operations Comparison of the three months ended June 30, 2025 and 2024 Results of Operations (Three Months Ended June 30, in thousands): | Metric | 2025 | 2024 | Increase (Decrease) | % Change | | :--- | :--- | :--- | :--- | :--- | | Revenues | $5 | $5 | $— | 0% | | Research and development | $17,236 | $21,155 | $(3,919) | (19)% | | General and administrative | $5,691 | $5,595 | $96 | 2% | | Loss from operations | $(22,922) | $(26,745) | $(3,823) | (14)% | | Total other income (expense), net | $776 | $2,105 | $(1,329) | (63)% | | Net loss | $(22,146) | $(24,640) | $(2,494) | (10)% | - The decrease in R&D expenses was primarily due to ongoing enrollment for the IMPACT Phase 2b trial in MASH during the first half of 2024 and a $1.6 million decrease in manufacturing expenses, partially offset by new AUD and ALD trials[85] - Total other income (expense), net decreased by $1.3 million, primarily due to a $1.0 million decrease in interest income and a $0.3 million increase in interest expense related to the Term Loan[88] Comparison of the six months ended June 30, 2025 and 2024 Results of Operations (Six Months Ended June 30, in thousands): | Metric | 2025 | 2024 | Increase (Decrease) | % Change | | :--- | :--- | :--- | :--- | :--- | | Revenues | $10 | $10 | $— | 0% | | Research and development | $33,063 | $42,642 | $(9,579) | (22)% | | General and administrative | $11,684 | $10,907 | $777 | 7% | | Loss from operations | $(44,737) | $(53,539) | $(8,802) | (16)% | | Total other income (expense), net | $2,335 | $4,505 | $(2,170) | (48)% | | Net loss | $(41,721) | $(49,034) | $(7,313) | (15)% | - The $9.6 million decrease in R&D expenses was primarily due to reduced MASH trial enrollment costs ($6.1 million), a $3.3 million decrease in manufacturing expenses, and the termination of the HepTcell program ($2.0 million), partially offset by increased expenses for AUD and ALD trials ($3.0 million)[92][93] - General and administrative expenses increased by $0.8 million, or 7%, primarily due to higher professional services[94] - Total other income (expense), net decreased by $2.2 million, primarily due to a $1.9 million decrease in interest income and a $0.3 million increase in interest expense from the Term Loan[95] Liquidity and Capital Resources Overview - As of June 30, 2025, cash, cash equivalents, and restricted cash totaled $183.1 million[97] - Management believes current cash on hand is sufficient to fund operations for at least a twelve-month period from the issuance date of the financial statements[98] - The company has an accumulated deficit of $603.1 million as of June 30, 2025, and will require additional equity or debt financing or partnerships for long-term capital needs[99] Sources of Liquidity - Secured a new term loan facility of up to $100.0 million with Hercules Capital, Inc., with $15.0 million drawn on May 13, 2025[100] - Filed a shelf registration statement on Form S-3 on February 27, 2025, allowing the company to offer and sell up to $400.0 million in various securities[101] - Raised approximately $42.4 million in net proceeds from the 2025 at-the-market (ATM) offering during the six months ended June 30, 2025, with $106.2 million remaining available[103] - Raised approximately $30.2 million in net proceeds from the 2023 ATM offering during the six months ended June 30, 2025, before its termination in February 2025[105] Cash Flows Cash Flow Summary (Six Months Ended June 30, in thousands): | Activity | 2025 | 2024 | Increase (Decrease) | | :--- | :--- | :--- | :--- | | Net cash used in operating activities | $(36,190) | $(34,465) | $1,725 | | Net cash provided by (used in) investing activities | $96,006 | $(43,217) | $139,223 | | Net cash provided by (used in) financing activities | $86,363 | $(307) | $86,670 | | Net increase (decrease) in cash | $146,179 | $(77,989) | $224,168 | - Net cash provided by investing activities significantly increased to $96.0 million in 2025 from $43.2 million used in 2024, primarily due to proceeds from sales and maturities of short-term investments[108] - Net cash provided by financing activities increased to $86.4 million in 2025 from $0.3 million used in 2024, driven by ATM offerings and the new term loan[109] Current Resources - As of June 30, 2025, the company had $183.1 million in cash, cash equivalents, and restricted cash, deemed sufficient for operations for at least the next twelve months[110] - Long-term capital needs for planned clinical trials will require additional equity or debt financing, or monetization through partnerships[110] Critical Accounting Estimates - No material changes to critical accounting policies and significant judgments and estimates were reported compared to the Annual Report on Form 10-K for the year ended December 31, 2024[112] Item 3. Quantitative and Qualitative Disclosures about Market Risk As a "smaller reporting company," Altimmune, Inc. is not required to provide these disclosures - The company is exempt from providing market risk disclosures as a "smaller reporting company" under Item 10 of Regulation S-K[113] Item 4. Controls and Procedures Management concluded that disclosure controls and procedures were effective, with no material changes in internal control over financial reporting - Management, including the principal executive and financial officers, concluded that disclosure controls and procedures were effective as of June 30, 2025[114][115] - There were no changes in internal control over financial reporting during the quarter ended June 30, 2025, that materially affected or are reasonably likely to materially affect internal control over financial reporting[116] PART II. OTHER INFORMATION Item 1. Legal Proceedings A new class action complaint was filed on August 5, 2025, alleging securities law violations, which the company will vigorously defend - A shareholder derivative complaint (In re Altimmune, Inc. Stockholder Derivative Litigation) was dismissed without prejudice on February 3, 2025[117] - A new class action complaint (Collier v. Altimmune, Inc., et al.) was filed on August 5, 2025, alleging violations of the Securities Exchange Act of 1934 related to pemvidutide and the IMPACT Phase 2b trial[118] - The company intends to vigorously defend against the Collier Class Action litigation[118] Item 1A. Risk Factors There have been no material changes to the risk factors previously disclosed in the company's Annual and Quarterly Reports - No material changes from the risk factors disclosed in the Annual Report on Form 10-K filed on February 27, 2025, and the latest Quarterly Report on Form 10-Q filed on May 13, 2025[120] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities or use of proceeds for the period - No unregistered sales of equity securities and use of proceeds to report[121] Item 3. Defaults Upon Senior Securities The company reported no defaults upon senior securities for the period - No defaults upon senior securities to report[122] Item 4. Mine Safety Disclosures This item is not applicable to Altimmune, Inc.'s operations - Not applicable to the company[123] Item 5. Other Information No officers or directors adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter - No officers or directors adopted, modified, or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" during the three months ended June 30, 2025[124] Item 6. Exhibits This section lists all exhibits filed with the Form 10-Q, including corporate governance and financing agreement documents - Includes Amended and Restated Certificate of Incorporation, Loan and Security Agreement, and certifications of principal executive and financial officers[126] Signatures The report was duly signed on August 12, 2025, by the President and Chief Executive Officer and the Chief Financial Officer - Report signed by Vipin K. Garg, President and Chief Executive Officer, and Gregory Weaver, Chief Financial Officer, on August 12, 2025[131]