Talphera(TLPH) - 2025 Q2 - Quarterly Report

PART I. FINANCIAL INFORMATION Talphera's unaudited financial statements, management's analysis, market risk, and internal controls are presented Item 1. Financial Statements Talphera's unaudited condensed consolidated financial statements and notes detail financial position, operations, cash flows, and equity, highlighting liquidity and going concern Condensed Consolidated Balance Sheets This section presents the company's financial position, including assets, liabilities, and equity, as of specific reporting dates Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :------------------ | | Cash and cash equivalents | $6,791 | $8,863 | | Total current assets | $7,696 | $9,417 | | Total assets | $16,515 | $18,236 | | Total current liabilities | $2,630 | $2,647 | | Total liabilities | $9,888 | $10,235 | | Total stockholders' equity | $6,627 | $8,001 | - Common stock outstanding increased to 20,522,655 shares as of June 30, 2025, from 17,029,469 shares as of December 31, 2024[14] Condensed Consolidated Statements of Operations This section details the company's revenues, expenses, and net loss over specific reporting periods Condensed Consolidated Statements of Operations Highlights (in thousands, except per share data) | 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 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue | $— | $— | $27 | $— | | Research and development | $1,500 | $1,909 | $2,669 | $3,342 | | Selling, general and administrative | $2,193 | $2,361 | $3,967 | $5,165 | | Total operating costs and expenses | $3,693 | $4,270 | $6,636 | $8,507 | | Loss from operations | $(3,693) | $(4,270) | $(6,609) | $(8,507) | | Total other income, net | $204 | $443 | $454 | $726 | | Net loss | $(3,489) | $(3,827) | $(6,082) | $(7,781) | | Basic and diluted loss per share | $(0.10) | $(0.15) | $(0.20) | $(0.31) | Condensed Consolidated Statements of Stockholders' Equity This section outlines changes in the company's equity, including common stock, additional paid-in capital, and accumulated deficit Changes in Stockholders' Equity (in thousands) | Metric | Balance as of January 1, 2025 | Balance as of June 30, 2025 | | :----------------------------------- | :---------------------------- | :-------------------------- | | Common Stock (Shares) | 17,029,469 | 20,522,655 | | Common Stock (Amount) | $17 | $20 | | Additional Paid-in Capital | $465,214 | $469,919 | | Accumulated Deficit | $(457,230) | $(463,312) | | Total Stockholders' Equity | $8,001 | $6,627 | - Net proceeds from the issuance of common stock and pre-funded warrants in connection with equity financing for the six months ended June 30, 2025, amounted to $4,354 thousand[21] Condensed Consolidated Statements of Cash Flows This section summarizes the company's cash inflows and outflows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(6,418) | $(7,493) | | Net cash provided by investing activities | $— | $3,181 | | Net cash provided by financing activities | $4,346 | $12,014 | | Net change in cash and cash equivalents | $(2,072) | $7,702 | | Cash and cash equivalents—End of period | $6,791 | $13,423 | Notes to Condensed Consolidated Financial Statements These notes provide detailed disclosures on the company's organization, significant accounting policies, financial instrument valuations, discontinued operations, sale of future payments, legal commitments, equity transactions, stock-based compensation, net loss per share, and segment reporting 1. Organization and Summary of Significant Accounting Policies This note describes the company's business, product pipeline, and critical accounting policies, including its going concern status - Talphera, Inc. is a specialty pharmaceutical company focused on developing and commercializing innovative therapies for medically supervised settings[26][78] - The company's product development portfolio includes Niyad™ (a regional anticoagulant for dialysis) and LTX-608 (a nafamostat formulation for direct IV infusion for indications like DIC, ARDS, acute pancreatitis, or as an anti-viral treatment)[26][27][78] - The company has incurred recurring operating losses and negative cash flows, raising substantial doubt about its ability to continue as a going concern, and expects to need additional capital within the next twelve months[28][103] 2. Investments and Fair Value Measurement This note details the company's cash, cash equivalents, and fair value measurements of financial instruments, particularly warrant liabilities Cash and Cash Equivalents (in thousands) as of June 30, 2025 | Category | Fair Value | | :-------------------------- | :--------- | | Cash | $615 | | Money market funds | $404 | | U.S. government agency securities | $5,772 | | Total | $6,791 | - The warrant liability, a Level III measurement, was valued at $759 thousand as of June 30, 2025, reflecting a gain on change in fair value of $302 thousand for the six months ended June 30, 2025, compared to a loss of $547 thousand for the same period in 2024[42][100] 3. Discontinued Operations This note provides financial information related to the company's discontinued operations and associated accrued liabilities Net Income from Discontinued Operations (in thousands) | Period | Net Income | | :----------------------------- | :--------- | | Six months ended June 30, 2025 | $73 | | Six months ended June 30, 2024 | $— | - Accrued liabilities for discontinued operations were $650 thousand as of June 30, 2025, down from $723 thousand as of December 31, 2024[46] 4. Sale of Future Payments This note explains the accounting for the sale of future DSUVIA payments and its impact on other income - In January 2024, the company recognized $1.2 million in other income from the sale of future commercial DSUVIA payments to XOMA (US) LLC[48][99] - Alora Pharmaceuticals, LLC discontinued DSUVIA sales efforts to non-DoD customers in October 2024, leading the company to estimate future payments under the Purchase Agreement will be less than proceeds, resulting in a 0% estimated effective interest rate for the six months ended June 30, 2025[50] 5. Commitments and Contingencies This note discloses the company's legal proceedings, including securities class action and shareholder derivative complaints - A securities class action complaint, dismissed with prejudice on May 7, 2024, is currently under appeal by plaintiffs in the Ninth Circuit Court of Appeals[52]