Financial Position - The company has approximately $27.3 million in cash and cash equivalents and marketable securities as of September 30, 2025[120]. - The accumulated deficit as of September 30, 2025, is $89.6 million, with a net loss of $18.9 million for the nine months ended September 30, 2025[121]. - As of September 30, 2025, the company had approximately $27.3 million in cash and cash equivalents, with an accumulated deficit of approximately $89.6 million[149]. - The company completed a private placement in April 2024, raising approximately $50.0 million, with potential additional proceeds of up to $99.4 million from warrant exercises[150]. - Cash provided by financing activities for the nine months ended September 30, 2025, was $4.6 million, a significant decrease from $46.4 million in the same period of 2024, reflecting a decline of approximately 90%[161]. - Cash used in investing activities for the nine months ended September 30, 2025, was $12.7 million, compared to $38.0 million in the same period of 2024, showing a reduction of about 66%[160]. - As of September 30, 2025, the company does not believe its existing cash and cash equivalents will fund operations for at least twelve months, raising substantial doubt about its ability to continue as a going concern[154]. Revenue and Grant Funding - The company has not generated any revenue from product sales and does not expect to do so in the near future[123]. - Grant funding recognized for the nine months ended September 30, 2025, was $4.0 million, compared to $7.6 million for the same period in 2024[123]. - Grant revenue decreased to $0.3 million for the three months ended September 30, 2025, down from $1.9 million in 2024, representing an 83% decline due to the completion of the Initial Phase of the RewinD-LB Trial[132]. - For the nine months ended September 30, 2025, grant revenue was $4.0 million, down 47% from $7.6 million in 2024, attributed to the transition phases of the RewinD-LB Trial[141]. Operating Expenses - Total operating expenses for the three months ended September 30, 2025, increased to $8.4 million, a 14% rise from $7.3 million in 2024, driven by higher research and development costs[131]. - Research and development expenses rose to $6.0 million for the three months ended September 30, 2025, an 18% increase from $5.1 million in 2024, primarily due to a $1.1 million increase in personnel costs[135]. - Total research and development expenses for the nine months ended September 30, 2025, were $16.0 million, a 37% increase from $11.7 million in 2024, mainly due to increased personnel and CMC-related costs[145]. - General and administrative expenses for the nine months ended September 30, 2025, totaled $8.0 million, a 16% increase from $6.9 million in 2024, driven by higher personnel costs and insurance expenses[146]. - The company expects to continue incurring losses and increasing research and development expenses, general and administrative expenses, and capital expenditures in the foreseeable future[153]. Clinical Trials and Research - The RewinD-LB Trial demonstrated a 54% risk reduction in clinically significant worsening compared to control at Week 32 of Batch B neflamapimod treatment (p=0.0037)[116]. - The planned Phase 3 clinical trial will evaluate neflamapimod in approximately 300 patients with DLB, expected to start in the second half of 2026[117]. - The company has received Orphan Drug Designation for neflamapimod for certain forms of frontotemporal dementia (FTD) in November 2024[118]. - The RewinD-LB Trial included 159 participants, funded primarily by a $21.3 million grant from the NIA[115]. - The company plans to implement manufacturing improvements to ensure the stability of neflamapimod's active ingredient in future trials[119]. Losses and Cash Flow - Net loss for the three months ended September 30, 2025, was $7.7 million, a 63% increase compared to a net loss of $4.8 million in 2024[131]. - For the nine months ended September 30, 2025, net cash used in operating activities was $16.9 million, compared to $8.5 million for the same period in 2024, representing a 99% increase in cash outflow[157][158]. - The net loss for the nine months ended September 30, 2025, was $18.9 million, up from a net loss of $9.6 million in the same period of 2024, indicating a 97% increase in losses[158][159]. - The company incurred a non-cash expense of $1.1 million for stock-based compensation during the nine months ended September 30, 2025[158]. Financing and Future Outlook - The company plans to finance its cash needs through equity offerings, debt financings, or other capital sources, which may dilute existing stockholders' ownership[154]. - The company is actively seeking additional financing to advance its product candidates and fund operations, but may face challenges in raising funds on favorable terms[154]. - The company has no off-balance sheet arrangements that could materially affect its financial condition[164].
DIFFUSION PHARMA(DFFN) - 2025 Q3 - Quarterly Report