Eledon Pharmaceuticals(ELDN) - 2023 Q2 - Quarterly Report

Company Focus and Development - Eledon Pharmaceuticals is focusing on the development of tegoprubart, an anti-CD40L antibody, to protect transplanted organs and treat amyotrophic lateral sclerosis (ALS) [99]. - The company has prioritized its kidney transplantation programs, discontinuing the islet cell transplantation program and deprioritizing the IgA Nephropathy program as of January 2023 [103]. - Eledon has received regulatory approvals in Canada, the UK, and Australia for a Phase 1b clinical trial of tegoprubart, with the first subject dosed in July 2022 [107]. - A Phase 2 trial of tegoprubart for kidney transplant rejection prevention is set to enroll 120 participants, with patient enrollment expected to begin in Q3 2023 [108]. - ALS has an estimated incidence of 5,000 cases per year in the U.S., with a prevalence of approximately 30,000 cases overall [109]. - Tegoprubart has shown potential therapeutic benefits in ALS models, with a Phase 2a study demonstrating safety and tolerability in 54 subjects [113]. - Eledon entered a collaboration agreement with eGenesis in January 2023 for preclinical xenotransplantation studies using tegoprubart [118]. Financial Performance - The company reported a net loss of $20.4 million for the six months ended June 30, 2023, compared to a net loss of $19.1 million for the same period in 2022 [132]. - Research and development expenses increased by $2.9 million to $15.3 million for the six months ended June 30, 2023, primarily due to higher clinical development expenses [133][128]. - General and administrative expenses decreased by $0.6 million to $6.2 million for the six months ended June 30, 2023, primarily due to lower professional service costs [134]. - Net cash used in operating activities for the six months ended June 30, 2023 was $18.1 million, compared to $14.4 million for the same period in 2022 [145]. - The company reported a net loss of $20.4 million for the six months ended June 30, 2023, partially offset by non-cash items totaling $3.3 million [146]. - Net cash used in investing activities for the six months ended June 30, 2023 was $30.3 million, primarily for purchases of available-for-sale short-term investments [149]. - Net cash provided by financing activities for the six months ended June 30, 2023 was $33.0 million, resulting from the sale of 8.7 million shares of common stock and 6.4 million pre-funded warrants [150]. - The company experienced a net change in cash and cash equivalents of $(15.5) million for the six months ended June 30, 2023 [145]. - The company’s cash flow from operating activities included a decrease in accounts payable and accrued expenses of $1.6 million [146]. Funding and Capital Raising - The company is unable to continue ALS clinical development without additional financing specific to the ALS program [114]. - The company plans to seek additional financing through equity offerings, debt financings, or collaborations to fund ongoing operations and product development [141]. - The company is currently unable to fund the continued clinical development of tegoprubart for ALS without additional financing [138]. - The company may receive up to an additional $105.0 million from the second and third closings of the Private Placement, contingent on achieving specified milestones [120][138]. - As of June 30, 2023, the company had cash and cash equivalents and short-term investments of approximately $71.4 million, with expectations of incurring significant net operating losses for the foreseeable future [137][136]. - The company has no approved products for commercial sale and has never generated revenue from product sales [136]. - The company faces significant uncertainties due to global economic volatility, which could impact its ability to raise necessary capital [122][142]. - The company is subject to risks associated with capital raising, including potential dilution of stockholder ownership interests [143]. - As of June 30, 2023, the company was permitted to sell up to $17.8 million of shares under the ATM Program [144]. - The company has not sold any shares under the ATM program through June 30, 2023 [144]. - The company’s public float must exceed $75.0 million for the ATM Program to allow for additional share sales [144].