Indaptus Therapeutics(INDP) - 2023 Q3 - Quarterly Report

Financial Performance - The net loss for the three months ended September 30, 2023, was $3,922,388, compared to a net loss of $3,466,365 for the same period in 2022, reflecting an increase in loss of about 13.1%[20] - The company reported a comprehensive loss of $4,056,543 for the three months ended September 30, 2023, compared to $3,424,297 in 2022, an increase of approximately 18.5%[20] - For the nine months ended September 30, 2023, the Company incurred a net loss of approximately $11.4 million, with an accumulated deficit of approximately $41.4 million[29] - Net loss for the nine months ended September 30, 2023, was approximately $11.4 million, an increase of approximately $754,670 or 7% compared to a net loss of $10.7 million for the same period in 2022[75] Cash Flow and Liquidity - As of September 30, 2023, cash and cash equivalents increased to $15,963,998 from $9,626,800 as of December 31, 2022, representing a growth of approximately 66.5%[18] - Cash flows from operating activities resulted in a net cash used of $10,803,370 for the nine months ended September 30, 2023, compared to $10,867,434 in 2022[24] - The company had a net cash provided by investing activities of $17,140,568 for the nine months ended September 30, 2023, contrasting with a net cash used of $21,546,518 in 2022[24] - As of September 30, 2023, the company had approximately $16.0 million in cash and cash equivalents, expected to fund operations into the second quarter of 2024[85] Operating Expenses - Research and development expenses for the three months ended September 30, 2023, were $2,226,688, up from $1,609,554 in 2022, indicating a rise of approximately 38.4%[20] - Total operating expenses for the nine months ended September 30, 2023, were $12,198,840, compared to $10,823,883 in 2022, an increase of about 12.7%[20] - General and administrative expenses for Q3 2023 were approximately $2.0 million, reflecting a 4% increase from $1.9 million in Q3 2022[72] - Total operating expenses for Q3 2023 amounted to $4.2 million, a 20% increase compared to $3.6 million in Q3 2022[70] Research and Development - The company expects research and development expenses to continue increasing as clinical development activities ramp up[64] - Research and development expenses for the nine months ended September 30, 2023, were approximately $5.6 million, an increase of approximately $1.2 million or 27% compared to $4.4 million for the same period in 2022[76] - Research and development expenses for Q3 2023 were approximately $2.2 million, an increase of 38% from $1.6 million in Q3 2022, primarily due to the Phase 1 clinical trial and pipeline expansion activities[71] Capital and Financing - The Company plans to secure additional capital through collaborations, strategic alliances, or public/private financing to fund ongoing activities beyond the second quarter of 2024[29] - The company has entered into agreements to raise capital, including an at-the-market offering agreement for up to $3.7 million and a commitment from Lincoln Park to purchase up to $20.0 million of its common stock over a 36-month period[119] - The company expects to continue incurring significant losses as it expands development activities and seeks regulatory approvals for its product candidates[109] Regulatory and Market Risks - The company has substantial doubt about its ability to continue as a going concern within one year after the filing of this Quarterly Report due to insufficient cash and ongoing losses[110] - The company does not anticipate that any of its current product candidates will receive regulatory approval for several years, if at all[122] - The company may face significant delays in clinical trials due to difficulties in patient recruitment and retention[145] - Regulatory approval processes by the FDA and EMA are lengthy and inherently unpredictable, which could substantially harm the company's business if approvals are not obtained[150] Product Development Challenges - The company is dependent on the success of its lead product candidate, Decoy20, which is still in the early stages of development and has not yet completed any clinical trials[120] - The clinical development process is expensive, time-consuming, and unpredictable, with no guarantee of success for new product candidates[149] - The successful commercialization of products depends on obtaining adequate coverage and reimbursement from governmental and private payors, which is essential for patient affordability[182] Intellectual Property and Compliance - The company may face challenges in adequately protecting its proprietary technology and products, which could adversely affect its business and financial condition[209] - Non-compliance with patent protection requirements could lead to the abandonment or lapse of patents, resulting in a loss of patent rights and allowing competitors to use the company's technologies[215]