MAIA Biotechnology(MAIA) - 2024 Q1 - Quarterly Report

PART I—FINANCIAL INFORMATION This section provides the company's unaudited condensed consolidated financial statements and management's discussion and analysis for the quarter ended March 31, 2024 Item 1. Financial Statements This section presents the unaudited condensed consolidated financial statements for the quarter ended March 31, 2024, highlighting a significant increase in net loss and a substantial rise in total liabilities leading to a stockholders' deficit Condensed Consolidated Balance Sheet Highlights (Unaudited) | Account | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash | $8,271,449 | $7,150,695 | | Total Current Assets | $8,700,001 | $7,564,052 | | Total Assets | $8,716,036 | $7,566,852 | | Total Current Liabilities | $4,907,767 | $4,937,153 | | Warrant Liability | $9,573,197 | $2,152,188 | | Total Liabilities | $14,480,964 | $7,089,341 | | Total Stockholders' Equity (Deficit) | ($5,764,928) | $477,511 | Condensed Consolidated Statements of Operations (Unaudited) | Account | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Research and development expenses | $2,320,742 | $2,195,991 | | General and administrative expenses | $1,628,134 | $1,988,259 | | Loss from operations | ($3,948,876) | ($4,184,250) | | Change in fair value of warrant liability | ($4,181,298) | $20,942 | | Net loss | ($8,067,455) | ($4,116,876) | | Net loss per share (Basic and diluted) | ($0.46) | ($0.38) | Condensed Consolidated Statements of Cash Flows Highlights (Unaudited) | Account | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | ($3,586,800) | ($3,360,649) | | Net cash provided by financing activities | $4,717,048 | $0 | | Net increase (decrease) in cash | $1,120,754 | ($3,364,615) | | Cash at end of period | $8,271,449 | $7,586,312 | - The company has incurred recurring losses and has an accumulated deficit of $72.0 million as of March 31, 2024, leading management to conclude there is substantial doubt about its ability to continue as a going concern within one year[34][35] - The fair value of warrant liabilities increased significantly from $2.15 million at the end of 2023 to $9.57 million at March 31, 2024, resulting in a $4.18 million loss recognized in the statement of operations[75] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's position as a clinical-stage biotech focusing on THIO for Non-Small Cell Lung Cancer (NSCLC), detailing Q1 2024 operational results, capital raising efforts, and ongoing going concern doubts - The company is a clinical-stage biotechnology firm with its lead asset, THIO, being developed for Non-Small Cell Lung Cancer (NSCLC)[118] - Key recent milestones include completing enrollment for the Phase 2 THIO-101 trial, reporting a 38% overall response rate (ORR) in third-line NSCLC patients, and receiving FDA clearance for the IND application for THIO in the U.S[122][123][124] Comparison of Operating Expenses (Q1 2024 vs Q1 2023) | Expense Category | Q1 2024 | Q1 2023 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Research and development | $2,320,742 | $2,195,991 | $124,751 | 6% | | General and administrative | $1,628,134 | $1,988,259 | ($360,125) | (18)% | | Total operating expenses | $3,948,876 | $4,184,250 | ($235,374) | (6)% | - The increase in net loss for Q1 2024 was primarily driven by a $4.2 million non-cash expense related to the change in the fair value of warrant liability[132] - The company raised capital through multiple financing activities in Q1 2024: - At-The-Market (ATM) Offering: Gross proceeds of approximately $745,000[135] - March 14 Private Placement: Gross proceeds of approximately $2.92 million[136] - March 28 Private Placement: Gross proceeds of approximately $1.33 million[137] Item 3. Quantitative and Qualitative Disclosures About Market Risk The company is classified as a smaller reporting company and, as such, is not required to provide the information typically disclosed under this item - As a smaller reporting company, MAIA Biotechnology is not required to provide quantitative and qualitative disclosures about market risk[146] Item 4. Controls and Procedures Based on an evaluation conducted by management, the company's disclosure controls and procedures were deemed effective at a reasonable assurance level as of March 31, 2024, with no material changes to internal control over financial reporting during the quarter - Management, including the CEO and Head of Finance, concluded that the company's disclosure controls and procedures were effective as of March 31, 2024[147] - No changes in internal control over financial reporting that materially affected, or are reasonably likely to materially affect, internal controls were identified during the quarter[148] PART II—OTHER INFORMATION This section covers other important information including legal proceedings, risk factors, equity sales, and recent corporate actions Item 1. Legal Proceedings The company reports that it is not currently a party to any material legal proceedings - The company is not involved in any material legal proceedings[151] Item 1A. Risk Factors This section highlights a new risk factor concerning the potential delisting of the company's common stock from the NYSE American due to its stockholders' deficit - A new risk factor was added regarding the potential delisting from the NYSE American if the company fails to comply with continued listing requirements[153] - As of March 31, 2024, the company had a stockholders' deficit of approximately $5.76 million and had incurred net losses in the last three fiscal years, but it currently satisfies alternate compliance standards for listing[154] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The company discloses two recent unregistered sales of equity securities, including restricted common stock for investor services and shares issued upon warrant exercise - On March 18, 2024, the company issued 12,500 shares of restricted common stock for investor services[156] - On May 10, 2024, 4,678 shares of Common Stock were issued upon the net-exercise of an existing warrant[157] Item 3. Defaults Upon Senior Securities The company reports no defaults upon senior securities - None[160] Item 4. Mine Safety Disclosures This item is not applicable to the company - Not applicable[160] Item 5. Other Information The company discloses that on May 11, 2024, it amended certain common stock purchase warrants to change their accounting treatment from a liability to equity in future periods - On May 11, 2024, the company amended certain common stock purchase warrants issued on March 14, March 28, and April 25, 2024[162][163][164] - The amendments to the 'Fundamental Transaction' provision are intended to facilitate the warrants being accounted for as equity rather than a warrant liability in the future[162][163][164] Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including forms of amendment to common stock purchase warrants and officer certifications - The exhibits filed with this report include amendments to common stock purchase warrants and required officer certifications under the Sarbanes-Oxley Act[168]