Titan Pharmaceuticals(TTNP) - 2023 Q2 - Quarterly Report

Part I. Financial Information This section presents the unaudited condensed financial statements and related notes, along with management's discussion and analysis of financial condition and results of operations Item 1. Financial Statements (unaudited) This section presents the unaudited condensed financial statements, including balance sheets, statements of operations, stockholders' equity, and cash flows, along with detailed notes explaining the company's organization, accounting policies, and specific financial activities for the periods ended June 30, 2023 Condensed Balance Sheets The company's financial position significantly deteriorated from December 31, 2022, to June 30, 2023, with a substantial decrease in cash and total assets, leading to a negative stockholders' equity | Metric | June 30, 2023 (in thousands) | December 31, 2022 (in thousands) | Change (in thousands) | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $105 | $2,937 | $(2,832) | | Total current assets | $498 | $3,603 | $(3,105) | | Total assets | $812 | $4,058 | $(3,246) | | Total current liabilities | $1,846 | $2,630 | $(784) | | Total liabilities | $1,846 | $2,695 | $(849) | | Total stockholders' equity (deficit) | $(1,034) | $1,363 | $(2,397) | Condensed Statements of Operations Titan Pharmaceuticals experienced a decrease in total revenues and operating expenses for both the three and six months ended June 30, 2023, compared to the prior year, resulting in a reduced net loss | Metric (in thousands) | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | Change (3 Months) | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Change (6 Months) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total revenues | $83 | $150 | $(67) | $181 | $341 | $(160) | | Research and development | $442 | $974 | $(532) | $1,003 | $2,383 | $(1,380) | | General and administrative | $1,229 | $1,618 | $(389) | $2,463 | $2,939 | $(476) | | Total operating expenses | $1,671 | $2,592 | $(921) | $3,466 | $5,322 | $(1,856) | | Net loss | $(1,586) | $(2,462) | $876 | $(3,261) | $(5,002) | $1,741 | | Basic and diluted net loss per common share | $(0.11) | $(0.18) | $0.07 | $(0.22) | $(0.41) | $0.19 | Condensed Statements of Stockholders' Equity (Deficit) The company's stockholders' equity shifted from a positive balance at December 31, 2022, to a deficit by June 30, 2023, primarily due to net losses, partially offset by stock-based compensation | Metric (in thousands) | December 31, 2022 | March 31, 2023 | June 30, 2023 | | :--- | :--- | :--- | :--- | | Total Stockholders' Equity (Deficit) | $1,363 | $(312) | $(1,034) | | Net loss (Q1 2023) | - | $(1,675) | - | | Net loss (Q2 2023) | - | - | $(1,586) | | Stock-based compensation (Q2 2023) | - | - | $864 | Condensed Statements of Cash Flows For the six months ended June 30, 2023, the company experienced significant net cash outflow from operating activities, with no cash generated from financing activities, leading to a substantial decrease in cash, cash equivalents, and restricted cash | Cash Flow Activity (in thousands) | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(3,011) | $(4,731) | | Net cash used in investing activities | $- | $- | | Net cash provided by financing activities | $- | $4,984 | | Net increase (decrease) in cash, cash equivalents and restricted cash | $(3,011) | $253 | | Cash, cash equivalents and restricted cash at end of period | $122 | $6,585 | Notes to Condensed Financial Statements Titan Pharmaceuticals is a pharmaceutical company focused on its ProNeura drug delivery platform for chronic diseases. The company has discontinued U.S. commercialization of Probuphine to focus on product development and is actively exploring strategic alternatives, including asset sales, due to significant financial challenges and going concern doubts Note 1. Organization and Summary of Significant Accounting Policies This note details the company's business, its proprietary ProNeura drug delivery platform, the discontinuation of U.S. Probuphine commercialization, and the ongoing exploration of strategic alternatives. It also covers the basis of financial statement presentation, including the going concern assessment, and key accounting policies for inventories, revenue recognition, R&D costs, leases, and recent accounting pronouncements The Company Titan Pharmaceuticals develops therapeutics using its ProNeura platform, discontinued U.S. Probuphine commercialization, and is exploring strategic alternatives including asset sales - Titan Pharmaceuticals develops therapeutics using its proprietary long-term drug delivery platform, ProNeura, for chronic diseases[18][82] - Probuphine, the first ProNeura product, is approved in the U.S., Canada, and EU for opioid use disorder, but U.S. commercialization was discontinued in Q4 2020 to focus on product development[19][83] - The company is exploring strategic alternatives, including acquisition, merger, asset sales, or licensing, and implemented cost reduction measures in June and December 2022[20][84] - In July 2023, the company entered an agreement to sell certain ProNeura assets, including drug addiction products (Probuphine and Nalmefene implant programs), to Fedson, Inc[21][85] Basis of Presentation Unaudited financial statements are prepared assuming going concern, despite substantial doubt beyond Q3 2023 without additional funding - The unaudited condensed financial statements are prepared assuming the company will continue as a going concern, despite substantial doubt about its ability to do so beyond Q3 2023 without additional funding[25][26] Discontinued Operations The company discontinued U.S. Probuphine sales in October 2020 to focus on early-stage product development, recasting related financial items as discontinued operations - In October 2020, the company decided to discontinue selling Probuphine in the U.S. and wind down commercialization activities to focus on early-stage ProNeura-based product development[27] - Assets, liabilities, revenue, and expenses related to U.S. commercialization activities have been recast as discontinued operations in the financial statements[28] Going Concern Assessment As of June 30, 2023, the company lacks sufficient cash for the next 12 months, raising substantial doubt about its ability to continue as a going concern - As of June 30, 2023, the company concluded it does not have sufficient cash to fund its operations for the next 12 months, raising substantial doubt about its ability to continue as a going concern[30] - The company is exploring several financing and strategic alternatives; however, there can be no assurance that its efforts will be successful[30] Use of Estimates Financial statement preparation involves management estimates and assumptions, where actual results may differ - The preparation of financial statements requires management to make estimates and assumptions that affect reported amounts, and actual results could differ[31] Inventories Inventory, primarily raw materials and finished goods, is classified as assets held for potential sale | Inventory Component (in thousands) | December 31, 2022 | | :--- | :--- | | Raw materials and supplies | $60 | | Finished goods | $46 | | Total | $106 | - Approximately $106,000 of raw materials and supplies and finished goods inventory at June 30, 2023, are classified as assets held for potential sale[33] Revenue Recognition Revenue is primarily from collaborative R&D, technology sales/licenses, and government grants, with milestone payments recognized when probable - Revenue is generated principally from collaborative research and development arrangements, sales or licenses of technology, and government grants[34] - Grant revenue from contracts with NIDA and the Bill & Melinda Gates Foundation is recognized as services are performed when funding is committed[36] - Milestone payments are included in the transaction price if probable of being achieved and not subject to significant revenue reversal; regulatory approvals are not considered probable until received[40] Research and Development Costs and Related Accrual R&D expenses include internal costs like salaries and facility costs, and external costs such as contract research and sponsored studies - Research and development expenses include internal costs (salaries, facility costs) and external costs (contract research organization activities, sponsored research studies)[46] Leases The company leases its office facility under an operating lease expiring in June 2024, with total minimum lease payments of $132,000 - The company leases its office facility under an operating lease that expires in June 2024[47][60] | Year | Minimum Lease Payments (in thousands) | | :--- | :--- | | 2023 | $66 | | 2024 | $66 | | Total minimum lease payments | $132 | | Less: imputed interest | $(4) | | Total operating lease liabilities | $128 | Recent Accounting Pronouncements The adoption of ASU 2016-13 had no material impact, while ASU 2020-06 is currently being evaluated for future impact - The adoption of ASU 2016-13 (Credit Losses) on January 1, 2023, did not have a material impact on the condensed financial statements[50] - The company is currently evaluating the impact of ASU 2020-06 (Convertible Instruments and Contracts in an Entity's Own Equity), effective after December 15, 2023[51] Fair Value Measurements Financial instruments are carried at cost with fair values approximated due to their short-term nature, and no money market investments were held at June 30, 2023 - Financial instruments like receivables, accounts payable, and accrued liabilities are carried at cost, with fair values approximated due to their short-term nature[52] - The company had no investments in money market funds at June 30, 2023, compared to approximately $2.6 million at December 31, 2022[53] Note 2. Stock Plans The company granted a significant number of stock options in late 2022, which were approved by shareholders in June 2023, leading to an increase in outstanding options and stock-based compensation expense, particularly in general and administrative costs | Stock Option Activity (in thousands) | December 31, 2022 | June 30, 2023 | | :--- | :--- | :--- | | Options Outstanding | 927 | 1,936 | | Weighted Average Exercise Price | $7.97 | $3.56 | | Options Granted (6 months to June 30, 2023) | - | 1,025 | | Stock-Based Compensation (in thousands) | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $26 | $123 | $54 | $246 | | Selling, general and administrative | $239 | $94 | $500 | $197 | | Total stock-based compensation | $265 | $217 | $554 | $443 | Note 3. Net Loss Per Share The calculation of diluted net loss per common share excludes a significant number of common shares underlying stock options and warrants due to their anti-dilutive effect for both periods presented | Anti-Dilutive Common Shares (in thousands) | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | From options | 934 | 986 | 926 | 982 | | From warrants | 7,380 | 9,038 | 6,761 | 6,433 | | Total | 8,314 | 10,024 | 7,687 | 7,415 | Note 4. JT Pharmaceuticals Asset Purchase Agreement In October 2020, Titan acquired JT Pharma's TP-2021 for use with its ProNeura technology, involving an initial payment and future milestone/earn-out payments. A proof-of-concept milestone was achieved in January 2022, resulting in a cash payment and stock issuance - Titan acquired JT Pharma's kappa opioid agonist peptide, TP-2021, in October 2020 for use with its ProNeura technology for chronic pruritus[59] - The agreement includes a $15,000 closing payment, future milestone payments (cash or stock), and single-digit earn-out payments on net sales[59] - In January 2022, a proof-of-concept milestone was achieved, leading to a $100,000 payment and issuance of 51,021 common shares to JT Pharma[59][66] Note 5. Commitments and Contingencies The company has an operating lease for its office facility expiring in June 2024 and is involved in a legal proceeding initiated by a former employee, with liabilities for this claim assumed by Fedson as part of an asset purchase agreement - The company leases its office facility under an operating lease expiring in June 2024, with rent expense of approximately $64,000 for the six months ended June 30, 2023 and 2022[60] - A former employee initiated a legal proceeding alleging wrongful termination, retaliation, infliction of emotional distress, negligent supervision, hiring and retention, and slander[61][107] - Fedson, Inc. has agreed to assume all liabilities related to this pending employment claim as further consideration for the Asset Purchase Agreement[61][107] Note 6. Stockholders' Equity (Deficit) As of June 30, 2023, and December 31, 2022, the company had 15,016,295 shares of common stock outstanding. In June 2023, stockholders approved an increase in authorized shares for the 2015 Omnibus Equity Incentive plan - Common stock outstanding was 15,016,295 shares at June 30, 2023, and December 31, 2022[62] - In June 2023, stockholders approved an amendment to the 2015 Omnibus Equity Incentive plan, increasing the number of authorized shares to 2,500,000[63] - In February 2022, the company completed a registered direct offering and a concurrent private placement, raising approximately $5.0 million in net cash proceeds[64][97] Note 7. Discontinued Operations The company's discontinued U.S. commercialization activities for Probuphine are reflected in the condensed balance sheets, showing minor assets and liabilities associated with these operations | Discontinued Operations (in thousands) | June 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | Current assets | $32 | $14 | | Current liabilities | $190 | $129 | Note 8. Assets Held for Sale In July 2023, the company entered an agreement to sell certain ProNeura assets, including drug addiction products, to Fedson, Inc., with associated assets and liabilities classified as held for sale at June 30, 2023 - In July 2023, Titan entered an Asset Purchase Agreement with Fedson for the sale of certain ProNeura Assets, including the Probuphine and Nalmefene implant programs[69] - As of June 30, 2023, assets held for sale included approximately $0.1 million of inventory and $0.1 million of property and equipment, net, with $0.2 million of accrued liabilities[69] - Fedson will assume all liabilities related to a pending employment claim as part of the transaction[69] Note 9. Related Party Transactions During the first six months of 2023, the company made payments for legal fees to a law firm operated by one of its Board members - Payments of approximately $75,000 were made for legal fees to a law firm operated by one of the Board members during the six months ended June 30, 2023[70] Note 10. Subsequent Events Post-June 30, 2023, the company entered into an asset purchase agreement with Fedson for ProNeura assets, secured two promissory notes from its CEO and another individual for immediate funding, and granted fully vested common stock to board members and management - In July 2023, Titan entered an Asset Purchase Agreement with Fedson for ProNeura Assets, including drug addiction products, for an upfront price of $2 million ($1 million at closing, $1 million in escrow) and potential milestone payments up to $50 million plus royalties[72][73] - In July 2023, the company received $250,000 from CEO David E. Lazar via an unsecured promissory note (Lazar Promissory Note), due January 1, 2024, or upon certain financing/asset sale proceeds[74][118] - In August 2023, the company received $500,000 from Choong Choon Hau via a convertible promissory note (Hau Promissory Note), due January 1, 2024, convertible into common stock at $0.5287 per share[76][119][120] - In July 2023, 450,000 shares of fully vested unrestricted common stock were granted to six Board members and one management team member[75] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides an overview of Titan Pharmaceuticals' business, its ProNeura drug delivery platform, and development programs. It analyzes the financial performance for the three and six months ended June 30, 2023, highlighting decreases in revenues and operating expenses, and discusses the company's liquidity, capital resources, and ongoing going concern challenges Forward-Looking Statements The report contains forward-looking statements subject to risks and uncertainties, with no obligation for the company to update them - The report contains forward-looking statements regarding future performance, which are subject to substantial risks and uncertainties, including the ability to complete strategic transactions, raise capital, and navigate product development and regulatory processes[78][79] - Forward-looking statements are based on information available at the time they are made and are not guarantees of future performance; the company assumes no obligation to update them[79][80] Overview Titan Pharmaceuticals is a drug development company utilizing its ProNeura platform for chronic diseases. Following the discontinuation of U.S. Probuphine commercialization, the company is focusing on product development and actively pursuing strategic alternatives, including asset sales, to enhance shareholder value and address financial challenges - Titan Pharmaceuticals develops therapeutics utilizing its proprietary long-term drug delivery platform, ProNeura, for the treatment of select chronic diseases[82] - U.S. commercialization of Probuphine was discontinued in the fourth quarter of 2020 to focus limited resources on product development programs[83] - The company is exploring strategic alternatives, including acquisition, merger, asset sales, or licensing, and implemented cost reduction measures in 2022, including a workforce reduction[84] - In July 2023, an Asset Purchase Agreement was entered into with Fedson for the sale of certain ProNeura assets, including drug addiction products (Probuphine and Nalmefene implant programs)[85] ProNeura Continuous Drug Delivery Platform The ProNeura platform is a subdermal implant designed for continuous, steady drug release, avoiding fluctuations seen with oral dosing. Its feasibility has been demonstrated with various molecules and approved by regulatory bodies for Probuphine, offering long-term outpatient treatment - The ProNeura system is a small, solid subdermal implant designed for continuous, steady drug release, avoiding fluctuating drug levels seen with oral dosing[86] - The platform aims to provide long-term outpatient treatment for up to 12 months, with its benefits demonstrated by Probuphine's clinical results and regulatory approvals (FDA, EMA, Health Canada)[87] - ProNeura has shown feasibility with small molecules, hormones, and bio-active peptides, working with both hydrophobic and hydrophilic molecules, and allowing for flexible release characteristics[87] Development Programs The company's primary development program is TP-2021, a ProNeura implant for chronic pruritus, but development activities are substantially curtailed while strategic and financing alternatives are explored - The primary development program is TP-2021, a subdermal ProNeura implant for the potential treatment of chronic pruritus, designed for up to six months or longer of therapeutic delivery[88] - Development activities for TP-2021 have been substantially curtailed as the company explores several financing and strategic alternatives[88] Recent Accounting Pronouncements Information on recent accounting pronouncements is detailed in Note 1 to the unaudited condensed financial statements - Information on recent accounting pronouncements is provided in Note 1 to the accompanying unaudited condensed financial statements[89] Results of Operations for the Three and Six Months ended June 30, 2023 and June 30, 2022 The company experienced a decrease in total revenues and operating expenses for both the three and six months ended June 30, 2023, compared to the prior year, primarily due to reduced R&D activities and cost-cutting measures, leading to a lower net loss Revenues Total revenues decreased due to reduced NIDA grant activities, partially offset by increased Gates Foundation grant activity | Revenue Type (in thousands) | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | Change | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | License revenue | $1 | $3 | $(2) | $1 | $5 | $(4) | | Grant revenue | $82 | $147 | $(65) | $180 | $336 | $(156) | | Total revenues | $83 | $150 | $(67) | $181 | $341 | $(160) | - The decrease in total revenues was primarily due to decreased activities related to the NIDA grant for the development of a nalmefene implant, partially offset by increased activity related to the Gates Foundation grant[90] Operating Expenses Operating expenses decreased due to reduced R&D activities, lower employee-related expenses, and professional fees, partially offset by increased stock-based compensation | Operating Expense (in thousands) | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | Change | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Research and development | $442 | $974 | $(532) | $1,003 | $2,383 | $(1,380) | | General and administrative | $1,229 | $1,618 | $(389) | $2,463 | $2,939 | $(476) | | Total operating expenses | $1,671 | $2,592 | $(921) | $3,466 | $5,322 | $(1,856) | - Research and development costs decreased primarily due to reduced activities related to the NIDA grant for nalmefene implant development, initial non-clinical TP-2021 studies, and personnel-related costs following a December 2022 workforce reduction[91] - General and administrative expenses decreased primarily due to lower employee-related expenses, legal and professional fees, partially offset by increases in non-cash stock-based compensation[92] Other Income (Expense), Net Other income (expense), net, increased primarily due to higher interest income and reduced tax-related expenses | Other Income (Expense) (in thousands) | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | Change | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Interest income (expense), net | $7 | $5 | $2 | $29 | $5 | $24 | | Other expense, net | $(5) | $(25) | $20 | $(5) | $(26) | $21 | | Total other income (expense), net | $2 | $(20) | $22 | $24 | $(21) | $45 | - The increase in other income (expense), net, was primarily due to increases in interest income and decreases in tax-related expenses[94] Net Loss and Net Loss per Share The company reported a reduced net loss and net loss per share for both the three and six months ended June 30, 2023 | Metric | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | Net loss from operations (in thousands) | $(1,600) | $(2,400) | $(3,300) | $(5,000) | | Net loss per share | $(0.11) | $(0.18) | $(0.22) | $(0.41) | Liquidity and Capital Resources The company's working capital shifted from a surplus to a deficit, and its cash and cash equivalents significantly decreased. Despite recent funding from promissory notes and anticipated asset sale proceeds, there is substantial doubt about its ability to continue as a going concern beyond Q3 2023 without further financing - At June 30, 2023, the company had a working capital deficit of approximately $1.3 million, compared to working capital of approximately $1.0 million at December 31, 2022[96] - As of June 30, 2023, cash and cash equivalents were approximately $0.1 million[98] - The company believes that current cash, along with $250,000 from the Lazar Promissory Note, $500,000 from the Hau Promissory Note, and $1.0 million anticipated from the Fedson asset sale, will fund operations to the end of the third quarter of 2023[98] - There is substantial doubt about the company's ability to continue as a going concern, as it explores several financing and strategic alternatives with no assurance of success[98] Sources and Uses of Cash For the six months ended June 30, 2023, the company primarily used cash in operating activities, with no cash generated from investing or financing activities, leading to a significant net decrease in cash | Cash Flow Activity (in thousands) | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(3,011) | $(4,731) | | Net cash used in investing activities | $- | $- | | Net cash provided by financing activities | $- | $4,984 | | Change in cash, cash equivalents and restricted cash | $(3,011) | $253 | - Net cash used in operating activities for the six months ended June 30, 2023, consisted primarily of a net loss of approximately $3.3 million and changes in operating assets and liabilities, partially offset by non-cash charges[100] - Net cash provided by financing activities for the six months ended June 30, 2022, was primarily from net cash proceeds from the February 2022 equity offering[101] Item 3. Quantitative and Qualitative Disclosures About Market Risk The company's market risk disclosures have not materially changed from those reported in its Annual Report on Form 10-K for the year ended December 31, 2022 - The market risk disclosures have not materially changed from those set forth in the Annual Report on Form 10-K for the year ended December 31, 2022[102] Item 4. Controls and Procedures This section confirms the effectiveness of the company's disclosure controls and procedures and reports no material changes in internal control over financial reporting during the period Disclosure Controls and Procedures The CEO concluded that the company's disclosure controls and procedures were effective as of June 30, 2023, ensuring timely and accurate reporting - The Chief Executive Officer concluded that the company's disclosure controls and procedures were effective as of June 30, 2023, ensuring timely and accurate reporting[103] Changes in Internal Control Over Financial Reporting No material changes in internal control over financial reporting occurred during the six months ended June 30, 2023 - There were no changes in internal control over financial reporting during the six months ended June 30, 2023, that materially affected, or were reasonably likely to materially affect, internal controls[104] Part II. Other Information This section provides additional information including legal proceedings, risk factors, equity sales, other disclosures, and exhibits Item 1. Legal Proceedings A legal proceeding by a former employee alleging wrongful termination and other claims is ongoing, but Fedson, Inc. has agreed to assume all related liabilities as part of an asset purchase agreement - A legal proceeding has been initiated by a former employee alleging wrongful termination, retaliation, infliction of emotional distress, negligent supervision, hiring and retention, and slander[107] - An independent investigation into the whistleblower retaliation allegations concluded they were not substantiated[107] - Fedson, Inc. has agreed to assume all liabilities related to this pending employment claim as further consideration for the Asset Purchase Agreement[107] Item 1A. Risk Factors The company faces substantial doubt about its ability to continue as a going concern due to recurring net losses and negative cash flows. It also faces significant risks related to maintaining its Nasdaq Capital Market listing due to non-compliance with minimum stockholders' equity and bid price requirements, which could lead to delisting and adverse effects on its stock and ability to raise capital - The company has incurred net losses in almost every year since inception and expects continued losses, raising substantial doubt about its ability to continue as a going concern[109] - As of June 30, 2023, the company had cash and cash equivalents of approximately $0.1 million and expects to continue incurring net losses and negative operating cash flow[109] - The company's stockholders' equity of $1,363,000 as of December 31, 2022, did not satisfy Nasdaq's $2,500,000 minimum requirement, and it has until October 2, 2023, to regain compliance[110] - The company is also not in compliance with Nasdaq's minimum bid price requirement of $1.00 per share and has until September 12, 2023, to regain compliance[113] - Failure to meet Nasdaq listing standards could result in delisting, reducing stock price, liquidity, and the ability to raise additional capital, potentially leading to trading in the over-the-counter market and application of 'penny stock' rules[111][115][116] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds There were no unregistered sales of equity securities or use of proceeds to report during the period - No unregistered sales of equity securities or use of proceeds occurred during the period[117] Item 5. Other Information In July and August 2023, the company secured $750,000 in funding through unsecured and convertible promissory notes from its CEO and another individual, respectively, with both notes due January 1, 2024 - In July 2023, the company received $250,000 in funding from David E. Lazar, its CEO, in exchange for an unsecured promissory note, due January 1, 2024, or upon certain financing/asset sale proceeds[118] - In August 2023, the company received $500,000 in funding from Choong Choon Hau in exchange for a convertible promissory note, due January 1, 2024, convertible into common stock at $0.5287 per share[119][120] Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including various agreements, promissory notes, certifications, and XBRL documents - Key exhibits include the Fourth Amended and Restated 2015 Omnibus Equity Incentive Plan, the Asset Purchase Agreement with Fedson, Inc., unsecured and convertible promissory notes, and certifications[121] SIGNATURES The report was duly signed on behalf of Titan Pharmaceuticals, Inc. by David Lazar, Chief Executive Officer, on August 14, 2023 - The report was signed by David Lazar, Chief Executive Officer of Titan Pharmaceuticals, Inc., on August 14, 2023[126]