ORGANOVO HOLDINGS INC
For the period ended Jun 30, 2024. Filed Aug 5, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 5, 2024
VIVS$0.14+0.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2023-12-31; filed 2024-02-08.
0000950170-24-012754
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-05.
0000950170-24-090726
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 68 previous paragraphs and 61 current paragraphs.
30 unchanged; 20 reworded; 11 added; 11 removed; 7 previous and 0 current paragraphs rearranged.
Tables are not compared: 7 previous and 4 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (11)
Current report
Recent Developments
Current report
Mosaic Cell Sciences Division
Current report
In February 2024, we formed our Mosaic Cell Sciences division (“Mosaic”) to serve as a key source of certain of the primary human cells we utilize in our research and development efforts. We believe Mosaic can help us optimize our supply chain, reduce operating expenses related to cell sourcing and procurement and ensure that the cellular raw materials we use are of the highest quality and are derived from tissues that are ethically sourced in full compliance with state and federal guidelines. Mosaic provides the Company with qualified human cells for use in its clinical research and development programs. In addition to supplying the Company with primary human cells, Mosaic offers human cells for sale to life science customers, both directly and through distribution partners, which we expect to offset costs and over time become a profit center that offsets overall R&D spending by Organovo.
Current report
Nasdaq Minimum Bid Notice
Current report
On July 18, 2024, we received a written notice (the “Notice”) from the Listing Qualifications Staff of the Nasdaq Stock Market LLC (“Nasdaq”) indicating that, based upon the closing bid price of our common stock for the last 30 consecutive business days, we no longer meet the requirement to maintain a minimum bid price of $1 per share, as set forth in Nasdaq Listing Rule 5550(a)(2) (“Rule 5550(a)(2)”).
Current report
In accordance with Nasdaq Listing Rule 5810(c)(3)(A), we have been provided with an initial period of 180 calendar days, or until January 14, 2025, to regain compliance. In order to regain compliance with the minimum bid price requirement, the closing bid price of our common stock must be at least $1 per share for a minimum of ten consecutive business days during this 180-day period. The Notice provides that the Nasdaq staff will provide written confirmation to us if we regain compliance with Rule 5550(a)(2).
Current report
If we do not regain compliance with Rule 5550(a)(2) by January 14, 2025, we may be eligible for an additional compliance period of 180 calendar days. To qualify, we would be required to meet the continued listing requirement for market value of publicly held shares and all other initial listing standards for the Nasdaq Capital Market, with the exception of the bid price requirement, and would need to provide written notice to Nasdaq of our intention to cure the bid price deficiency during the second compliance period. However, if it appears to the Nasdaq staff that we will not be able to cure the deficiency, or we are otherwise not eligible, Nasdaq would notify us that our securities will be subject to delisting. In the event of such a notification, we may appeal the Nasdaq staff’s determination to delist our securities, but there can be no assurance the Nasdaq staff would grant any request for continued listing.
Current report
The Notice had no immediate effect on the listing or trading of our common stock and our common stock will continue to trade on the Nasdaq Capital Market under the symbol “ONVO”. We intend to monitor the closing bid price of our common stock and consider our available options if our common stock does not trade at a level likely to result in us regaining compliance with Rule 5550(a)(2) by January 14, 2025, including effecting a reverse stock split, which would be subject to the prior approval of our stockholders. There can be no assurance that we will be able to regain compliance with Nasdaq’s minimum bid price requirement or that we will maintain our compliance with the other listing requirements necessary for us to maintain the listing of our common stock on the Nasdaq Capital Market.
Current report
Cost of Revenues
Current report
For the three months ended June 30, 2024 and 2023, total cost of revenues was less than $0.1 million and zero, respectively, and is related to the sale of finished goods inventory by Mosaic.
Current report
On May 8, 2024, the we priced a best efforts public offering (the “Offering”) of: (i) 1,562,500 shares of our common stock and accompanying common warrants (“Common Warrants”) to purchase up to 1,562,500 shares of common stock at a combined public offering price of $0.80 per share and accompanying Common Warrant to purchase one share of common stock and (ii) pre-funded warrants (“Pre-Funded Warrants”) to purchase 5,000,000 shares of common stock and accompanying Common Warrants to purchase up to 5,000,000 shares of common stock at a combined public offering price of $0.799 per Pre-Funded Warrant and accompanying Common Warrant to purchase one share of common stock. The closing of the Offering occurred on May 13, 2024. We received net proceeds of approximately $4.5 million from the Offering, after deducting the offering expenses payable by us including the placement agent fees.
Removed paragraphs (11)
Previous report
Costs and Expenses
Previous report
Other income was $0.1 million for the three months ended December 31, 2023, which was related to interest income. Other income was $0.1 million for the three months ended December 31, 2022, which was related to interest income of approximately $0.1 million offset by a loss on investment in equity securities of less than $0.1 million.
Previous report
Comparison of the nine months ended December 31, 2023 and 2022
Previous report
Revenues
Previous report
Costs and Expenses
Previous report
Research and Development Expenses
Previous report
Selling, General and Administrative Expenses
Previous report
For the nine months ended December 31, 2023, total selling, general and administrative expenses were approximately $7.6 million, an increase of approximately $0.9 million, or approximately 14%, compared to the prior year period. The increase year over year relates to increases in legal and other corporate expenses. Our average full-time general and administrative staff remained consistent at an average of five full-time employees for both the nine months ended December 31, 2022 and December 31, 2023. However, there was a reduction in force event in the second quarter of fiscal 2024 that resulted in a decrease from five to four total employees for the quarter ended December 31, 2023. Our fiscal 2024 operations resulted in a $0.1 million decrease in personnel related costs, including stock based compensation, related to severance for the reduction in force event, a $0.1 million decrease in depreciation and amortization expense, offset by a $0.1 million increase in consulting costs, a $0.6 million increase in legal expenses, a $0.3 million increase in investor relations expenses, and a $0.1 million increase in other corporate expenses.
Previous report
Other Income
Previous report
On October 12, 2022, our stockholders and the Board of Directors ("Board") approved the 2022 Equity Incentive Plan ("2022 Plan"), and it became effective on that date. The 2022 Plan replaced the 2012 Equity Incentive Plan ("2012 Plan") on the effective date. Upon the effective date, we ceased granting awards under the 2012 Plan and any shares remaining available for future issuance under the 2012 Plan were cancelled and are no longer available for future issuance. The 2012 Plan continues to govern awards previously granted under it. At the time the Board approved the 2022 Plan, an aggregate of 1,363,000 shares of our common stock was initially reserved for issuance under the 2022 Plan. We committed to reducing the new 2022 Plan share reserve by the number of shares that were granted under the 2012 Plan and the Inducement Plan between July 25, 2022 and October 12, 2022. From July 25, 2022 to October 12, 2022, we issued 126,262 shares of common stock under the 2012 Plan. As a result, the number of shares initially reserved for future issuance under the 2022 Plan was 1,236,738 shares of common stock as of October 12, 2022. We also committed to reducing the aggregate number of shares of common stock issuable pursuant to the 2021 Inducement Equity Incentive Plan ("Inducement Plan") from 750,000 shares to 51,000 shares (which includes 50,000 shares of its common stock issuable pursuant to an outstanding option to purchase common stock with an exercise price of $2.75 per share, leaving only 1,000 shares available for future issuance under the Inducement Plan) and the share reserve was reduced effective October 12, 2022.
Previous report
As of December 31, 2023, we had 9,838,755 total issued and outstanding shares of common stock. Under the 2022 Plan, 1,643,798 shares remain available for issuance as of December 31, 2023, to executive officers, directors, advisory board members, employees and consultants. Additionally, 45,000 shares of common stock have been reserved for issuance under the 2023 Employee Stock Purchase Plan (“ESPP”), of which 45,000 shares remain available for future issuance as of December 31, 2023. Finally, 51,000 shares of common stock have been reserved for issuances under our Inducement Plan, of which 1,000 remain available for future issuance as of December 31, 2023. In aggregate, issued and outstanding common stock and shares issuable under outstanding equity awards or reserved for future issuance under the 2022 Plan, the 2012 Plan, the Inducement Plan, and the ESPP total 12,347,904 shares of common stock as of December 31, 2023.
Reworded paragraphs (20)
Previous wording
The following management’s discussion and analysis of financial condition and results of operations should be read in conjunction with our historical consolidated financial statements and the related notes thereto included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2023. This management’s discussion and analysis contains forward-looking statements, such as statements related to our plans, objectives, expectations and intentions. Any statements that are not statements of historical fact are forward-looking statements. When used, the words “believe,” “plan,” “intend,” “anticipate,” “target,” “estimate,” “expect” and the like, and/or future tense or conditional constructions such as “will,” “may,” “could,” “should,” or similar expressions, identify certain of these forward-looking statements. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q and are subject to risks and uncertainties, including those described in this Quarterly Report on Form 10-Q, as well as the risk factors disclosed in our Annual Report on the Form 10-K for the fiscal year ended March 31, 2023, filed with the Securities and Exchange Commission on July 14, 2023, and discussed in the section titled “Risk Factors” under Part II, Item 1A in this Quarterly Report on Form 10-Q, that could cause our actual results or events to differ materially from those expressed or implied by such forward-looking statements. Unless the context otherwise requires, the terms “Organovo,” the “Company”, “we”, “us” and “our” in this Quarterly Report on Form 10-Q refer to Organovo Holdings, Inc. and its wholly owned subsidiaries, Organovo, Inc. and Opal Merger Sub, Inc.
Current wording
The following management’s discussion and analysis of financial condition and results of operations should be read in conjunction with our historical consolidated financial statements and the related notes thereto included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2024. This management’s discussion and analysis contains forward-looking statements, such as statements related to our plans, objectives, expectations and intentions. Any statements that are not statements of historical fact are forward-looking statements. When used, the words “believe,” “plan,” “intend,” “anticipate,” “target,” “estimate,” “expect” and the like, and/or future tense or conditional constructions such as “will,” “may,” “could,” “should,” or similar expressions, identify certain of these forward-looking statements. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q and are subject to risks and uncertainties, including those described in this Quarterly Report on Form 10-Q, as well as the risk factors disclosed in our Annual Report on the Form 10-K for the fiscal year ended March 31, 2024, filed with the Securities and Exchange Commission on May 31, 2024, and discussed in the section titled “Risk Factors” under Part II, Item 1A in this Quarterly Report on Form 10-Q, that could cause our actual results or events to differ materially from those expressed or implied by such forward-looking statements. Unless the context otherwise requires, the terms “Organovo,” the “Company”, “we”, “us” and “our” in this Quarterly Report on Form 10-Q refer to Organovo Holdings, Inc. and its wholly owned subsidiary, Organovo, Inc.
Previous wording
We are a clinical stage biotechnology company that is focusing on clinical drug development of the farnesoid X receptor (“FXR”) agonist FXR314. FXR is a mediator of gastrointestinal and liver diseases. FXR agonism has been tested in a variety of preclinical models of inflammatory bowel disease ("IBD"). FXR314 is the lead compound in our established FXR program containing two clinically tested compounds (including FXR314) and over 2,000 discovery or preclinical compounds. FXR314 is a drug with safety and tolerability after daily oral dosing in Phase 1 and Phase 2 trials. Further, FXR314 has FDA clinical trial authorization for a Phase 2 trial in ulcerative colitis ("UC").
Current wording
We are a clinical stage biotechnology company that is focused on developing FXR314 in inflammatory bowel disease (“IBD”), including ulcerative colitis (“UC”), based on demonstration of clinical promise in three-dimensional (“3D”) human tissues as well as strong preclinical data. FXR is a mediator of gastrointestinal and liver diseases. FXR agonism has been tested in a variety of preclinical models of IBD. FXR314 is the lead compound in our established FXR program containing two clinically tested compounds (including FXR314) and over 2,000 discovery or preclinical compounds. FXR314 is a drug with safety and tolerability after daily oral dosing in Phase 1 and Phase 2 trials. Further, FXR314 has FDA clinical trial authorization for a Phase 2 trial in UC.
Previous wording
Our current clinical focus is in advancing FXR314 in IBD, including UC and Crohn’s disease (“CD”). We plan to start a Phase 2a clinical trial in UC in the calendar year 2024.
Current wording
Our current clinical focus is in advancing FXR314 in IBD, including UC and Crohn’s disease (“CD”). We plan to start a Phase 2a clinical trial in UC in the calendar year 2025. We released Phase 2 data for FXR314 for the treatment of metabolic function-associated steatohepatitis ("MASH") in April 2024 that are supportive of ongoing development, and we believe FXR314 has a commercial opportunity in MASH, most likely in combination therapy. We are exploring the potential for combination therapies using FXR314 and currently approved mechanisms in preclinical animal studies and our IBD disease models.
Previous wording
Our current understanding of intestinal tissue models and IBD disease models leads us to believe that we can create models that provide greater insight into the biology of these diseases than are generally currently available. We are creating high fidelity disease models, leveraging our prior work including the work found in our peer-reviewed publication on bioprinted intestinal tissues (Madden et al. Bioprinted 3D Primary Human Intestinal Tissues Model Aspects of Native Physiology and ADME/Tox Functions. iScience.
Current wording
Our current understanding of intestinal tissue models and IBD disease models leads us to believe that we can create models that provide greater insight into the biology of these diseases than are generally currently available. We are creating high fidelity disease models, leveraging our prior work including the work found in our peer-reviewed publication on bioprinted intestinal tissues (Madden et al. Bioprinted 3D Primary Human Intestinal Tissues Model Aspects of Native Physiology and ADME/Tox Functions. iScience. 2018 Apr 27;2:156-167. doi: 10.1016/j.isci.2018.03.015.) Our advances include cell type-specific compartments, prevalent intercellular tight junctions, and the formation of microvascular structures.
Previous wording
Using these disease models, we intend to identify and validate novel therapeutic targets. After finding therapeutic drug targets, we intend to focus on developing novel small molecule, antibody, or other therapeutic drug candidates to treat the disease, and advance these novel drug candidates towards an Investigational New Drug (“IND”) filing and potential future clinical trials.
Current wording
Using these disease models, we intend to identify and validate novel therapeutic targets. After finding therapeutic drug targets, we intend to focus on developing novel small molecule, antibody, or other therapeutic drug candidates to treat the disease, and advance these novel drug candidates towards an Investigational New Drug filing and potential future clinical trials.
Previous wording
For the three months ended December 31, 2023 and 2022, total revenue was less than $0.1 million and $0.1 million, respectively. The revenue is related to sales-based royalties from licensing intellectual property. The decrease in royalty revenue year over year relates to a decrease in sales of royalty bearing products by the licensee. Given the trend of reduced sales during the fiscal year, we expect a decrease in sales of royalty bearing products by the licensee going forward.
Current wording
For the three months ended June 30, 2024 and 2023, total revenue was less than $0.1 million and $0.1 million, respectively. Royalty revenue is related to sales-based royalties from licensing intellectual property. The decrease in royalty revenue year over year relates to a decrease in sales of royalty bearing products by the licensee in fiscal 2025. We expect quarterly sales of royalty bearing products by the licensee to remain consistent with the first quarter of fiscal 2025 going forward. Product revenue is related to the sale of human cells developed by Mosaic. The first quarter of fiscal 2025 is the first quarter of product sales since the inception of Mosaic. We expect product revenue to increase going forward.
Previous wording
For the nine months ended December 31, 2023, total research and development expenses were $4.4 million, an increase of $1.0 million, or 29%, from the prior year period. Our average full-time research and development staff increased from an average of fourteen full-time employees for the nine months ended December 31, 2022 to an average of sixteen full-time employees for the nine months ended December 31, 2023. Our fiscal 2024 research and development activities resulted in a $0.3 million increase in personnel related costs, a $0.3 million increase in lab expenses, a $0.2 million increase in consulting expenses, a $0.1 million increase in depreciation and amortization expense, and a $0.1 million increase in facility costs. Going forward, we intend to continue to advance the clinical drug development of FXR314 with an associated increase in expenses.
Current wording
For the three months ended June 30, 2024, total research and development expenses were $1.4 million, a decrease of $0.3 million, or approximately 16%, from the prior year period. Our average full-time research and development staff decreased from an average of eighteen full-time employees for the three months ended June 30, 2023 to an average of fifteen full-time employees for the three months ended June 30, 2024. Our fiscal 2025 operations resulted in a $0.2 million decrease in personnel related costs which includes stock-based compensation, a $0.1 million decrease in facilities costs, a $0.1 million decrease in lab expenses, offset by a $0.1 million increase in consulting expenses. Going forward, we intend to continue to advance the clinical drug development of FXR314 and expect an associated increase in expenses.
Previous wording
For the three months ended December 31, 2023, total selling, general and administrative expenses were approximately $2.3 million, a decrease of less than $0.1 million, or approximately 2%, compared to the prior year period. The decrease year over year relates to a decrease in personnel. Our average full-time general and administrative staff decreased from an average of five full-time employees for the three months ended December 31, 2022 to an average of four full-time employees for the three months ended December 31, 2023. Our fiscal 2024 operations resulted in a $0.4 million decrease in personnel related costs, including stock based compensation, related to severance for the reduction in force in the second quarter of fiscal 2024. There was also a $0.1 decrease in other corporate expenses and a decrease of less than $0.1 million in depreciation and amortization expense in fiscal 2024. This was offset by a $0.2 million increase in legal expenses and a $0.3 million increase in investor relations expenses compared to the prior year period.
Current wording
For the three months ended June 30, 2024, total selling, general and administrative expenses were approximately $2.0 million, a decrease of $0.6 million, or approximately 22%, compared to the prior year period. Our average full-time general and administrative staff of five employees remained the same for each of the three months ended June 30, 2024 and 2023. However, in fiscal 2024 one of the staff was our former General Counsel who was an Executive Officer included in a reduction in force during the second quarter of fiscal 2024. Subsequently, a sales associate for the Mosaic Cell Sciences segment was hired in the fourth quarter of fiscal 2024. Our fiscal 2025 operations resulted in a $0.3 million decrease in personnel related expenses which includes stock-based compensation, a $0.1 million decrease in consulting expenses, and a $0.2 million decrease in legal and other corporate costs, which includes a $0.3 decrease in legal expenses, and a $0.1 million decrease in audit and tax expense, offset by a $0.2 million increase in investor relations expenses.
Previous wording
Other income was $0.4 million for the nine months ended December 31, 2023, related to interest income. Other income was $0.2 million for the nine months ended December 31, 2022, which was related to interest income of approximately $0.3 million offset by a loss on investment in equity securities of approximately $0.1 million.
Current wording
Other income was less than $0.1 million and $0.2 million for the three months ended June 30, 2024 and 2023, respectively, which was related to interest income.
Previous wording
Going forward, we intend to focus on clinical drug development of FXR314, the lead compound in our established FXR program. Our current clinical focus is in advancing FXR314 in IBD, including UC and CD. We plan to start a Phase 2a clinical trial in UC in the calendar year 2024. Additionally, we plan to leverage our proprietary technology platform to develop therapeutic drugs, focusing on IBD, including CD and UC, with a goal of broadening our work into additional therapeutic areas over time.
Current wording
Going forward, we intend to focus on clinical drug development of FXR314, the lead compound in our established FXR program. Our current clinical focus is in advancing FXR314 in IBD, including UC and CD. We plan to start a Phase 2a clinical trial in UC in the calendar year 2025. We released Phase 2 data for FXR314 for the treatment of metabolic function-associated steatohepatitis (“MASH”) in April 2024 that is supportive of ongoing development, and we believe FXR314 has a commercial opportunity in MASH, most likely in combination therapy. Additionally, we plan to leverage our proprietary technology platform to develop therapeutic drugs, focusing on IBD, including CD and UC, with a goal of broadening our work into additional therapeutic areas over time.
Previous wording
The accompanying consolidated financial statements have been prepared on the basis that we are a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. At December 31, 2023, we had cash and cash equivalents of approximately $5.3 million, restricted cash of approximately $0.1 million and an accumulated deficit of approximately $336.6 million. The restricted cash was pledged as collateral for a letter of credit that the Company is required to maintain as a security deposit under the terms of the lease agreement for its facilities. We had negative cash flow from operations of approximately $12.0 million during the nine months ended December 31, 2023. At March 31, 2023, we had cash and cash equivalents of approximately $15.3 million, restricted cash of approximately $0.1 million and an accumulated deficit of approximately $325.0 million.
Current wording
The accompanying consolidated financial statements have been prepared on the basis that we are a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. At June 30, 2024, we had cash and cash equivalents of approximately $6.2 million, restricted cash of approximately $0.1 million and an accumulated deficit of approximately $343.0 million. The restricted cash was pledged as collateral for a letter of credit that the Company is required to maintain as a security deposit under the terms of the lease agreement for its facilities. We had negative cash flow from operations of approximately $3.0 million during the three months ended June 30, 2024. At March 31, 2024, we had cash and cash equivalents of approximately $2.9 million, restricted cash of approximately $0.1 million and an accumulated deficit of approximately $339.7 million.
Previous wording
At December 31, 2023, we had total current assets of approximately $6.2 million and current liabilities of approximately $1.7 million, resulting in working capital of $4.5 million. At March 31, 2023, we had total current assets of approximately $17.0 million and current liabilities of approximately $3.7 million, resulting in working capital of $13.3 million.
Current wording
At June 30, 2024, we had total current assets of approximately $7.3 million and current liabilities of approximately $2.0 million, resulting in working capital of $5.3 million. At March 31, 2024, we had total current assets of approximately $3.9 million and current liabilities of approximately $1.9 million, resulting in working capital of $2.0 million.
Previous wording
The following table summarizes the primary sources and uses of cash for the nine months ended December 31, 2023 and 2022 (in thousands):
Current wording
The following table summarizes the primary sources and uses of cash for the three months ended June 30, 2024 and 2023 (in thousands):
Previous wording
Net cash used in operating activities for the nine months ended December 31, 2023 was approximately $12.0 million as compared to $7.7 million used in operating activities for the nine months ended December 31, 2022. This $4.3 million increase in operating cash usage can be attributed primarily to the increase in research and development activities. Operating cash usage includes $2.0 million of cash outflows for acquired in-process research and development of Metacrine's FXR drug compound, related research data, and IP.
Current wording
Net cash used in operating activities for the three months ended June 30, 2024, was approximately $3.0 million as compared to $5.3 million used in operating activities for the three months ended June 30, 2023. This $2.3 million decrease in operating cash usage can be attributed primarily to the $2.0 million cash payment in fiscal 2024 for acquired in-process research and development assets.
Previous wording
$0.7 million, and fixed asset purchases of less than $0.1 million. Net cash used in investing activities was $0.8 million for the nine months ended December 31, 2022, which consisted of purchases of equity securities of $1.1 million, purchases of investments of $9.9 million, maturities of investments of $10.0 million, sales of equity securities of $0.4 million, and fixed asset purchases of $0.2 million.
Current wording
Net cash provided by investing activities was less than $0.1 million for the three months ended June 30, 2024, which consisted of interest income. Net cash provided by investing activities was $0.8 million for the three months ended June 30, 2023, which consisted of the purchases of investments of $4.9 million, the maturities of investments of $5.0 million, the liquidation of equity securities of $0.7 million, and fixed asset purchases of less than $0.1 million.
Previous wording
Net cash provided by financing activities was $1.2 million for the nine months ended December 31, 2023. Financing activities consisted of the sale of common stock through at-the-market ("ATM") offerings. There were no financing activities in the nine months ended December 31, 2022.
Current wording
Net cash provided by financing activities was $6.2 million and zero for the three months ended June 30, 2024 and 2023, respectively. Financing activities consisted of the sale of common stock through at-the-market (“ATM”) share offerings and a public offering of common stock and accompanying common warrants and pre-funded warrants. Refer to “Operations funding requirements” below for further information regarding financing activities.
Previous wording
We previously had an effective shelf registration statement on Form S-3 (File No. 333-222929) (the “2018 Shelf”) that registered $100.0 million of common stock, preferred stock, warrants and units, or any combination of the foregoing and expired on February 22, 2021. On January 19, 2021, we filed a shelf registration statement on Form S-3 (File No. 333-252224) to register $150.0 million of common stock, preferred stock, debt securities, warrants and units, or any combination of the foregoing (the “2021 Shelf”). The 2021 Shelf registration statement was declared effective by the SEC on January 29, 2021 and replaced the 2018 Shelf at that time. On January 26, 2024, we filed a new shelf registration statement on Form S-3 (File No. 333-276722) to register $150.0 million of the Company’s common stock, preferred stock, debt securities, warrants and units, or any combination of the foregoing (the “2024 Shelf”). The 2024 Shelf has not yet been declared effective by the SEC.
Current wording
We previously had an effective shelf registration statement on Form S-3 (File No. 333-252224), declared effective by the SEC on January 29, 2021 (the “2021 Shelf”), which registered $150.0 million of common stock, preferred stock, warrants and units, or any combination of the foregoing, that expired on January 29, 2024. On January 26, 2024, we filed a new shelf registration statement on Form S-3 (File No. 333-276722) to register $150.0 million of common stock, preferred stock, debt securities, warrants and units, or any combination of the foregoing (the “2024 Shelf”). The 2024 Shelf was declared effective by the SEC on February 8, 2024 and replaced the 2021 Shelf at that time.
Previous wording
On March 16, 2018, we entered into a Sales Agreement (“Sales Agreement”) with H.C. Wainwright & Co., LLC and Jones Trading Institutional Services LLC (each an “Agent” and together, the “Agents”). On January 29, 2021, we filed a prospectus supplement to the 2021 Shelf (the “2021 ATM Prospectus Supplement”), pursuant to which we could offer and sell, from time to time, through the Agents, shares of our common stock in ATM sales transactions having an aggregate offering price of up to $50.0 million. Any shares offered and sold will be issued pursuant to our 2021 Shelf until it is replaced by the 2024 Shelf.
Current wording
On March 16, 2018, we entered into a Sales Agreement (“Sales Agreement”) with H.C. Wainwright & Co., LLC and Jones Trading Institutional Services LLC (each an “Agent” and together, the “Agents”). On January 29, 2021, we filed a prospectus supplement to the 2021 Shelf (the “2021 ATM Prospectus Supplement”), pursuant to which we could offer and sell, from time to time through the Agents, shares of our common stock in ATM sales transactions having an aggregate offering price of up to $50.0 million. Any shares offered and sold were issued pursuant to our 2021 Shelf until it was replaced by the 2024 Shelf.
Previous wording
On January 26, 2024, we also filed a prospectus to the 2024 Shelf (the “2024 ATM Prospectus”), pursuant to which we may offer and sell, from time to time, through the Agents, shares of its common stock in ATM sales transactions having an aggregate offering price of up to $2,605,728. Any shares offered and sold in these ATM sales transactions will be issued pursuant to the 2024 Shelf.
Current wording
On January 26, 2024, we filed a prospectus to the 2024 Shelf (the “2024 ATM Prospectus”), pursuant to which we may offer and sell, from time to time, through the Agents, shares of its common stock in ATM sales transactions having an aggregate offering price of up to $2,605,728. Any shares offered and sold in these ATM transactions are issued pursuant to the 2024 Shelf.
Previous wording
During the nine months ended December 31, 2023, we sold 934,621 shares of common stock in ATM offerings pursuant to the 2021 ATM Prospectus Supplement. As of December 31, 2023, we have sold an aggregate of 2,515,483 shares of common stock in ATM offerings under the 2021 ATM Prospectus Supplement, for gross proceeds of approximately $22.9 million. As of December 31, 2023, there was approximately $100.0 million available in future offerings under the 2021 Shelf (excluding amounts available but not yet issued under the ATM Prospectus Supplement), and approximately $27.1 million available for future offerings through our ATM program under the 2021 ATM Prospectus Supplement.
Current wording
During the three months ended June 30, 2024, we issued 1,352,600 shares of common stock in ATM offerings for net proceeds of approximately $1.7 million, all of which were sold pursuant to the 2024 Shelf. As of June 30, 2024, we have sold an aggregate of 1,389,002 shares of common stock in ATM offerings under the 2024 ATM Prospectus, with gross proceeds of approximately $1.8 million and net proceeds of approximately $1.8 million. As of June 30, 2024, there was approximately $100.0 million available for future offerings under the 2024 Shelf, and approximately $0.8 million available for future offerings through our ATM program under the 2024 ATM Prospectus.
Rearranged previous paragraphs (7)
Previous report — wording carried elsewhere
2018 Apr 27;2:156-167. doi: 10.1016/j.isci.2018.03.015.)Our advances include cell type-specific compartments, prevalent intercellular tight junctions, and the formation of microvascular structures.
Previous report — wording carried elsewhere
For the three months ended December 31, 2023, total research and development expenses were $1.4 million, an increase of $0.2 million, or approximately 21%, from the prior year period. The increase year over year directly relates to the shift in strategic focus to advance the clinical drug development of FXR314 and start a Phase 2a clinical trial in the calendar year 2024. Our average full-time research and development staff decreased from an average of fifteen full-time employees for the three months ended December 31, 2022 to an average of fourteen full-time employees for the three months ended December 31, 2023. Our fiscal 2024 operations resulted in a $0.1 million increase in consulting expenses, and a $0.1 million increase in lab expenses. Going forward, we intend to continue to advance the clinical drug development of FXR314 and expect an associated increase in expenses.
Previous report — wording carried elsewhere
The following table summarizes our results of operations for the nine months ended December 31, 2023 and 2022 (in thousands, except %):
Previous report — wording carried elsewhere
For the nine months ended December 31, 2023 and 2022, total revenue was less than $0.1 million and $0.2 million, respectively. The revenue is related to sales-based royalties from licensing intellectual property. The decrease in royalty revenue year over year relates to a decrease in sales of royalty bearing products by the licensee. Given the trend of reduced sales during the fiscal year, we expect a decrease in sales of royalty bearing products by the licensee going forward.
Previous report — wording carried elsewhere
The following table summarizes our research and development expenses for the nine months ended December 31, 2023 and 2022 (in thousands, except %):
Previous report — wording carried elsewhere
The following table summarizes our selling, general and administrative expenses for the nine months ended December 31, 2023 and 2022 (in thousands, except %):
Previous report — wording carried elsewhere
Net cash provided by investing activities was $0.8 million for the nine months ended December 31, 2023. Investing activities consisted of purchases of investments of $9.9 million, maturities of investments of $10.0 million, liquidation of equity securities of