Coya Therapeutics Inc
For the period ended Sep 30, 2024. Filed Nov 6, 2024.
View on SEC.govAbout this filing
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.
Sep 30, 2024 · Filed Nov 6, 2024
COYA$2.99+6.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-08-12.
0000950170-24-095075
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-09-30; filed 2024-11-06.
0000950170-24-121837
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 145 previous paragraphs and 169 current paragraphs.
118 unchanged; 24 reworded; 26 added; 3 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 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 (26)
Current report
On October 29, 2024, we announced that results from the investigator-initiated placebo-controlled Phase 2 POC clinical trial of LD IL-2 in patients with mild to moderate AD were announced on that same day at the 17th Clinical Trials on Alzheimer’s Disease Conference, or CTAD24, in Madrid, Spain. The study was led by Dr. Alireza Faridar and Dr. Stanley Appel from the Houston Methodist Research Institute. Dr. Appel is a member of our Scientific Advisory Board. The study received funding from the Alzheimer's Association, the Gates Foundation, and the National Institute on Aging, with additional support from us.
Current report
Study Design
Current report
The investigator-initiated, randomized, double-blind, placebo-controlled Phase 2 trial evaluated two dosing regimens of subcutaneous LD IL-2 in 38 participants with AD that were between the ages of 50 to 86 and had Mini-Mental State Examination, or MMSE, scores ranging from 12 to 26.
Current report
Of the 38 total participants, 22 were randomized in a 1:1 ratio to receive either 5 days of LD IL-2 (106 IU/day), or LD IL-2 q4wks, or placebo every 4 weeks for 21 weeks. An additional 16 participants were randomized in a 2:1 ratio to receive 5-day cycles of LD IL-2 every 2 weeks, or LD IL-2 q2wks, or placebo for the same 21-week duration. All participants were monitored for 9 weeks post-treatment, resulting in a total study period of 30 weeks. Demographics and baseline disease characteristics were comparable among the treatment groups.
Current report
The primary endpoint was the incidence and severity of adverse events, or AEs, with the secondary endpoint evaluating changes in Tregs. Exploratory endpoints assessed changes in cerebrospinal fluid, or CSF, AD-related biomarkers, and cognitive status.
Current report
Study Results
Current report
The study successfully met its primary and secondary endpoints, demonstrating that treatment with LD IL-2 is safe and well-tolerated in patients with Alzheimer’s disease. Notably, LD IL-2 showed targeted biological activity, evidenced by a significant expansion of regulatory T cell populations in the LD IL-2 q4wks group without any off-target effects on other peripheral lymphocytes. Additionally, the q4wks regimen led to significant improvements (defined by increased levels) in cerebrospinal fluid, or CSF-soluble Aβ42 levels, an indicator of amyloid pathology, and showed a promising trend in stabilizing cognitive function, with a clinically meaningful 4.93-point improvement 1 in the ADAS-Cog14 score compared to placebo.
Current report
In contrast, the q2wks group, representing the higher total dose cohort, did not exhibit benefits in exploratory endpoints, underscoring the importance of appropriate IL-2 dosing for maintaining Treg functionality and its associated effects on CSF biomarkers and cognitive outcomes. LD IL-2 q2wks dosing also resulted in a reduction of Foxp3 expression, a critical marker of Treg functionality (a lower level or loss of Foxp3 expression is associated with unstable/dysfunctional Tregs). While these unstable Tregs continue to show suppressive immune response in vitro, they may lose their immunomodulatory functions in vivo, potentially explaining the dose impact on Treg populations and associated exploratory endpoints. As a result of these data, we will likely advance LD IL-2 q4wks.
Current report
Primary Endpoint (Safety and Tolerability): All patients completed the 21-week treatment phase. The proportion of patients experiencing adverse events, or AEs, was similar between the LD IL-2 treatment groups and the placebo group, with no serious AEs or deaths reported. The most common AEs in the LD IL-2 groups included mild erythema at the injection site and a slight increase in eosinophil counts.
Current report
Secondary Endpoint (Treg Cell Populations): There was a significant increase (p < 0.05) in the percentage of CD4+ FOXP3+CD25 high Tregs, mean fluorescence intensity (MFI) of Foxp3, Treg CD25 MFI, and Treg suppression of T responders following both dosing regimens of LD IL-2 treatment compared to placebo. Notably, the LD IL-2 q4wks treatment group showed greater enhancement in both Treg numbers and Foxp3 MFI compared to the q2wks group. The loss of Foxp3 expression in the q2wks group (back to baseline levels equivalent to placebo) indicated that higher IL-2 dosing may compromise Treg functionality. Repeated stimulation of Tregs without sufficient rest periods has been reported to result in exhausted and unstable Treg populations. Published studies also suggest an inverse relationship between IL-2 dose and Treg functionality.
Current report
Exploratory Endpoint (Cognitive Function & Cerebrospinal Fluid, or CSF, Biomarkers)
Current report
Although not powered for significance, the analyses of exploratory endpoints also showed encouraging results.
Current report
Cognitive Function: The Alzheimer’s Disease Assessment Scale–Cognitive Subscale (ADAS-Cog14) scores on day 148 showed a slight improvement following LD IL-2 q4wks administration (change from baseline: -0.450), vs. placebo, which worsened 4.480 from baseline, demonstrating a clinically meaningful difference of 4.93 points (P=0.061). This cognitive effect was not observed in the LD IL-2 q2wks administration, which demonstrated a similar decline as placebo.
Current report
Stabilization of ADCS-CGIC (Alzheimer's Disease Assessment Scale – Cognitive Subscale) scores was observed in both the IL-2 q4wks and IL-2 q2wks groups on day 148 compared to the placebo arm, which declined from baseline.
Current report
The change from baseline in the Clinical Dementia Rating Scale Sum of Boxes, or CDR-SOB, on Day 148 was 1.401 in the LD IL-2 q4wks group, 1.976 in the LD IL-2 q2wks group, and 1.893 in the placebo group, suggesting a 27% slower decline in CDR-SOB scores following LD IL-2 q4wks treatment compared to the placebo group. These findings suggest that LD IL-2 q4wks may be an optimal dose for cognitive effects in mild to moderate AD, which was the dose associated with a robust and sustained increase in Treg populations along with enhanced expression of the IL-2 receptor, CD25, and the Treg transcription factor, FoxP3. Furthermore, the cognitive effect of this dose was associated with significant improvements in AD pathology in the CSF and stabilization of CSF inflammatory markers.
Current report
CSF Aβ42: Low CSF Aβ42 is universally associated with AD, and higher CSF Aβ42 levels are independently associated with slowing cognitive impairment and clinical decline. Increases in Aβ42 may represent a mechanism of potential benefit of intervention. LD IL-2 q4wks treatment significantly improved CSF Aβ42 levels after the 21-week treatment, compared to the placebo group (p = 0.045). LD IL-2 q2wks treatment did not significantly modify CSF Aβ42 levels. These data further suggest the dose-dependent effect of LD IL-2 on Treg cell populations (i.e. FOXP3) is associated with effects on CSF Aβ42.
Current report
CSF Neurofilament Light Chain, or NfL: NfL is increasingly recognized as a promising biomarker for neurodegeneration (neuronal/axonal degeneration) in AD. Residing predominantly within myelinated axons, NfL is a cytoskeletal protein that plays a role in maintaining neuronal structural integrity and axonal caliber. Neuronal damage in neurodegenerative diseases releases NfL into the extracellular space and eventually into the CSF, resulting in higher CSF NfL levels in AD.
Current report
CSF NfL levels remained stable following LD IL-2 q4wks administration and almost reached statistical significance vs. placebo (which increased by 217.3pg/mL) (p=0.060). CSF NfL increased by 148.0 pg/mL in the LD IL-2 q2wks arm. These data suggest the dose-dependent effect of LD IL-2 on Treg cell populations (i.e. FOXP3) is associated with effects on CSF NfL.
Current report
CSF Glial Fibrillary Acidic Protein, or GFAP: GFAP is an astrocytic cytoskeleton intermediate filament protein. GFAP is a marker of astrogliosis, which is the abnormal activation and proliferation of astrocytes. Astrogliosis is associated with Aβ plaques in the prodromal stages of AD.
Current report
CSF GFAP levels showed a slight improvement following LD IL-2 q4wks administration (change from baseline: -214.1 pg/mL) and remained almost stable in the LD IL-2 q2wks group (change from baseline: 17.4 pg/mL), but increased by 1548.99 pg/mL in the placebo group.
Current report
We intend to file an IND for COYA 302 for the treatment of FTD after the IND for the Phase 2 trial of COYA 302 in patients with ALS is approved by the FDA.
Current report
In the second half of 2025, we anticipate that clinical data in FTD patients will be reported for a proof-of-concept, investigator-initiated, open-label study conducted at Houston Methodist Hospital to assess safety and tolerability of LD IL-2, plus CTLA-4 Ig Fusion Protein (Abatacept) immunotherapy. Up to 10 FTD patients will be administered subcutaneous abatacept (125 mg) followed by five-day-courses of IL-2 (1MUI/day) every two or four weeks for a total of 21 weeks. Outcomes will include safety and tolerability, impact of treatment on Treg cell populations, effects on peripheral and central inflammation, as well as the rate of FTD progression using clinical rating scales.
Current report
On October 21, 2024, we entered into a Securities Purchase Agreement with certain accredited investors, majority of which were existing institutional stockholders of ours, for the issuance and sale in a private placement of 1,379,314 shares of our common stock, or the October 2024 Private Placement. The offering resulted in gross proceeds of $10.0 million, at a price of $7.25 per share of common stock, before deducting placement agent commissions and other offering expenses.
Current report
Collaboration revenue
Current report
No collaboration revenues were earned during the three months ended September 30, 2024 due to an increase in budgeted spending for COYA 302. The increase in budgeted spending is a result of communication with the FDA in which the FDA stated that additional non-clinical data must be submitted prior to initiating our planned randomized, double-blind placebo-controlled Phase 2 study of COYA 302 in patients with ALS. Budgeted spending for COYA 302 includes total forecasted pre-clinical and clinical costs incurred for the advancement of COYA 302 in patients with ALS. R&D Services revenue is calculated quarterly using the inputs approach, by applying actual COYA 302 expenses against budgeted COYA 302 expenses as the two inputs. The increase in budgeted COYA 302 expenses offset the actual COYA 302 expenses incurred during the three months ended September 30, 2024, which resulted in immaterial movements of R&D Services revenue. As such, no R&D Services revenue were recorded. In addition, License revenue is recognized at a point in time upon delivery of a license or upon a cumulative catch-up in the event of a contract modification. No licenses were transferred nor were there any contract modifications during the three months ended September 30, 2024, as such no License revenue was recognized.
Current report
Comparison of the nine months ended September 30, 2024 and 2023
Removed paragraphs (3)
Previous report
On October 9, 2023, we announced that the randomized, double-blind placebo-controlled Investigator Initiated Trial in Alzheimer’s Disease assessing LD IL-2 entitled: “A Phase II Clinical Trial of Interleukin-2 (IL-2) in Patients with Mild to Moderate Alzheimer's Disease,” was fully enrolled with 38 patients. This study is being conducted by investigators at Houston Methodist Research Institute and is supported by the Gates Foundation and the Alzheimer’s Association. The study will evaluate the safety and tolerability, biological activity, blood and cerebrospinal fluid biomarkers, neuroimaging, and changes in cognitive function of LD IL-2 compared to placebo at pre-specified timepoints over the course of the 21-week treatment period and at 9 weeks after the last dose of study treatment. Although we had expected to disclose the data from the study during the summer of 2024, based on the decision by the investigators (who are independent from us) this data will now be presented at a poster presentation in person during the 17th edition of the Clinical Trials on Alzheimer’s Disease Conference, or CTAD24, to be held in Madrid (Spain) on October 29th - November 1, 2024.
Previous report
We intend to provide an update on the proposed timing for filing an IND for COYA 302 for the treatment of FTD after the proposed fourth quarter 2024 discussion with the FDA discussed above.
Previous report
Comparison of the six months ended June 30, 2024 and 2023
Reworded paragraphs (24)
Previous wording
the impact of COVID-19 and resulting pandemic on our preclinical studies and any future clinical trials;
Current wording
the impact of any global health events, including endemics or pandemics, on our preclinical studies and any future clinical trials;
Previous wording
Our lead asset, COYA 302, is a Treg-enhancing biologic, which has been developed from key learnings established in our early work and discoveries of our autologous Treg cell therapy asset. Our autologous Treg cell therapy program has completed a Phase 1 and Phase 2a studies in amyotrophic lateral sclerosis, or ALS. We believe the clinical data from these initial studies served as an important confirmation of the underlying immunomodulatory properties of Tregs and their potential therapeutic benefits. These studies have also significantly expanded our own foundational knowledge of the biological activity of Tregs and key biomarkers of disease progression and drug effect, which we believe will be critical for the design of our future clinical and preclinical studies, the selection of future targeted diseases and the overall advancement of our development pipeline. We believe our findings have also established mechanistic benefits of combination biologics to address Treg dysfunction as well as highlighted important advantages of scalability and cost.
Current wording
Our lead asset, COYA 302, is a Treg-enhancing biologic, which has been developed from key learnings established in our early work and discoveries of our autologous Treg cell therapy asset. Our autologous Treg cell therapy program has completed Phase 1 and Phase 2a studies in amyotrophic lateral sclerosis, or ALS. We believe the clinical data from these initial studies serves as an important confirmation of the underlying immunomodulatory properties of Tregs and their potential therapeutic benefits. These studies have also significantly expanded our own foundational knowledge of the biological activity of Tregs and key biomarkers of disease progression and drug effect, which we believe will be critical for the design of our future clinical and preclinical studies, the selection of future targeted diseases and the overall advancement of our development pipeline. We believe our findings have also established mechanistic benefits of combination biologics to address Treg dysfunction as well as highlighted important advantages of scalability and cost.
Previous wording
Our operations have consisted of developing our clinical and preclinical product candidates and we have devoted substantially all of our resources to developing product and technology rights, conducting research and development, organizing and staffing our company, business planning and raising capital. We have funded our operations primarily through private convertible preferred stock offerings, a convertible debt financing, the public offering of our securities that closed in January 2023, two private security offerings, and payments from Dr. Reddy's Laboratories Ltd., or DRL, and its affiliate, Dr. Reddy's Laboratories SA, collectively, Dr. Reddy's, in accordance with the Development and License Agreement, or DRL Development Agreement, as amended in June 2024. Our net losses were $2.9 million and $3.1 million for the three months ended June 30, 2024 and 2023, respectively. Our net losses were $7.9 million and $5.8 million for the six months ended June 30, 2024 and 2023, respectively. As of June 30, 2024, we had an accumulated deficit of $33.8 million. Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures, and to a lesser extent, general and administrative expenditures. Our ability to generate product revenue sufficient to achieve profitability will depend heavily on the successful development and eventual commercialization of one or more of our current or future product candidates.
Current wording
Our operations have consisted of developing our clinical and preclinical product candidates and we have devoted substantially all of our resources to developing product and technology rights, conducting research and development, organizing and staffing our company, business planning and raising capital. We have funded our operations primarily through private convertible preferred stock offerings, a convertible debt financing, public and private offerings of our securities, and payments from certain of our license and collaboration agreements. Our net losses were $4.0 million and $3.4 million for the three months ended September 30, 2024 and 2023, respectively. Our net losses were $12.0 million and $9.3 million for the nine months ended September 30, 2024 and 2023, respectively. As of September 30, 2024, we had an accumulated deficit of $37.8 million. Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures, and to a lesser extent, general and administrative expenditures. Our ability to generate product revenue sufficient to achieve profitability will depend heavily on the successful development and eventual commercialization of one or more of our current or future product candidates.
Previous wording
During the first half of 2023, our combination product for neurodegenerative diseases, or COYA 302, and our LD IL-2, or COYA 301, showed positive results in a proof of concept, or POC, open label study in amyotrophic lateral sclerosis, or ALS, patients and in Alzheimer’s Disease, or AD, patients, respectively. Both POC studies were conducted with commercially available products as investigator-initiated trials.
Current wording
During the first half of 2023, two proof of concept, or POC studies conducted with commercially available products, as investigator-initiated trials, or IITs, reported results. First, the combination of LD IL-2 and abatacept showed positive results in a POC open label study in amyotrophic lateral sclerosis, or ALS. In the second POC study, LD IL-2 showed positive results in Alzheimer’s Disease, or AD patients.
Previous wording
The POC study in support of COYA 301, an open label study conducted in 8 patients with AD, evaluated the safety and tolerability, biological activity, blood biomarkers, and preliminary efficacy of commercially available IL-2. Study data found that (i) cognitive function, as measured by 3 validated tools, either improved or did not decline, (ii) Treg function was significantly enhanced, (iii) pro-inflammatory blood cytokines and chemokines were significantly reduced with evidence of reduced neuroinflammation in the brain and (iv) the study treatment appeared to be well tolerated as no serious adverse events were reported.
Current wording
The POC study of LD IL-2 in support of COYA 301, an open label study conducted in 8 patients with AD, evaluated the safety and tolerability, biological activity, blood biomarkers, and preliminary efficacy of commercially available IL-2. Study data found that (i) cognitive function, as measured by 3 validated tools, either improved or did not decline, (ii) Treg function was significantly enhanced, (iii) pro-inflammatory blood cytokines and chemokines were significantly reduced with evidence of reduced neuroinflammation in the brain and (iv) the study treatment appeared to be well tolerated as no serious adverse events were reported.
Previous wording
The POC study in support of COYA 302, an open label study conducted in 4 ALS patients, evaluated the safety and tolerability, function of regulatory T-cells, biomarkers, and preliminary efficacy (as measured by the ALSFRS-R scale) utilizing commercially available IL-2 and abatacept. Study data showed no decline or minimal decline at 24 and 48 weeks respectively after initiation of treatment and appeared to be well tolerated in all study patients as no serious adverse events were reported. Twenty-four weeks is an important timepoint as this is the period that ALS studies are usually benchmarked to measure differences in the ALSFRS-R scale for a treatment versus placebo. Based on this POC data, we decided to design and conduct a well-powered and well-controlled Phase 2 study to demonstrate the safety and efficacy of COYA 302 (COYA 301 or LD IL-2, plus an abatacept proposed biosimilar, or DRL_AB, licensed from DRL) in patients with ALS.
Current wording
The POC study of LD IL-2 and abatacept in support of COYA 302, an open label study conducted in 4 ALS patients, evaluated the safety and tolerability, function of regulatory T-cells, biomarkers, and preliminary efficacy (as measured by the ALSFRS-R scale) utilizing commercially available IL-2 and abatacept. Study data showed no decline or minimal decline at 24 and 48 weeks respectively after initiation of treatment and appeared to be well tolerated in all study patients as no serious adverse events were reported. Twenty-four weeks is an important timepoint as this is the period that ALS studies are usually benchmarked to measure differences in the ALSFRS-R scale for a treatment versus placebo. Based on this POC data, we decided to design and conduct a well-powered and well-controlled Phase 2 study to demonstrate the safety and efficacy of COYA 302 (COYA 301 or LD IL-2, plus an abatacept proposed biosimilar, or DRL_AB, licensed from DRL) in patients with ALS.
Previous wording
We submitted an IND filing with the U.S. Food and Drug Administration, or the FDA, in the second quarter of 2024. On July 12, 2024, we received an email notification from the FDA stating that additional non-clinical data is required prior to the initiation of a Phase 2 trial and that further guidance would be provided. On August 9, 2024, the FDA provided feedback that additional non-clinical toxicology/pharmacology data must be submitted prior to initiating our planned randomized, double-blind placebo-controlled Phase 2 study of our first-in-class biologic combination COYA 302 in patients with ALS. We intend to discuss the recommendations with the FDA in the fourth quarter of 2024 to align on our revised non-clinical package to enable the implementation of the study. We will provide further details following the meeting with the FDA. While we hope to initiate a Phase 2 clinical trial of COYA 302 in ALS after coming to agreement with the FDA on our non-clinical plans and after receiving their approval of our IND, there can be no certainty that the FDA will find that additional information sufficient or that they will permit us to start clinical trials with COYA 302 within our proposed timing or at all.
Current wording
We submitted an IND with the U.S. Food and Drug Administration, or the FDA, in the second quarter of 2024 for a randomized, double-blind placebo-controlled Phase 2 study of our first-in-class biologic combination COYA 302 in ALS patients. On July 12, 2024, we received an email notification from the FDA stating that additional nonclinical data was required prior to the initiation of this study and that further guidance would be provided. On August 9, 2024, the FDA provided feedback that additional nonclinical toxicology/pharmacology data were required prior to initiating our proposed study. On November 1, 2024, we had productive communication with the FDA and believe we now have alignment on their expectations for the required additional nonclinical data. We are endeavoring to complete the required nonclinical studies and submit the required data necessary to support our IND in the second quarter of 2025. We intend to initiate the proposed Phase 2 clinical trial in patients with ALS upon approval of the IND by the FDA. However, there can be no certainty that the FDA will find that additional information sufficient or that it will permit us to start clinical trials with COYA 302 within our proposed timing or at all.
Previous wording
In January of 2024, we announced that we are expanding our pipeline in neurodegenerative conditions for COYA 302 beyond ALS to include FTD and PD. More recently, in February of 2024, we announced our expansion of COYA 302 to AD. This expansion advances our approach of combination biologics with LD IL-2 as a backbone which we believe may represent a new approach to target complex immune pathways in neurodegenerative diseases.
Current wording
In January of 2024, we announced that we are expanding our pipeline in neurodegenerative conditions for COYA 302 beyond ALS to include FTD and PD. More recently, in February of 2024, we announced our expansion of COYA 302 to AD. This expansion advances our approach of combination biologics with LD IL-2 as a backbone which we believe may represent a new strategy to target complex immune pathways in neurodegenerative diseases.
Previous wording
In addition, studies in animal models of PD are ongoing, and based on those studies, a subsequent IND filing may be for the treatment of PD. We will await the results of the ongoing double-blind placebo-controlled trial being conducted by Dr. Appel of LD IL-2, one of the key components of COYA 302, prior to determining our development plan for COYA 302 in AD patients.
Current wording
In addition, studies in animal models of PD are ongoing, and based on those studies, a subsequent IND may be filed for the treatment of PD. We are evaluating the recently announced results of the double-blind placebo-controlled trial in AD being conducted by Dr. Alireza Faridar and Dr. Stanley Appel of LD IL-2 (described above), one of the key components of COYA 302, prior to determining our development plan for COYA 302 in AD patients.
Previous wording
On May 17, 2024, we entered into a Securities Purchase Agreement with the Alzheimer's Drug Discovery Foundation, or the ADDF, for the issuance and sale in a private placement of 603,136 shares of our common stock at a purchase price of $8.29 per share for net proceeds of $4.9 million, or the 2024 Private Placement. In connection with the Securities Purchase Agreement, we entered into an Agreement to Accept Conditions for Biotechnology Funding agreement, or the Funding Agreement, with ADDF, pursuant to which the proceeds received in connection with the Securities Purchase agreement shall be used for a Phase 2 study of COYA 302 in FTD.
Current wording
On May 17, 2024, we entered into a Securities Purchase Agreement with the Alzheimer's Drug Discovery Foundation, or the ADDF, for the issuance and sale in a private placement of 603,136 shares of our common stock at a purchase price of $8.29 per share for net proceeds of $4.9 million, or the May 2024 Private Placement. In connection with this financing, we entered into an Agreement to Accept Conditions for Biotechnology Funding agreement, with ADDF pursuant to which the proceeds received in connection with the financing shall be used for a Phase 2 study of COYA 302 in FTD.
Previous wording
Research and development expenses increased by $3.5 million from $1.1 million for the three months ended June 30, 2023 to $4.6 million for the three months ended June 30, 2024. The increase was due to a $3.0 million increase in our preclinical expenses primarily due to our preclinical advancement of COYA 302 in ALS, a $0.4 million increase in internal research and development expenses, and a $0.1 million increase in sponsored research. External research and development expenses include fees paid to CROs and CMOs and fees paid to regulatory, clinical trial and manufacturing professional service firms largely in connection with preclinical activities necessary to prepare COYA 302 for its initial IND filing and launch of a Phase 2 clinical trial. We expect these expenses to continue to grow in the third quarter of 2024. Once the IND for COYA 302 has been approved, we intend to expand the table below, creating a new class called "Clinical product candidates", wherein we will disclose the clinical expenses for COYA 302.
Current wording
Research and development expenses increased by $0.6 million from $1.6 million for the three months ended September 30, 2023 to $2.2 million for the three months ended September 30, 2024. The increase was due to a $0.3 million increase in our preclinical expenses primarily due to our preclinical advancement of COYA 302 in ALS and a $0.3 million increase in internal research and development expenses. External research and development expenses include fees paid to CROs and CMOs and fees paid to regulatory, clinical trial and manufacturing professional service firms largely in connection with preclinical activities necessary to prepare COYA 302 for its initial IND filing and launch of a Phase 2 clinical trial. We expect these expenses to continue to grow in the fourth quarter of 2024. Once the IND for COYA 302 has been approved, we intend to expand the table below, creating a new class called "Clinical product candidates," wherein we will disclose the clinical expenses for COYA 302.
Previous wording
General and administrative expenses increased by $0.3 million from $1.8 million for the three months ended June 30, 2023 compared to $2.1 million for the three months ended June 30, 2024. The increase was primarily due to a $0.4 increase in personnel related expenses related to an increase in stock-based compensation and employee headcount, partially offset by a $0.1 million decrease in professional fees related costs incurred for the private placement financing in 2023.
Current wording
General and administrative expenses increased by $0.2 million from $2.0 million for the three months ended September 30, 2023 compared to $2.2 million for the three months ended September 30, 2024. The increase was primarily due to a $0.4 million increase in stock-based compensation and employee headcount, partially offset by a $0.2 million decrease in corporate fees.
Previous wording
Other income, net increased by $0.2 million from the three months ended June 30, 2023 compared to the three months ended June 30, 2024. The increase was primarily due to interest and dividend income earned on cash balances.
Current wording
Other income, net increased by $0.3 million from the three months ended September 30, 2023 compared to the three months ended September 30, 2024. The increase was primarily due to interest and dividend income earned on cash balances.
Previous wording
Research and development expenses increased by $5.4 million from $2.3 million for the six months ended June 30, 2023 to $7.7 million for the six months ended June 30, 2024. The increase was due to a $4.7 million increase in our preclinical expenses primarily due to our preclinical advancement of COYA 302 in ALS, $0.1 million increase in sponsored research, and a $0.6 million increase in internal research and development expenses. External research and development expenses include fees paid to CROs and CMOs and fees paid to regulatory, clinical trial and manufacturing professional service firms largely in connection with preclinical activities necessary to prepare COYA 302 for its initial IND filing and launch of a Phase 2 clinical trial. We expect these expenses to continue to grow in the third quarter of 2024. Once the IND for COYA 302 has been approved, we intend to expand the table below, creating a new class called "Clinical product candidates", wherein we will disclose the clinical expenses for COYA 302.
Current wording
Research and development expenses increased by $6.0 million from $3.9 million for the nine months ended September 30, 2023 to $9.9 million for the nine months ended September 30, 2024. The increase was due to a $5.0 million increase in our preclinical expenses primarily due to our preclinical advancement of COYA 302 in ALS, $0.2 million increase in sponsored research, and a $0.8 million increase in internal research and development expenses. External research and development expenses include fees paid to CROs and CMOs and fees paid to regulatory, clinical trial and manufacturing professional service firms largely in connection with preclinical activities necessary to prepare COYA 302 for its initial IND filing and launch of a Phase 2 clinical trial. We expect these expenses to continue to grow in the fourth quarter of 2024. Once the IND for COYA 302 has been approved, we intend to expand the table below, creating a new class called "Clinical product candidates", wherein we will disclose the clinical expenses for COYA 302.
Previous wording
General and administrative expenses increased by $1.0 million from $3.5 million for the six months ended June 30, 2023 compared to $4.5 million for the six months ended June 30, 2024. The increase was primarily due to an $0.8 million increase in personnel related expenses primarily related to an increase in stock-based compensation and employee headcount, and a $0.3 million increase in board fees and taxes, partially offset by a $0.1 million decrease in office expenses.
Current wording
General and administrative expenses increased by $1.3 million from $5.5 million for the nine months ended September 30, 2023 compared to $6.7 million for the nine months ended September 30, 2024. The increase was primarily due to an $1.2 million increase in stock-based compensation and employee headcount, and a $0.2 million increase in board fees and taxes, partially offset by a $0.1 million decrease in office expenses.
Previous wording
Other income, net increased by $0.5 million from the six months ended June 30, 2023 compared to the six months ended June 30, 2024. The increase was primarily due to interest and dividend income earned on cash balances.
Current wording
Other income, net increased by $0.7 million from the nine months ended September 30, 2023 compared to the nine months ended September 30, 2024. The increase was primarily due to interest and dividend income earned on cash balances.
Previous wording
Since our inception, we have incurred operating losses and incurred negative cash flows from our operations through 2023. We have not yet commercialized any product and we do not expect to generate revenue from sales of any products for several years, if at all. Since our inception through June 30, 2024 we have funded our operations through the sale of convertible promissory notes and convertible preferred stock, our IPO, two private security offerings, and payments from DRL in accordance with the DRL Development Agreement, as amended in June 2024. As of June 30, 2024 we had $36.6 million in cash and cash equivalents and had an accumulated deficit of $33.8 million. We expect our existing cash and cash equivalents will enable us to fund our operating expenses and capital expenditure requirements into 2026. We have based these estimates on assumptions that may prove to be imprecise, and we could utilize our available capital resources sooner than we expect.
Current wording
Since our inception, we have incurred operating losses and incurred negative cash flows from our operations through 2023. We have not yet commercialized any product and we do not expect to generate revenue from sales of any products for several years, if at all. Since our inception through September 30, 2024 we have funded our operations through the sale of convertible promissory notes and convertible preferred stock, our IPO, private securities offerings, and payments from DRL in accordance with the DRL Development Agreement, as amended in June 2024. As of September 30, 2024, we had $31.1 million in cash and cash equivalents and had an accumulated deficit of $37.8 million. We expect our existing cash and cash equivalents, together with the $10.0 million in gross proceeds from the October 2024 Private Placement, to enable us to fund our operating expenses and capital expenditure requirements into 2026. We have based these estimates on assumptions that may prove to be imprecise, and we could utilize our available capital resources sooner than we expect.
Previous wording
During the six months ended June 30, 2024, we used $2.4 million of cash in operating activities. Cash used in operating activities reflected our net loss of $7.9 million, offset by a $4.4 million net increase from our operating assets and liabilities and noncash charges of $1.1 million primarily related to stock-based compensation. The net increase in our operating assets was mainly related to the receipt of a $7.5 million payment from DRL pursuant to the DRL Development Agreement during the six months ended June 30, 2024.
Current wording
During the nine months ended September 30, 2024, we used $7.9 million of cash in operating activities. Cash used in operating activities reflected our net loss of $12.0 million, partially offset by a $2.2 million net increase from our operating assets and liabilities and noncash charges of $1.9 million primarily related to stock-based compensation. The net increase in our operating assets was mainly related to the receipt of a $7.5 million payment from DRL pursuant to the DRL Development Agreement during the nine months ended September 30, 2024.
Previous wording
During the six months ended June 30, 2023, we used $6.7 million of cash in operating activities. Cash used in operating activities reflected our net loss of $5.8 million and a $1.6 million net decrease in our operating assets and liabilities, partially offset by noncash charges of $0.7 million related to stock-based compensation and acquired in-process research and development. The primary use of cash was to fund our operations related to the development of our product candidates.
Current wording
During the nine months ended September 30, 2023, we used $8.9 million of cash in operating activities. Cash used in operating activities reflected our net loss of $9.3 million and a $0.7 million net decrease in our operating assets and liabilities, partially offset by noncash charges of $1.1 million related to stock-based compensation and acquired in-process research and development. The primary use of cash was to fund our operations related to the development of our product candidates.
Previous wording
During the six months ended June 30, 2024, we purchased $25,000 of in-process research and development assets. During the six months ended June 30, 2023, we purchased $0.4 million of in-process research and development assets relating to the DRL Agreement.
Current wording
During the nine months ended September 30, 2024, we purchased $25,000 of in-process research and development assets. During the nine months ended September 30, 2023, we purchased $0.4 million of in-process research and development assets relating to the DRL Agreement.
Previous wording
During the six months ended June 30, 2024, financing activities provided $6.4 million of cash from the proceeds received from the sale of common stock of $5.0 million and the exercise of warrants of $1.5 million, partially offset by $0.1 million in payments of offering costs related to the 2023 private placement.
Current wording
During the nine months ended September 30, 2024, financing activities provided $6.3 million of cash from the proceeds received from the sale of common stock of $5.0 million and the exercise of warrants of $1.5 million, partially offset by $0.1 million in payments of offering costs related to the 2023 private placement.
Previous wording
During the six months ended June 30, 2023, financing activities provided $14.3 million of cash from the issuance of common stock upon our initial public offering, net of deferred financing costs.
Current wording
During the nine months ended September 30, 2023, financing activities provided $14.3 million of cash from the issuance of common stock upon our initial public offering, net of deferred financing costs.
Previous wording
During the six months ended June 30, 2024, there were no material changes to our critical accounting policies and estimates from those described under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2023 Annual Report filed on Form 10-K.
Current wording
During the nine months ended September 30, 2024, there were no material changes to our critical accounting policies and estimates from those described under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2023 Annual Report filed on Form 10-K.
Previous wording
In addition, we may also owe tiered payments to ARS based on our achievement of certain developmental milestones. Under the ARS License Agreement, we will pay an aggregate of $13.3 million in developmental milestone payments for the first Combination Product (as defined in the ARS License Agreement) in a new indication. We will then pay an aggregate of $11.6 million in developmental milestone payments for each Combination Product in each subsequent new indication. Further, for the first Mono Product (as defined in the ARS License Agreement), we will pay an aggregate of $11.8 million in developmental milestone payments. We will then pay an aggregate of $5.9 million in developmental milestone payments for each Mono Product in each subsequent new indication, and we will owe an aggregate of $5.9 million if all developmental milestones are achieved for each new indication. We will also owe royalties on net sales of licensed products ranging from low to mid-single digit percentages. In the event we sublicense our rights under the ARS License Agreement, we will owe royalties on sublicense income within the range of 10% to 20%. To date, the $0.1 million option fee and the mid-six-figure up-front fee (upon exercise of the ARS Option) are the only payments made to ARS under the ARS License Agreement.
Current wording
In addition, we may also owe tiered payments to ARS based on our achievement of certain developmental milestones. Under the ARS License Agreement, we will pay an aggregate of $13.3 million in developmental milestone payments for the first Combination Product (as defined in the ARS License Agreement) in a new indication. We will then pay an aggregate of $11.6 million in developmental milestone payments for each Combination Product in each subsequent new indication. Further, for the first Mono Product (as defined in the ARS License Agreement), we will pay an aggregate of $11.8 million in developmental milestone payments. We will then pay an aggregate of $5.9 million in developmental milestone payments for each Mono Product in each subsequent new indication, and we will owe an aggregate of $5.9 million if all developmental milestones are achieved for each new indication. We will also owe royalties on net sales of licensed products ranging from low to mid-single digit percentages. In the event we sublicense our rights under the ARS
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
License Agreement, we will owe royalties on sublicense income within the range of 10% to 20%. To date, the $0.1 million option fee and the mid-six-figure up-front fee (upon exercise of the ARS Option) are the only payments made to ARS under the ARS License Agreement.