MEDICINOVA INC

Previous wording

We are a biopharmaceutical company focused on developing novel therapeutics for the treatment of serious diseases with unmet medical needs and a commercial focus on the United States market. Our current strategy is to focus our development activities on MN-166 (ibudilast) for neurological and other disorders such as progressive multiple sclerosis (MS), amyotrophic lateral sclerosis (ALS), chemotherapy-induced peripheral neuropathy, degenerative cervical myelopathy, glioblastoma, substance dependence and addiction (e.g., methamphetamine dependence, opioid dependence, and alcohol dependence), prevention of acute respiratory distress syndrome (ARDS), and Long COVID, and MN-001 (tipelukast) for fibrotic and other diseases such as nonalcoholic fatty liver disease (NAFLD) and idiopathic pulmonary fibrosis (IPF). Our pipeline also includes MN-221 (bedoradrine) for the treatment of acute exacerbation of asthma and MN-029 (denibulin) for solid tumor cancers. We were incorporated in Delaware in September 2000.

Current wording

We are a biopharmaceutical company focused on developing novel therapeutics for the treatment of serious diseases with unmet medical needs and a commercial focus on the United States market. Our current strategy is to focus our development activities on MN-166 (ibudilast) for neurological and other disorders such as progressive multiple sclerosis (MS), amyotrophic lateral sclerosis (ALS), chemotherapy-induced peripheral neuropathy, degenerative cervical myelopathy, glioblastoma, substance dependence and addiction (e.g., methamphetamine dependence, opioid dependence, and alcohol dependence), prevention of acute respiratory distress syndrome (ARDS), and Long COVID, and MN-001 (tipelukast) for fibrotic and other metabolic disorders such as nonalcoholic fatty liver disease (NAFLD) and hypertriglycedemia. We were incorporated in Delaware in September 2000.

Previous wording

We have incurred significant net losses since our inception. For the year ended December 31, 2023, we had a net loss of $8.6 million. At December 31, 2023, from inception, our accumulated deficit was $415.7 million. We expect to incur substantial net losses for the next several years as we continue to develop certain of our existing product development programs, and over the long-term if we expand our research and development programs and acquire or in-license products, technologies or businesses that are complementary to our own.

Current wording

We have incurred significant net losses since our inception. For the year ended December 31, 2024, we had a net loss of $11.0 million. At December 31, 2024, from inception, our accumulated deficit was $426.8 million. We expect to incur substantial net losses for the next several years as we continue to develop certain of our existing product development programs, and over the long-term if we expand our research and development programs and acquire or in-license products, technologies or businesses that are complementary to our own.

Previous wording

Our research, development and patents expenses consist primarily of license fees related to our product candidates, salaries and related employee benefits, costs associated with the preclinical and clinical development of our product development programs, costs associated with non-clinical activities, such as regulatory expenses, and pre-commercialization manufacturing development activities. We use external service providers to manufacture our compounds to be used in clinical trials and for the majority of the services performed in connection with the preclinical and clinical development of our product candidates. Research, development and patents expenses include fees paid to consultants, contract research organizations, contract manufacturers and other external service providers, including professional fees and costs associated with legal services, patents and patent applications for our intellectual property. Internal research and development expenses include costs of compensation and other expenses for research and development personnel, supplies, facility costs and depreciation. We determine accrual estimates through reports from and discussions with applicable personnel and outside service providers as to the progress or state of completion of studies, or the services completed. Our estimates of accrued expenses as of each balance sheet date are based on the facts and circumstances known at the time. Although we do not expect our estimates to be materially different from amounts actually incurred, if our estimates of the status and timing of services performed differ from the actual status and timing of services performed, it could result in us reporting amounts that are too high or low in any particular period. To date, our accrued research, development and patent expenses have not differed significantly from the actual expenses incurred.

Current wording

Our research, development and patents expenses consist primarily of license fees related to our product candidates, salaries and related employee benefits, costs associated with the preclinical and clinical development of our product development programs, costs associated with non-clinical activities, such as regulatory expenses, and pre-commercialization manufacturing development activities. We use external service providers to manufacture our compounds to be used in clinical trials and for the majority of the services performed in connection with the preclinical and clinical development of our product candidates. Research, development and patents expenses include fees paid to consultants, contract research organizations, contract manufacturers and other external service providers, including professional fees and costs associated with legal services, patents and patent applications for our intellectual property. Internal research and development expenses include costs of compensation and other expenses for research and development personnel, supplies, facility costs and depreciation. We determine accrual estimates through reports from and discussions with applicable personnel and outside service providers as to the progress or state of completion of studies, or the services completed. Costs that are paid in advance of performance are deferred as a prepaid expense and recognized over the service period as the services are performed. Our estimates of accrued expenses as of each balance sheet date are based on the facts and circumstances known at the time. Although we do not expect our estimates to be materially different from amounts actually incurred, if our estimates of the status and timing of services performed differ from the actual status and timing of services performed, it could result in us reporting amounts that are too high or low in any particular period. To date, our accrued research, development and patent expenses have not differed significantly from the actual expenses incurred.

Previous wording

Revenues were $1.0 million and $0.0 million for the years ended December 31, 2023 and 2022, respectively. The increase of $1.0 million was due to the receipt of a milestone payment under an agreement with Genzyme Corporation.

Current wording

Revenues were $0.0 million and $1.0 million for the years ended December 31, 2024 and 2023, respectively. The decrease of $1.0 million was due to the receipt of a milestone payment under an agreement with Genzyme Corporation in 2023, which did not recur in the current year.

Previous wording

Research, development and patent expenses for the year ended December 31, 2023 decreased by $3.4 million to $5.7 million as compared to $9.1 million for the prior year, primarily due to a decrease in MN-166 and MN-221 expenses. The decrease in MN-166 expenses is primarily due to decreased study expenses based on patient enrollment and study completion timelines in 2023 compared to 2022, as well as the receipt of a $0.7 million payment from the Biomedical Advanced Research and Development Authority (BARDA) to partially reimburse us for preclinical study costs, which was recorded as an offset to MN-166 research and development expense in 2023. The decrease in MN-221 expenses is primarily related to a fee we paid in 2022 to Kissei Pharmaceutical co., Ltd. (Kissei) in connection with terminating a license agreement.

Current wording

Research, development and patent expenses for the year ended December 31, 2024 increased by $1.5 million to $7.2 million as compared to $5.7 million for the prior year, primarily due to an increase in MN-166 expenses. The increase in MN-166 related expenses is primarily due to ALS clinical trial related expenses and the evaluation of a new formulation. Additionally, in 2023 we received a $0.7 million payment from BARDA to partially reimburse us for pre-clinical study costs, which was recorded as an offset to MN-166 research and development expense.

Previous wording

General and administrative expenses for the year ended December 31, 2023 decreased by $0.3 million to $5.2 million compared to $5.5 million for the prior year, primarily driven by a decrease in compensation costs and accounting expenses.

Current wording

General and administrative expenses for the year ended December 31, 2024 increased by $0.3 million to $5.5 million compared to $5.2 million for the prior year, primarily driven by an increase in performance-based stock option expense and professional fees, partially offset by a reduction in headcount.

Previous wording

Other expense for the years ended 2023 and 2022 was approximately $0.5 million and $0.2 million, respectively. The increase of $0.3 million was primarily driven by penalties on early disposal of bank certificates of deposit.

Current wording

Other expense for the years ended December 31, 2024 and 2023 was approximately $0.0 million and $0.5 million, respectively. The decrease of $0.5 million was primarily driven by penalties on early disposal of bank certificates of deposit in 2023, which did not recur in the current year.

Previous wording

Interest income for the year ended December 31, 2023 increased by $1.0 million to $1.8 million compared to $0.8 million for the prior year, primarily driven by higher interest rates on cash and bank certificates of deposit. Interest income consists of interest earned on our cash and cash equivalents and investments.

Current wording

Interest income for the year ended December 31, 2024 decreased by $0.1 million to $1.7 million compared to $1.8 million for the prior year, primarily driven by lower interest rates on available cash and bank certificates of deposit. Interest income consists of interest earned on our cash and cash equivalents and investments.

Previous wording

We incurred losses of $8.6 million and $14.1 million for the years ended December 31, 2023 and 2022, respectively. At December 31, 2023, our accumulated deficit was $415.7 million as compared to $407.1 million for the year ended December 31, 2022. Our operating losses to date have been funded primarily through the private placement of our equity securities, the public sale of our common stock, long-term debt, development agreements with partners and the exercise of warrants, net of treasury stock repurchases.

Current wording

We incurred losses of $11.0 million and $8.6 million for the years ended December 31, 2024 and 2023, respectively. At December 31, 2024, our accumulated deficit was $426.8 million as compared to $415.7 million for the year ended December 31, 2023. Our operating losses to date have been funded primarily through the private placement of our equity securities, the public sale of our common stock, long-term debt, development agreements with partners and the exercise of warrants, net of treasury stock repurchases.

Previous wording

As of December 31, 2023, we had available cash and cash equivalents of $51.0 million and working capital of $47.9 million. As of the date of this report, we believe we have sufficient working capital to fund operations at least through the end of 2025. This is based on our expected operating cash needs for 2024 to be approximately $19.2 million and assuming we keep our spend at a similar level for 2025 including expected inflation increases. We expect that this level of operating spend will be sufficient to meet the businesses needs for research and development to help monetize our products in development.

Current wording

As of December 31, 2024, we had available cash and cash equivalents of $40.4 million and working capital of $38.1 million. As of the date of this report, we believe we have sufficient working capital to fund operations at least through the end of February 2026. This is based on our expected operating cash needs for 2025 to be approximately $21.3 million and assuming we keep our spend at a similar level for 2026 including expected inflation increases. We expect that this level of operating spend will be sufficient to meet the businesses needs for research and development to help monetize our products in development.

Previous wording

Our operating lease commitments reflect payments due for our lease agreements in San Diego, California and Tokyo, Japan. As of December 31, 2023, our contractual commitments for our leases were $0.6 million, which will be paid over the lease term.

Current wording

Our operating lease commitments reflect payments due for our lease agreements in San Diego, California and Tokyo, Japan. As of December 31, 2024, our contractual commitments for our leases were $0.4 million, which will be paid over the lease terms.