Entera Bio Ltd

Previous wording

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Current wording

. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Previous wording

The following discussion and analysis provides information we believe is relevant to an assessment and understanding of our results of operations, financial condition, liquidity and cash flows for the periods presented below. This discussion should be read in conjunction with the interim unaudited condensed consolidated financial statements and related notes contained elsewhere in this Quarterly Report, Part II, Item 1A-Risk Factors in this Quarterly Report, and Item 1A-Risk Factors in our 2023 Annual Report. As discussed in the section above titled “Cautionary Note Regarding Forward-Looking Statements,” the following discussion contains forward-looking statements that are based upon our current expectations, including with respect to our future operations, revenues and operating results. Our actual results may differ materially from those anticipated in such forward-looking statements as a result of various factors. Factors that could cause or contribute to such differences include, but are not limited to, those identified below, and those discussed in the section titled “Risk Factors” included under Part II, Item 1A below, as well as in Item 1A-Risk Factors in our 2023 Annual Report.

Current wording

The following discussion and analysis provides information we believe is relevant to an assessment and understanding of our results of operations, financial condition, liquidity and cash flows for the periods presented below. This discussion should be read in conjunction with the interim unaudited condensed consolidated financial statements and related notes contained elsewhere in this Quarterly Report, Part II, Item 1A-Risk Factors in this Quarterly Report, and Part I, Item 1A-Risk Factors in our 2023 Annual Report. As discussed in the section above titled “Cautionary Note Regarding Forward-Looking Statements,” the following discussion contains forward-looking statements that are based upon our current expectations, including with respect to our future operations, revenues and operating results. Our actual results may differ materially from those anticipated in such forward-looking statements as a result of various factors. Factors that could cause or contribute to such differences include, but are not limited to, those identified below, and those discussed in the section titled “Risk Factors” included under Part II, Item 1A below, as well as in Part I, Item 1A-Risk Factors in our 2023 Annual Report.

Previous wording

Our most advanced product candidate, EB613, oral PTH (1-34), is being developed as the first oral, osteoanabolic (bone building) once-daily tablet treatment for post-menopausal women with low bone mineral density (“BMD”) and high-risk osteoporosis with no prior fracture. A placebo controlled, dose ranging Phase 2 study of EB613 tablets (n= 161) met primary (pharmacodynamic/bone turnover biomarker) and secondary endpoints (BMD). Following the completion of a Type C and a Type D meeting with the U.S. Food and Drug Administration’s (FDA), we announced the FDA’s concurrence that a 2-year, placebo-controlled phase 3 (registrational) study with Total Hip BMD as primary endpoint could support a new drug application (“NDA”) for EB613. In November 2023, we reported that the American Society for Bone and Mineral Research (ASBMR) announced that the SABRE (Strategy to Advance BMD as a Regulatory Endpoint) project team had submitted its full qualification plan to the FDA for the use of BMD as a surrogate endpoint for fractures in future trials of new anti-osteoporosis drugs. In March 2024, we reported that the ASBMR had announced that the FDA ruling to qualify the treatment-related change in BMD as a surrogate endpoint for fractures in future trials of new anti-osteoporosis drugs would be provided within 10 months of March 2024. We believe EB613 stands as the first program to potentially avail itself of the ASBMR-SABRE BMD endpoint.

Current wording

Our most advanced product candidate, EB613, oral PTH (1-34), is being developed as the first oral, osteoanabolic (bone building) once-daily tablet treatment for post-menopausal women with low bone mineral density (“BMD”) and high-risk osteoporosis with no prior fracture. A placebo controlled, dose ranging Phase 2 study of EB613 tablets (n= 161) met primary (pharmacodynamic/bone turnover biomarker) and secondary endpoints (BMD). Following the completion of a Type C and a Type D meeting with the U.S. Food and Drug Administration’s (FDA), we announced the FDA’s concurrence that a 2-year, placebo-controlled phase 3 (registrational) study with Total Hip BMD as primary endpoint could support a new drug application for EB613. In November 2023, we reported that the American Society for Bone and Mineral Research (ASBMR) announced that the SABRE (Strategy to Advance BMD as a Regulatory Endpoint) project team had submitted its full qualification plan to the FDA for the use of BMD as a surrogate endpoint for fractures in future trials of new anti-osteoporosis drugs. In March 2024, we reported that the ASBMR had announced that the FDA ruling to qualify the treatment-related change in BMD as a surrogate endpoint for fractures in future trials of new anti-osteoporosis drugs would be provided within 10 months of March 2024. We believe EB613 stands as the first program to potentially avail itself of the ASBMR-SABRE BMD endpoint.

Previous wording

Our ability to deliver our oral PTH(1-34) peptide in a simple mini tablet format with reproduceable, dose dependent pharmacokinetics and rapid biological responses across gender, age, and health status was highlighted as part of two poster sessions at the ASBMR 2023 Annual Meeting. We believe our work to date has built the foundation for our oral PTH (1-34) tablets to potentially treat diverse patient populations, including younger men and women athletes at risk of stress fractures. We are exploring the use of our PTH(1-34) tablets for the treatment of stress fractures in athletes and an investigator sponsored phase 2 study is expected to be initiated with respect to this indication in the second half of 2024.

Current wording

Our ability to deliver our oral PTH(1-34) peptide in a simple mini tablet format with reproduceable, dose dependent pharmacokinetics and rapid biological responses across gender, age, and health status was highlighted as part of two poster sessions at the ASBMR 2023 Annual Meeting. We believe our work to date has built the foundation for our oral PTH (1-34) tablets to potentially treat diverse patient populations, including younger men and women athletes at risk of stress fractures.

Previous wording

Oxyntomodulin (OXM) is a naturally occurring peptide hormone found in the colon, with glucagon-like-peptide 1 (GLP-1) and glucagon dual agonist activity which suppresses appetite and induces weight loss. OPKO has developed several proprietary, modified OXM analogs as potential candidates for treating obesity, including an injectable pegylated peptide which demonstrated significant reductions in weight loss and decreased plasma triglyceride levels in over 430 patients in phase 2/2B studies.

Current wording

Oxyntomodulin (OXM) is a naturally occurring peptide hormone found in the colon, with glucagon-like-peptide 1 (GLP-1) and glucagon dual agonist activity that suppresses appetite and induces weight loss. OPKO has developed several proprietary, modified OXM analogs as potential candidates for treating obesity, including an injectable pegylated peptide which demonstrated significant reductions in weight loss and decreased plasma triglyceride levels in over 430 patients in phase 2/2B studies.

Previous wording

In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Hamas also launched extensive rocket attacks on the Israeli population and industrial centers located along Israel’s border with the Gaza Strip and in other areas within the State of Israel. These attacks resulted in thousands of deaths and injuries, and Hamas additionally kidnapped hundreds Israeli civilians and soldiers, including infants, children and elderly men and women. Following the attack, Israel’s security cabinet declared war against Hamas and commenced a military campaign against Hamas.

Current wording

In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Hamas also launched extensive rocket attacks on the Israeli population and industrial centers located along Israel’s border with the Gaza Strip and in other areas within the State of Israel. These attacks resulted in thousands of deaths and injuries, and Hamas additionally kidnapped hundreds Israeli civilians and soldiers, including infants, children and elderly men and women. Following the attack, Israel’s security cabinet declared war against Hamas and commenced a military campaign against Hamas. The intensity and duration of Israel’s current war against Hamas is difficult to predict, as are such war’s economic implications on the Israel's economy in general.

Previous wording

In April 2024, Israel experienced a direct attack from Iran, involving hundreds of drones and missiles launched towards various parts of the country, mostly targeting military bases. The Israeli defense systems, aided by international allies, successfully intercepted the majority of these attacks, minimizing physical damage and casualties. Despite the effectiveness of Israel's missile defense systems, such incidents contribute to regional instability and could potentially escalate into broader conflicts with Iran and its proxies in the Middle East, affecting Israel's political and trade relations, especially with neighboring countries and global allies. The situation remains fluid, and the potential for further escalation exists.

Current wording

In April 2024, Israel experienced a direct attack from Iran, involving hundreds of drones and missiles launched towards various parts of the country, mostly targeting military bases. The Israeli defense systems, aided by international allies, successfully intercepted the majority of these attacks, minimizing physical damage and casualties. Additionally, Since October 2023, the Houthis, a military organization based in Yemen, have launched a series of attacks on global shipping routes in the Red Sea, as well as direct attacks on various parts of Israel. Such incidents contribute to regional instability and could potentially escalate into broader conflicts with Iran and its proxies in the Middle East, affecting Israel's political and trade relations, especially with neighboring countries and global allies. The situation remains fluid, and the potential for further escalation exists.

Previous wording

While we have a few employees who are in active military service, the ongoing war with Hamas and the conflict with Iran and its proxies have not, to date, materially impacted our business or operations. Furthermore, we do not expect any delays to any of our programs as a result of such conflicts. While R&D and management are located in Israel, other core activities including clinical, regulatory and our supply chain are not. However, we cannot currently predict the intensity or duration of Israel’s war against Hamas and/or the conflict with Iran and its proxies, nor can we predict how such conflicts will ultimately affect our business and operations or Israel’s economy in general.

Current wording

While we have a few employees who are in active military service, the ongoing war with Hamas, and the conflict with Iran and its proxies have not, to date, materially impacted our business or operations. Furthermore, we do not expect any delays to any of our programs as a result of such conflicts. While R&D and management are located in Israel, other core activities including clinical, regulatory and our supply chain are not. However, we cannot currently predict the intensity or duration of Israel’s war against Hamas or the conflict with Iran and its proxies, nor can we predict how such conflicts will ultimately affect our business and operations or Israel’s economy in general.

Previous wording

Since our inception, we have raised a total of $91.9 million from a combination of public and private equity offerings, IIA grants and the exercise of options and warrants. Since inception, we have incurred significant losses. For the three months ended March 31, 2024 and 2023, our operating losses were $2.1 million and $2.2 million, respectively, and we expect to continue to incur significant expenses and losses for the foreseeable future.

Current wording

Since our inception, we have raised a total of $93.1 million from a combination of public and private equity offerings, IIA grants and the issuance of Ordinary Shares upon the exercise of options and warrants. Since inception, we have incurred significant losses. For the three months ended June 30, 2024 and 2023, our operating losses were $2.2 million and $2.3 million, respectively. For the six months ended June 30, 2024 and 2023, our operating losses were $4.2 million and $4.5 million, respectively, and we expect to continue to incur significant expenses and losses for the foreseeable future.

Previous wording

As of March 31, 2024, we had an accumulated deficit of $106.4 million. Our losses may fluctuate significantly from quarter to quarter and year to year, depending on the timing of our clinical trials, our expenditures on research and development activities and any third-party collaborations into which we may enter.

Current wording

Since inception in 2010 through June 30, 2024, we had an accumulated deficit of $108.5 million. Our losses may fluctuate significantly from quarter to quarter and year to year, depending on the timing of our clinical trials, our expenditures on research and development activities and any third-party collaborations into which we may enter.

Previous wording

Notwithstanding our current expectation that we will have sufficient capital to continue operations into the third quarter of 2025 without additional funding, as a result of our recurring losses from operations, negative cash flows and lack of liquidity, management is of the opinion that there is substantial doubt as to the Company's ability to continue as a going concern, and our independent registered public accounting firm included an explanatory paragraph in its report on our financial statements as of, and for the year ended, December 31, 2023, expressing the existence of substantial doubt about our ability to continue as a going concern. The unaudited condensed consolidated financial statements included herein have been prepared assuming that we will continue as a going concern and do not include adjustments that might result from the outcome of this uncertainty. See “Item 1A-Risk Factors-Risks Related to Our Financial Position and Need for Additional Capital” contained in our 2023 Annual Report.

Current wording

Notwithstanding our current expectation that we will have sufficient capital to continue operations into the third quarter of 2025 without additional funding, because of our recurring losses from operations, negative cash flows and lack of liquidity, management is of the opinion that there is substantial doubt as to the Company's ability to continue as a going concern, and our independent registered public accounting firm included an explanatory paragraph in its report on our financial statements as of, and for the year ended, December 31, 2023, expressing the existence of substantial doubt about our ability to continue as a going concern. The unaudited condensed consolidated financial statements included herein have been prepared assuming that we will continue as a going concern and do not include adjustments that might result from the outcome of this uncertainty. See Part I, Item 1A-Risk Factors-Risks Related to Our Financial Position and Need for Additional Capital contained in our 2023 Annual Report.

Previous wording

As of March 31, 2024, we had cash and cash equivalents of $9.2 million. We believe that our existing cash resources will be sufficient to meet our projected operating requirements into the third quarter of 2025, which include the capital required to fund our ongoing operations, including R&D, the completion of the Phase 1 PK study related to our new generation platform and the GLP-2/OXM collaborative research we are conducting with OPKO. Our ability to commence the Phase 3 study of EB613 in osteoporosis will depend on finalizing discussions with the FDA pursuant to their qualification of the total hip BMD endpoint and will require additional funding, which may not be available on reasonable terms, or at all. Any delay or our inability to secure such funding will delay or prevent the commencement of these studies.

Current wording

Asof June 30, 2024, we had cash and cash equivalents of $9.1 million. We believe that our existing cash resources will be sufficient to meet our projected operating requirements into the third quarter of 2025, which include the capital required to fund our ongoing operations, including regulatory expenses and optimization related to the preparation of the EB613 phase 3 study, research and development, the completion of an additional Phase 1 PK study related to our new generation platform and the GLP-2/OXM collaborative research we are conducting with OPKO. Our ability to commence the Phase 3 study of EB613 in osteoporosis will depend on finalizing discussions with the FDA in connection with their anticipated qualification of the total hip BMD endpoint and will require additional funding, which may not be available on reasonable terms, or at all. Any delay or our inability to secure such funding will delay or prevent the commencement of these studies.

Previous wording

In order to fund further operations, we will need to raise additional capital. We may raise these funds through a variety of means, including private or public equity offerings, debt financings, strategic collaborations and licensing arrangements. Additional financing may not be available when we need it or may not be available on terms that are favorable to us.

Current wording

In order to fund further operations, we will need to raise additional capital. We may raise these funds through a variety of means, including private or public equity offerings, debt financings and strategic collaborations. Additional financing may not be available when we need it or may not be available on terms that are favorable to us.

Previous wording

As of March 31, 2024, we had a total of 19 employees, of whom 17 are full-time employees, and all are based in Israel (including our Chief Executive Officer, EVP of Research and Development and Chief Operating Officer). In addition, we employ a number of specialized outside advisors and expert consultants based in the United States, the United Kingdom and Europe. Our operations are located in Jerusalem, Israel.

Current wording

As of June 30, 2024, we had a total of 19 employees, of whom 17 are full-time employees, and all are based in Israel (including our Chief Executive Officer, Chief of Research and Development and Chief Operating Officer). In addition, we employ a number of specialized outside advisors and expert consultants based in the United States, the United Kingdom and Europe. Our operations are located in Jerusalem, Israel.

Previous wording

Our research and development expenses may vary substantially from period to period based on the timing of our research and development activities, including due to the timing of initiation of clinical trials and the enrollment of patients in clinical trials. Our research and development expenses were $0.7 million and $0.9 million for the three months ended March 31, 2024 and 2023, respectively, and were primarily for the development of EB613, EB612 and our collaboration with OPKO related to GLP-2 and OXM. The successful development of our product candidates is highly uncertain. At this time, we cannot reasonably estimate the nature, timing and estimated costs of the efforts that will be necessary to complete the development of, or the period, if any, in which material net cash inflows may commence from, any of our product candidates. This is due to numerous risks and uncertainties associated with developing drugs, including:

Current wording

Our research and development expenses may vary substantially from period to period based on the timing of our research and development activities, including due to the timing of initiation of clinical trials and the enrollment of patients in clinical trials. For the three months ended June 30, 2024 and 2023, our research and development expenses were $1.1 million and $1.2 million, respectively. For the six months ended June 30, 2024 and 2023, our research and development expenses were $1.8 million and $2.1 million, respectively. Research and development expenses for the three and six months ended June 30, 2024 and 2023 were primarily for the development of EB613 and EB612 and our collaboration with OPKO related to GLP-2 and OXM. The successful development of our product candidates is highly uncertain. At this time, we cannot reasonably estimate the nature, timing and estimated costs of the efforts that will be necessary to complete the development of, or the period, if any, in which material net cash inflows may commence from, any of our product candidates. This is due to numerous risks and uncertainties associated with developing drugs, including:

Previous wording

Financial income, net is composed primarily of interest income from bank deposits and exchange rate differences of certain currencies against our functional currency.

Current wording

Financial income, net is composed primarily of interest income from bank deposits and exchange rate differences of certain currencies against our functional currency, which is the U.S. Dollar.

Previous wording

We have not generated taxable income since our inception, and as of March 31, 2024, we had carry-forward tax losses of $77.7 million.

Current wording

We have not generated taxable income since our inception, and, as of June 30, 2024, we had carry-forward tax losses of $79.5 million.

Previous wording

The Company’s subsidiary, Entera Bio, Inc., is taxed separately under U.S. tax laws. As of March 31, 2024, Entera Bio Inc. had tax loss carry-forwards of $154 thousand.

Current wording

The Company’s subsidiary, Entera Bio, Inc., is taxed separately under U.S. tax laws. As of June 30, 2024, Entera Bio Inc. had tax loss carry-forwards of $156 thousand.

Previous wording

Research and development expenses for the three months ended March 31, 2024 were $0.7 million, as compared to $0.9 million for the three months ended March 31, 2023. The decrease was attributable to a decrease o f $0.2 million in clinical expenses for our Phase 1 PK study related to our new generation platform and new formulations for EB612 and related expenses.

Current wording

Research and development expenses for the three months ended June 30, 2024 were $1.1 million, as compared to $1.2 million for the three months ended June 30, 2023. The decrease of $0.1 million was primarily due to a decrease of $0.2 million in clinical expenses for our Phase 1 PK study related to our new generation platform and new formulations for EB612 and a related decrease of $0.1 million in consultant costs. The decrease was partially offset by an increase of $0.2 million in share-based compensation.

Previous wording

Financial income, net for the three months ended March 31, 2024 was $45 thousand as compared to $22 thousand for the three months ended March 31, 2023. Our financial income, net for the three months ended March 31, 2024 and 2023 was composed mainly of interest income from bank deposits and exchange rate differences of certain currencies against our functional currency, which is the U.S. Dollar.

Current wording

Financial income, net for the three months ended June 30, 2024 was $20 thousand as compared to $5 thousand for the three months ended June 30, 2023. Our financial income, net for the three months ended June 30, 2024 and 2023 was composed mainly of interest income from bank deposits and exchange rate differences of certain currencies against our functional currency, which is the U.S. Dollar.

Previous wording

General and administrative expenses for both the three months ended March 31, 2024 and 2023 were $1.3 million. For the three months ended March 31, 2024, there was a decrease of $0.1 million in D&O insurance costs and an increase of $0.1 million in compensation, consultant and other fees.

Current wording

General and administrative expenses for both the six months ended June 30, 2024 and 2023 were $2.4 million. For the six months ended June 30, 2024, there was a decrease of $0.1 million in D&O insurance costs, which was offset by an increase of $0.1 million in professional services and other fees.

Previous wording

Since inception, we have incurred significant losses. For the three months ended March 31, 2024 and 2023, our operating losses were $2.1 million and $2.2 million, respectively. As of March 31, 2024, we had an accumulated deficit of $106.4 million. We expect to continue to incur significant expenses and losses for the next several years as we advance our products through development and provide administrative support for our operations.

Current wording

Since inception, we have incurred significant losses. For the three months ended June 30, 2024 and 2023, our operating losses were $2.2 million and $2.3 million, respectively. For the six months ended June 30, 2024 and 2023, our operating losses were $4.2 million and $4.5 million, respectively. Since inception in 2010 through June 30, 2024, we had an accumulated deficit of $108.5 million. We expect to continue to incur significant expenses and losses for the next several years as we advance our products through development and provide administrative support for our operations.

Previous wording

Notwithstanding our current expectation that we will have sufficient capital to continue operations into the third quarter of 2025 without additional funding, as a result of our recurring losses from operations, negative cash flows and lack of liquidity, management is of the opinion that there is substantial doubt as to the Company's ability to continue as a going concern. See “Item 1A-Risk Factors-Risks Related to Our Financial Position and Need for Additional Capital” contained in our 2023 Annual Report.

Current wording

Notwithstanding our current expectation that we will have sufficient capital to continue operations into the third quarter of 2025 without additional funding, because of our recurring losses from operations, negative cash flows and lack of liquidity, management is of the opinion that there is substantial doubt as to the Company's ability to continue as a going concern. See Part I, Item 1A-Risk Factors-Risks Related to Our Financial Position and Need for Additional Capital contained in our 2023 Annual Report.

Previous wording

Since our inception, we have raised a total of $91.9 million, including $25.9 million through at-the-market-offering (“ATM”) programs, $20.9 million in private placements since our IPO, $11.2 million in our IPO in 2018 and $33.9 million in aggregate funding from a combination of grants, exercises of options and warrants and private placements of Ordinary Shares, preferred shares and debt prior to our IPO. In addition, as of March 31, 2024, we had received approximately $1.7 million under our previously terminated collaboration agreement.

Current wording

Since our inception, we have raised a total of $93.1 million, including $26.5 million through at-the-market-offering (“ATM”) programs, $20.9 million in private placements since our IPO, $11.2 million in our IPO in 2018 and $34.5 million in aggregate funding from a combination of grants, the issuance of Ordinary Shares upon the exercise of options and warrants, and private placements of Ordinary Shares, preferred shares and debt prior to our IPO. In addition, through June 30, 2024, we had received approximately $1.7 million under our previously terminated collaboration agreement.

Previous wording

As of March 31, 2024, we had cash and cash equivalents of $9.2 million. Our primary uses of cash have been to fund research and development, general and administrative expenses and working capital requirements, and we expect these will continue to be our primary uses of cash.

Current wording

As of June 30, 2024, we had cash and cash equivalents of $9.1 million. Our primary uses of cash have been to fund research and development, general and administrative expenses and working capital requirements, and we expect these will continue to be our primary uses of cash.

Previous wording

On September 2, 2022, we entered into a Sales Agreement with Leerink Partners LLC (f/k/a SVB Securities LLC), as sales agent, to implement an ATM program, under which we may from time to time offer and sell up to 5,000,000 Ordinary Shares (the “Leerink ATM Program”) under our currently effective Registration Statement on Form S-3 and a related prospectus supplement forming a part thereof. The sales agent is entitled to a fixed commission of 3% of the aggregate gross proceeds as well as reimbursement of expenses. As of March 31, 2024, we had sold an aggregate of 4,030 shares under the Leerink ATM Program for aggregate proceeds of $5 thousand, net of issuance costs. Through May 6, 2024, we had sold 218,118 shares under the Leerink ATM Program for aggregate proceeds of $0.5 million, net of issuance costs.

Current wording

On September 2, 2022, we entered into a Sales Agreement with Leerink Partners LLC (f/k/a SVB Securities LLC), as sales agent, to implement an ATM program, under which we may from time to time offer and sell up to 5,000,000 Ordinary Shares (the “Leerink ATM Program”) under our currently effective Registration Statement on Form S-3 and a related prospectus supplement forming a part thereof. The sales agent is entitled to a fixed commission of 3% of the aggregate gross proceeds as well as reimbursement of expenses. As of June 30, 2024, we had sold an aggregate of 240,156 shares under the Leerink ATM Program for aggregate proceeds of $0.6 million, net of issuance costs.

Previous wording

We believe that our existing capital resources will be sufficient to fund our operations into the third quarter of 2025, which include R&D, the completion of the Phase 1 PK study related to our new generation platform and the GLP-2/OXM collaborative research we are conducting with OPKO. Our ability to commence the Phase 3 study of EB613 in osteoporosis will depend on finalizing discussions with the FDA pursuant to their qualification of the total hip BMD endpoint and will require additional funding, which may not be available on reasonable terms, or at all. Any delay or our inability to secure such funding will delay or prevent the commencement of these studies.

Current wording

Webelieve that our existing capital resources will be sufficient to fund our operations into the third quarter of 2025, which include regulatory expenses and optimization related to the preparation of the EB613 phase 3 study, research and development, the completion of an additional Phase 1 PK study related to our new generation platform and the GLP-2/OXM collaborative research we are conducting with OPKO. Our ability to commence the Phase 3 study of EB613 in osteoporosis will depend on finalizing discussions with the FDA pursuant to their qualification of the total hip BMD endpoint and will require additional funding, which may not be available on reasonable terms, or at all. Any delay or our inability to secure such funding will delay or prevent the commencement of these studies.

Previous wording

Notwithstanding our current expectation that we will have sufficient capital to continue operations into the third quarter of 2025 without additional funding, as a result of our recurring losses from operations, negative cash flows and lack of liquidity, management is of the opinion that there is substantial doubt as to the Company's ability to continue as a going concern and our independent registered public accounting firm included an explanatory paragraph in its report on our financial statements as of, and for the year ended, December 31, 2023, expressing the existence of substantial doubt about our ability to continue as a going concern. The unaudited condensed consolidated financial statements contained in this Quarterly Report have been prepared on a going concern basis and do not include any adjustments that may be necessary should we be unable to continue as a going concern. If we are unable to finance our operations, our business would be in jeopardy, and we might not be able to continue operations and might have to liquidate our assets. In that case, investors might receive less than the value at which those assets are carried on our financial statements, and it is likely that investors would lose all or a part of their investment.

Current wording

Notwithstanding our current expectation that we will have sufficient capital to continue operations into the third quarter of 2025 without additional funding, because of our recurring losses from operations, negative cash flows and lack of liquidity, management is of the opinion that there is substantial doubt as to the Company's ability to continue as a going concern and our independent registered public accounting firm included an explanatory paragraph in its report on our financial statements as of, and for the year ended, December 31, 2023, expressing the existence of substantial doubt about our ability to continue as a going concern. The unaudited condensed consolidated financial statements contained in this Quarterly Report have been prepared on a going concern basis and do not include any adjustments that may be necessary should we be unable to continue as a going concern. If we are unable to finance our operations, our business would be in jeopardy, and we might not be able to continue operations and might have to liquidate our assets. In that case, investors might receive less than the value at which those assets are carried on our financial statements, and it is likely that investors would lose all or a part of their investment.

Previous wording

Three Months Ended March 31, 2024 compared to Three Months Ended March 31, 2023

Current wording

Six Months Ended June 30, 2024 compared to Six Months Ended June 30, 2023

Previous wording

Net cash used in operating activities for the three months ended March 31, 2024 was $1.9 million, consisting primarily of our operating loss of $2.1 million and an increase of $0.3 million in our working capital, which was partially offset by $0.5 million of share-based compensation and depreciation expenses.

Current wording

Net cash used in operating activities for the six months ended June 30, 2024 was $3.2 million, consisting primarily of our operating loss of $4.2 million and an increase of $0.1 million in our working capital, which was partially offset by approximately $1.1 million of share-based compensation and depreciation expenses.

Previous wording

Net cash used in operating activities for the three months ended March 31, 2023 was $1.6 million, consisting primarily of our operating loss of $2.2 million, which was partially offset by a decrease of $0.1 million in our working capital and approximately $0.5 million of share-based compensation expense and depreciation expenses.

Current wording

Net cash used in operating activities for the six months ended June 30, 2023 was $3.2 million, consisting primarily of our operating loss of $4.5 million, which was partially offset by a decrease of $0.3 million in our working capital and $1.0 million of share-based compensation and depreciation expenses.

Previous wording

The increase of $0.3 million in cash used in operating activities for the three months ended March 31, 2024 compared to the same period in 2023 was mainly attributed to an increase of $0.4 million in working capital, which was partially offset by a decrease of $0.1 million in our operating loss.

Current wording

The changes in cash used in operating activities for the six months ended June 30, 2024 compared to the same period in 2023 was mainly attributed to a decrease of $0.3 million in our operating loss, which was offset by an increase of $0.4 million in working capital and an increase of $0.1 million in share-based compensation.

Previous wording

There was no net cash used in investing activities for the three months ended March 31, 2024. Net cash used in investing activities for the three months ended March 31, 2023 consisted primarily of the purchase of property and equipment.

Current wording

Net cash used in investing activities for the six months ended June 30, 2023 consisted primarily of the purchase of property and equipment.

Previous wording

Net cash provided by financing activities for the three months ended March 31, 2024 consisted of the net proceeds of $30 thousand from the issuance of Ordinary Shares due to exercise of outstanding warrants.

Current wording

Net Cash provided by financing activities for the six months ended June 30, 2023 consisted of the net proceeds of $5 thousand from the issuance of Ordinary Shares under the Leerink ATM Program.

Previous wording

There have not been any material changes in our assessment of material contractual obligations and commitments as set forth in Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our 2023 Annual Report.

Current wording

There have not been any material changes in our assessment of material contractual obligations and commitments as set forth in Part II, Item 7“Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our 2023 Annual Report.