CERO THERAPEUTICS HOLDINGS, INC.
For the period ended Jun 30, 2025. Filed Aug 22, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 22, 2025
CERO$0.010.0%Stored close · as of Jul 8, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-15.
0001213900-25-044335
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-22.
0001213900-25-079898
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 71 previous paragraphs and 83 current paragraphs.
44 unchanged; 19 reworded; 17 added; 8 removed; 0 previous and 3 current paragraphs rearranged.
Tables are not compared: 17 previous and 18 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 (17)
Current report
On April 22, 2025, the Company issued 6,250 shares of its Series D preferred stock to investors in exchange for 1,000,279 shares of Series D preferred stock of Stella Diagnostics. The transaction was completed in lieu of a cash payment. The value of Stella’s Series D Preferred Stock received was determined to be $500,000 as of the transaction date, based on the subsequent sale of the 1,000,279 Stella Series D Preferred Stock for $500,000 in cash, pursuant to a Stock Purchase Agreements dated August 20, 2025. Accordingly, the Company recognized the issuance of its Series D preferred stock to investors at a cost of $500,000, which represents the fair value of the consideration received. The difference between the stated value of the Company Series D Preferred Stock ($5.0 million) and the fair value of the consideration received ($500,000) was recorded as a decrease to additional paid-in capital, which amounted to $4.5 million. The investment in Stella’s Series D Preferred Stock is classified as an equity security without a readily determinable fair value and is accounted for under the measurement alternative in accordance with ASC 321,Investments – Equity Securities. Under this method, the investment is initially recorded at cost, which was determined to be equal to the fair value of the consideration received, and is subsequently adjusted for observable price changes in orderly transactions for the same or similar securities and for impairment, if any. There was no impairment identified on the investment in equity securities during the period ended June 30, 2025.This non-cash transaction did not impact the Company’s cash flows and is disclosed as a non-cash investing and financing activity in the condensed consolidated statement of cash flows in accordance with ASC 230,Statement of Cash Flows. As of June 30, 2025, the value of Stella’s Series D Preferred Stock received was determined to be $500,000, based on the subsequent sale of the 1,000,279 Stella Series D Preferred Stock for $500,000 in cash, pursuant to a Stock Purchase Agreements dated August 20, 2025.
Current report
Reverse Stock Splits
Current report
As discussed above, on April 21, 2025, the Company entered into the Fourth Securities Purchase Agreement, pursuant to which the Company agreed to issue and sell up to 10,000 shares of Series D Preferred Stock for an aggregate purchase price of up to $8 million in one or more closings. On April 22, 2025, the Company consummated a private placement of 6,250 shares of Series D Preferred Stock pursuant to the Fourth Securities Purchase Agreement, by and among the Company and certain investors in exchange for the receipt of 1,000,279 shares of the Stella Series D Preferred in lieu of cash, which is included in investment in equity securities on the accompanying unaudited condensed balance sheet as of June 30, 2025. The fair value of Stella’s Series D Preferred Stock received was determined to be $500,000 as of the transaction date, based on the subsequent sale of the 1,000,279 Stella Series D Preferred Stock for $500,000 in cash, pursuant to a Stock Purchase Agreement dated August 20, 2025. On August 20, 2025, the Company and certain investors entered into a Stock Purchase Agreement, pursuant to which the Company sold 1,000,279 Stella Series D Preferred Stock for cash proceeds of $500,000. In accordance with ASC 855-10,Subsequent Events, the Company evaluated this event under ASC 855-10-25-1 and determined that it represents a Type I subsequent event (recognized subsequent event) because the sale provided additional evidence about conditions that existed at the balance sheet date. Accordingly, the Company determined that the fair value of the equity securities on the date of the Fourth Securities Purchase Agreement of April 21, 2025 and June 30, 2025 was equal to $500,000.
Current report
On June 25, 2025, the Company entered into an amendment to the Fourth Securities Purchase Agreement pursuant to which the Company added certain new institutional investors to the schedule of buyers in the Fourth Securities Purchase Agreement, to issue and sell to such investors, in one or more closings shares of the Company’s Series D Preferred Stock. Also, on June 25, 2025, the Company sold an additional 2,315 shares of Series D Preferred Stock for gross cash proceeds of $1,852,000 in an additional closing of the Fourth PIPE Financing. On July 18, 2025, the Company sold an additional 497 shares of Series D Preferred Stock for gross cash proceeds of $432,600 in an additional closing of the Fourth PIPE Financing.
Current report
July 2025 ELOC Transaction
Current report
On July 11, 2025, the Company entered into an agreement to issue and sell 12,500,000 shares of Common Stock under the New Keystone Purchase Agreement. As the New Keystone Purchase Agreement constitutes a continuation of the equity line program commenced under the February 2024 Purchase Agreement, the Commitment Shares issued to the Investor pursuant to the February 2024 Purchase Agreement shall satisfy in full the Company’s obligation to deliver any additional shares of Common Stock to the Investor as consideration for entering into the New Keystone Purchase Agreement.
Current report
Orphan Drug Designation
Current report
In July 2025, CER-1236 received an FDA Orphan Drug Designation for the treatment of acute myeloid leukemia.
Current report
On June 11, 2025, we received a Bid Price Requirement Letter notifying us that, for the 30 consecutive business day period between April 25, 2025 through June 9, 2025, the closing bid price for our Common Stock was below the minimum $1.00 per share required for continued listing on The Nasdaq Capital Market set forth in Nasdaq Listing Rule 5550(a)(2), which is required for continued listing of the Common Stock on Nasdaq. We timely appealed the delisting determination by requesting a hearing before the Nasdaq Panel. Such request for a Nasdaq Panel hearing stayed the suspension of the Company’s securities. On July 7, 2025, Nasdaq informed us that they had determined that we have regained compliance with the Bid Price Requirement and were therefore in compliance with the continued listing requirements. As a result, Nasdaq canceled the hearing and the Common Stock will continue to be listed and traded on the Nasdaq Capital Market, subject to maintaining all listing standards.
Current report
General and administrative expenses were $1,970,000 for the three months ended June 30, 2025 as compared to $2,434,000 for the three months ended June 30, 2024, reflecting a decrease of approximately $464,000. The decrease during the three months ended June 30, 2025 as compared to the three months ended June 30, 2024, was primarily due to a decrease in salaries and benefits of $505,000 primarily due to a decrease in stock-based compensation of $478,000 attributable to a decrease in accretion of stock option expense. This decrease was offset by an increase in other general and administrative expenses of $41,000.
Current report
Results of Operations for the Six Months Ended June 30, 2025 and 2024
Current report
Research and Development Expenses
Current report
Research and development expenses were $5,662,000 for the six months ended June 30, 2025 as compared to $4,383,000 for the six months ended June 30, 2024, reflecting an increase of $1,279,000. The increase was primarily attributable to an increase in clinical expenses of $2,362,000, and an increase in scientific consulting fees of $496,000. In the first quarter of 2025, we began clinical trials related to the IND for CER-1236. This increase was primarily offset by a decrease in lab expenses of $461,000 primarily attributable to a decrease in toxicology studies performed in the 2025 period as compared to the 2024 period, a decrease in research and development salaries and benefits of approximately $989,000 which included a decrease in stock-based compensation expense of $723,000 primarily attributable to a decrease in accretion in stock-based option expense and a decrease in bonuses paid of $132,000, and a decrease in other research and development costs of $129,000.
Current report
General and Administrative Expenses
Current report
Other Income (Expense), Net
Current report
Other expense was $(849,000) for the six months ended June 30, 2025 as compared to other income of $4,952,000 for the six months ended June 30, 2024, reflecting a negative change in other income, net of $5,801,000. The negative change was primarily due to (1) the recording of a $4,700,000 gain from change in value of the Company’s earnout liability and a $320,000 gain recorded for the change in value of the Predecessor’s preferred stock warrant liability during the six months ended June 30, 2024 as compared to $0 during the six months ended June 30, 2025, (2) the recording of a gain on settlement of vendor liabilities of $589,000 during the six months ended June 30, 2024 compared to $0 during the six months ended June 30, 2025, and (3) the recording of stock-based inducement expense of $864,000 during the six months ended June 30, 2025 as compared to $0 during the six months ended June 30, 2024. These decreases in other income, net were offset by the recording of other expense of $631,000 during the six months ended June 30, 2024 related to registration rights penalties recorded compared to $0 during the six months ended June 30, 2025, and an increase in interest income, net of $41,000.
Current report
**Investment in equity securities -**The Company’s investment in equity securities consists of Series D Preferred Stock of Stella Diagnostics, Inc. Investments in equity securities are initially measured at cost. Cost is based upon either the cost of the investment or the estimated market value of the investment at the time it was acquired, whichever can be more clearly determined. The Company has elected the measurement alternative for equity securities without readily determinable fair values. Under this alternative, if the Company identifies an observable price change in an orderly transaction for an identical or similar investment of the same issuer, the Company measures the equity security at fair value as of the date that the observable transaction occurred. Any adjustments resulting from observable price changes are recognized in earnings. The Company monitors these investments for changes in observable prices from orderly transactions and assesses them for impairment. If an equity security is deemed to be impaired, an impairment loss is recognized in earnings, measured as the difference between the investment’s cost and its fair value at the impairment assessment date.
Removed paragraphs (8)
Previous report
Reverse Stock Split
Previous report
February 2025 Offering
Previous report
On February 7, 2025, we closed our reasonable best efforts public offering, with participation from a member of our board of directors and a single institutional investor, for the purchase and sale of (i) 2,551,020 shares of Common Stock or common stock equivalents in lieu thereof; and (ii) February 2025 Common Warrants to purchase up to 2,551,020 shares of common stock, at a combined public offering price of $1.96 per share and warrant. In connection with the offering, on February 5, 2025, we entered into the SPA with the investors. Such transaction is referred to as the “February 2025 Offering.” The shares of Common Stock and the Warrants described above and the shares of Common Stock underlying the Warrants were offered pursuant to the Registration Statement on Form S-1 (File No. 333-284007), as amended, which was declared effective by the Securities and Exchange Commission on February 5, 2025. In connection with this offering, we received net proceeds of approximately $4.3 million.
Previous report
On April 21, 2025, the Company consummated a private placement of 6,250 shares of Series D Preferred Stock pursuant to the Securities Purchase Agreement, for aggregate proceeds of approximately $5 million, paid through the transfer of certain Transfer Shares (as defined in the Securities Purchase Agreement) in lieu of cash, and agreed to issue up to 3,750 additional shares of Series D Preferred Stock for cash proceeds of up to $3 million at one or more additional closings. Each additional closing is at the option of the investors upon notice to the Company and subject to satisfaction of customary closing conditions.
Previous report
Investigational New Drug Application Submission
Previous report
On June 28, 2024, the Company submitted an Investigational New Drug Application (“IND”) for its product candidate, CER-1236, to FDA. On July 26, 2024, the Company was informed by the FDA that it has placed a clinical hold on the IND. The FDA indicated that the clinical hold has been placed as a result of insufficient data provided with regard to two issues within pharmacology and toxicology of CER-1236. The FDA indicated that, within 30 calendar days, it would provide a detailed official hold letter and requested that the Company hold its response until after receipt of such letter (the “Hold Letter”).
Previous report
The Company received the Hold Letter on July 26, 2024 and submitted a complete response letter to the FDA on October 21, 2024 in which the Company requested a meeting to address the FDA’s questions.
Previous report
On November 15, 2024, the Company received notice from the FDA that the IND for CER-1236 was cleared. The Company began clinical trials in May 2025. We submitted a second IND application for the investigation of CER-T cell therapy in NSCLC and ovarian cancer, which was accepted by the FDA on March 27, 2025.
Reworded paragraphs (19)
Previous wording
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company’s ability to continue as a going concern is dependent on its ability to raise additional capital to fund its R&D activities and meet its obligations on a timely basis. As of March 31, 2025, the Company reported $5.1 million of cash and cash equivalents, with an accumulated deficit of $76.0 million.
Current wording
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company’s ability to continue as a going concern is dependent on its ability to raise additional capital to fund its R&D activities and meet its obligations on a timely basis. As of June 30, 2025, the Company reported approximately $3.2 million of cash and cash equivalents, with an accumulated deficit of approximately $81.4 million.
Previous wording
On February 5, 2025, we entered into a securities purchase agreement, with participation from a member of the Board and a single institutional investor, for the purchase and sale of (i) 2,551,020 shares of Common Stock or Common Stock equivalents in lieu thereof; and (ii) February 2025 Common Warrants to purchase up to 2,551,020 shares of Common Stock at an exercise price of $1.96. In connection with such offering, we received net proceeds of approximately $4.3 million. Additionally, during the three months ended March 31, 2025, we received net proceeds from the exercise of the remaining Series A Preferred Warrants, the collection of subscriptions receivable and equity line of credit fundings of approximately $2.4 million.
Current wording
On February 5, 2025, we entered into a securities purchase agreement, with participation from a member of the Board and a single institutional investor, for the purchase and sale of (i) 127,551 shares of Common Stock or Common Stock equivalents in lieu thereof; and (ii) February 2025 Common Warrants to purchase up to 127,551 shares of Common Stock at an exercise price of $39.20. In connection with such offering, we received net proceeds of approximately $4.2 million. Additionally, during the six months ended June 30, 2025, we received net proceeds from the exercise of the remaining Series A Preferred Warrants, the collection of subscriptions receivable and equity line of credit fundings of approximately $2.4 million.
Previous wording
On April 22, 2025, the Company filed the Certificate of Designations of Rights and Preferences of the Series D Preferred Stock (the “Certificate of Designations”) for the purpose of designating and establishing the Company’s Series D Preferred Stock. The Certificate of Designations was filed pursuant to the Securities Purchase Agreement, dated April 21, 2025, with certain accredited investors named therein. The Certificate of Designations became effective on April 22, 2025.
Current wording
On April 21, 2025, the Company entered into a Securities Purchase Agreement (the “Fourth Securities Purchase Agreement”) with certain accredited investors named therein. Further, on April 22, 2025, the Company filed the Certificate of Designations of Rights and Preferences of the Series D Preferred Stock (the “Series D Certificate of Designations”) for the purpose of designating and establishing the Company’s Series D Preferred Stock. Pursuant to the Securities Purchase Agreement, up to 10,000 shares of the Company’s Series D Preferred Stock shall be purchased for an aggregate purchase price of up to $8 million in one or more closings (each a “Closing”).
Previous wording
Further, on April 21, 2025, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with certain accredited investors named therein. Pursuant to the Securities Purchase Agreement, up to 10,000 shares of the Company’s Series D Preferred Stock shall be purchased for an aggregate purchase price of up to $8 million in one or more closings (each a “Closing”). On April 22, 2025, pursuant to the Securities Purchase Agreement, the Company issued and sold, and the investors purchased, in a private placement (the “Private Placement”): 6,250 shares of the Series D Preferred Stock for aggregate proceeds of approximately $5 million, paid through the transfer of certain Transfer Shares (as defined in the Securities Purchase Agreement) in lieu of cash. The date of the first closing is referred to as the “First Closing Date.” Each additional closing of the Private Placement is at the option of the investors upon notice to the Company and subject to satisfaction of customary closing conditions. On April 22, 2025, the Company filed the Certificate of Designations of Rights and Preferences of the Series D Preferred Stock (the “Certificate of Designations”) for the purpose of designating and establishing the Company’s Series D Preferred Stock. Additional funds are necessary to maintain current operations and to continue R&D activities. However, there can be no assurance that sufficient funding will be available to allow the Company to successfully continue its R&D activities and planned regulatory filings with the FDA. If the Company is unable to obtain the necessary funds, significant reductions in spending and the delay or cancellation of planned activities may be necessary. These actions would have a material adverse effect on the Company’s business, results of operations, and prospects. These conditions raise substantial doubt about the Company’s ability to continue as a going concern within one year from the date these accompanying financial statements are issued. The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.
Current wording
Each additional closing of the Private Placement is at the option of the investors upon notice to the Company and subject to satisfaction of customary closing conditions. Additional funds are necessary to maintain current operations and to continue R&D activities. However, there can be no assurance that sufficient funding will be available to allow the Company to successfully continue its R&D activities and planned regulatory filings with the FDA. If the Company is unable to obtain the necessary funds, significant reductions in spending and the delay or cancellation of planned activities may be necessary. These actions would have a material adverse effect on the Company’s business, results of operations, and prospects. These conditions raise substantial doubt about the Company’s ability to continue as a going concern within one year from the date these accompanying financial statements are issued. The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.
Previous wording
At 12:01 a.m. Eastern time on January 8, 2025, we effected the Reverse Stock Split pursuant to which each 100 shares of our Common Stock outstanding immediately prior thereto was converted into 1 share of our Common Stock outstanding immediately thereafter.
Current wording
At 12:01 a.m. Eastern time on January 8, 2025, the Company effected the Reverse Stock Split pursuant to which each 100 shares of Common Stock outstanding immediately prior thereto was converted into 1 share of Common Stock outstanding immediately thereafter, and at 12:01 a.m. Eastern time on June 13, 2025, the Company effected the Reverse Stock Split pursuant to which each 20 shares of Common Stock outstanding immediately prior thereto was converted into 1 share of Common Stock outstanding immediately thereafter.
Previous wording
As previously disclosed, on January 17, 2025, the Company received a letter setting forth the determination of a panel convened by Nasdaq (the “Nasdaq Panel”) granting the Company’s request for an extension (the “Extension”) to regain compliance with certain continued listing requirements of the Nasdaq Stock Market until April 22, 2025 (the “Extension Date”). The Company presented its plan (the “Plan”) for regaining compliance with such requirements at a hearing conducted on December 17, 2025. The Company’s Plan included completion of a reverse stock split, which occurred on January 8, 2025, and transferring the listing of its securities to the Nasdaq Capital Market, which was completed on February 12, 2025, and certain other conditions, including the satisfaction of the $2.5 million minimum stockholders’ equity requirement for continued listing on the Nasdaq Capital Market.
Current wording
As previously disclosed, on January 17, 2025, the Company received a letter setting forth the determination of a panel convened by Nasdaq (the “Nasdaq Panel”) granting the Company’s request for an extension (the “Extension”) to regain compliance with certain continued listing requirements of the Nasdaq Stock Market until April 22, 2025. The Company presented its plan (the “Plan”) for regaining compliance with such requirements at a hearing conducted on December 17, 2025. The Company’s Plan included completion of a reverse stock split, which occurred on January 8, 2025, and transferring the listing of its securities to the Nasdaq Capital Market, which was completed on February 12, 2025, and certain other conditions, including the satisfaction of the $2.5 million minimum stockholders’ equity requirement for continued listing on the Nasdaq Capital Market.
Previous wording
In addition, as previously disclosed, from November 2024 through January 2025, the Company raised approximately $2.3 million of net proceeds from its equity line of credit entered into November 2024, and an additional approximately $4.3 million of net proceeds from its public offering of shares of common stock, pre-funded warrants and warrants to purchase shares of common stock that closed on February 7, 2025 (the “February 2025 Offering”). As a result of such capital raising activities and the proceeds of the Private Placement received on the First Closing Date, as well as successful negotiations with certain service providers to reduce outstanding balances payable, the Company received a notification letter from Nasdaq on May 7, 2025, stating that the Company to have regained compliance with the Nasdaq continued listing standard under Nasdaq Listing Rule 5550(b)(1), which requires, among other things, that the Company maintain at least $2.5 million in stockholders’ equity.
Current wording
In addition, as previously disclosed, from November 2024 through June 30, 2025, the Company raised approximately $3.1 million of net proceeds from its equity line of credit entered into November 2024, and an additional approximately $4.3 million of net proceeds from its public offering of shares of common stock, pre-funded warrants and warrants to purchase shares of common stock that closed on February 7, 2025 (the “February 2025 Offering”). As a result of such capital raising activities and the proceeds of the Private Placement received on the First Closing Date, as well as successful negotiations with certain service providers to reduce outstanding balances payable, the Company received a notification letter from Nasdaq on May 7, 2025, stating that the Company had regained compliance with the Nasdaq continued listing standard under Nasdaq Listing Rule 5550(b)(1), which requires, among other things, that the Company maintain at least $2.5 million in stockholders’ equity.
Previous wording
Research and development expenses were $2.9 million for the three months ended March 31, 2025 as compared to $1.7 million for the three months ended March 31, 2024, reflecting an increase of $1.2 million. The increase was primarily attributable to an increase in clinal expenses of approximately $1.3 million and an increase in scientific consulting fees of $0.4 million. During the three months ended March 31, 2025, we began clinical trials related to the IND for CER-1236. This increase was primarily offset by a decrease in lab expenses of approximately $0.3 million and a decrease in research and development salaries and benefits of approximately $0.1 million.
Current wording
Research and development expenses were $2,754,000 for the three months ended June 30, 2025 as compared to $2,714,000 for the three months ended June 30, 2024, reflecting an increase of $40,000. The increase was primarily attributable to an increase in clinical expenses of approximately $1,056,000 and an increase in scientific consulting fees of $93,000, offset by a decrease in salaries and benefits of $893,000 primarily due to a decrease in stock-based compensation of $728,000 attributable to a decrease in accretion of stock option expense, and a decrease in lab and other expenses of $216,000. During the first quarter of 2025, we began clinical trials related to the IND for CER-1236.
Previous wording
Other expense was $(0.2) million for the three months ended March 31, 2025 as compared to other income of $2.3 million for the three months ended March 31, 2024, reflecting a decrease of $2.4 million. The decrease was primarily due to the recording of a $1.8 million gain from change in value of the Company’s earnout liability and the $0.4 million gain recorded for the change in value of the Predecessor’s preferred stock warrant liability during the three months ended March 31, 2024 as compared to $0 during the three months ended March 31, 2025, and the recording of an inducement expense during the three months ended March 31, 2025. Additionally, settlement of vendor liabilities in 2024 resulted in a $0.1 million increase in other income during the three months ended March 31, 2024.
Current wording
Other expense was $693,000 for the three months ended June 30, 2025 as compared to other income of $2,700,000 for the three months ended June 30, 2024, reflecting a negative change of $3,393,000. The negative change was primarily due to (1) the recording of a $2.9 million gain from change in value of the Company’s earnout liability during the three months ended June 30, 2024 as compared to $0 during the three months ended June 30, 2025, (2) the recording of a gain on settlement of vendor liabilities of $447,000 during the three months ended June 30, 2024 as compared to $0 during the three months ended June 30, 2025, and (3) the recording of stock-based inducement expense of $707,300 during the three months ended June 30, 2025 related to the conversion of Series C Preferred Stock as compared to $0 during the three months ended June 30, 2024. These negative changes in other expenses, net were offset by the recording of other expense of $631,000 during the three months ended June 30, 2024 related to registration rights penalties recorded compared to $0 during the three months ended June 30, 2025, and an increase in interest income, net of $30,000.
Previous wording
The results of operations for the three months ended March 31, 2024 arepro forma as the period presented in the following table and discussion includes the Predecessor for the period from January 1, 2024 through February 13, 2024 and the Company for the period from February 14, 2024 through March 31, 2024. This pro forma period from January 1, 2024 to March 31, 2024 does not include the Merger transactions that occurred on-the-line.
Current wording
The results of operations for the six months ended June 30, 2024 arepro forma as the period presented in the following table and discussion includes the Predecessor for the period from January 1, 2024 through February 13, 2024 and the Company for the period from February 14, 2024 through June 30, 2024. This pro forma period from January 1, 2024 to June 30, 2024 does not include the Merger transactions that occurred on-the-line.
Previous wording
General and administrative expenses were $2.0 million for the three months ended March 31, 2025 as compared to $2.9 million for the three months ended March 31, 2024, reflecting a decrease of approximately $0.8 million. The decrease during the three months ended March 31, 2025 as compared to the three months ended March 31, 2024, was primarily due to a decrease of $1.8 million in underwriting fees from the PBAX initial public offering, which were incurred upon the consummation of the business combination in February 2024. This decrease was offset by an increase in executive salaries and benefits of $0.4 million, an increase in professional fees of $0.5 million primarily to an increase in auditing, accounting and legal fees which were offset by a decrease in recruiting fees. The additional professional fees were all driven by the increased expenses of operational compliance as a public company.
Current wording
General and administrative expenses were $4,013,000 for the six months ended June 30, 2025 as compared to $5,318,000 for the six months ended June 30, 2024, reflecting a decrease of $1,305,000. The decrease during the six months ended June 30, 2025 as compared to the six months ended June 30, 2024, was primarily due to a decrease of $1,750,000 in underwriting fees from the PBAX initial public offering, which were incurred upon the consummation of the business combination in February 2024, and a decrease in executive salaries and benefits of $68,000. This decrease was offset by an increase in professional fees of $516,000 primarily due to an increase in auditing, accounting and legal fees which were offset by a decrease in recruiting fees. The additional professional fees were all driven by the increased expenses of operational compliance as a public company.
Previous wording
For the three months ended March 31, 2025 and 2024, net loss amounted to $5.1 million and $2.3 million, respectively, which represents an increase in net loss of $2.8 million, or 122.0%. During the three months ended March 31, 2025, in connection with our Series A and Series B preferred stock conversions, and the redemption of Series C Preferred Stock, we recorded deemed dividends of $0.3 million, and in connection with the adjustment in the exercise price of Series C Common Warrants, we recorded deemed dividends of $0.1 million. Accordingly, for the three months ended March 31, 2025 and 2024, net loss attributable to common stockholders amounted to $5.5 million, or $(1.59) per common share, and $2.3 million, or $(16.30) per common share, respectively.
Current wording
For the six months ended June 30, 2025 and 2024, net loss amounted to $10,523,000 and $4,748,000, respectively, which represents an increase in net loss of $5,775,000, or 121.6%. During the six months ended June 30, 2025, in connection with our Series A, Series B and Series C preferred stock conversions, and the redemption of Series C Preferred Stock, we recorded deemed dividends of $24,965,000, and in connection with the adjustment in the exercise price of Series C Common Warrants, we recorded deemed dividends of $84,000. Accordingly, for the six months ended June 30, 2025 and 2024, net loss attributable to common stockholders amounted to $35,572,000, or $(107.60) per common share, and $4,748,348, or $(604.19) per common share, respectively.
Previous wording
The Company, therefore, anticipates that substantial additional funding will be needed in connection with its continuing operations. At March 31, 2025, the Company had $5.1 million in cash and cash equivalents. The Company intends to devote most of the available cash to the preclinical and clinical development of its product candidates and public company compliance costs. Based on current business plans, the Company believes that the cash available at March 31, 2025 will not fund its operations and capital requirements for 12 months after the filing of these unaudited condensed financial statements for the period ended March 31, 2025. The Company has arranged two equity lines of credit, one providing for the sale of up to 25,000,000 newly issued shares of Common Stock and the other providing for the purchase of up to $20.6 million of Common Stock on the satisfaction of certain conditions. The Company has no guarantee that the conditions will be satisfied to require the purchase of all, or any additional amount, of the ELOC funds. On February 5, 2025, the Company entered into the SPA, with participation from a member of the Company’s Board and a single institutional investor, for the purchase and sale of (i) 2,551,020 shares of our common stock or common stock equivalents in lieu thereof; and (ii) February 2025 Common Warrants to purchase up to 2,551,020 shares of common stock, at a combined public offering price of $1.96 per share and warrant. In connection with this offering, the Company received net proceeds of approximately $4.3 million. Additionally, during the three months ended March 31, 2025, the Company received net proceeds from the exercise of the remaining Series A Preferred Warrants, the collection of subscriptions receivable and ELOC fundings of approximately $2.4 million. Any estimate as to how long the Company expects the net proceeds from the ELOC funding may fund the Company’s operations is based on assumptions that may prove to be wrong, and the Company could use its available capital resources sooner than its current expectations. Changing circumstances, some of which may be beyond the Company’s control, could result in less cash and cash equivalents available to fund operations or cause the Company to consume capital significantly faster than currently anticipated, and the Company may need to seek additional funds from additional sources sooner than planned.
Current wording
The Company, therefore, anticipates that substantial additional funding will be needed in connection with its continuing operations. As of June 30, 2025, the Company had approximately $3.2 million in cash and cash equivalents. The Company intends to devote most of the available cash to the preclinical and clinical development of its product candidates and public company compliance costs. Based on current business plans, the Company believes that the cash available as of June 30, 2025 will not fund its operations and capital requirements for 12 months after the filing of these unaudited condensed financial statements for the period ended June 30, 2025. The Company has arranged two equity lines of credit, one providing for the sale of up to 25,000,000 newly issued shares of Common Stock and the other providing for the purchase of up to $17.5 million of Common Stock on the satisfaction of certain conditions. The Company has no guarantee that the conditions will be satisfied to require the purchase of all, or any additional amount, of the ELOC funds. On February 5, 2025, the Company entered into the SPA, with participation from a member of the Company’s Board and a single institutional investor, for the purchase and sale of (i) 127,551 shares of our common stock or common stock equivalents in lieu thereof; and (ii) February 2025 Common Warrants to purchase up to 127,551 shares of common stock, at a combined public offering price of $39.20 per share and warrant. In connection with this offering, the Company received net proceeds of approximately $4.2 million. Additionally, during the six months ended June 30, 2025, the Company received net proceeds from the exercise of the remaining Series A Preferred Warrants, the collection of subscriptions receivable and ELOC fundings of approximately $2.9 million. Furthermore, during the six months ended June 30, 2025, we received net proceeds from the sales of Series D Preferred Stock of $2.2 million. Any estimate as to how long the Company expects the net proceeds from the ELOC and Series D Preferred Stock funding may fund the Company’s operations is based on assumptions that may prove to be wrong, and the Company could use its available capital resources sooner than its current expectations. Changing circumstances, some of which may be beyond the Company’s control, could result in less cash and cash equivalents available to fund operations or cause the Company to consume capital significantly faster than currently anticipated, and the Company may need to seek additional funds from additional sources sooner than planned.
Previous wording
Net cash used in operating activities for the three months ended March 31, 2025 primarily reflected a net loss of $5.1 million, adjusted for the reconciliation of non-cash items such as depreciation expense of $0.1 million, stock-based compensation of $0.3 million, inducement expense of $0.2 million, and amortization of right-of-use asset of $0.2 million, and changes in operating asset and liabilities primarily consisting of an increase in prepaid expenses and other current assets of $0.3 million, an increase in accounts payable of $0.7 million, a decrease in accrued liabilities of $0.3 million, and a decrease in operating lease liabilities of $0.2 million.
Current wording
Net cash used in operating activities for the six months ended June 30, 2025 primarily reflected a net loss of $10,523,000, adjusted for the reconciliation of non-cash items such as depreciation expense of $146,000, stock-based compensation of $488,000, stock-based inducement expense of $864,000, and amortization of right-of-use asset of $391,000, and changes in operating asset and liabilities primarily consisting of an increase in prepaid expenses and other current assets of $169,000, an increase in accounts payable of $562,000, a decrease in accrued liabilities of $404,000, and a decrease in operating lease liabilities of $423,000.
Previous wording
Net cash used in operating activities for the three months ended March 31, 2024 primarily reflected a net loss of $2.3 million, adjusted for the reconciliation of non-cash items such as a gain of settlement of liabilities with vendors of $0.1 million, depreciation expense of $0.1 million, stock-based compensation of $0.1 million, amortization of right-of-use asset of $0.2 million and a gain on revaluation of earnout liability and the preferred stock warrant liability of $2.1 million, and changes in operating asset and liabilities primarily consisting of an increase in prepaid expenses and other current assets of $0.5 million, a decrease in accounts payable of $0.3 million, an increase in accrued liabilities of $0.1 million, and a decrease in operating lease liabilities of $0.2 million.
Current wording
Net cash used in operating activities for the six months ended June 30, 2024 primarily reflected a net loss of $4,748,000, adjusted for the reconciliation of non-cash items such as a gain of settlement of liabilities with vendors of $589,000, depreciation expense of $228,000, stock-based compensation of $1,489,000, amortization of right-of-use asset of $353,000 and a gain on revaluation of earnout liability and the preferred stock warrant liability of $5,020,000, and changes in operating asset and liabilities primarily consisting of an increase in prepaid expenses and other current assets of $269,000, a decrease in accounts payable of $551,000, an increase in accrued liabilities of $941,000, and a decrease in operating lease liabilities of $450,000.
Previous wording
Net cash provided by financing activities for the three months ended March 31, 2025 amounted to $6.3 million as compared to $7.2 million for the three months ended March 31, 2024.
Current wording
Net cash provided by financing activities for the six months ended June 30, 2025 amounted to $9,045,000 as compared to $9,749,000 for the six months ended June 30, 2024.
Previous wording
During the three months ended March 31, 2025, net cash provided by financing activities of $6.3 million was primarily attributable to the receipt of net proceeds of $0.5 million from the exercise of Series A Preferred Warrants, net proceeds of $1.2 million from the sale of common stock under the ELOC, proceeds of $0.7 million from the collection of stock subscriptions receivable from previous sales of common stock under the ELOC, and net proceeds from sale of common stock and pre-funded warrants of $4.3 million. Offset by the cash redemption of Series C Preferred Stock of $0.4 million.
Current wording
During the six months ended June 30, 2025, net cash provided by financing activities of $9,045,000 was primarily attributable to the receipt of net proceeds of $500,000 from the exercise of Series A Preferred Warrants, net proceeds of $2,426,000 from the sale of common stock under the ELOC, net proceeds of $2,240,000 from the sale of Series D Preferred Stock, and net proceeds from sale of common stock and pre-funded warrants of $4,273,000, offset by the cash redemption of Series C Preferred Stock of $395,000.
Previous wording
During the three months ended March 31, 2024, net cash provided by financing activities of $7.2 million was primarily attributable to the receipt of net proceeds of $6.8 million from the sale of Series A Preferred Stock and $0.4 million from short-term borrowings.
Current wording
During the six months ended June 30, 2024, net cash provided by financing activities of $9,749,000 was primarily attributable to the receipt of net proceeds of $6,758,000 from the sale of Series A Preferred Stock, $408,000 from short-term borrowings, net proceeds of $500,000 from the sale of Series B Preferred Stock, and net proceeds of $2,238,000 from the sale of common stock under the ELOC, offset by the repayment of short-term borrowings of $149,000.
Previous wording
Earnout liability - As a result of the Merger in February 2024, the Company recognized an earnout liability of $4.9 million on the merger date. The earnout liability is measured using unobservable (Level 3) inputs and was included in current liabilities on balance sheet. The Company estimated the fair value of the earnout liability by applying a Monte-Carlo simulation method using the Company’s projection of future operating results and the estimated probability of achievement of the earnout target metrics. The Monte-Carlo simulation is a generally accepted statistical technique used to generate a defined number of valuation paths in order to develop a reasonable estimate of the fair value of the earnout liability. The liability is remeasured to fair value using the Monte-Carlo simulation method at each reporting period, and the change in fair value is recognized in other income (expense) until the contingency is resolved. During the three months ended March 31, 2024, the Company recorded a gain from change of fair value of the earnout liability of $1,800,000, which is included in other income (expenses), net on the accompanying consolidated statement of operations.
Current wording
Earnout liability - As a result of the Merger in February 2024, the Company recognized an earnout liability of $4.9 million on the merger date. The earnout liability is measured using unobservable (Level 3) inputs and was included in current liabilities on balance sheet. The Company estimated the fair value of the earnout liability by applying a Monte-Carlo simulation method using the Company’s projection of future operating results and the estimated probability of achievement of the earnout target metrics. The Monte-Carlo simulation is a generally accepted statistical technique used to generate a defined number of valuation paths in order to develop a reasonable estimate of the fair value of the earnout liability. The liability is remeasured to fair value using the Monte-Carlo simulation method at each reporting period, and the change in fair value is recognized in other income (expense) until the contingency is resolved. During the three and six months ended June 30, 2024, the Company recorded a gain from change of fair value of the earnout liability of $2,900,000 and $4,700,000, which is included in other income (expenses), net on the accompanying consolidated statement of operations, respectively.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
For the three months ended June 30, 2025 and 2024, net loss amounted to $5,417,000 and $2,449,000, respectively, which represents an increase in net loss of $2,968,000, or 121.2%. During the three months ended June 30, 2025, in connection with our Series A, Series B and Series C preferred stock conversions, we recorded deemed dividends of $24,700,000. Accordingly, for the three months ended June 30, 2025 and 2024, net loss attributable to common stockholders amounted to $30,117,000, or $(61.71) per common share, and $2,449,000, or $(302.32) per common share, respectively.
Current report — wording carried from elsewhere
The Company anticipates that its R&D expenses will significantly increase in the future as the Company increases headcount, compensation expense, and contracted services for preclinical and clinical development of its product candidates, as well as for manufacturing of clinical product to be used in clinical development.
Current report — wording carried from elsewhere
Net loss and net loss attributable to common stockholders