Clene Inc.
For the period ended Mar 31, 2025. Filed May 7, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 7, 2025
CLNN$3.95-0.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-13.
0001437749-24-034663
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-07.
0001437749-25-014918
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 101 previous paragraphs and 104 current paragraphs.
59 unchanged; 35 reworded; 9 added; 5 removed; 2 previous and 1 current paragraphs rearranged.
Tables are not compared: 44 previous and 44 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 (9)
Current report
In December 2024, we announced that we recently received written guidance from the Division of Neurology 1 (“DN1”) of the U.S. Food and Drug Administration (“FDA”) regarding a potential accelerated approval pathway for CNM-Au8® in ALS. As announced previously in September 2024, we were initially advised that the data presented in our briefing package for CNM-Au8 was not adequate to support an NDA submission under the accelerated approval pathway. However, following our November 2024 meeting with DN1 and presentation of additional data and analyses, the FDA provided guidance on a potential path to meet the regulatory standard for substantial evidence of effectiveness supporting accelerated approval. The FDA recommended that we investigate whether additional data from our ongoing compassionate use Expanded Access Programs (“EAPs”) could be leveraged to substantiate the effect of CNM-Au8 on neurofilament light (“NfL”) decline. We intend to follow the FDA’s recommendation to provide data from the ongoing EAPs and believe we can address the FDA’s requests. The additional NfL biomarker collection and analyses to support NDA submission will occur during the third quarter of 2025, as summarized below:
Current report
The FDA noted that whether NfL can serve as a reasonably likely surrogate endpoint for the effects of CNM-Au8 in ALS and whether the magnitude of change observed on NfL in patients treated with CNM-Au8 is reasonably likely to predict clinical benefit for ALS would be a matter of review. In preparation for a potential NDA submission in the fourth quarter of 2025 with the accelerated approval request, we plan to commence a confirmatory Phase 3 trial, RESTORE-ALS, in the second half of 2025. The trial is designed to investigate the effects of CNM-Au8 on improved survival (primary endpoint) and delayed time to ALS clinical worsening events (secondary efficacy endpoint). We have submitted the RESTORE-ALS trial protocol to the FDA and the FDA review process is ongoing.
Current report
In April 2025, we announced new evidence of remyelination and neuronal repair in MS participants following treatment with CNM-Au8 30 mg from analyses of the long-term open-label extension of the VISIONARY-MS clinical trial. Thepost hoc analyses identify consistent anatomical and physiologic effects within the same trial participants resulting in cognition and vision improvement for people living with MS. The analyses highlight significant and clinically meaningful improvements in cognition and visual function, supported by corresponding objective biomarkers, including advanced magnetic resonance imaging (“MRI”) diffusion tensor imaging (“DTI”) and multi-focal visual evoked potential (“mf-VEP”) assessments. Key findings from the analyses included:
Current report
Both the low contrast letter acuity (“LCLA”) vision—a visual measure associated with vision-specific quality of life and overall MS disability—and symbol digit modality test (“SDMT”)—a benchmark for working memory and cognitive processing speed in MS—improved in CNM-Au8 participants, results that have not been previously documented in MS clinical trials of other repair candidate drugs. Importantly, these clinical improvements correlated with objective biomarker measurements including:
Current report
These results are also consistent with previous neuronal and clinical improvement observed in the double-blind period of VISIONARY-MS, while also reinforcing the long-term benefits of the novel therapeutic mechanism of CNM-Au8. CNM-Au8 supports critical repair processes within neurons and oligodendrocytes, leading to improved neurological function and remyelination, as previously documented.
Current report
Public Offerings
Current report
In October 2024, pursuant to a placement agency agreement with Canaccord Genuity LLC (“Canaccord”), we sold 725,000 shares of Common Stock and pre-funded warrants to purchase up to 17,626 shares of Common Stock at an exercise price of $0.001 per share. The aggregate gross proceeds were approximately $3.5 million, excluding the proceeds, of any, from the exercise of the pre-funded warrants and before deducting placement agent fees and expenses and other expenses payable by us. We paid Canaccord a placement agent fee of 6.00% of the aggregate gross proceeds of the offering. The offering was made pursuant to our registration statement on Form S-3 (file number 333-264299), declared effective by the Securities and Exchange Commission (“SEC”) on April 26, 2022, and a related prospectus supplement. Additionally, in separate, concurrent private placements, we also sold 379,930 shares of Common Stock, pre-funded warrants to purchase up to 424,358 shares of Common Stock at an exercise price of $0.001 per share, and warrants to purchase up to 1,546,914 shares of Common Stock at an exercise price of $4.82 per share. The aggregate gross proceeds from the private placements were approximately $3.8 million, of which $1.3 million was contributed by certain of our directors, executive officers and their affiliated entities, and excludes the proceeds, if any, from the exercise of the warrants and pre-funded warrants.
Current report
We classified a portion of the 2024 SSCP Notes as convertible notes payable in the consolidated balance sheets and separated three features from the host contract as derivative instruments measured at fair value: (i) the conversion option (the “SSCPN Conversion Feature”), (ii) the redemption option upon a change of control or any bankruptcy, liquidation, or other restructuring process consisting of a cash payment equal to 115% of the outstanding principal (the “SSCPN Redemption Feature”), and (iii) the acceleration option plus a penalty equal to 10% of all outstanding principal and accrued and unpaid interest upon the occurrence and continuation of certain events of default (the “SSCPN Default Feature,” collectively with the SSCPN Conversion Feature and SSCPN Redemption Feature, the “SSCPN Derivative Liabilities”). We accounted for the remainder of the 2024 SSCP Notes as liabilities measured at their amortized cost as of March 31, 2025 and December 31, 2024, with a carrying value of $8.8 million and $8.6 million, respectively. We remeasure the SSCPN Derivative Liabilities at each reporting date and record the change in fair value as a component of other income (expense), net in the condensed consolidated statements of operations and comprehensive loss. During the three months ended March 31, 2025, the change in fair value of the SSCPN Derivative Liabilities resulted in a gain of $1.2 million. We estimate the fair value of the 2024 SSCP Notes with and without the SSCPN Derivative Liabilities and calculate the difference as the implied fair value of the SSCPN Derivative Liabilities. The valuation model consists of a discounted cash flow model and a Black-Scholes option-pricing model with probability weights for the occurrence of the following events: (i) a change of control transaction, (ii) dissolution of the Company, or (iii) another outcome outside of (i)-(ii). These estimates require significant judgment. The unobservable valuation inputs were as follows:
Current report
Pursuant to a registered direct public offering in October 2024, we issued the 2024 Common Warrants to purchase 1,546,914 shares of Common Stock at $4.82 per share. The change in fair value of the 2024 Common Warrants resulted in a gain of $1.8 million during the three months ended March 31, 2025. We estimate the fair value using a Black-Scholes option-pricing model with probability weights for the occurrence of the following events: (i) dissolution of the Company and (ii) another outcome outside of (i). These estimates require significant judgment. The unobservable valuation inputs were as follows:
Removed paragraphs (5)
Previous report
On November 1, 2024, we met with the FDA in a Type C meeting that we previously announced on September 16, 2024 and are awaiting minutes from that meeting. We are also planning to execute an international confirmatory Phase 3 trial of CNM-Au8 30 mg, RESTORE-ALS, and expect to initiate the trial in the second quarter of 2025, contingent upon the outcome of the Type C meeting and funding. We announced the following planned design of RESTORE-ALS at the 2024 Annual Northeast ALS Consortium (“NEALS”) Meeting on October 23, 2024:
Previous report
Public Offering
Previous report
In June 2023, we sold 2,500,000 units at a sale price of $16.00 per unit pursuant to an underwriting agreement with Canaccord Genuity LLC (“Canaccord”). Each unit consisted of (i) one share of Common Stock, (ii) one warrant to purchase one share of Common Stock at an exercise price of $22.00 per share (the “Tranche A Warrants”), and (iii) one warrant to purchase one share of Common Stock at an exercise price of $30.00 per share (the “Tranche B Warrants”). The aggregate gross proceeds were $40.0 million, excluding the proceeds, if any, from the exercise of the Tranche A and Tranche B Warrants, and we paid underwriting discounts and commissions of $2.4 million and offering expenses of $0.2 million. The offering was made pursuant to our registration statement on Form S-3 (file number 333-264299), declared effective by the Securities and Exchange Commission (“SEC”) on April 26, 2022, a related registration statement pursuant to Rule 462(b) (file number 333-272692), filed with the SEC and effective on June 16, 2023, and a related prospectus supplement.
Previous report
During the three and nine months ended September 30, 2024, we sold 394,453 and 394,453 shares of Common Stock, respectively, under the ATM Agreement with Canaccord, generated gross proceeds of $2.1 million and $2.1 million, respectively, and paid commissions of $0.1 million and $0.1 million, respectively. During the three and nine months ended September 30, 2023, we sold 0 and 144,755 shares of Common Stock, respectively; generated gross proceeds of $0 and $4.5 million, respectively; and paid commissions of $0 and $0.1 million, respectively. The sale of Common Stock under the ATM Agreement was made pursuant to our registration statement on Form S-3 (file number 333-264299), declared effective by the SEC on April 26, 2022, and a related prospectus supplement. On September 30, 2024, we notified Canaccord that we were suspending the prospectus supplement related to the ATM Agreement. We will not make any sales of our common stock pursuant to the ATM Agreement, unless and until a new prospectus supplement is filed. Other than the termination of the prospectus supplement related to the ATM Agreement, the ATM Agreement remains in full force and effect.
Previous report
Common Stock Purchase Agreement
Reworded paragraphs (35)
Previous wording
Our patent-protected, proprietary position affords us the potential to develop a broad and deep pipeline of novel CSN therapeutics to address a range of diseases with high impact on human health. We innovated an electro-crystal-chemistry drug development platform that draws from advances in nanotechnology, plasma and quantum physics, material science, and biochemistry. Our platform process results in nanocrystals with faceted structures and surfaces that are free of the chemical surface modifications that accompany other production methods. Many traditional methods of nanoparticle synthesis involve the unavoidable deposition of potentially toxic organic residues and stabilizing surfactants on the particle surfaces. Synthesizing stable nanocrystals that are both nontoxic and highly catalytic has overcome this significant hurdle in harnessing transition metal catalytic activity for therapeutic use. Our clean-surfaced nanocrystals exhibit catalytic activities many-fold higher than multiple other commercially available nanoparticles, produced using various techniques, that we have comparatively evaluated.
Current wording
Our patent-protected, proprietary position affords us the potential to develop a broad and deep pipeline of novel CSN therapeutics to address a range of diseases with high impact on human health. We innovated an electro-crystal-chemistry drug development platform that draws from advances in nanotechnology, plasma and quantum physics, material science, and biochemistry. Our platform process results in nanocrystals with faceted structures and surfaces that are free of the chemical surface modifications that accompany other production methods. Many traditional methods of nanoparticle synthesis involve the unavoidable deposition of potentially toxic organic residues and stabilizing surfactants on the particle surfaces. Synthesizing stable nanocrystals that are both nontoxic and highly catalytic has overcome this significant hurdle in harnessing transition metal catalytic activity for therapeutic use. Our clean-surfaced nanocrystals exhibit catalytic activities many-fold higher than other commercially available nanoparticles, produced using various techniques, that we have comparatively evaluated.
Previous wording
We have multiple drug assets currently in development and/or clinical trials for applications primarily in neurology. Our development and clinical efforts are currently focused on addressing the high unmet medical needs in central nervous system disorders including amyotrophic lateral sclerosis (“ALS”), multiple sclerosis (“MS”), and Parkinson’s disease (“PD”). We currently have no drugs approved for commercial sale and have not generated any revenue from drug sales. We have never been profitable and have incurred operating losses in each year since inception. We generate revenue from sales of dietary supplements through our wholly owned subsidiary, dOrbital, Inc., or through an exclusive license with 4Life Research LLC (“4Life”), an international supplier of health supplements, stockholder, and related party. We anticipate these revenues to be small compared to our operating expenses and to the revenue we expect to generate from potential future sales of our drug candidates, for which we are currently conducting clinical trials.
Current wording
Our development and clinical efforts are dedicated to revolutionizing the treatment of neurodegenerative diseases to restore and protect neuronal health and function. Our nanotherapeutics target cellular energy impairments that are common to many diseases and we are currently focused on addressing the high unmet medical needs in central nervous system disorders including amyotrophic lateral sclerosis (“ALS”), multiple sclerosis (“MS”), and Parkinson’s disease (“PD”). We currently have no drugs approved for commercial sale and have not generated any revenue from drug sales. We have never been profitable and have incurred operating losses in each year since inception. We generate revenue from sales of dietary supplements through our wholly owned subsidiary, dOrbital, Inc., or through an exclusive license with 4Life Research LLC (“4Life”), an international supplier of health supplements, stockholder, and related party. We anticipate these revenues to be small compared to our operating expenses and to the revenue we expect to generate from potential future sales of our drug candidates, for which we are currently conducting clinical trials.
Previous wording
We have initiated a second dosing cohort of REPAIR-MS, an open-label, investigator blinded Phase 2 clinical trial in non-active progressive MS patients. We anticipate enrollment concluding by the end of 2024 with topline results available by mid-2025. We plan to work closely with regulatory health authorities from the FDA and EMA, MS experts, and patient representatives to determine the proper path to advance CNM-Au8 into Phase 3 and potential future approval. We expect to meet with the FDA in an end of Phase 2 meeting in the first half of 2025.
Current wording
We have initiated a second dosing cohort of REPAIR-MS, an open-label, investigator blinded Phase 2 clinical trial in non-active progressive MS patients. Enrollment concluded in January 2025 with topline results expected in mid-2025. We plan to work closely with regulatory health authorities from the FDA, European Medicines Agency and other international regulatory bodies, MS experts, and patient representatives to determine the proper path to advance CNM-Au8 into Phase 3 and potential future approval. We expect to meet with the FDA in an end of Phase 2 meeting in the third quarter of 2025.
Previous wording
Despite the great need for an effective disease-modifying treatment for ALS and significant research efforts by the pharmaceutical industry to meet this need, there have been limited clinical successes and no curative therapies approved to date. In April 2023, the FDA granted accelerated approval to tofersen, branded as Qalsody, a drug from Biogen Inc. for the treatment of SOD1-ALS, a rare genetic form of ALS. In May 2024, the European Commission granted marketing authorization under exceptional circumstances for Qalsody in the European Union. Additionally, sodium phenylbutyrate and taurursodiol, a drug from Amylyx Pharmaceuticals, Inc. which previously received approval from the FDA and conditional approval from Health Canada based on the results of a Phase 2 trial, was voluntarily withdrawn from the market in the U.S. and Canada following the negative outcome of a Phase 3 clinical trial.
Current wording
Despite the great need for an effective disease-modifying treatment for ALS and significant research efforts by the pharmaceutical industry to meet this need, there have been limited clinical successes and no curative therapies approved to date. In early 2025, the topline results were announced for two regimens of the HEALEY ALS Platform Trial (ABBV-CLS-7262 from Calico Life Sciences LLC and AbbVie Inc., and DNL343 from Denali Therapeutics Inc.), with both treatments failing to meet their primary and key secondary endpoints.
Previous wording
The discovery and development of novel drug candidates require a significant investment of resources over a prolonged period of time, and a core part of our strategy is to continue making sustained investments in this area. As a result of this commitment, our pipeline of drug candidates has been advancing, with substantially all our research and development expenses relating to CNM-Au8, our lead asset, with the remainder spent on our CNM-ZnAg asset.
Current wording
The discovery and development of novel drug candidates requires a significant investment of resources over a prolonged period of time, and a core part of our strategy is to continue making sustained investments in this area. As a result of this commitment, our pipeline of drug candidates has been advancing, with substantially all our research and development expenses relating to our lead asset, CNM-Au8.
Previous wording
Our research and development expenses are affected by the scope and advancement of our existing product pipeline and the commencement of new drug programs. Drug candidates in later stages of clinical development generally have higher development costs than those in earlier stages, primarily due to costs and fees for per patient clinical trial sites for larger clinical trials, opening and monitoring clinical sites, contract research organization (“CRO”) activity, and manufacturing. We anticipate that our research and development expenses will decrease throughout 2024 as we complete our Phase 2 clinical trials and will increase in future years if and when we advance our assets into Phase 3. Additionally, if we are able to file an NDA with the FDA under an accelerated approval pathway or subsequent to future Phase 3 clinical development activities, if any, we anticipate that our research and development expenses related to regulatory activities would increase in advance of receiving regulatory approval.
Current wording
Our research and development expenses are affected by the scope and advancement of our existing product pipeline and the commencement of new drug programs. Drug candidates in later stages of clinical development generally have higher development costs than those in earlier stages, primarily due to costs and fees for per patient clinical trial sites for larger clinical trials, opening and monitoring clinical sites, contract research organization (“CRO”) activity, and manufacturing. We anticipate that our research and development expenses will increase in future years if and when we advance our assets into Phase 3. Additionally, if we are able to file an NDA with the FDA under an accelerated approval pathway or subsequent to future Phase 3 clinical development activities, if any, we anticipate that our research and development expenses related to regulatory activities would increase in advance of receiving regulatory approval.
Previous wording
Research and development costs consist primarily of payroll and personnel expenses for salaries, benefits, and stock-based compensation; supplies and materials expenses to support our clinical trials; payments to CROs, principal investigators, and clinical trial sites; costs of preclinical activities; consulting costs; and allocated overhead costs, including rent, equipment, utilities, depreciation, insurance, and facilities maintenance. Research and development costs are charged to operations as incurred, and nonrefundable advance payments related to future research and development activities are initially recorded as assets and are expensed when we receive the related goods or services.
Current wording
Research and development costs consist primarily of payroll and personnel expenses for salaries, benefits, and stock-based compensation; supplies, materials, and manufacturing expenses to support our clinical trials; payments to CROs, principal investigators, and clinical trial sites; costs of preclinical and nonclinical activities; consulting costs; and allocated overhead costs, including rent, equipment, utilities, depreciation, insurance, maintenance, and information technology. Research and development costs are charged to operations as incurred, and nonrefundable advance payments related to future research and development activities are initially recorded as assets and are expensed when we receive the related goods or services. Grant funding is recognized as a reduction in research and development costs.
Previous wording
General and administrative expenses consist primarily of payroll and personnel expenses for salaries, benefits, and stock-based compensation; fees for legal, accounting, tax, and information technology services; fees for directors’ and officers’ insurance; expenses for business development activities and investor and public relations; rent, utilities, and facility costs; travel costs; and consulting fees.
Current wording
General and administrative expenses consist primarily of payroll and personnel expenses for salaries, benefits, and stock-based compensation; fees for legal, finance, accounting, tax, and information technology services; insurance costs; expenses for public and investor relations; rent, utilities, depreciation, and other costs related to our facilities.
Previous wording
We anticipate that our general and administrative expenses in future periods will be contingent upon our discussions with the FDA. If we are able to file an NDA with the FDA under an accelerated pathway, we anticipate our general and administrative expenses would increase in future periods to support increases in our drug development activities and as we build our commercial capabilities in advance of receiving regulatory approval. This potential increase will likely include increased headcount, increased stock compensation expenses, expanded infrastructure including certain sales and marketing activities performed ahead of regulatory approval, and increased insurance expenses. If we are unable to file an NDA with the FDA under an accelerated pathway, we would need to continue investing in clinical research activities and we anticipate our general and administrative expenses would decrease in future periods as we decrease commercial expansion projects, including at our Elkton, Maryland facility, and as we implement cost-saving initiatives, such as a reduction in compensation, a hiring freeze, and elimination of certain staff positions.
Current wording
We anticipate that our general and administrative expenses in future periods will be contingent upon our discussions with the FDA. If we are able to file an NDA with the FDA under an accelerated pathway, we anticipate our general and administrative expenses would increase in future periods to support increases in our drug development activities and as we build our commercial capabilities in advance of receiving regulatory approval. This potential increase will likely include increased headcount, increased stock-based compensation expenses, expanded infrastructure including certain sales and marketing activities performed ahead of regulatory approval, and increased insurance expenses. If we are unable to file an NDA with the FDA under an accelerated pathway, we would need to continue investing in clinical research activities and we anticipate our general and administrative expenses would decrease in future periods as we decrease commercial expansion projects, including at our Elkton, Maryland facility, and as we implement cost-saving initiatives, such as a reduction in compensation, a hiring freeze, and elimination of certain staff positions.
Previous wording
Total other income (expense), net, consists primarily of (i) interest income and interest expense, (ii) commitment share expense from shares of Common Stock issued as a commitment fee, (iii) issuance costs for common stock warrant liabilities, (iv) a loss on initial issuance of equity from the fair value in excess of proceeds from a public equity offering, (v) changes in the fair value of our common stock warrant liabilities and Contingent Earn-outs, (vi) research and development tax credits, unrestricted grants, and conditional grants for which applicable conditions have been met, and (vii) realized gains and losses on foreign currency transactions and other miscellaneous income and expense items.
Current wording
Total other income (expense), net, consists primarily of (i) interest income and interest expense, (ii) changes in the fair value of our common stock warrant liabilities, derivative liabilities, and Contingent Earn-outs, and (iii) research and development tax credits, unrestricted grants, and conditional grants for which applicable conditions have been met.
Previous wording
Our results of operations for the three and nine months ended September 30, 2024 and 2023 were as follows:
Current wording
Our results of operations for the three months ended March 31, 2025 and 2024 were as follows:
Previous wording
Product revenue relates to our dietary supplement products and consists of (i) sales of an aqueous zinc-silver ion dietary (mineral) supplement sold by our wholly-owned subsidiary, dOrbital, Inc., under the trade name “rMetx™ ZnAg Immune Boost,” or under a supply agreement with 4Life under the trade name “Zinc Factor™,” and (ii) sales of KHC46, an aqueous gold dietary (mineral) supplement of very low concentration, sold under a supply agreement with 4Life under the trade name “Gold Factor™.” Royalty revenue relates to our dietary supplement products and consists of proceeds under an exclusive and royalty-bearing license agreement with 4Life relating to the sale of Gold Factor. During the three and nine months ended September 30, 2024 and 2023, changes in product and royalty revenues were due to the timing of purchases of Zinc Factor and Gold Factor by 4Life under the supply and license agreements.
Current wording
Product revenue relates to our dietary supplement products and consists of (i) sales of an aqueous zinc-silver ion dietary (mineral) supplement sold by our wholly-owned subsidiary, dOrbital, Inc., under the trade name “rMetx™ ZnAg Immune Boost,” or under a supply agreement with 4Life under the trade name “Zinc Factor™,” and (ii) sales of KHC46, an aqueous gold dietary (mineral) supplement of very low-concentration, sold under a supply agreement with 4Life under the trade name “Gold Factor™.” Royalty revenue relates to our dietary supplement products and consists of proceeds under an exclusive and royalty-bearing license agreement with 4Life relating to the sale of Gold Factor. During the three months ended March 31, 2025 and 2024, changes in product and royalty revenues were due to the timing of purchases and sales of Zinc Factor and Gold Factor by 4Life under the supply and license agreements.
Previous wording
Research and development expense during the three and nine months ended September 30, 2024 and 2023 was as follows:
Current wording
Research and development expense during the three months ended March 31, 2025 and 2024 was as follows:
Previous wording
General and administrative expense during the three and nine months ended September 30, 2024 and 2023 was as follows:
Current wording
General and administrative expense during the three months ended March 31, 2025 and 2024 was as follows:
Previous wording
Total other income (expense), net, during the three and nine months ended September 30, 2024 and 2023 was as follows:
Current wording
Total other income (expense), net, during the three months ended March 31, 2025 and 2024 was as follows:
Previous wording
We are incorporated in the state of Delaware and subject to statutory U.S. federal corporate income tax at a rate of 21.00%. We are also subject to state income tax in Maryland at a rate of 8.25%, and in Utah at a rate of 4.55% and 4.65% for the nine months ended September 30, 2024 and 2023, respectively. As of September 30, 2024 and December 31, 2023, we recorded a full valuation allowance against our net deferred tax assets due to the uncertainty as to whether such assets will be realized resulting from our three-year cumulative loss position and the uncertainty surrounding our ability to generate pre-tax income in the foreseeable future.
Current wording
We are incorporated in the state of Delaware and subject to statutory U.S. federal corporate income tax at a rate of 21.00%. We are also subject to state income tax in Maryland at a rate of 8.25%, and in Utah at a rate of 4.55% and 4.65% for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025 and December 31, 2024, we recorded a full valuation allowance against our net deferred tax assets due to the uncertainty as to whether such assets will be realized resulting from our three-year cumulative loss position and the uncertainty surrounding our ability to generate pre-tax income in the foreseeable future.
Previous wording
Our wholly-owned subsidiary, Clene Australia Pty Ltd (“Clene Australia”), was established in Australia in March 2018 and is subject to corporate income tax at a rate of 30.00%. Clene Australia had no taxable income or provision for income taxes for the nine months ended September 30, 2024 and 2023. We recorded other income of $0.1 million and $0.9 million for the nine months ended September 30, 2024 and 2023, respectively, for research and development tax credits pertaining to Clene Australia for the 2024 and 2023 tax years, respectively.
Current wording
Our wholly-owned subsidiary, Clene Australia Pty Ltd (“Clene Australia”), was established in Australia in March 2018 and is subject to corporate income tax at a rate of 30.00%. Clene Australia had no taxable income or provision for income taxes for the three months ended March 31, 2025 and 2024. We recorded other income of $24,000 and $14,000 for the three months ended March 31, 2025 and 2024, respectively, for research and development tax credits pertaining to Clene Australia for the 2025 and 2024 tax years, respectively.
Previous wording
Our wholly-owned subsidiary, Clene Netherlands B.V. (“Clene Netherlands”), was established in the Netherlands in April 2021 and is subject to corporate income tax at a rate of 19.00% up to €200,000 of taxable income and 25.80% for taxable income in excess of €200,000. Clene Netherlands had no taxable income or provision for income taxes for the nine months ended September 30, 2024 and 2023.
Current wording
Our wholly-owned subsidiary, Clene Netherlands B.V. (“Clene Netherlands”), was established in the Netherlands in April 2021 and is subject to corporate income tax at a rate of 19.00% up to €200,000 of taxable income and 25.80% for taxable income in excess of €200,000 for the three months ended March 31, 2025 and 2024. Clene Netherlands had no taxable income or provision for income taxes for the three months ended March 31, 2025 and 2024.
Previous wording
We also received indirect financial support for the HEALEY ALS Platform Trial, administered by Massachusetts General Hospital, which conducted a platform trial for the treatment of ALS with certain drug candidates, including CNM-Au8, at significantly lower costs than we would have otherwise incurred if we had conducted a comparably designed clinical trial at reasonable market rates.
Current wording
We also received indirect financial support for the HEALEY ALS Platform Trial, administered by Massachusetts General Hospital, which conducted an ALS platform trial of CNM-Au8 alongside multiple other drug candidates, at significantly lower costs than we would have otherwise incurred if we had conducted a comparably designed clinical trial at reasonable market rates.
Previous wording
We incurred a loss from operations of $7.8 million and $9.5 million for the three months ended September 30, 2024 and 2023, respectively; and $24.4 million and $30.6 million for the nine months ended September 30, 2024 and 2023, respectively. Our accumulated deficit was $268.6 million and $242.7 million as of September 30, 2024 and December 31, 2023, respectively. Our cash, cash equivalents, and marketable securities totaled $14.6 million and $35.0 million as of September 30, 2024 and December 31, 2023, respectively, and net cash used in operating activities was $16.5 million and $23.0 million for the nine months ended September 30, 2024 and 2023, respectively.
Current wording
We incurred a loss from operations of $4.1 million and $9.2 million for the three months ended March 31, 2025 and 2024, respectively. Our accumulated deficit was $282.9 million and $282.1 million as of March 31, 2025 and December 31, 2024, respectively. Our cash and cash equivalents totaled $9.8 million and $12.2 million as of March 31, 2025 and December 31, 2024, respectively, and net cash used in operating activities was $5.0 million and $7.1 million for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
We have incurred significant losses and negative cash flows from operations since our inception. We have not generated significant revenues since our inception, and we do not anticipate generating significant revenues unless we successfully complete development and obtain regulatory approval for commercialization of a drug candidate. We expect to incur additional losses in the future, particularly as we advance the development of our clinical-stage drug candidates, continue research and development of our preclinical drug candidates, and initiate additional clinical trials of, and seek regulatory approval for, these and other future drug candidates. We expect that within the next twelve months, we will not have sufficient cash and other resources on hand to sustain our current operations or meet our obligations as they become due unless we obtain additional financing. Additionally, pursuant to our term loan with Avenue Venture Opportunities Fund, L.P. (“Avenue”), we are required to maintain unrestricted cash and cash equivalents of at least $5.0 million to avoid acceleration of the full balance of the loan (see Note 8 to the condensed consolidated financial statements). These conditions raise substantial doubt about the Company’s ability to continue as a going concern.
Current wording
We have incurred significant losses and negative cash flows from operations since our inception. We have not generated significant revenues since our inception, and we do not anticipate generating significant revenues unless we successfully complete development and obtain regulatory approval for commercialization of a drug candidate. We expect to incur additional losses in the future, particularly as we advance the development of our clinical-stage drug candidates, continue research and development of our preclinical drug candidates, and initiate additional clinical trials of, and seek regulatory approval for, these and other future drug candidates. We expect that within the next twelve months, we will not have sufficient cash and other resources on hand to sustain our current operations or meet our obligations as they become due unless we obtain additional financing. Additionally, pursuant to our senior secured convertible promissory notes (the “2024 SSCP Notes”), we are required to maintain unrestricted cash and cash equivalents of at least $2.0 million to avoid acceleration of the full balance of the 2024 SSCP Notes (see Note 8 to the condensed consolidated financial statements). These conditions raise substantial doubt about the Company’s ability to continue as a going concern.
Previous wording
To mitigate our funding needs, we plan to raise additional funding, including exploring equity financing and offerings, debt financing, licensing or collaboration arrangements with third parties, as well as utilizing our existing at-the-market facility and equity purchase agreement and potential proceeds from the exercise of outstanding warrants and stock options. These plans are subject to market conditions and reliance on third parties, and there is no assurance that effective implementation of our plans will result in the necessary funding to continue current operations. During the three months ended September 30, 2024, we generated $2.1 million of gross proceeds from our equity distribution agreement (the “ATM Agreement”) and subsequent to September 30, 2024, we raised $3.5 million from a registered direct offering of equity securities and an additional $3.8 million that we received as of September 30, 2024 from separate, concurrent private placements of equity securities that closed on October 1, 2024. We have implemented cost-saving initiatives, including delaying and reducing certain research and development programs and commercialization efforts and elimination of certain staff positions. We have concluded that our plans do not alleviate the substantial doubt about our ability to continue as a going concern beyond one year from the date the condensed consolidated financial statements are issued.
Current wording
To mitigate our funding needs, we plan to raise additional funding, including exploring equity financing and offerings, debt financing, licensing or collaboration arrangements with third parties, as well as utilizing our existing at-the-market facility and equity purchase agreement and potential proceeds from the exercise of outstanding warrants and stock options. These plans are subject to market conditions and reliance on third parties, and there is no assurance that effective implementation of our plans will result in the necessary funding to continue current operations. During the three months ended March 31, 2025, we generated $2.7 million of gross proceeds from our equity distribution agreement and subsequent to March 31, 2025, we generated $0.9 million of gross proceeds from our equity distribution agreement. We have implemented cost-saving initiatives, including delaying and reducing certain research and development programs and commercialization efforts and elimination of certain staff positions. We have concluded that our plans do not alleviate the substantial doubt about our ability to continue as a going concern beyond one year from the date the condensed consolidated financial statements are issued.
Previous wording
For at least the next twelve months, our primary capital requirements are to fund our operations, including research and development, personnel, regulatory, and other clinical trial costs related to development of our lead drug candidate, CNM-Au8; and general and administrative costs to support our drug development and pre-commercial activities in advance of receiving regulatory approval for our drug candidates. Firm commitments for funds include approximately $1.1 million of payments under operating lease obligations; payment of principal and interest on notes payable totaling $11.0 million; and commitments under various agreements for capital expenditures totaling $0.2 million related to the construction of our manufacturing facilities. We expect to meet our short-term liquidity requirements primarily through cash on hand. Additional sources of funds include equity financing, debt financing, or other capital sources.
Current wording
For at least the next twelve months, our primary capital requirements are to fund our operations, including research and development, personnel, regulatory, and other clinical trial costs related to development of our lead drug candidate, CNM-Au8; general and administrative costs to support our drug development and pre-commercial activities in advance of receiving regulatory approval for our drug candidates; and principal and interest payments on our notes payable and convertible notes payable. Firm commitments for funds include approximately $1.4 million of payments under operating lease obligations, payment of principal and interest on notes payable and convertible notes payable totaling $4.9 million, and a commitment for capital expenditures totaling $0.2 million related to the construction of our manufacturing facilities. We expect to meet our short-term liquidity requirements primarily through cash on hand. Additional sources of funds include equity financing, debt financing, or other capital sources.
Previous wording
Beyond the next twelve months, our primary capital requirements are to fund our operations, including research and development, personnel, regulatory, and other clinical trial costs related to development of our lead drug candidate, CNM-Au8; and general and administrative costs to support our drug development activities in advance of receiving regulatory approval for our drug candidates. Additional funds may be spent to initiate new clinical trials, at our discretion. Known obligations beyond the next twelve months include $5.5 million of payments under operating lease obligations, and interest and principal repayment of notes payable of $7.7 million. We expect to meet our long-term liquidity requirements primarily through equity financing, debt financing, or other capital sources.
Current wording
Beyond the next twelve months, our primary capital requirements are to fund our operations, including research and development, personnel, regulatory, and other clinical trial costs related to development of our lead drug candidate, CNM-Au8; general and administrative costs to support our drug development activities in advance of receiving regulatory approval for our drug candidates; and principal and interest payments on our notes payable and convertible notes payable. Additional funds may be spent to initiate new clinical trials, at our discretion. Known obligations beyond the next twelve months include $4.9 million of payments under operating lease obligations, and interest and principal repayment of notes payable and convertible notes payable of $14.6 million. We expect to meet our long-term liquidity requirements primarily through equity financing, debt financing, or other capital sources.
Previous wording
Our cash flows for the nine months ended September 30, 2024 and 2023 were as follows:
Current wording
Our cash flows for the three months ended March 31, 2025 and 2024 were as follows:
Previous wording
Net cash used in operating activities was $23.0 million for the nine months ended September 30, 2023, which resulted from a net loss of $39.3 million, adjusted for non-cash items totaling $17.0 million and a net change in operating assets and liabilities of $0.7 million. Significant non-cash items included: (i) depreciation expense of $1.3 million for laboratory and office equipment and leasehold improvements; (ii) non-cash lease expense of $0.3 million; (iii) commitment share expense of $0.4 million for shares of Common Stock issued to Lincoln Park as an initial fee for their commitment to purchase shares of our Common Stock under a purchase agreement; (iv) issuance costs of $0.3 million for liability-classified warrants issued in a public equity offering; (v) a loss on initial issuance of equity of $14.8 million from the fair value in excess of proceeds from a public equity offering; (vi) stock-based compensation expense of $7.1 million; (vii) accretion of debt discount of $0.8 million; (viii) non-cash interest expense of $0.3 million; (ix) a change in fair value of the Clene Nanomedicine and Initial Stockholders Contingent Earn-outs of $2.1 million and $0.3 million, respectively, due to the decrease in price of our Common Stock on Nasdaq and changes in valuation model inputs; and (x) a change in fair value of common stock warrant liabilities of $6.0 million due to the increase in price of our Common Stock on Nasdaq and changes in valuation model inputs. The net change in operating assets and liabilities was primarily attributable to: (a) a decrease in accounts receivable of $0.1 million and a decrease in accounts payable of $1.1 million due to the timing of vendor invoicing and payments; (b) an increase in inventory of $0.1 million; (c) a decrease in prepaid expenses and other current assets of $1.5 million due to the timing of vendor invoicing and payments, the timing of receipt of metals to be used in research and development, and a decrease in research and development tax credits receivable; (d) a decrease in accrued liabilities of $0.7 million primarily due to decreased accrued compensation and benefits and CRO and clinical fees; and (e) a decrease in operating lease obligations of $0.4 million.
Current wording
Net cash used in operating activities was $5.0 million for the three months ended March 31, 2025, which resulted from a net loss of $0.8 million, adjusted for non-cash items totaling $0.9 million and a net change in operating assets and liabilities of $3.3 million. Significant non-cash items included: (i) depreciation expense of $0.4 million related to laboratory and office equipment and leasehold improvements, (ii) non-cash lease expense of $0.1 million, (iii) stock-based compensation expense of $1.9 million, (iv) accretion of debt discount of $0.2 million, (v) non-cash interest expense on notes payable of $12,000, (vi) a change in fair value of our common stock warrant liabilities of $2.5 million due to changes in the price of our Common Stock on Nasdaq and changes in valuation model inputs, and (vii) a change in fair value of our derivative liabilities of $1.1 million due to changes in the price of our Common Stock on Nasdaq and changes in valuation model inputs. The net change in operating assets and liabilities was primarily attributable to: (A) a decrease in accounts receivable of $0.1 million and an increase in accounts payable of $0.2 million due to the timing of vendor invoicing and payments, (B) a decrease in inventory of $30,000, (C) an increase in prepaid expenses and other current assets of $0.9 million due to the timing of vendor invoicing and payments, the timing of receipt of metals to be used in research and development, an increase in prepaid ACT-EAP expenses, and an increase in research and development tax credits receivable, (D) a decrease in accrued liabilities of $2.5 million primarily due to a decrease in deferred grants, a decrease in accrued CRO and clinical fees, a decrease in other miscellaneous accrued liabilities, partially offset by an increase in accrued compensation and benefits, and (E) a decrease in operating lease obligations of $0.2 million.
Previous wording
Net cash used in operating activities was $16.5 million for the nine months ended September 30, 2024, which resulted from a net loss of $25.9 million, adjusted for non-cash items totaling $7.8 million and a net change in operating assets and liabilities of $1.6 million. Significant non-cash items included: (i) depreciation expense of $1.2 million for laboratory and office equipment and leasehold improvements; (ii) non-cash lease expense of $0.4 million; (iii) stock-based compensation expense of $6.2 million; (iv) accretion of debt discount of $1.2 million; (v) non-cash interest expense of $40,000; (vi) non-cash interest income on marketable securities of $0.2 million; (vii) a change in fair value of common stock warrant liabilities of $1.0 million due to changes in the price of our Common Stock on Nasdaq and changes in valuation model inputs; and (viii) a change in fair value of the Clene Nanomedicine and Initial Stockholders Contingent Earn-outs of $0.1 million and $10,000, respectively, due to changes in the price of our Common Stock on Nasdaq and changes in valuation model inputs. The net change in operating assets and liabilities was primarily attributable to: (a) a decrease in accounts receivable of $0.1 million and an increase in accounts payable of $0.2 million due to the timing of vendor invoicing and payments; (b) an increase in prepaid expenses and other current assets of $1.2 million due to the timing of vendor invoicing and payments, the timing of receipt of metals to be used in research and development, and an increase in prepaid ACT-EAP expenses, partially offset by a decrease in research and development tax credits receivable; (c) an increase in accrued liabilities of $2.9 million primarily due to increased accrued compensation and benefits, increased deferred grants, and an increase in accrued CRO and clinical fees; and (d) a decrease in operating lease obligations of $0.4 million.
Current wording
Net cash used in operating activities was $7.1 million for the three months ended March 31, 2024, which resulted from a net loss of $11.1 million, adjusted for non-cash items totaling $4.2 million and a net change in operating assets and liabilities of $0.2 million. Significant non-cash items included: (i) depreciation expense of $0.4 million related to laboratory and office equipment and leasehold improvements, (ii) non-cash lease expense of $0.1 million, (iii) stock-based compensation expense of $2.0 million, (iv) accretion of debt discount of $0.4 million, (v) non-cash interest expense of $0.1 million, (vi) a change in fair value of our common stock warrant liabilities of $1.3 million due to changes in the price of our Common Stock on Nasdaq and changes in valuation model inputs, and (vii) a change in fair value of the Clene Nanomedicine and Initial Stockholders Contingent Earn-outs of $0.1 million and $7,000, respectively, due to changes in the price of our Common Stock on Nasdaq and changes in valuation model inputs. The net change in operating assets and liabilities was primarily attributable to: (A) a decrease in accounts receivable of $0.1 million and an increase in accounts payable of $0.1 million due to the timing of vendor invoicing and payments, (B) an increase in prepaid expenses and other current assets of $0.4 million due to the timing of vendor invoicing and payments, the timing of receipt of metals to be used in research and development, and an increase in research and development tax credits receivable, (C) an increase in accrued liabilities of $0.2 million primarily due to increased accrued compensation and benefits and CRO and clinical fees, partially offset by a decrease in other accrued liabilities, and (D) a decrease in operating lease obligations of $0.2 million.
Previous wording
Net cash provided by investing activities was $6.3 million for the nine months ended September 30, 2024, which consisted of proceeds from maturities of marketable securities of $12.5 million, partially offset by purchases of marketable securities of $6.2 million and purchases of property and equipment of $14,000. Net cash provided by investing activities was $4.7 million for the nine months ended September 30, 2023, which consisted of proceeds from maturity of marketable securities of $5.0 million, partially offset by purchases of property and equipment of $0.3 million.
Current wording
We had no net cash provided by or used in investing activities for the three months ended March 31, 2025. Net cash provided by investing activities was $0.1 million for the three months ended March 31, 2024, which consisted of proceeds from maturities of marketable securities of $6.3 million, partially offset by purchases of marketable securities of $6.2 million and purchases of property and equipment of $11,000.
Previous wording
Net cash used in financing activities was $4.1 million for the nine months ended September 30, 2024, which consisted of proceeds from the exercise of stock options of $0.1 million, proceeds from the issuance of common stock of $2.0 million, and proceeds from share subscriptions receivable of $3.8 million due to receipt of investor subscriptions from a registered direct offering in advance of the closing date of October 1, 2024; partially offset by payments of finance lease obligations of $27,000 and payments of notes payable principal of $10.0 million related to our loan with Avenue. Net cash provided by financing activities was $42.2 million for the nine months ended September 30, 2023, which consisted of proceeds from issuance of common stock and warrants, net of offering costs, of $42.1 million, and proceeds from the issuance of notes payable of $0.4 million; partially offset by payments of notes payable modification fees of $0.2 million and payments of finance lease obligations of $0.1 million.
Current wording
Net cash provided by financing activities was $2.7 million for the three months ended March 31, 2025, which consisted of proceeds from the issuance of common stock of $2.7 million. Net cash used in financing activities was $19,000 for the three months ended March 31, 2024, which consisted of payments of finance lease obligations of $19,000.
Previous wording
During the nine months ended September 30, 2023, we sold 20,000 shares of Common Stock under our purchase agreement (the “Purchase Agreement”) with Lincoln Park, issued 145 Additional Commitment Shares, and generated proceeds of $0.4 million. We did not effect any sales during any of the other periods presented herein. The sale of Common Stock under the Purchase Agreement was made pursuant to our registration statement on Form S-3 (file number 333-264299), declared effective by the SEC on April 26, 2022, and a related prospectus supplement. On June 16, 2023, we suspended and terminated the prospectus supplement related to the Purchase Agreement with respect to the unsold shares of Common Stock issuable pursuant to the Purchase Agreement. We will not make any further sales of our securities pursuant to the Purchase Agreement, unless and until a new prospectus supplement is filed. Other than the termination of the prospectus supplement related to the Purchase Agreement with respect to future sales by us, the Purchase Agreement remains in full force and effect.
Current wording
During the three months ended March 31, 2025, we sold 578,205 shares of Common Stock under an equity distribution agreement (the “2022 ATM Agreement”) with Canaccord, generated gross proceeds of $2.7 million, and paid commissions of $0.1 million. We did not effect any sales during any of the other periods presented herein. The sale of Common Stock under the 2022 ATM Agreement was made pursuant to our registration statement on Form S-3 (file number 333-264299), declared effective by the SEC on April 26, 2022, and a related prospectus supplement.
Previous wording
In accordance with ASU 2020-06,Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, we classified a portion of the 2021 Avenue Loan as convertible notes payable in the condensed consolidated balance sheets as of December 31, 2023 and did not separate the conversion option from the host contract as it did not meet the requirements for accounting as a derivative instrument. As of September 30, 2024, the conversion option has expired. We accounted for the convertible note as a single liability measured at its amortized cost as December 31, 2023 with a carrying value of $4.9 million.
Current wording
In accordance with ASU 2020-06,Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, we classified the 2022 DHCD Loan as convertible notes payable in the condensed consolidated balance sheets and did not separate the conversion option from the host contract as it did not meet the requirements for accounting as a derivative instrument. We account for the convertible note as a single liability measured at its amortized cost as of March 31, 2025 and December 31, 2024, with a carrying value of $5.3 million and $5.3 million, respectively.
Previous wording
Pursuant to amendments to the 2021 Avenue Loan in June 2023 and September 2024, we issued a warrant to purchase 150,000 shares of Common Stock at $4.6014 per share (the “2023 Avenue Warrant”). In accordance with ASC 815, we recognized the 2023 Avenue Warrant as a derivative liability measured at fair value and remeasure the 2023 Avenue Warrant at each reporting date and record the change in fair value as a component of other income (expense), net, in the condensed consolidated statements of operations and comprehensive loss. The change in fair value of the 2023 Avenue Warrant resulted in a gain of $0.1 million and a gain of $0.4 million during the three months ended September 30, 2024 and 2023, respectively; and a gain of $39,000 and a gain of $0.3 million during the nine months ended September 30, 2024 and 2023, respectively. We estimate the fair value using a Black-Scholes option-pricing model with probability weights for the occurrence of the following events: (i) settlement of the instrument upon a change of control transaction, (ii) dissolution of the Company, or (iii) another outcome outside of (i)-(ii). These estimates require significant judgment. As of September 30, 2024 and December 31, 2023, the unobservable inputs were as follows:
Current wording
Pursuant to amendments to the 2021 Avenue Loan in June 2023 and September 2024, we issued a warrant to purchase 150,000 shares of Common Stock at $4.6014 per share (the “2023 Avenue Warrant”). The change in fair value of the 2023 Avenue Warrant resulted in a gain of $0.2 million and a loss of $0.1 million during the three months ended March 31, 2025 and 2024, respectively. We estimate the fair value using a Black-Scholes option-pricing model with probability weights for the occurrence of the following events: (i) settlement of the instrument upon a change of control transaction, (ii) dissolution of the Company, or (iii) another outcome outside of (i)-(ii). These estimates require significant judgment. The unobservable valuation inputs were as follows:
Previous wording
Pursuant to an underwritten public offering in June 2023, we issued the Tranche A Warrants to purchase 2,500,000 shares of Common Stock at $22.00 per share. In accordance with ASC 815, we recognized the Tranche A Warrants as derivative liabilities measured at fair value and will remeasure them at each reporting date and record the change in fair value as a component of other income (expense), net, in the condensed consolidated statements of operations and comprehensive loss. The change in fair value of the Tranche A Warrants resulted in a gain of $0.6 million and a gain of $5.9 million during the three months ended September 30, 2024 and 2023, respectively; and a gain of $0.9 million and a gain of $5.6 million during the nine months ended September 30, 2024 and 2023, respectively. We estimate the fair value using a Black-Scholes option-pricing model with probability weights for the occurrence of the following events: (i) FDA acceptance of an NDA for CNM-Au8, (ii) settlement upon a fundamental transaction, (iii) dissolution of the Company, and (iv) another outcome outside of (i)-(iii). These estimates require significant judgment. As of September 30, 2024 and December 31, 2023, the unobservable inputs were as follows:
Current wording
Pursuant to an underwritten public offering in June 2023, we issued the Tranche A Warrants to purchase 2,500,000 shares of Common Stock at $22.00 per share. The change in fair value of the Tranche A Warrants resulted in a gain of $0.6 million and a loss of $1.2 million during the three months ended March 31, 2025 and 2024, respectively. We estimate the fair value using a Black-Scholes option-pricing model with probability weights for the occurrence of the following events: (i) FDA acceptance of an NDA for CNM-Au8, (ii) settlement upon a fundamental transaction, (iii) dissolution of the Company, and (iv) another outcome outside of (i)-(iii). These estimates require significant judgment. The unobservable valuation inputs were as follows:
Previous wording
We estimate the fair value of stock options using a Black-Scholes option-pricing model, which requires significant judgment. The unobservable inputs include the expected price volatility, risk-free interest rate, expected dividend yield, and expected term. For the nine months ended September 30, 2024 and 2023, the unobservable inputs were as follows:
Current wording
We estimate the fair value of stock options using a Black-Scholes option-pricing model, which requires significant judgment. The unobservable inputs include the expected price volatility, risk-free interest rate, expected dividend yield, and expected term. The unobservable valuation inputs were as follows:
Previous wording
We estimate the fair value of restricted stock awards using a Monte Carlo valuation model to simulate the achievement of certain stock price milestones. The unobservable inputs include the expected stock price volatility, risk-free interest rate, and expected term. No restricted stock awards were granted during the nine months ended September 30, 2024 and 2023.
Current wording
We estimate the fair value of restricted stock awards using a Monte Carlo valuation model to simulate the achievement of certain stock price milestones. The unobservable inputs include the expected stock price volatility, risk-free interest rate, and expected term. No restricted stock awards were granted during the three months ended March 31, 2025 and 2024.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
In accordance with ASC 815, we recognized the below common stock warrants as derivative liabilities measured at fair value and will remeasure them at each reporting date and record the change in fair value as a component of other income (expense), net, in the condensed consolidated statements of operations and comprehensive loss.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
We plan to continue working closely with regulatory health authorities from the FDA, European Medicines Agency, ALS experts, and patient representatives to determine the proper path to support potential approval.
Previous report — wording carried elsewhere
We classified the 2022 DHCD Loan as convertible notes payable in the condensed consolidated balance sheets and did not separate the conversion option from the host contract as it did not meet the requirements for accounting as a derivative instrument. We account for the convertible note as a single liability measured at its amortized cost. As of September 30, 2024 and December 31, 2023, the convertible note was carried at $5.3 million and $5.3 million, respectively.