AVENUE THERAPEUTICS INC
For the period ended Mar 31, 2025. Filed May 15, 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.
Mar 31, 2025 · Filed May 15, 2025
ATXI$0.42-50.7%Stored close · as of Mar 18, 2025
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-14.
0001437749-24-035309
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-15.
0001437749-25-017180
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 75 previous paragraphs and 71 current paragraphs.
38 unchanged; 17 reworded; 15 added; 16 removed; 4 previous and 1 current paragraphs rearranged.
Tables are not compared: 27 previous and 27 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 (15)
Current report
Recent Developments
Current report
Nasdaq Delisting
Current report
On March 17, 2025, The Nasdaq Stock Market LLC (“Nasdaq”) notified us that the Nasdaq Hearings Panel (the “Panel”) had determined to delist our common stock due to a violation of Nasdaq Listing Rule 5550(b)(1), which requires companies listed on The Nasdaq Capital Market to maintain stockholders’ equity of at least $2,500,000. As a result, trading of our common stock was suspended from Nasdaq at the open of trading on March 19, 2025, with formal delisting to occur upon Nasdaq's expected filing of a Form 25 with the SEC.
Current report
Our common stock began trading under its current trading symbol (“ATXI”) on the OTC Markets system effective upon the open of the markets on March 19, 2025. We plan to continue to file our required periodic reports and other filings with the SEC. We can provide no assurance that our common stock will continue to trade on this market, whether broker-dealers will continue to provide public quotes of our common stock on this market, or whether the trading volume of our common stock will be sufficient to provide for an efficient trading market for existing and potential holders of our common stock.
Current report
On April 24, 2025 (the "AnnJi Termination Effective Date"), we and AnnJi entered into a License Termination and Program Transfer Agreement (the “Termination and Transfer Agreement”), pursuant to which: (i) the AnnJi License Agreement (as well as the Subscription Agreement and the Registration Rights Agreement entered into in connection therewith) was terminated with immediate effect; (ii) the parties dismissed all pending dispute resolution proceedings between them and provided mutual releases of claims; (iii) we transferred to AnnJi all of our rights, title and interest to and under the assets arising under the AnnJi License Agreement and otherwise related to AJ201 and (iv) we agreed not to, for 48 months following the date of the Termination and Transfer Agreement, develop, commercialize, manufacture or sell any product competing with AJ201 in the US, Canada, the European Union, Great Britain or Israel. Under the Termination and Transfer Agreement, we will repurchase, for an aggregate payment of $1.00, all 14,777 shares of our common stock that are held by AnnJi, and we also made a payment of $0.2 million to AnnJi as consideration for legal expenses.
Current report
AnnJi agreed to make payments to us of $2.0 million, with $1.0 million due within 30 days after the AnnJi Termination Effective Date and $1 million due within 90 days after the AnnJi Termination Effective Date. Additionally, we will be eligible to receive from AnnJi:
Current report
We do not currently have any plans to initiate the study, unless we obtain financing for this purpose.
Current report
We are currently exploring strategic alternatives for Baergic and/or BAER-101, which may involve engaging a development or licensing partner or a sale, license, divestiture of Baergic and/or BAER-101, or we may initiate a Phase 2a study for the program if we receive additional financing.
Current report
Interest income was $32,000 and $49,000 for the three months ended March 31, 2025 and 2024, respectively.
Current report
Contractual Obligations
Current report
We enter into contracts in the normal course of business with licensors, CROs, contract manufacturing organizations (CMOs) and other third parties for the procurement of various products and services, including without limitation biopharmaceutical development, biologic assay development, commercialization, clinical and preclinical development, clinical trials management, pharmacovigilance and manufacturing and supply. These contracts typically do not contain minimum purchase commitments (although they may) and are generally terminable by us upon written notice. Payments due upon termination or cancelation/delay consist of payments for services provided or expenses incurred, including non-cancelable obligations of our service providers, up to the date of cancellation; in certain cases, our contractual arrangements with CROs and CMOs include cancelation and/or delay fees and penalties.
Current report
We have obligations under various license agreements to make future payments to third parties that become due and payable on the achievement of certain development, regulatory, and commercial milestones (such as clinical trial development, product approval by the FDA or other regulatory agencies, product launch, or product sales). These commitments include:
Current report
Our subsidiary, Baergic, has entered into two license agreements with: (i) AstraZeneca AB to acquire an exclusive license to patent and related intellectual property rights pertaining to their proprietary compound and (ii) Cincinnati Children's Hospital Medical Center to acquire patent and related intellectual property rights pertaining to a program for neurological disorders. Development milestones totaling up to approximately $81.5 million in the aggregate are due upon achievement of such milestones, and commercial and sales-based milestone payments totaling up to approximately $151.0 million may be payable. Royalties are payable on net sales of products covered by the licensed intellectual property in the low to high single digits.
Current report
We entered into a license agreement with Revogenex, pursuant to which we received a worldwide exclusive license to make, market and sell IV tramadol. A regulatory milestone of $3.0 million is payable on approval high single-digit to low double-digit royalties are payable on net sales.
Current report
We entered into a share repurchase agreement with InvaGen, which requires us to pay InvaGen seven and a half (7.5%) of the proceeds of future financings, as defined in the agreement, up to $4 million in aggregate. For the three months ended March 31, 2025 and 2024, we have paid $0.2 million and $0.3 million, respectively, towards this aggregate amount. Approximately $1.4 million in aggregate has been paid to InvaGen under the Share Repurchase Agreement through the three months ended March, 31, 2025.
Removed paragraphs (16)
Previous report
The license provided under the AnnJi License Agreement is exclusive as to all oral forms of AJ201 for use in all indications (other than androgenetic alopecia and Alzheimer’s disease) in the United States, Canada, the European Union, the United Kingdom and Israel. The AnnJi License Agreement also contains customary representations and warranties and provisions related to confidentiality, diligence, indemnification and intellectual property protection. The Company is initially obligated to obtain both clinical and commercial supply of AJ201 exclusively through AnnJi.
Previous report
The 12-week, multicenter, randomized, double-blind trial enrolled 25 patients, randomly assigned to AJ201 (600mg/day) or placebo. The primary endpoint of the study is to assess safety and tolerability of AJ201 in subjects with clinically and genetically defined SBMA. Secondary endpoints include pharmacodynamic data measuring change from baseline in mutant androgen receptor protein levels in skeletal muscle and changes in the fat and muscle composition as seen on MRI scans. Further details on the study can be found using the ClinicalTrials.gov identifier NCT05517603. Information on clinicaltrials.gov does not constitute part of this Quarterly Report on Form 10-Q.
Previous report
In May 2024, we announced last patient last visit in the Phase 1b/2a trial and anticipate top-line data readout around year-end 2024.
Previous report
We plan to initiate the study as soon as possible, subject to having the necessary financing.
Previous report
Interest income was $51,000 and $9,000 for the three months ended September 30, 2024 and 2023, respectively.
Previous report
Comparison of the Nine Months Ended September 30, 2024 and 2023
Previous report
Research and Development Expenses
Previous report
For the nine months ended September 30, 2024 and 2023, research and development expenses were $6.1 million and $5.1 million, respectively. The increase of $1.0 million is primarily associated with a $1.0 million increase in pre-clinical and clinical development costs.
Previous report
For the nine months ended September 30, 2023, research and development - licenses acquired expenses were $4.2 million related to the AJ201 license acquisition, with no comparable expense in 2024.
Previous report
General and Administrative Expenses
Previous report
For the nine months ended September 30, 2024 and 2023, general and administrative expenses were $3.6 million and $3.0 million, respectively. The increase of $0.6 million is primarily related to an increase of $0.5 million in payments to InvaGen, and $0.1 million in common stock issued to Fortress.
Previous report
Interest Income
Previous report
Interest income was $0.2 million and $0.1 million for the nine months ended September 30, 2024 and 2023, respectively.
Previous report
Investing Activities
Previous report
Net cash and cash equivalents used in investing activities was $0.0 for the nine months ended September 30, 2024 and was $3.0 million for the nine months ended September 30, 2023, primarily comprised of the $3.0 million AJ201 license payment.
Previous report
Net cash and cash equivalents provided by financing activities was $3.6 million for the nine months ended September 30, 2023, primarily comprised of $3.1 million from the registered direct and private placement offerings in January 2023, and $0.6 million from the private placement offering in September 2023, partially offset by $0.1 million of expenses related to the public offering in November 2023.
Reworded paragraphs (17)
Previous wording
Avenue Therapeutics, Inc. (“Avenue” or the “Company”) is a specialty pharmaceutical company focused on the development and commercialization of therapies for the treatment of neurologic diseases. Our product candidates include AJ201 for the treatment of spinal and bulbar muscular atrophy ("SBMA", also known as Kennedy's Disease), an intravenous formulation of tramadol ("IV tramadol"), a schedule IV opioid for the treatment of post-operative acute pain, and BAER-101 for the treatment of epilepsy and panic disorders. We may in the future acquire additional product candidates.
Current wording
Avenue Therapeutics, Inc. (“Avenue” or the “Company”) is a specialty pharmaceutical company focused on the development and commercialization of therapies for the treatment of neurologic diseases. Our product candidates include an intravenous formulation of tramadol ("IV tramadol"), a schedule IV opioid for the treatment of post-operative acute pain, and BAER-101 for the treatment of epilepsy and panic disorders. We may in the future acquire additional product candidates.
Previous wording
Our net loss for the nine months ended September 30, 2024 and 2023 was approximately $10.1 million and $11.1 million, respectively. As of September 30, 2024, we had an accumulated deficit of approximately $101.0 million. Substantially all our net losses resulted from costs incurred for research and development, and general and administrative purposes.
Current wording
Our net loss for the three months ended March 31, 2025 and 2024 was approximately $1.9 million and $4.3 million, respectively. As of March 31, 2025, we had an accumulated deficit of approximately $104.4 million. Substantially all our net losses resulted from costs incurred for research and development, and general and administrative purposes.
Previous wording
Under the AnnJi License Agreement, in exchange for exclusive rights to the intellectual property underlying the AJ201 product candidate, the Company paid an initial cash license fee of $3.0 million. The Company issued shares of its common stock and is obligated to make additional payments over the course of the AnnJi License Agreement including reimbursement payments of up to $10.8 million in connection with the product’s Phase 1b/2a clinical trial.
Current wording
Under the AnnJi License Agreement, in exchange for exclusive rights to the intellectual property underlying the AJ201 product candidate, the Company paid an initial cash license fee of $3.0 million. The Company issued shares of its common stock and was obligated to make additional payments over the course of the AnnJi License Agreement including reimbursement payments of up to $10.8 million in connection with the product’s Phase 1b/2a clinical trial.
Previous wording
We participated in a Type C meeting with the FDA in March 2023 to discuss a proposed study protocol to assess the risk of respiratory depression related to opioid stacking on IV tramadol relative to an approved opioid analgesic. We announced in April 2023 that we received official meeting minutes from the Type C meeting with the FDA. The Type C meeting minutes indicate that we are in agreement with the FDA on a majority of the proposed protocol items and are in active discussion about remaining open items. The minutes indicate that the FDA also agrees that a successful study will support the submission of a complete response to the second Complete Response Letter for IV tramadol pending final agreement on a statistical analysis plan and a full review of the submitted data in the complete response as well as concurrence from the DAAAP.
Current wording
We participated in a Type C meeting with the FDA in March 2023 to discuss a proposed study protocol to assess the risk of respiratory depression related to opioid stacking on IV tramadol relative to an approved opioid analgesic. We announced in April 2023 that we received official meeting minutes from the Type C meeting with the FDA. The Type C meeting minutes indicate that we are in agreement with the FDA on a majority of the proposed protocol items and are in active discussion about remaining open items. The minutes indicate that the FDA also agrees that a successful study will support the submission of a complete response to the second Complete Response Letter for IV tramadol pending final agreement on a statistical analysis plan and a full review of the submitted data in the complete response as well as concurrence from the FDA's Division of Anesthesia, Analgesia, and Addiction Products.
Previous wording
In August 2023, we reported preclinical data for BAER-101 from an in vivo evaluation in SynapCell’s Genetic Absence Epilepsy Rate from the Strasbourg (“GAERS”) model of absence epilepsy. The GAERS model mimics behavioral, electrophysiological and pharmacological features of human absence seizures and has shown to be an early informative indicator of efficacy in anti-seizure drug development. In the model, BAER-101 demonstrated full suppression of seizure activity with a minimal effective dose of 0.3 mg/kg administered orally. The data were subsequently presented at the American Epilepsy Society (“AES”) 2023 Annual Meeting in December 2023 and at the American Society for Experimental Neurotherapeutics (“ASENT”) 2024 Annual Meeting in March 2024. The data were also published inDrug Development Research in February 2024.
Current wording
In August 2023, we reported preclinical data for BAER-101 from an in vivo evaluation in SynapCell’s Genetic Absence Epilepsy Rat from the Strasbourg (“GAERS”) model of absence epilepsy. The GAERS model mimics behavioral, electrophysiological and pharmacological features of human absence seizures and has shown to be an early informative indicator of efficacy in anti-seizure drug development. In the model, BAER-101 demonstrated full suppression of seizure activity with a minimal effective dose of 0.3 mg/kg administered orally. The data were subsequently presented at the American Epilepsy Society 2023 Annual Meeting in December 2023 and at the American Society for Experimental Neurotherapeutics 2024 Annual Meeting in March 2024. The data were also published inDrug Development Research in February 2024.
Previous wording
At September 30, 2024, we had an accumulated deficit of $101.0 million. While we may in the future generate revenue from a variety of sources, including license fees, milestone payments, research and development payments in connection with strategic partnerships and/or product sales, our product candidate are still in development and may never be successfully developed or commercialized. Accordingly, we expect to continue to incur substantial losses from operations for the foreseeable future, and there can be no assurance that we will ever generate significant revenues.
Current wording
At March 31, 2025, we had an accumulated deficit of $104.4 million. While we may in the future generate revenue from a variety of sources, including license fees, milestone payments, research and development payments in connection with strategic partnerships and/or product sales, our product candidates are still in development and may never be successfully developed or commercialized. Accordingly, we expect to continue to incur substantial losses from operations for the foreseeable future, and there can be no assurance that we will ever generate significant revenues.
Previous wording
For the three months ended September 30, 2024 and 2023, research and development expenses were $2.3 million and $0.9 million, respectively. The increase of $1.4 million was associated with a $1.6 million increase in pre-clinical and clinical development costs, partially offset by a $0.2 million decrease in personnel-related costs, including salaries, benefits, and stock-based compensation.
Current wording
For the three months ended March 31, 2025 and 2024, research and development expenses were $0.4 million and $2.4 million, respectively. The decrease of $2.0 million was associated with a $1.9 million decrease in pre-clinical and clinical development costs for AJ201, prior to its sale to AnnJi, and $0.1 million in IV tramadol supply costs.
Previous wording
We expect our research and development activities to continue as we attempt to gain regulatory approval for our existing product candidates, reflecting costs associated with the following:
Current wording
We expect our research and development activities to decrease due to no further development obligations for AJ201, however we will continue to develop and attempt to gain regulatory approval for our existing product candidates, reflecting costs associated with the following:
Previous wording
General and administrative expenses consist principally of professional fees for legal and consulting services, market research, personnel-related costs, public reporting company related costs and other general operating expenses not otherwise included in research and development expenses. We expect our general and administrative costs to continue as we seek potential regulatory approval and commercialization of our product candidates.
Current wording
General and administrative expenses consist principally of professional fees for legal and consulting services, market research, personnel-related costs, public reporting company related costs and other general operating expenses not otherwise included in research and development expenses. We expect our general and administrative costs to continue as we seek potential regulatory approval and commercialization of our product candidates and explore strategic alternatives for our Baergic subsidiary.
Previous wording
For the three months ended September 30, 2024 and 2023, general and administrative expenses were $0.8 million and $1.2 million, respectively. The decrease of $0.4 million is related to a decrease of $0.3 million in personnel-related costs, including salaries, benefits, and stock-based compensation and $0.1 million in professional fees.
Current wording
For the three months ended March 31, 2025 and 2024, general and administrative expenses were $1.5 million and $1.3 million, respectively. The increase of $0.2 million is related to an increase of $0.4 million in legal expenses, partially offset by a decrease of $0.1 million in personnel-related costs, including salaries, benefits, and stock-based compensation and $0.1 million in professional fees.
Previous wording
The loss on common stock warrant liabilities was $0.8 million and $0 for the nine months ended September 30, 2024 and 2023, respectively. The new Series A common stock warrants, new Series B common stock warrants, new Series C common stock warrants and new Series D common stock warrants had a fair value of $0.8 million allocated to the liability classified warrants to purchase shares of our common stock originally issued in October 2022 and January 2023 at the time of issuance as a cost of inducement, which was recorded as a loss on settlement of common stock warrant liabilities.
Current wording
The loss on common stock warrant liabilities was $0 and $0.6 million for the three months ended March 31, 2025 and 2024, respectively. The January 2024 Series A Warrants and January 2024 Series B Warrants had a fair value of $0.6 million allocated to the January 2023 Warrants at the time of issuance as a cost of inducement, which was recorded as a loss on settlement of common stock warrant liabilities.
Previous wording
The change in fair value of warrant liabilities was a gain of $19 thousand and $2.6 million for the three months ended September 30, 2024 and 2023, respectively. Warrants to purchase common stock that are required to be classified as a liability are valued at fair market value at each reporting period. The change in the fair value of warrant liabilities was primarily due to the modification of the exercise price as part of a warrant inducement, the exercise of warrants classified as liabilities, and fluctuation in our stock price.
Current wording
The change in fair value of warrant liabilities was a gain of $15 thousand and a loss of $0.1 million for the three months ended March 31, 2025 and 2024, respectively. Warrants to purchase common stock that are required to be classified as a liability are valued at fair market value at each reporting period. The change in the fair value of warrant liabilities was primarily due to the modification of the exercise price as part of a warrant inducement, the exercise of warrants classified as liabilities, and fluctuation in our stock price.
Previous wording
At September 30, 2024, we had $2.6 million in cash and cash equivalents. To date, we have funded our operations primarily with proceeds from various public and private offerings of our common stock. We expect that our expenses will increase substantially for the foreseeable future as we continue to execute on our product development plan and seek opportunities to license or acquire additional products. We will require additional financing to carry out our business plan and implement our strategy, and continue to analyze various alternatives, including potentially obtaining lines of credit, debt or equity financings, including through at-the-market program offerings, or other arrangements. We cannot be sure that any additional funding, if needed, will be available on terms favorable to us or at all. If we obtain funding through a strategic collaboration or licensing arrangement, we may be required to relinquish our rights to our product candidates or marketing territories. Without additional capital, we do not expect our cash will be sufficient to fund our projected operating requirements or allow us to fund our operating plan past the first half of 2025. We regularly evaluate market conditions, our liquidity profile, and various financing alternatives for opportunities to enhance our capital structure.
Current wording
At March 31, 2025, we had $3.5 million in cash and cash equivalents. To date, we have funded our operations primarily with proceeds from various public and private offerings of our common stock. We expect that our expenses will continue for the foreseeable future as we continue to advance our candidates through clinical development and ultimately regulatory approval, and seek opportunities to license or acquire additional products. We will require additional financing to carry out our business plan and implement our strategy, and continue to analyze various alternatives, including potentially obtaining lines of credit, debt or equity financings. We cannot be sure that any additional funding, if needed, will be available on terms favorable to us or at all. If we obtain funding through a strategic collaboration or licensing arrangement, we may be required to relinquish our rights to our product candidates or marketing territories. Without additional capital, we do not expect our cash will be sufficient to fund our projected operating requirements or allow us to fund our operating plan for more than 12 months from the date of issuance of the accompanying unaudited condensed consolidated financial statements. We regularly evaluate market conditions, our liquidity profile, and various financing alternatives for opportunities to enhance our capital structure.
Previous wording
Cash Flows for the Nine Months Ended September 30, 2024 and 2023
Current wording
Cash Flows for the Three Months Ended March 31, 2025 and 2024
Previous wording
Net cash and cash equivalents used in operating activities was $7.1 million for the nine months ended September 30, 2023, primarily comprised of our $11.1 million net loss and $1.5 million change in fair value of warrant liability, partially offset by the $3.0 million AJ201 license payment, an increase in operating assets and liabilities of $0.6 million, $0.6 million in share-based compensation, $1.2 million in stock issuance for licenses acquired and $0.1 million common share issuance to Fortress.
Current wording
Net cash and cash equivalents used in operating activities was $1.2 million for the three months ended March 31, 2025, primarily comprised of our $1.9 million net loss, partially offset by $0.2 million in share-based compensation, $0.1 million for common shares issued to Fortress and an increase of $0.4 million in operating assets and liabilities.
Previous wording
Net cash and cash equivalents used in operating activities was $8.3 million for the nine months ended September 30, 2024, primarily comprised of our $10.1 million net loss, $0.4 million reduction in common shares issuable to Fortress and $0.2 million change in fair value of warrant liabilities, partially offset by a $0.8 million loss on settlement of common stock warrant liabilities, an increase of $0.4 million in operating assets and liabilities, $0.5 million for common shares issued to Fortress and $0.7 million in share-based compensation.
Current wording
Net cash and cash equivalents used in operating activities was $3.1 million for the three months ended March 31, 2024, primarily comprised of our $4.3 million net loss and $0.4 million reduction in common share issuable to Fortress, partially offset by a $0.6 million loss on settlement of common stock warrant liabilities, an increase of $0.3 million in operating assets and liabilities, $0.4 million for shares issued to Fortress, $0.1 million change in fair value of warrant liabilities and $0.2 million in share-based compensation.
Previous wording
Net cash and cash equivalents provided by financing activities was $9.1 million for the nine months ended September 30, 2024, primarily due to $8.2 million in net proceeds from the inducement offer letter agreements we entered into in January 2024 and April 2024 and $0.9 million in net proceeds received from the sale of common stock pursuant to the At the Market Offering Agreement we entered into with H.C. Wainwright & Co. in May 2024.
Current wording
Net cash and cash equivalents provided by financing activities was $2.1 million for the three months ended March 31, 2025, primarily due to $2.1 million in net proceeds received from the sale of common stock pursuant to the At the Market Offering Agreement.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Net cash and cash equivalents provided by financing activities was $4.5 million for the three months ended March 31, 2024, primarily comprised of $4.5 million in net proceeds from the January 2024 Warrant Inducement.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
Research and development expenses primarily consist of personnel related expenses, including salaries, benefits, travel, and other related expenses, stock-based compensation, payments made to third parties for license and milestone costs related to in-licensed products and technology, payments made to third party contract research organizations for preclinical and clinical studies, investigative sites for clinical trials, consultants, the cost of acquiring and manufacturing clinical trial materials, costs associated with pre-commercialization validation manufacturing, costs associated with regulatory filings, laboratory costs and other supplies.
Previous report — wording carried elsewhere
General and administrative expenses consist principally of professional fees for legal and consulting services, market research, personnel-related costs, public reporting company related costs and other general operating expenses not otherwise included in research and development expenses. We expect our general and administrative costs to continue as we seek potential regulatory approval and commercialization of our product candidates.
Previous report — wording carried elsewhere
Change in Fair Value of Warrant Liabilities
Previous report — wording carried elsewhere
The change in fair value of warrant liabilities was a gain of $0.2 million and $1.5 million for the nine months ended September 30, 2024 and 2023, respectively. Warrants to purchase common stock that are required to be classified as a liability are valued at fair market value at each reporting period. The change in the fair value of warrant liabilities was primarily due to the modification of the exercise price as part of a warrant inducement, the exercise of warrants classified as liabilities, and fluctuation in our stock price.