ARTELO BIOSCIENCES, INC.
For the period ended Jun 30, 2025. Filed Aug 13, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 13, 2025
ARTL$1.91-9.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-13.
0001640334-25-000825
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-13.
0001640334-25-001429
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 64 previous paragraphs and 91 current paragraphs.
39 unchanged; 14 reworded; 37 added; 11 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 5 previous and 8 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 (37)
Current report
Recent Developments
Current report
Digital Asset Treasury Strategy — Solana (SOL)
Current report
Since June 2025, we have entered into two private placement transactions that expressly require the purchase of Solana’s native token, SOL. Under the June 2025 private placement offering, we committed to use $250,000 of consideration received in connection with a private placement of equity securities to acquire SOL. Under the August 2025 private placement offering, we committed to apply the net cash proceeds of that $9.4 million offering to purchase additional SOL. To date, these two private placement offering-related resolutions, together with the related delegation of authority to management to execute the purchases, constitute the full extent of Board authorization with respect to digital-asset activity. No comprehensive digital-asset treasury policy has yet been adopted, and no authorization has been given to stake, lend, pledge, rehypothecate, or otherwise deploy our SOL for yield. Management plans to prepare a fulsome policy for future Board consideration; any expansion of the strategy (including, without limitation, staking or other yield-generating uses) will be presented to, and will require the express approval of, the Board before implementation.
Current report
Current Parameters (as approved through the date of this filing)
Current report
Potential Future Enhancements (subject to separate Board approval)
Current report
We are evaluating, and may present for Board consideration and approval, additional treasury initiatives that could include: (i) staking SOL directly or via delegation to earn protocol rewards; (ii) potentially further diversifying custody across multiple qualified custodians in addition to CUBE and BitGo; (iii) using SOL as collateral for non-recourse financing; and (iv) other permissible yield-generating strategies consistent with applicable law. No such activities will commence unless and until specifically authorized by the Board.
Current report
Description of Solana (SOL) and Rationale for Acquisition
Current report
SOL is the native digital asset of the Solana blockchain, an open-source, high-performance blockchain designed for speed and scalability. Solana employs a unique hybrid consensus mechanism that combines proof-of-history (PoH) with proof-of-stake (PoS), enabling high throughput and low transaction costs. SOL is primarily used to pay transaction fees (as the network's “gas” token) and as a means of staking to support the network’s consensus and security, with validators and delegators earning rewards for their participation.
Current report
The Solana blockchain supports a wide range of decentralized applications (dApps), including decentralized finance (DeFi) protocols, non-fungible token (NFT) marketplaces, and other Web3 projects. As of the date of this filing, Solana has a robust and growing ecosystem, with significant developer activity and adoption across multiple sectors.
Current report
From a tokenomics perspective, Solana was launched with an initial supply of 500 million SOL, with new tokens created through inflationary rewards distributed to validators and delegators. The inflation rate is designed to decrease over time, providing a long-term supply schedule that supports both network security and economic sustainability.
Current report
The Board determined that acquiring SOL as a treasury asset is supported by several factors: (i) exposure to SOL offers potential long-term appreciation and may help preserve the purchasing power of our excess liquidity; (ii) SOL is highly liquid relative to many other digital assets, with deep spot markets on multiple U.S.-regulated trading venues; (iii) the Solana ecosystem continues to expand, particularly in DeFi, NFT infrastructure, and other Web3 use cases, which may drive further demand and utility for SOL. The Board also considered the technical maturity of the Solana network, its institutional-grade custody solutions, and the optionality for future yield generation through staking, subject to further Board approval.
Current report
Governance and Controls
Current report
At present, our digital asset activity is limited to converting USD into SOL within our accounts at BitGo and CUBE, U.S.-regulated, qualified digital-asset custodians. We have not yet adopted formal internal controls or protocols governing the movement or custody of SOL beyond the standard procedures provided by BitGo and CUBE. No SOL has been transferred out of BitGo or CUBE custody to date, and we do not self-custody any digital assets. We are in the process of developing and implementing additional internal controls and protocols to govern the movement, authorization, and custody of SOL, which we expect to present to the Board for review and approval.
Current report
A written transaction record is maintained for every SOL purchase or custodial movement and is reconciled daily to custodial statements. Digital-asset treasury disclosures (including this description) will be included in our annual and quarterly reports on Forms 10-K and 10-Q, so that the full Board, the Audit Committee, and outside auditors and advisors can review and comment prior to filing.
Current report
Advisory and Technical Support
Current report
To supplement internal resources, we have engaged a consulting firm as a strategic advisor for digital-asset treasury matters. The advisor is expected to review and comment on draft policy materials and external disclosures.
Current report
In addition, we benefit from the technical expertise and support of CUBE, one of our digital-asset custodians. CUBE provides ongoing technical guidance and operational support in connection with our digital asset custody and treasury management. CUBE’s involvement ensures that our custody arrangements and related protocols reflect current best practices in digital asset security, compliance, and risk management.
Current report
Together, these advisory relationships help ensure that our digital asset treasury strategy is informed by up-to-date industry knowledge and that our internal policies and disclosures are robust, accurate, and aligned with evolving regulatory and technical standards.
Current report
Risk Management Considerations
Current report
We recognize that SOL is volatile, that the regulatory landscape remains unsettled, and that custodial, cybersecurity, market-liquidity, tax, and accounting risks could materially impact our results of operations. These risks, along with continued compliance with Nasdaq listing standards, will be reassessed at each Board meeting and re-evaluated before any expansion of the strategy. See “Risk Factors – Risks relating to SOL” for a description of the material risks that apply to our holdings of SOL.
Current report
Forward Look
Current report
We will continue to update and implement our Digital Asset Treasury (or “DAT”) strategy, incorporating the parameters above, feedback from our technical and strategic advisors, and any additional safeguards as needed. Until additional capital resources are secured and/or a comprehensive DAT policy is adopted, especially related to staking SOL, our authority is limited to fulfilling the current private placement offering-related SOL purchase obligations described in this report.
Current report
Key Trends and Factors Affecting Comparability Between Periods
Current report
Six months ended June 30, 2025, compared to the six months ended June 30, 2024
Current report
Our operating expenses for the six months ended June 30, 2025, were $5.5 million compared to $5.1 million for the same period in 2024. The increase in operating expenses for the six months ended June 30, 2025, was primarily the result of increases in professional fees associated with our capital raising efforts and increases in research and development expenditures related to our clinical programs. Offsetting the increased research and development expenditures were tax credits of $704 received from the UK Government during the current period compared to the credits in the prior year which were received subsequent to June 30, 2024.
Current report
On May 1, 2025, we issued at-market, unsecured convertible notes with gross proceeds of $900. The convertible notes bear interest at 12.0% and have a maturity of 180 days. The convertible notes are subject to voluntary and automatic provisions for conversion into our common stock, as well as conversion into warrants to purchase our common stock for a five-year period at a price of $6.24. Certain members of our board of directors, an officer and consultants to the Company acquired $350 of the convertible notes.
Current report
On June 24, 2025, we entered into a securities purchase agreement (the “Purchase Agreement”) with the purchasers named therein (the “Purchasers”), for the private placement (the “Private Placement”) of (i) 136,843 shares (the “Shares”) of tour common stock, par value $0.001 per share (the “Common Stock”), at $5.82 per share, (ii) pre-funded warrants to purchase 93,180 shares of Common Stock at an exercise price of $0.001 per Share (the “Pre-Funded Warrants”) at $5.819 per Pre-Funded Warrant, (iii) warrants to purchase 460,046 shares of Common Stock at an exercise price of $5.82 per share (the “$5.82 Warrants”), and (iv) warrants to purchase 230,023 shares of Common Stock at an exercise price of $10.00 per share (the “$10.00 Warrants”). The Pre-Funded Warrants, the $5.82 Warrants and the $10.00 Warrants are collectively referred to herein as the “Warrants” and the shares issuable upon such Warrants, the “Warrant Shares.” Gross proceeds were $1.4 million.
Current report
On July 18, 2025, we entered into an At-The-Market Offering Agreement (the “Sales Agreement”) with R.F. Lafferty & Co., Inc. (“R.F. Lafferty”) under which we may offer and sell up to $6.5 million of shares of our common stock from time to time through an “at the market” offering program under which R.F. Lafferty will act as sales agent. Under the Sales Agreement, we will set the parameters for the sale of shares, including the number or dollar amount of shares to be issued, the time period during which sales are requested to be made, limitations on the number or dollar amount of shares that may be sold in any one trading day and any minimum price below which sales may not be made. Subject to the terms and conditions of the Sales Agreement, R.F. Lafferty may sell the shares by methods deemed to be an “at the market” offering as defined in Rule 415 promulgated under the Securities Act of 1933, as amended. We have no obligation to sell any shares under the Sales Agreement and may at any time suspend solicitation and offers under the Sales Agreement. The shares will be issued pursuant to our shelf registration statement on Form S-3, including the prospectus supplement contained therein, which was declared effective by the SEC on July 14, 2023. As of August 11, 2025, 4,580 common stock shares have been sold under the ATM for net proceeds of $47,000.].
Current report
Long-Lived Assets
Current report
We evaluate long-lived assets, including indefinite life intangible assets and operating lease right-of-use (ROU) assets, for impairment whenever events or circumstances indicate that the carrying value of an asset or asset group may not be recoverable. We group assets at the lowest level for which cash flows are separately identified in order to measure an impairment. Events or circumstances that would result in an impairment review include a significant change in the use of an asset, the planned sale or disposal of an asset, or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset or asset group. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the asset to future undiscounted cash flows expected to be generated by the asset or asset group. If the asset or asset group is determined to be impaired, the impairment recognized is measured by the amount by which the carrying value of the asset or asset group exceeds its fair value.
Current report
Assumptions and estimates used to determine cash flows in the evaluation of impairment and fair values used to determine the impairment are subject to a degree of judgment and complexity. Any future changes to the assumptions and estimates resulting from changes in actual results or market conditions from those anticipated may affect the carrying value of long-lived assets and could result in additional impairment charges, and such changes could be material.
Current report
Accrued Clinical Trial and Research and Development Expenses
Current report
As part of the process of preparing our financial statements, we are required to estimate our accrued expenses as of each consolidated balance sheet date. This process involves reviewing open contracts and purchase orders, communicating with our personnel to identify services that have been performed on our behalf and estimating the level of service performed and the associated cost incurred for the service when we have not yet been invoiced or otherwise notified of the actual cost. We make estimates of our accrued expenses as of each consolidated balance sheet date based on facts and circumstances known to us at that time. We periodically confirm the accuracy of our estimates with the service providers and make adjustments, if necessary. The significant estimates in our accrued clinical trial and research and development expenses include the costs incurred for services performed by our vendors in connection with clinical trial and research and development activities for which we have not yet been invoiced.
Current report
We base our expenses related to clinical trial and research and development activities on our estimates of the services received and efforts expended pursuant to quotes and contracts with vendors that conduct clinical trials and research and development on our behalf. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows. There may be instances in which payments made to our vendors will exceed the level of services provided and result in a prepayment of the clinical trial and research and development expense. In accruing service fees, we estimate the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from our estimate, we adjust the accrual or prepaid expense accordingly. Advance payments for goods and services that will be used in future clinical trial or research and development activities are expensed when the activity has been performed or when the goods have been received rather than when the payment is made.
Current report
Although we do not expect our estimates to be materially different from amounts actually incurred, if our estimates of the status and timing of services performed differ from the actual status and timing of services performed, it could result in us reporting amounts that are too high or too low in any particular period. To date, there have been no material differences between our estimates of such expenses and the amounts actually incurred.
Current report
Stock-Based Compensation Expense
Current report
Stock-based compensation expense represents the cost of the grant date fair value of equity awards recognized over the requisite service period of the awards (usually the vesting period) on a straight-line basis. We estimate the fair value of equity awards using the Black-Scholes option pricing model and recognize forfeitures as they occur. Estimating the fair value of equity awards as of the grant date using valuation models, such as the Black-Scholes option pricing model, is affected by assumptions regarding a number of variables, including the risk-free interest rate, the expected stock price volatility, the expected term of stock options, the expected dividend yield and the fair value of the underlying common stock on the date of grant. Changes in the assumptions can materially affect the fair value and ultimately how much stock-based compensation expense is recognized. These inputs are subjective and generally require significant analysis and judgment to develop. See Note 6 to our unaudited consolidated financial statements included elsewhere in this Interim Report on Form 10-Q for information concerning certain of the specific assumptions we used in applying the Black-Scholes option pricing model to determine the estimated fair value of our stock options granted, if any, during the three months ended June 30, 2025, and 2024.
Removed paragraphs (11)
Previous report
Our lead FABP5 inhibitor program is designated ART26.12. Preclinical research with ART26.12 showed evidence of activity in multiple pain models including osteoarthritis, cancer bone pain, and neuropathic pain. Based upon positive preclinical evidence from five separate studies showing promising activity and a differentiated mechanism-of-action for the prevention and treatment of painful neuropathies, including diabetic neuropathy and Chemotherapy Induced Peripheral Neuropathy (“CIPN”), we prioritized CIPN as the initial indication for development of ART26.12. Treatment and/or prevention of CIPN is a significant unmet need, often resulting in anti-cancer treatment delays or discontinuations, and there are currently no approved treatments for CIPN by the regulatory authorities in the U.S., UK or EU. We submitted an IND application for ART26.12 to the FDA on 10th of June 2024 and received a study may proceed notice from the FDA on the 8th of July 2024. First-in-human studies for ART26.12 began in Q4 of 2024 and we successfully completed dosing all 48 healthy volunteers planned for the Phase 1 Single Ascending Dose study at the end of April 2025. In addition to its potential as a synthetic endocannabinoid modulator with development targeting pain, inflammation, dermatologic conditions such as psoriasis, FABP5 is understood to play an important role in lipid signaling and is believed to be an attractive strategy for drug development in oncology. Large amounts of human biomarker and animal model data support FABP5 as an oncology target, including triple negative breast cancer, ovarian cancer, cervical cancer, and castration-resistant prostate cancer. Through our sponsored research we have also subsequently identified a potential role for FABP5 inhibition to treat anxiety disorders, such as Post Traumatic Stress Disorder (“PTSD”). We have been awarded a research grant in Canada to expand on our earlier research at the University of Western Ontario in this new development area.
Previous report
In addition to our in-licensed programs, we have internal discovery research initiatives which resulted in ART12.11, a proprietary cocrystal composition of CBD and TMP. The crystal structure of CBD is known to exhibit solid polymorphism, or the ability to manifest in different forms. Polymorphism can adversely affect stability, dissolution, and bioavailability of a drug product and thus may affect its quality, safety, and efficacy. Based upon our research, we believe our CBD cocrystal exists as a single crystal form and as such is anticipated to have advantages over other solid forms of CBD that exhibit polymorphism. Emerging data demonstrates potential advantages of this single crystal structure, including improved stability, solubility, and a more consistent absorption profile. We believe these features have contributed to a more consistent and improved bioavailability and pharmacokinetic profile which may ultimately lead to improved safety and efficacy in human therapeutics, as already demonstrated in animal studies.
Previous report
Presently, we have two U.S. patents, one pending U.S. patent application, six foreign patents (Australia, Brazil, China, Mexico, Japan and Taiwan) and three pending foreign patent applications (Canada, Europe, and South Korea) directed to our cocrystal composition of CBD. Composition claims are generally known in the pharmaceutical industry as the most desired type of intellectual property and should provide for long lasting market exclusivity for our synthetic CBD cocrystal drug product candidate. In addition, due to the reasons outlined above, we believe that our synthetic CBD cocrystal will continue to demonstrate a superior set of pharmaceutical properties compared to non-cocrystal CBD compositions. We plan to develop ART12.11 for multiple potential indications where CBD has shown activity of such anxiety disorders, including PTSD, depression, and other possible uses such as epilepsy and insomnia.
Previous report
Product Candidate Pipeline:
Previous report
Emerging science suggests that modulating lipid-signaling pathways can unlock novel therapeutic strategies for diseases and medical conditions for which there are no or limited options. Lipids are critical to certain cell signaling pathways. Lipid-signaling modulation is the alteration of the signaling of lipid molecules to change biological activity or function within cellular communication pathways. Lipids contain various fatty acids as their building blocks and are the key components of lipid activity. Fatty Acid Binding Proteins (FABPs) facilitate lipid-signaling by binding to fatty acids which control various cellular functions. FABPs are essential mediators of normal cell signaling processes and under certain conditions can be associated with dysfunctional signaling. Inhibition of specific FABPs may correct abnormal lipid-signaling or improve the function of the ECS, which holds promise as new treatment modalities. We are at the forefront of advancing the application of lipid-modulating therapeutics.
Previous report
The ECS is composed of cannabinoid receptors, endogenous receptor ligands (“endocannabinoids”) and their associated transporter mechanisms, as well as enzymes responsible for the synthesis and degradation of endocannabinoids and has emerged as a considerable target for pharmacotherapy approaches of numerous human diseases. As a widespread modulatory and lipid-signaling system, the ECS plays important roles in the CNS, development, synaptic plasticity, and the response to endogenous and environmental factors.
Previous report
The modulation of the ECS can be affected by using selective or non-selective agonists, partial agonists, inverse agonists, and antagonists of the cannabinoid receptors, CB 1 and CB 2. The CB 1 receptor is distributed in brain areas associated with motor control, emotional responses, motivated behavior and energy homeostasis. In the periphery, CB 1 is ubiquitously expressed in the adipose tissue, pancreas, liver, gastrointestinal tract, skeletal muscles, heart and the reproductive system. The CB 2 receptor is mainly expressed in the immune system regulating its functions and is upregulated in response to tissue stress or damage in most cell types. The ECS is therefore involved in pathophysiological conditions in both the central and peripheral tissues.
Previous report
The actions of endogenous ligands can be enhanced or attenuated by targeting mechanisms that are associated with their transport within the cellular and extra cellular matrix as well as their synthesis and breakdown. Small molecule chemical modulators of the ECS can be derived from plants (phytocannabinoids), can be semi-synthetic derivatives of phytocannabinoids or endocannabinoids, or can be completely synthetic new chemical entities. We plan to develop approaches within our portfolio that address receptor binding and endocannabinoid transport modulation using only synthetic new chemical entities. Future approaches may also involve targeting synthesis or breakdown enzymes.
Previous report
ECS targeting cannabinoid-based medicines are already approved and used to treat numerous medical conditions. The ECS is further implicated in many disease states within the peer reviewed literature including conditions which involve the regulation of food intake, central nervous system, pain, cardiovascular, gastrointestinal, immune and inflammation, behavioral, antiproliferative and reproductive functions. These areas of ECS pathophysiology are aligned with our therapeutic areas of focus: anxiety, pain, inflammation, anorexia, and cancer.
Previous report
Business Strategy
Previous report
Our objective is to develop and commercialize ethical pharmaceutical products that provide physicians access to the therapeutic potential of lipid signaling modulation, including within the ECS. We intend to pursue technologies and compounds that offer promising therapeutic approaches to known and validated signaling pathways, specifically lipid-signaling which includes compounds that promote the effectiveness of the ECS. While several of our programs are directed towards improving the lives of people suffering with cancer and cancer treatments, our portfolio may ultimately be used to treat a wide range of diseases and conditions where lipid-signaling modulation is particularly promising, including pain, inflammation, various neurological diseases, epilepsy, anxiety disorders, and dermatologic conditions.
Reworded paragraphs (14)
Previous wording
We incorporated in the State of Nevada on May 2, 2011, and are presently based in the County of San Diego, California. We are a clinical stage biopharmaceutical company focused on the development and commercialization of therapeutics that target lipid-signaling modulation pathways, including the endocannabinoid system (the “ECS”), a network of receptors and neurotransmitters that form a biochemical communication system throughout the body.
Current wording
We are a clinical stage biopharmaceutical company focused on the development and commercialization of therapeutics that target lipid-signaling modulation pathways, including the endocannabinoid system (the “ECS”), a network of receptors and neurotransmitters that form a biochemical communication system throughout the body.
Previous wording
Our second program, ART26.12 is a small molecule and the lead product candidate from our chemical library of inhibitors of fatty acid binding proteins, notably Fatty Acid Binding Protein 5 (“FABP5”). We received U.S. Food & Drug Administration (the “FDA”) clearance for our Investigational New Drug (“IND”) application for ART26.12 in July 2024 and have completed enrolment to a Phase 1 clinical trial in healthy subjects to support the development towards an agent intended to treat chemotherapy-induced peripheral neuropathy. In addition, ART26.12 may have broad applications as a cancer therapeutic, as a treatment for dermatologic conditions, such as psoriasis, as a treatment for pain and inflammation, and potential use in anxiety-related disorders, including post-traumatic stress disorder.
Current wording
Our second program, ART26.12 is a small molecule and the lead product candidate from our chemical library of inhibitors of fatty acid binding proteins, notably Fatty Acid Binding Protein 5 (“FABP5”). We received U.S. Food & Drug Administration (the “FDA”) clearance for our Investigational New Drug (“IND”) application for ART26.12 in July 2024 and have completed enrollment to a Phase 1 clinical trial in healthy subjects to support the development towards an agent intended to treat chemotherapy-induced peripheral neuropathy. In addition, ART26.12 may have broad applications as a cancer therapeutic, as a treatment for dermatologic conditions, such as psoriasis, as a treatment for pain and inflammation, and potential use in anxiety-related disorders, including post-traumatic stress disorder.
Previous wording
We obtained two of our patent protected product candidates through our in-licensing activities. Our first in-licensed program, ART27.13, is being developed for cancer-related anorexia. ART27.13 is a peripherally-selective high-potency dual CB 1 and CB 2 full-receptor agonist, which was originally invented at AstraZeneca plc (“AstraZeneca”). We exercised our option to exclusively license this product candidate through the NEOMED Institute (“NEOMED”), a Canadian not-for-profit corporation, renamed adMare Bioinnovations (“adMare”) in June 2019, which had obtained rights to ART27.13 from AstraZeneca. In Phase 1, single dose studies in healthy volunteers and a multiple ascending dose study in individuals with chronic low back pain conducted by AstraZeneca, ART27.13 exhibited an attractive pharmacokinetic and absorption, distribution, metabolism, and excretion profile and was well tolerated within the target exposure range. It also exhibited dose-dependent and potentially clinically meaningful increases in body weight. Importantly, the changes in body weight were not associated with fluid retention or other adverse effects and occurred at exposures without central nervous system (“CNS”) side effects. Discussions with United Kingdom (“UK”), U.S. and Canadian regulators indicate there is a potential pathway for development of ART27.13 for the treatment of cancer-related anorexia, which affects approximately 60% of advanced stage cancer patients.
Current wording
We obtained two of our patent protected product candidates through our in-licensing activities. Our first in-licensed program, ART27.13, is being developed for cancer-related anorexia. ART27.13 is a peripherally-selective high-potency dual CB 1 and CB 2 full-receptor agonist, which was originally invented at AstraZeneca plc (“AstraZeneca”). We exercised our option to exclusively license this product candidate through the NEOMED Institute (“NEOMED”), a Canadian not-for-profit corporation, renamed adMare Bioinnovations (“adMare”) in June 2019, which had obtained rights to ART27.13 from AstraZeneca.
Previous wording
We commenced enrollment and dosed the first patient in CAReS, our Phase 1b/2a clinical study of cancer-related anorexia with ART27.13 in April 2021, and completed enrolling patients in the Phase 1b during the first quarter 2023. Data from the Phase 1b stage was used to determine the most effective and safe dose selected as the starting dose for the Phase 2a portion of CAReS. We received approval from the regulatory authorities in the UK, Ireland and Norway to increase the daily dose from the starting dose of 650 micrograms to 1,000 micrograms after 4 weeks and up to 1,300 micrograms initiated at 8 weeks in patients for whom intra-patient dose escalation is expected to be well tolerated. We also received approval from the regulatory authorities to enroll 40 evaluable patients into the Phase 2a stage with a 3:1 randomization of ART27.13 to placebo. We initiated the Phase 2a portion of CAReS during April 2023. As of May 6, 2025, 18 clinical sites across five countries are open and enrollment of approximately 40 participants is projected during the first half of 2025.
Current wording
We commenced enrollment and dosed the first patient in CAReS, our Phase 1b/2a clinical study of cancer-related anorexia with ART27.13, in April 2021 and completed enrolling patients in the Phase 1b during the first quarter of 2023. We initiated the Phase 2a portion of CAReS during April 2023. As of June 20, 2025, 15 clinical sites across five countries were open to enrollment. We are on track to report initial data from the Phase 2 CAReS study of ART27.13, its peripherally acting cannabinoid receptor agonist, in Q3 2025.
Previous wording
Our second in-licensed patented program is being advanced from our platform of small-molecule inhibitors of fatty acid binding proteins, notably FABP5. Fatty acid binding proteins (“FABPs”) are attractive therapeutic targets, however, the high degree of sequence and structural similarities among family members made the creation of drugs targeting specific FABPs challenging. FABP5 is believed to specifically target and regulate one of the body’s endogenous cannabinoids, anandamide (“AEA”). While searching for a FABP5 inhibitor to regulate AEA, researchers at Stony Brook University (“SBU”) discovered the chemistry for creating a large library of compounds which we believe to be highly specific and potent small molecule inhibitors of FABP5 and other isoforms. SBU had received approximately $8.0 million in funding from the National Institutes of Health to develop FABP5 inhibitor candidates including a $4.2 million grant in 2020 to advance research of FABP5 inhibition in prostate cancer. We licensed the rights to world-wide intellectual property in all fields and certain know-how to these inhibitors from SBU.
Current wording
Our second in-licensed patented program is being advanced from our platform of small-molecule inhibitors of fatty acid binding proteins, notably FABP5. FABP5 is believed to specifically target and regulate one of the body’s endogenous cannabinoids, anandamide (“AEA”). We licensed the rights to world-wide intellectual property in all fields and certain know-how to these inhibitors from Stony Brook University (“SBU”).
Previous wording
Our operating expenses for the three months ended March 31, 2025, were $2.4 million compared to $2.6 million for the same period in 2024. The decrease in operating expenses for the three months ended March 31, 2025, was primarily the result of decreased corporate and research and development activity as a result of our cash preservation actions.
Current wording
Our operating expenses for the three months ended June 30, 2025, were $3.2 million compared to $2.5 million for the same period in 2024. The increase in operating expenses for the three months ended June 30, 2025, was primarily the result of increases in professional fees associated with our capital raising efforts and increases in research and development expenditures related to our clinical programs. Offsetting the increased research and development expenditures were tax credits of $704 received from the UK Government during the current period compared to the credits in the prior year which were received subsequent to June 30, 2024.
Previous wording
Since our inception, we have not generated any revenue from product sales and have incurred significant operating losses and negative cash flows from our operations. Our net loss was $2.4 million for the three months ended March 31, 2025. As of March 31, 2025, we had cash and cash equivalents of $0.7 million. In May 2022, we entered into a purchase agreement and a registration rights agreement (the “Equity Line”) with an institutional investor, providing for the sale of up to $20.0 million worth of our Common Stock over the thirty-six (36) month term of the purchase agreement. Under the terms and subject to the conditions of the purchase agreement we have the right, but not the obligation, to sell to the institutional investor and the institutional investor is obligated to purchase, up to $20.0 million worth of shares of our Common Stock, subject to certain limitations. As of March 31, 2025, in accordance with the Equity Line we have issued a total of 425,344 shares of our Common Stock under the purchase agreement with aggregate proceeds of $679.
Current wording
Since our inception, we have not generated any revenue from product sales and have incurred significant operating losses and negative cash flows from our operations. Our net loss was $5.6 million for the six months ended June 30, 2025. As of June 30, 2025, we had cash and cash equivalents of $2.1 million. In May 2022, we entered into a purchase agreement and a registration rights agreement (the “Equity Line”) with an institutional investor, providing for the sale of up to $20.0 million worth of our Common Stock over the thirty-six (36) month term of the purchase agreement, which has now expired. As of June 30, 2025, in accordance with the Equity Line we have issued a total of 74,153 shares of our Common Stock under the purchase agreement with aggregate proceeds of $679.
Previous wording
In July 2023 we filed a $75.0 million shelf registration statement on Form S-3 which became effective on July 14, 2023. The shelf registration statement is effective for three years and permits us to sell, from time to time, up to $75.0 million in aggregate value of our Common Stock, preferred stock, debt securities, warrants and/or units subject to a limit of one-third (1/3) of our public float within a twelve (12) month period if our public float is less than $75,000. The shelf registration statement was intended to provide us with flexibility to access additional capital when market conditions are appropriate.
Current wording
In July 2023 we filed a $75.0 million shelf registration statement on Form S-3 which became effective on July 14, 2023. The shelf registration statement is effective for three years, and permits us to sell, from time to time, up to $75.0 million in aggregate value of our Common Stock, preferred stock, debt securities, warrants and/or units subject to a limit of one-third (1/3) of our public float within a twelve (12) month period if our public float is less than $75,000 as of relevant measurement dates under applicable securities laws. The shelf registration statement was intended to provide us with flexibility to access additional capital when market conditions are appropriate.
Previous wording
Our total current assets as of March 31, 2025, were $1.4 million as compared to total current assets of $2.6 million as of December 31, 2024. The decrease in current assets was primarily due to the funding of our operating activities.
Current wording
Our total current assets as of June 30, 2025, were $2.2 million as compared to total current assets of $2.6 million as of December 31, 2024. The decrease in current assets was primarily due to the funding of our operating activities.
Previous wording
Our total current liabilities as of March 31, 2025, were $2.8 million as compared to total current liabilities of $1.8 million as of December 31, 2024, the result of our deferring payment on certain payables as a result of our cash preservation strategy.
Current wording
Our total current liabilities as of June 30, 2025, were $5.7 million as compared to total current liabilities of $1.8 million as of December 31, 2024, the result of our deferring payment on certain payables as a result of our cash preservation strategy.
Previous wording
During the three months ended March 31, 2025, cash used in operating activities was $1.6 million compared to $2.9 million during the three months ended March 31, 2024. Cash used in operating activities during the three months ended March 31, 2025, was attributed to a net loss of $2.4 million offset by decreases in operating assets and liabilities of $0.6 million and non-cash stock-based compensation of $0.2 million. Cash used in operating activities during the three months ended March 31, 2024, was attributed to a net loss of $2.5 million and a non-cash gain of $0.1 million associated with our trading of marketable securities and decreases in operating assets and liabilities of $0.6 million offset by stock-based compensation of $0.2 million.
Current wording
During the six months ended June 30, 2025, cash used in operating activities was $2.1 million compared to $5.0 million during the six months ended June 30, 2024. Cash used in operating activities during the six months ended June 30, 2025, was attributed to a net loss of $5.6 million offset by decreases in operating assets and increases in liabilities of $3.1 million and non-cash stock-based compensation of $0.3 million. Cash used in operating activities during the six months ended June 30, 2024, was attributed to a net loss of $4.9 million and a non-cash gain of $0.2 million associated with our trading of marketable securities and decreases in operating assets and liabilities of $0.3 million offset by stock-based compensation of $0.4 million.
Previous wording
During the three months ended March 31, 2025, cash provided by investing activities was $0.0 million compared to $1.3 million during the three months ended March 31, 2024. During the three months ended March 31, 2024, cash flows provided by investing activities of $1.3 million was the result of $1.8 million received from dispositions of trading marketable securities offset by $0.5 million from purchases of trading marketable securities
Current wording
During the six months ended June 30, 2025, cash provided by investing activities was $0.0 million compared to $3.0 million during the six months ended June 30, 2024 . During the six months ended June 30, 2024, cash flows provided by investing activities of $3.0 million was the result of $3.5 million received from dispositions of trading marketable securities offset by $0.5 million from purchases of trading marketable securities.
Previous wording
During the three months ended March 31, 2025, cash flows provided by financing activities was $0.0 million compared to $0.1 million during the three months ended March 31, 2024. During the three months ended March 31, 2024, cash flows provided by financing activities was comprised of proceeds from the issuance of common stock of $0.1 million.
Current wording
During the six months ended June 30, 2025, cash flows provided by financing activities was $1.8 million compared to $0.1 million during the six months ended June 30, 2024. During the six months ended June 30, 2025, cash flows provided by financing activities were the result of the net proceeds from the issuance of common shares of $1.1 million and net proceeds from the issuance of convertible notes of $0.7 million. During the six months ended June 30, 2024, cash flows provided by financing activities were comprised of proceeds from the issuance of common stock of $0.1 million.
Previous wording
There were no new accounting standards adopted during the three months ended March 31, 2025.
Current wording
There were no new accounting standards adopted during the six months ended June 30, 2025 .
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Since our inception, we have not generated any revenue from product sales and have incurred significant operating losses and negative cash flows from our operations. Our net loss was $5.6 million for the six months ended June 30, 2025. As of June 30, 2025, we had cash and cash equivalents of $2.1 million. In order to continue operations, we will be required to raise additional funds by completing additional equity or debt offerings or licensing our product candidates. We are currently pursuing various financing strategies. There can be no assurance that we will be successful in acquiring additional funding, that our projections of our future working capital needs will prove accurate, or that any additional funding would be sufficient to continue operations in future years. These conditions raise substantial doubt about our ability to continue as a going concern within one year after the date that the consolidated financial statements are issued. The accompanying consolidated financial statements do not include any adjustments to reflect the future effects on the recoverability and classification of assets or the amounts and classification of liabilities if we are unable to continue as a going concern.