Lantern Pharma Inc.
For the period ended Dec 31, 2024. Filed Mar 27, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Mar 27, 2025
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What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-03-18.
0001493152-24-010302
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-03-27.
0001641172-25-000926
Item 7. 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 69 previous paragraphs and 68 current paragraphs.
39 unchanged; 25 reworded; 4 added; 5 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 6 previous and 6 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 (4)
Current report
General and administrative expenses increased approximately $108,000 , or 2%, from approximately $5,983,000 for the year ended December 31, 2023 to approximately $6,091,000 for the year ended December 31, 2024. The increase was primarily attributable to increases in other professional fees of approximately $395,000, offset, in part, by a decrease in wage and benefit costs of approximately $108,000 due to a decline in stock-based compensation and a decrease in insurance expenses of approximately $185,000.
Current report
Research and development expenses increased approximately $4,232,000, or 36%, from approximately $11,894,000 for the year ended December 31, 2023 to approximately $16,126,000 for the year ended December 31, 2024. The increase was primarily attributable to increases in research studies of approximately $2,947,000 relating to the conduct and support of our clinical trials, increases in contract labor expenses of approximately $376,000 and increases in research and development wages and benefit expenses of approximately $897,000.
Current report
Interest income decreased approximately $23,000 from approximately $765,000 during the year ended December 31, 2023 to approximately $742,000 for the year ended December 31, 2024. This decrease in interest income was offset, in part, by an increase in non-cash income of approximately $99,000 during the year ended December 31, 2024, due to an increase in accretion of bond discounts. During the years ended December 31, 2024 and 2023, we generated interest income (excluding non-cash income) of approximately $472,000 and $592,000, respectively, from our cash and cash equivalents and marketable securities.
Current report
Other income, net decreased approximately $458,000 from approximately $1,151,000 for the year ended December 31, 2023 to approximately $693,000 for the year ended December 31, 2024. This decrease was primarily driven by a decrease in Australian research and development tax incentives of approximately $404,000 during the year ended December 31, 2024, as a result of completion of animal studies relating to our Phase 1 clinical trials that resulted in reduced activity in our Australian subsidiary. We also reported an increase in foreign currency translation loss of approximately $208,000 and a decrease in dividend income of approximately $28,000 during the year ended December 31, 2024 compared to the year ended December 31, 2023. These reductions in other income, net, were offset, in part by an increase in net appreciation in the fair value of marketable securities of approximately $182,000 during the year ended December 31, 2024.
Removed paragraphs (5)
Previous report
Research and Development costs relating to LP-184 for the year ended December 31, 2022 were reduced by $935,000 as a result of a payment we received in July 2022 from one of our service providers in connection with the resolution of a difference of views regarding the service provider agreement. This payment received by us offset other LP-184 costs during the year ended December 31, 2022.
Previous report
General and administrative expenses increased approximately $153,000, or 3%, from approximately $5,830,000 for the year ended December 31, 2022 to approximately $5,983,000 for the year ended December 31, 2023. The increase was primarily attributable to increases in other professional fees of $445,000, increases in travel expenses of $150,000, increases in payroll and compensation expenses of $141,000 and increases in rent expense of $38,000. This was partially offset by decreases in corporate insurance expense of $412,000, decreases in legal and patent related expenses of $102,000, decreases in business development expenses of $50,000, decreases in office and administrative expenses of $38,000 and decreases in other general and administrative office expenses of $23,000.
Previous report
Research and development expenses increased approximately $3,291,000, or 38%, from approximately $8,603,000 for the year ended December 31, 2022 to approximately $11,894,000 for the year ended December 31, 2023. The increase was primarily attributable to increases in research studies of approximately $2,980,000, increases in consulting expenses of approximately $160,000 and increases in research and development payroll expenses of approximately $1,241,000. These increases were partially offset by decreases in product candidate manufacturing related expenses of approximately $631,000, and decreases of approximately $459,000 in payments to Allarity Therapeutics. During the year ended December 31, 2022, we released an escrow payment of approximately $459,000 to Allarity Therapeutics, and there was not a release of escrow payment amounts to Allarity Therapeutics during the year ended December 31, 2023. Manufacturing related expenses for the year ended December 31, 2022 were also reduced by $935,000 as a result of a payment we received in July 2022 from one of our service providers in connection with the resolution of a difference of views regarding the service provider agreement.
Previous report
Interest income increased approximately $561,000 from $204,000 during the year ended December 31, 2022 to approximately $765,000 for the year ended December 31, 2023. The increase was primarily driven by changes in the interest rate environment, resulting in corporate bonds being purchased at a discount rather than a premium. During the year ended December 31, 2023, we recognized noncash income of approximately $173,000 related to the accretion of corporate bond discounts as compared to a noncash expense of approximately $82,000 during the year ended December 31, 2022. We also opened a new money market account during the year ended December 31, 2023 that returned approximately $253,000 of interest.
Previous report
Other income (expense), net increased approximately $1,182,000 from a loss of approximately $32,000 for the year ended December 31, 2022 to a gain of approximately $1,151,000 for the year ended December 31, 2023. This increase was primarily attributable to increases in unrealized gains on investments of approximately $625,000, increases in dividend income of approximately $531,000, and a reduction in foreign currency losses of approximately $47,000, offset by a reduction of approximately $21,000 in research and development tax incentives related to the Australia subsidiary. We recorded research and development tax incentive receivables of approximately $427,000 with respect to the year ended December 31, 2023 related to the Australia subsidiary.
Reworded paragraphs (25)
Previous wording
We are a clinical stage biotechnology company, focused on leveraging artificial intelligence (“A.I.”), machine learning and genomic data to streamline the drug development process and to identify the patients that will benefit from our targeted oncology therapies. Our portfolio of therapies consists of small molecules that others have tried, but failed, to develop into an approved commercialized drug, as well as new compounds that we are developing with the assistance of our proprietary A.I. platform and our biomarker driven approach. Our A.I. platform, known as RADR®, currently includes more than 60 billion data points, and uses big data analytics (combining molecular data, drug efficacy data, data from historical studies, data from scientific literature, phenotypic data from trials and publications, and mechanistic pathway data) and machine learning to rapidly uncover biologically relevant genomic signatures correlated to drug response, and then identify the cancer patients that we believe may benefit most from our compounds. This data-driven, genomically-targeted and biomarker-driven approach allows us to pursue a transformational drug development strategy that identifies, rescues or develops, and advances potential small molecule drug candidates at what we believe is a fraction of the time and cost associated with traditional cancer drug development.
Current wording
We are an artificial intelligence (A.I.) focused company dedicated to developing cancer therapies and transforming the cost, pace, and timeline of oncology drug discovery and development. Our development portfolio includes three clinical stage oncology focused product candidates and consists of small molecules that others have tried, but failed, to develop into an approved commercialized drug, as well as new compounds that we are developing with the assistance of our proprietary A.I. platform and our biomarker driven approach. Our A.I. platform, known as RADR®, currently includes more than 100 billion data points, and uses big data analytics (combining molecular data, drug efficacy data, data from historical studies, data from scientific literature, phenotypic data from trials and publications, and mechanistic pathway data) and machine learning to rapidly uncover biologically relevant genomic signatures correlated to drug response, and then identify the cancer patients that we believe may benefit most from our compounds. This data-driven, genomically-targeted and biomarker-driven approach allows us to pursue a transformational drug development strategy that identifies, rescues or develops, and advances potential small molecule drug candidates at what we believe is a fraction of the time and cost associated with traditional cancer drug development.
Previous wording
A key component of our strategy is to target specific cancer patient populations and treatment indications identified by leveraging our RADR® platform, a proprietary A.I. enabled engine created and owned by us. We believe the combination of our therapeutic area expertise, our A.I. expertise, and our ability to identify and develop promising drug candidates through our collaborative relationships with research institutions in selected areas of oncology gives us a significant competitive advantage. Our RADR® platform was developed and refined over the last five years and integrates billions of data points immediately relevant for oncology drug development and patient response prediction using artificial intelligence and proprietary machine learning algorithms. By identifying clinical candidates, together with relevant genomic and phenotypic data, we believe our approach will help us design more efficient pre-clinical studies, and more targeted clinical trials, thereby accelerating our drug candidates’ time to approval and eventually to market. Although we have not yet applied for or received regulatory or marketing approval for any of our drug candidates, we believe our RADR®platform has the ability to reduce the cost and time to bring drug candidates to specifically targeted patient groups. We believe we have developed a sustainable and scalable biopharma business model by combining a unique, oncology-focused big-data platform that leverages artificial intelligence along with active clinical and preclinical programs that are being advanced in targeted cancer therapeutic areas to address today’s treatment needs.
Current wording
A key component of our strategy is to target specific cancer patient populations and treatment indications identified by leveraging our RADR® platform, a proprietary A.I. enabled engine created and owned by us. We believe the combination of our therapeutic area expertise, our A.I. expertise, and our ability to identify and develop promising drug candidates through our collaborative relationships with research institutions in selected areas of oncology gives us a significant competitive advantage. Our RADR® platform has been developed and refined over the last several years and integrates billions of data points immediately relevant for oncology drug development and patient response prediction using artificial intelligence and proprietary machine learning algorithms. By identifying clinical candidates, together with relevant genomic and phenotypic data, we believe our approach will help us design more efficient pre-clinical studies, and more targeted clinical trials, thereby accelerating our drug candidates’ time to approval and eventually to market. Although we have not yet applied for or received regulatory or marketing approval for any of our drug candidates, we believe our RADR®platform has the ability to reduce the cost and time to bring drug candidates to specifically targeted patient groups. We believe we have developed a sustainable and scalable biopharma business model by combining a unique, oncology-focused big-data platform that leverages artificial intelligence along with active clinical and preclinical programs that are being advanced in targeted cancer therapeutic areas to address today’s treatment needs.
Previous wording
Our current portfolio consists of three lead drug candidates that are in clinical phases (known as LP-300, LP-184 and LP-284) and an Antibody Drug Conjugate (ADC) program that is in preclinical research optimization. In January 2023, we formed a wholly owned subsidiary, Starlight Therapeutics Inc. (“Starlight”), to develop drug candidate LP-184’s central nervous system (CNS) and brain cancer indications – including glioblastoma (GBM), brain metastases (brain mets.), and several rare pediatric CNS cancers. Following the formation of Starlight, we refer to the molecule LP-184, as it is developed in CNS indications, as “STAR-001”. All of these drug candidates and our ADC program are leveraging precision oncology, A.I. and genomic driven approaches to accelerate and direct development efforts.
Current wording
Our current portfolio consists of three lead drug candidates that are in clinical phases (known as LP-300, LP-184 and LP-284) and an Antibody Drug Conjugate (ADC) program that is in preclinical research optimization. In January 2023, we formed a wholly owned subsidiary, Starlight Therapeutics Inc. (“Starlight”), to develop drug candidate LP-184’s central nervous system (CNS) and brain cancer indications – including glioblastoma (GBM), brain metastases (brain mets.), and several rare pediatric CNS cancers. Following the formation of Starlight, we may also refer to the molecule LP-184, as it is developed in CNS indications, as “STAR-001”. All of these drug candidates and our ADC program are leveraging precision oncology, A.I. and genomic driven approaches to accelerate and direct development efforts.
Previous wording
We are currently conducting a targeted phase 2 trial (the Harmonic™ trial) for LP-300 in never smoking patients with NSCLC in combination with chemotherapy, under an existing investigational new drug application. Our candidate LP-184 has shown promisingin-vitroandin vivo anticancer activity in multiple solid tumor indications (including pancreatic, glioblastoma and triple negative breast cancer), and it is advancing in a Phase 1A clinical trial that commenced in mid-2023. Our candidate LP-284 has shown promisingin-vitroandin vivo anticancer activity in multiple hematological cancers, which are distinct from the indications targeted by LP-184. LP-284 is advancing in a Phase 1A clinical trial that commenced in the fourth quarter of 2023.
Current wording
We are conducting a targeted phase 2 trial (the Harmonic™ trial) for LP-300 in never smoking patients with NSCLC in combination with chemotherapy, under an existing investigational new drug application. Our candidate LP-184 has shown promisingin-vitroandin vivo anticancer activity in multiple solid tumor indications (including pancreatic, glioblastoma and triple negative breast cancer), and it is advancing in a Phase 1A clinical trial. Our candidate LP-284 has shown promisingin-vitroandin vivo anticancer activity in multiple hematological cancers, which are distinct from the indications targeted by LP-184. LP-284 is advancing in a Phase 1A clinical trial that commenced in the fourth quarter of 2023.
Previous wording
Our ADC program has also continued to advance. In 2023, we entered into a research collaboration with Bielefeld University in Germany focused on development of ADCs utilizing cryptophycin as the ADC drug-payload. Cryptophycins are promising antitumor molecules that have demonstrated potency at ultra-low, picomolar, concentrations. In a broad range of preclinical studies, the cryptophycin-ADC synthesized as part of the Bielefeld collaboration demonstrated promising picomolar level potency and anti-tumor activity in multiple solid tumor cell lines, including breast, bladder, colorectal, gastric, pancreatic and ovarian.
Current wording
Our ADC program has also continued to advance. During 2024, we continued to progress the application of our RADR® A.I. platform to advance and refine an A.I. powered module focused on improving the precision, cost and timelines of ADC development for cancer. In 2023, we entered into a research collaboration with Bielefeld University in Germany focused on development of ADCs utilizing cryptophycin as the ADC drug-payload. Cryptophycins are promising antitumor molecules that have demonstrated potency at ultra-low, picomolar, concentrations. In a broad range of preclinical studies, the cryptophycin-ADC synthesized as part of the Bielefeld collaboration demonstrated promising picomolar level potency and anti-tumor activity in multiple solid tumor cell lines, including breast, bladder, colorectal, gastric, pancreatic and ovarian.
Previous wording
To date, except for a prior research grant, we have not generated any revenue, we have incurred net losses and our operations have been financed primarily by sales of our equity securities. Our net losses were approximately $15,962,000 and $14,260,000 for the years ended December 31, 2023 and 2022, respectively.
Current wording
To date, except for a prior research grant, we have not generated any revenue, we have incurred net losses and our operations have been financed primarily by sales of our equity securities. Our net losses were approximately $20,781,000 and $15,962,000 for the years ended December 31, 2024 and 2023, respectively.
Previous wording
Our net losses have primarily resulted from costs incurred in licensing and developing the drug candidates in our pipeline, planning, preparing and conducting preclinical studies, clinical testing and general and administrative activities associated with our operations. We expect to continue to incur significant expenses and corresponding increased operating losses for the foreseeable future as we continue to develop our pipeline. Our costs may further increase as we conduct additional preclinical studies and clinical trials and potentially seek regulatory clearance for and prepare to commercialize our drug candidates. We expect to incur significant expenses to continue to build the infrastructure necessary to support our expanded operations, preclinical studies, clinical trials, and commercialization, including manufacturing, marketing, sales and distribution functions. We have experienced and will continue to experience substantial costs associated with operating as a public company.
Current wording
Our net losses have primarily resulted from costs incurred in licensing and developing the drug candidates in our pipeline, planning, preparing and conducting preclinical studies and clinical testing, and general and administrative activities associated with our operations. We expect to continue to incur significant expenses and corresponding increased operating losses for the foreseeable future as we continue to develop our pipeline. Our costs may further increase as we conduct additional preclinical studies and clinical trials and potentially seek regulatory clearance for and prepare to commercialize our drug candidates. We expect to incur significant expenses to continue to build the infrastructure necessary to support our expanded operations, preclinical studies, clinical trials, and commercialization, including manufacturing, marketing, sales and distribution functions. We have experienced and will continue to experience substantial costs associated with operating as a public company.
Previous wording
We expect that our research and development expenses will continue to increase as we progress our clinical trials for LP-300, LP-184 and LP-284, advance clinical development of LP-100, and advance our other programs and drug candidates. We expect this increase to include additional expenses associated with research and service provider agreements for the advancement of our drug candidates and research and development efforts.
Current wording
We expect that our research and development expenses will fluctuate from quarter to quarter and year to year. We expect that our research and development expenses will increase substantially over time based on the progress of our clinical trials for LP-300, LP-184 and LP-284, and other programs and drug candidates. We expect to make substantial expenditures associated with research and service provider agreements for the advancement of our drug candidates and research and development efforts.
Previous wording
Because of the numerous risks and uncertainties associated with product development, we cannot determine with certainty the duration and completion costs of these or other current or future clinical trials of LP-300, LP-184, LP-284, LP-100 or our other drug candidates. We may never succeed in achieving regulatory approval for LP-300, LP-184, LP-284, LP-100 or any of our other drug candidates. The duration, costs and timing of clinical trials and development of our drug candidates will depend on a variety of factors, including the uncertainties of future clinical and preclinical studies, uncertainties in clinical trial enrollment rates and significant and changing government regulation. In addition, the probability of success for each drug candidate will depend on numerous factors, including competition, manufacturing capability and commercial viability.
Current wording
Because of the numerous risks and uncertainties associated with product development, we cannot determine with certainty the duration and completion costs of these or other current or future clinical trials of LP-300, LP-184, LP-284 or our other drug candidates. We may never succeed in achieving regulatory approval for LP-300, LP-184, LP-284 or any of our other drug candidates. The duration, costs and timing of clinical trials and development of our drug candidates will depend on a variety of factors, including the uncertainties of future clinical and preclinical studies, uncertainties in clinical trial enrollment rates, significant and changing government regulation, and geopolitical risk, including in Taiwan where we are pursuing clinical testing of LP-300. In addition, the probability of success for each drug candidate will depend on numerous factors, including competition, manufacturing capability and commercial viability.
Previous wording
We expect increased administrative costs resulting from our ongoing and anticipated clinical trials and the potential commercialization of our drug candidates. We believe that these increases will likely include increased costs for director and officer liability insurance, hiring additional personnel to support future market research and future product commercialization efforts and increased fees for outside consultants, attorneys and accountants. We also expect to continue to incur substantial costs to comply with corporate governance, internal controls, investor relations and disclosures and similar requirements applicable to a public company.
Current wording
We expect increased administrative costs resulting from our existing and anticipated clinical trials and the potential commercialization of our drug candidates. We believe that these increases will likely include increased costs for hiring additional administrative personnel to support future market research and future product commercialization efforts and increased fees for outside consultants, attorneys and accountants.
Previous wording
Interest Income and Other Income (Expense)
Current wording
Interest Income and Other Income
Previous wording
We incurred net losses of approximately $15,962,000 and $14,260,000 for the years ended December 31, 2023 and 2022, respectively. As of December 31, 2023, we had working capital of approximately $40,663,000.
Current wording
We incurred net losses of approximately $20,781,000 and $15,962,000 for the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024, we had working capital of approximately $20,916,000.
Previous wording
We have not yet generated any revenues from operations, other than revenues from a research grant, and we have not yet achieved profitability. We expect that general and administrative expenses and our research and development expenses will continue to increase and, as a result, we will need to generate significant product revenues to achieve profitability. We may never achieve profitability.
Current wording
We have not yet generated any revenues from operations, other than revenues from a research grant, and we have not yet achieved profitability. We expect that we will need substantial additional funding in the near future, and if we are unable to raise capital when needed, we could be forced to delay, reduce or eliminate our drug development programs or commercialization efforts. We expect that general and administrative expenses and our research and development expenses will fluctuate from quarter to quarter. In order to achieve profitability, we will need to generate significant product revenues, which could be several years in the future. We may never achieve significant product revenues or profitability.
Previous wording
In November 2021, the Company’s Board of Directors authorized a share repurchase program to acquire up to $7,000,000 of our common stock. During the year ended December 31, 2022, we repurchased 353,667 shares of common stock pursuant to the repurchase program for a total of approximately $2,482,000, including purchase fees. The share repurchase program terminated July 31, 2022. During 2023, we also repurchased 145,348 shares of our common stock for approximately $497,000.
Current wording
During the year ended December 31, 2023, we repurchased 145,348 shares of our common stock for approximately $500,000. No shares were repurchased in 2024.
Previous wording
As of December 31, 2023 and 2022, we had cash and cash equivalents of approximately $21,938,000 and $37,202,000, respectively. Based on our anticipated expenditures and capital commitments as of the date of this report, we believe that our existing cash and cash equivalents as of December 31, 2023 will enable us to fund our operating expenses and capital expenditure requirements for at least 12 months from the date of filing this Form 10-K. As of December 31, 2023 and 2022, we had marketable securities of approximately $19,365,000 and $17,994,000, respectively.
Current wording
As of December 31, 2024 and 2023, we had cash and cash equivalents of approximately $7,511,000 and $21,938,000, respectively. Based on our anticipated expenditures and capital commitments as of the date of this report, we believe that our existing cash, cash equivalents, and marketable securities as of December 31, 2024 will enable us to fund our operating expenses and capital expenditure requirements for at least 12 months from the date of filing this Form 10-K. As of December 31, 2024 and 2023, we had marketable securities of approximately $16,502,000 and $19,365,000, respectively.
Previous wording
For the year ended December 31, 2023, net cash used in operating activities was approximately $14,347,000 compared to approximately $12,767,000 for the year ended December 31, 2022. The increase in net cash used in operating activities was primarily the result of the increase in the net loss for the year ended December 31, 2023, offset in part by increases in interest and dividend income.
Current wording
For the year ended December 31, 2024, net cash used in operating activities was approximately $17,813,000 compared to approximately $14,347,000 for the year ended December 31, 2023. The increase in net cash used in operating activities was primarily the result of the increase of approximately $4,820,000 in the net loss for the year ended December 31, 2024 as compared to the year ended December 31, 2023, offset in part by an increase in accounts payable and accrued expenses of approximately $1,636,000.
Previous wording
For the year ended December 31, 2023, net cash used in investing activities was approximately $930,000 compared to net cash provided of approximately $179,000 for the year ended December 31, 2022. The change is primarily a result of making more net investments in marketable securities during the year ended December 31, 2023 than we did during the year ended December 31, 2022.
Current wording
For the year ended December 31, 2024, net cash provided by investing activities was approximately $3,369,000 compared to net cash used of approximately $930,000 for the year ended December 31, 2023. The change is primarily a result of investing in more short-term securities that are considered cash and cash equivalents during the year ended December 31, 2024 than we did during the year ended December 31, 2023.
Previous wording
For the year ended December 31, 2023, net cash used in financing activities was approximately $500,000 compared to approximately $2,182,000 for the year ended December 31, 2022. The decrease in net cash used in financing activities was primarily due to a significantly lower level of share repurchases during the year ended December 31, 2023.
Current wording
For the year ended December 31, 2024, net cash provided by financing activities was approximately $67,000 compared to net cash used of approximately $500,000 for the year ended December 31, 2023. The change is primarily due to share repurchases during the year ended December 31, 2023.
Previous wording
We expect to continue to incur significant and increasing operating losses at least for the next several years as we continue our clinical trials of LP-300, LP-184 and LP-284, advance clinical development of LP-100, pursue development of our other drug candidates, and seek potential future marketing approval for our drug candidates which could be several years in the future, if at all. We do not expect to generate revenue, other than possible license and grant revenue, unless and until we successfully complete development and obtain regulatory approval for our therapeutic candidates. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our planned clinical trials and our expenditures on other research and development activities.
Current wording
We expect to continue to incur significant and often increasing operating losses at least for the next several years as we continue our clinical development of LP-300, LP-184 and LP-284, pursue development of our other drug candidates and programs, and seek potential future marketing approval for our drug candidates, which could be several years in the future, if at all. We do not expect to generate revenue, other than possible license and grant revenue, unless and until we successfully complete development and obtain regulatory approval for our therapeutic candidates. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our existing and planned clinical trials and our expenditures on other research and development activities.
Previous wording
We expect that we will need to obtain substantial additional funding in order to complete our clinical trials. To the extent that we raise additional capital through the sale of common stock, convertible securities or other equity securities, the ownership interests of our existing stockholders may be materially diluted and the terms of these securities could include liquidation or other preferences that could adversely affect the rights of our existing stockholders. In addition, debt financing, if available, would result in increased fixed payment obligations and may involve agreements that include restrictive covenants that limit our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends, that could adversely impact our ability to conduct our business. If we are unable to raise capital when needed or on attractive terms, we could be forced to significantly delay, scale back or discontinue the development or commercialization of LP-300, LP-184, LP-284, LP-100 and/or other drug candidates and programs, seek collaborators at an earlier stage than otherwise would be desirable or on terms that are less favorable than might otherwise be available, and relinquish or license, potentially on unfavorable terms, our rights to LP-300, LP-184, LP-284, LP-100 and/or other drug candidates and programs that we otherwise would seek to develop or commercialize ourselves.
Current wording
We expect that we will need to obtain substantial additional funding in order to complete our clinical trials. To the extent that we raise additional capital through the sale of common stock, convertible securities or other equity securities, the ownership interests of our existing stockholders may be materially diluted and the terms of these securities could include liquidation or other preferences that could adversely affect the rights of our existing stockholders. In addition, debt financing, if available, would result in increased fixed payment obligations and may involve agreements that include restrictive covenants that limit our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends, that could adversely impact our ability to conduct our business. If we are unable to raise capital when needed or on attractive terms, we could be forced to significantly delay, scale back or discontinue the development or commercialization of LP-300, LP-184, LP-284, and/or other drug candidates and programs, seek collaborators at an earlier stage than otherwise would be desirable or on terms that are less favorable than might otherwise be available, and relinquish or license, potentially on unfavorable terms, our rights to LP-300, LP-184, LP-284, and/or other drug candidates and programs that we otherwise would seek to develop or commercialize ourselves.
Previous wording
When preparing our financial statements, we are required to estimate our accrued clinical expenses. This process involves reviewing contracts and 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 actual cost. Payments under some of the contracts we have with third parties depend on factors, such as successful enrollment of certain numbers of patients, site initiation and the completion of clinical trial milestones.
Current wording
When preparing our financial statements, we are required to estimate our accrued clinical expenses. This process involves reviewing contracts and communicating with our personnel and third party vendors 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 actual cost. Payments under some of the contracts we have with third parties depend on factors, such as successful enrollment of certain numbers of patients, site initiation and the completion of clinical trial milestones.
Previous wording
When accruing clinical expenses, we estimate the time period over which services will be performed and the level of effort to be expended in each period. If possible, we obtain information regarding unbilled services directly from our service providers. However, we may be required to estimate the cost of these services based only on information available to us. If we underestimate or overestimate the cost associated with a trial or service at a given point in time, adjustments to research and development expenses may be necessary in future periods. Historically, our estimated accrued clinical expenses have approximated actual expense incurred.
Current wording
When accruing clinical expenses, we estimate the time period over which services will be performed and the level of effort to be expended in each period. If possible, we obtain information regarding unbilled services directly from our service providers. However, we may be required to estimate the cost of these services based only on information available to us. If we underestimate or overestimate the cost associated with a trial or service at a given point in time, adjustments to research and development expenses may be necessary in future periods. Historically, our estimated accrued clinical expenses have generally approximated actual expense incurred.
Previous wording
Each option award is subject to specified vesting schedules and requirements. Compensation expense is charged to us over the required service period to earn the award which is expected to be up to four years, subject to the achievement of time and event-based vesting requirements. For the years ended December 31, 2023 and 2022, we have incurred share-based compensation expense related to equity awards totaling approximately $1,068,000 and $1,188,000, respectively.
Current wording
Each option award is subject to specified vesting schedules and requirements. Compensation expense is charged to us over the required service period to earn the award which is expected to be up to four years, subject to the achievement of time and event-based vesting requirements. For the years ended December 31, 2024 and 2023, we have incurred share-based compensation expense related to equity awards totaling approximately $733,000 and $1,068,000, respectively.
Previous wording
We formed a wholly owned subsidiary, Lantern Pharma Australia Pty Ltd, in Australia in September 2021 and experienced foreign currency losses of approximately $12,000 and $59,000 for the years ended December 31, 2023 and 2022, respectively, in connection with this subsidiary. We will remain subject to the risk of foreign currency losses in future periods, although we do not expect the impact of any foreign currency losses to be material. We do not participate in any foreign currency hedging activities, and we do not have any other derivative financial instruments.
Current wording
We formed a wholly owned subsidiary, Lantern Pharma Australia Pty Ltd, in Australia in September 2021 and experienced foreign currency losses of approximately $220,000 and $12,000 for the years ended December 31, 2024 and 2023, respectively, in connection with this subsidiary. We will remain subject to the risk of foreign currency losses in future periods, although we do not expect the impact of any foreign currency losses to be material. We do not participate in any foreign currency hedging activities, and we do not have any other derivative financial instruments.
Previous wording
Inflation generally affects us by increasing our cost of labor and clinical trial costs. We do not believe that inflation has had a material effect on our results of operations during the periods presented. Inflation has increased substantially in recent periods and could have a greater impact on our future results of operations if it remains at current levels or continues to increase.
Current wording
Inflation generally affects us by increasing our cost of labor and clinical trial costs. We do not believe that inflation has had a material effect on our results of operations during the periods presented. Inflation could have a greater impact on our future results of operations if it remains at current levels or increases further.