Telomir Pharmaceuticals, Inc. — Q1 2024 Form 10-Q
Reporting period: Three months ended March 31, 2024. Financial statements are unaudited. Telomir is an early preclinical-stage biopharmaceutical company developing TELOMIR-1; it reported no revenue.
Key financial metrics
| Metric | Q1 2024 | Q1 2023 / prior date |
|---|---|---|
| Revenue | $0 | $0 |
| Research and development expense | $804,023 | $440,335 |
| General and administrative expense | $741,541 | $42,603 |
| Related-party travel expense | $370,500 | $0 |
| Interest expense | $4,338,543 | $0 |
| Net loss | $6,254,607 | $482,938 |
| Basic and diluted loss per share | $0.23 | $0.02 |
| Cash from operating activities | $(1,939,415) | $(735,739) |
| Cash from financing activities | $5,212,498 | $736,127 |
| Cash at period end | $3,274,314 | $1,231 at Dec. 31, 2023 |
| Total assets | $3,503,122 | $4,773,768 at Dec. 31, 2023 |
| Total liabilities | $486,552 | $1,335,564 at Dec. 31, 2023 |
| Stockholders’ equity | $3,016,570 | $3,438,204 at Dec. 31, 2023 |
Margins are not meaningful with no revenue. The $4.34 million interest expense reflects amortization of deferred financing costs associated with warrants issued for a related-party credit facility; it was added back in the cash-flow reconciliation and was not a cash interest payment. The filing reports no interest paid.
Material changes and financing
- Net loss increased to $6.25 million from $0.48 million. R&D expense rose about 83%, while G&A increased substantially, which management attributed mainly to higher compensation, professional fees, and insurance costs.
- On February 13, 2024, the company completed an IPO of 1 million shares at $7 per share, raising approximately $7.0 million gross and $5.8 million net after $1.2 million of offering costs.
- Cash rose from $1,231 at year-end to $3.27 million. Operating cash use was $1.94 million, partly offset by $5.21 million of net financing cash flow.
- The Bay Shore Trust related-party line of credit was repaid in full; after the IPO, further advances under that facility were unavailable. At March 31, the company reported $7,902 due to related parties and $130,000 due from related parties. The latter is due on demand and non-interest bearing.
- Common shares outstanding were 29,609,814 at March 31, up 1 million from year-end due to the IPO.
Outlook, risks, and other notable matters
- Management expects cash, including IPO proceeds, to fund operations and development plans through the beginning of Q4 2024. Separately, the financial-statement note says available cash is insufficient to support operations for at least 12 months after issuance of the statements and identifies substantial doubt about the company’s ability to continue as a going concern. Additional financing is needed; there is no assurance it can be obtained on acceptable terms.
- The company expects R&D spending to rise as it advances preclinical work and clinical development. An Investigational New Drug application for osteoarthritis is anticipated in Q1 2025; timing and regulatory success are uncertain. No revenue is expected unless development, regulatory approval, and commercialization succeed.
- Related-party aircraft travel costs were $370,500 in Q1. Management said the company would stop using the aircraft after March 2024 and had no further obligation under that arrangement.
- TELOMIR-1 is licensed from MIRALOGX, an entity associated with the company’s founder and sole inventor. The agreement provides for an 8% royalty on net sales and on non-royalty-bearing milestone revenue; no payments had been made. The international patent application is pending, and national-phase filings were expected in Q1 2025.
- Management concluded that disclosure controls and procedures were not effective at March 31, citing limited personnel with technical accounting expertise. It plans additional review and personnel with greater expertise; no material change in internal control over financial reporting was reported during the quarter.
- The cover page indicates the company checked “No” when asked whether it had filed all required reports during the preceding 12 months (or shorter required period). The filing reports no pending legal proceedings expected by management to have a material adverse effect.
Important facts for investors to verify
- Reconcile the stated cash runway through early Q4 2024 with the going-concern disclosure and assess the timing and terms of financing needed.
- Review the noncash $4.34 million financing-cost amortization and its effect on reported loss, and confirm the related-party facility is fully settled with no further availability.
- Assess the nature, approval, and oversight of related-party travel, consulting, lease, and licensing arrangements.
- Track preclinical results, spending, patent filings, and progress toward the anticipated Q1 2025 IND filing.
- Clarify the checked “No” response regarding timely filing of required Exchange Act reports and monitor remediation of ineffective disclosure controls.