MIRA Pharmaceuticals, Inc. — FY2023 Form 10-K
Reporting period: Fiscal year ended December 31, 2023; filed April 1, 2024. This is an annual report, not a standalone fourth-quarter report. MIRA is a preclinical-stage pharmaceutical developer with no approved products or revenue.
Business context and development programs
- Ketamir-2: An oral ketamine analog licensed for the U.S., Canada and Mexico, under development for treatment-resistant depression and major depressive disorder with suicidal ideation, with possible future PTSD research. The DEA concluded it is not a controlled substance or listed chemical under the Controlled Substances Act. The company planned to submit an IND by the end of 2024; it had not begun clinical trials.
- MIRA-55: A synthetic cannabinoid candidate being studied for anxiety, cognitive decline and pain-related indications. In early 2024, the company discovered that prior preclinical studies attributed to MIRA1a had in fact used MIRA-55. It filed a provisional patent application in March 2024 and chose MIRA-55 as its lead cannabinoid candidate. The application is pending; no issued patent for MIRA-55 is reported.
- Both programs remain preclinical. The company relies on third-party research and manufacturing providers and describes its preclinical findings as preliminary, not predictive of clinical outcomes.
Financial results and liquidity
| Metric | FY2023 | FY2022 |
|---|---|---|
| Revenue | $0 | $0 |
| Operating costs | $8.53 million | $7.05 million |
| Net loss | $11.98 million | $7.06 million |
| Loss per share, basic and diluted | $0.64 | $0.40 |
| Cash used in operating activities | $4.53 million | $5.60 million |
| Cash at year-end | $4.60 million | $0.35 million |
| Working capital at year-end | $4.4 million | Not clearly stated |
| Total liabilities at year-end | $0.56 million | $1.45 million |
Profitability and operating margins are not meaningful because the company had no revenue. R&D expense declined to $1.57 million from $2.35 million; G&A increased to $6.50 million from $2.99 million, primarily reflecting stock-based compensation, debt issuance costs and IPO-related executive compensation. Related-party travel costs fell to $0.45 million from $1.70 million after the aircraft lease ended in March 2023.
Net interest expense was $3.46 million, versus $0.01 million in 2022. The filing describes substantial noncash financing-related charges, including a $2.8 million write-off of deferred financing costs; warrant-related expenses are also disclosed. The reported components do not clearly reconcile to the total interest expense. Financing activities provided $8.78 million in 2023, primarily from the IPO and related-party financing. The IPO sold 1.275 million shares at $7 per share; audited statements report net proceeds of approximately $7.7 million.
At year-end, the Bay Shore Trust note was reported paid in full apart from approximately $0.01 million of accrued interest. No amounts had been drawn under the separate MIRALOGX loan facility of up to $3 million; borrowings under that facility are restricted to specified Ketamir-2 IND preparation costs. Year-end liabilities were predominantly payables, accrued interest and lease liabilities, rather than material outstanding borrowings.
Material changes and unusual items
- Net loss increased by approximately $4.92 million year over year, with higher G&A and interest expense partly offset by lower R&D and related-party travel costs.
- The company completed its IPO in August 2023 and ended the year with $4.60 million in cash, compared with $0.35 million a year earlier.
- A $3.5 million fair value was assigned to warrants issued to Bay Shore Trust in connection with its credit facility; the filing reports a substantial deferred financing cost write-off when the facility was repaid. MIRALOGX also received warrants in connection with the Ketamir-2 license, with a disclosed fair value of approximately $1.83 million recorded as interest expense.
- The company completed a 1-for-5 reverse stock split in June 2023. It reported 14.78 million common shares outstanding at December 31, 2023 and 14.78 million as of March 28, 2024.
- After year-end, management and board changes included the March 2024 departure of the executive chairman and chief scientific officer and appointments of new directors. These events occurred after the reporting period.
Outlook, risks and contingencies
- Going concern: The auditor included a going-concern explanatory paragraph, and management stated that substantial doubt exists about the company’s ability to continue as a going concern. Management estimated available resources would fund operations into the fourth quarter of 2024, but said it lacked sufficient cash at filing to fund the 12 months following issuance of the financial statements. Planned financing and strategic alternatives were not committed.
- Development outlook: Management planned a Ketamir-2 IND submission by year-end 2024 and a MIRA-55 IND submission for anxiety and cognitive decline by the end of Q2 2025. These are plans, subject to completion of studies, FDA action, financing and manufacturing readiness; no assurance is given that timelines will be met.
- Key risks: Further funding needs and potential shareholder dilution; failure or delay in preclinical, clinical or regulatory development; manufacturing scale-up, quality and supplier dependence; uncertain patent protection, particularly for MIRA-55; reimbursement, pricing and market adoption; and reliance on related parties and external contractors. The Ketamir-2 license carries an 8% royalty on net sales and certain other revenue.
- The company reported no material pending legal proceedings. It also disclosed that management concluded disclosure controls and procedures were not effective at December 31, 2023; no material changes in internal control over financial reporting were reported during the year.
Important facts for investors to verify
- Current cash, burn rate, financing availability and whether the stated runway or going-concern assumptions have changed since the filing.
- Whether the planned Ketamir-2 and MIRA-55 IND timelines were achieved, and the status of required preclinical safety, toxicology and manufacturing work.
- The MIRA-55 provisional patent’s status and the implications of discovering that earlier reported MIRA1a preclinical studies used MIRA-55.
- The reconciliation of the $3.46 million net interest expense with the filing’s separately described warrant and financing-cost charges.
- Current related-party balances and arrangements, including the unused MIRALOGX loan facility, license royalties and outstanding warrants; also verify potential dilution from warrants, options and future fundraising.
- Whether the company has remediated the disclosed ineffective disclosure controls and procedures.