nlnk-20230930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

For the quarterly period ended September 30, 2023.

☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

For the transition period from to .

Commission File Number

001-35342

LUMOS PHARMA, INC.

(Exact name of Registrant as specified in Its Charter)


Delaware						42-1491350
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

4200 Marathon Blvd #200

Austin, Texas 78756

(512) 215-2630

(Address, including zip code, and telephone number, including area code, of principal executive offices)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	LUMO	The Nasdaq Stock Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer o						Accelerated filer o

Non-accelerated filer ☒						Smaller reporting company ☒

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of November 2, 2023, there were 7,914,582 shares of the registrant’s Common Stock, par value $0.01 per share, outstanding.

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Lumos Pharma, Inc.

FORM 10-Q

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		Page
PART I – FINANCIAL INFORMATION
ITEM 1.	Condensed Consolidated Financial Statements	5
	Condensed Consolidated Balance Sheets as of September 30, 2023 (unaudited) and December 31, 2022	5
	Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three and Nine Months Ended September 30, 2023 and 2022 (unaudited)	6
	Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three and Nine Months Ended September 30, 2023 and 2022 (unaudited)	7
	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2023 and 2022 (unaudited)	9
	Notes to Condensed Consolidated Financial Statements (unaudited)	10
ITEM 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	19
ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk	28
ITEM 4.	Controls and Procedures	28

PART II - OTHER INFORMATION
ITEM 1.	Legal Proceedings	30
ITEM 1A.	Risk Factors	30
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	69
ITEM 3.	Defaults Upon Senior Securities	69
ITEM 4.	Mine Safety Disclosures	69
ITEM 5.	Other Information	70
ITEM 6.	Exhibits	71

INDEX OF EXHIBITS		71
SIGNATURES		72

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Forward-Looking Statements

This quarterly report on Form 10‑Q for the quarter ended September 30, 2023 (this “Quarterly Report”) contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements involve risks and uncertainties and reflect our current views with respect to, among other things, future events and our financial performance. When used in this report, the words “believe,” “may,” “could,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “indicate,” “seek,” “should,” “would,” and similar expressions are intended to identify forward-looking statements, though not all forward-looking statements contain these identifying words. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date of this Quarterly Report, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.

Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to those summarized below:

•the development plan for our product candidate, the growth hormone secretagogue ibutamoren (“LUM-201”);

•a weakened macroeconomic environment, including high inflation rates, and its impact on our business, including impacts to our operating costs and financial condition;

•our expectations regarding the potential benefits, activity, effectiveness and safety of our product candidates;

•the development plan for our existing pipeline and potential partnership and out-licensing opportunities;

•the timing of planned preclinical studies and clinical trials and availability of clinical data from such clinical trials;

•the timing of and our ability to obtain regulatory approvals for our product candidates;

•the clinical utility of our product candidates;

•our plans to leverage our existing technologies to discover and develop additional product candidates;

•our intellectual property position;

•our ability to enter into strategic collaborations, licensing or other arrangements;

•our dependence on collaborators for developing, obtaining regulatory approval for and commercializing product candidates in the collaboration;

•our estimates regarding expenses, future revenues, capital requirements and needs for additional financing;

•plans to develop and commercialize our product candidates;

•our ability to obtain additional funds for our operations;

•the rate and degree of market acceptance of any approved product candidates;

•the commercialization of any approved product candidates;

•the implementation of our business model and strategic plans for our business, technologies and product candidates;

•our reliance on third parties to conduct our preclinical studies or any future clinical trials;

•our ability to attract and retain qualified key management and technical personnel;

•the amount and timing of share repurchases, if any;

•our reliance on third-party supply and manufacturing partners to supply the materials and components for, and manufacture, our research and development, preclinical and clinical trial product supplies;

•the extent to which military conflict and any associated economic downturn, governmental regulations or restrictions may adversely impact our business, including impacts to our research, clinical trials, manufacturing and financial condition; and

•developments relating to our competitors or our industry.

For additional information regarding known material factors that could cause our actual results to differ from our projected results, please read (1) Part II, “Item 1A. Risk Factors” in this Quarterly Report; (2) our reports and registration statements filed from time to time with the Securities and Exchange Commission (the “SEC”), and (3) other public announcements we make from time to time. Given these uncertainties, you should not place undue reliance on these forward-

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looking statements. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future.

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PART I - FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

Lumos Pharma, Inc.

Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)


	September 30,		December 31,
	2023		2022
	(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	35,557	$	56,007
Short-term investments	7,137		11,352
Prepaid expenses and other current assets	4,581		4,427
Other receivables	172		223
Total current assets	47,447		72,009
Non-current assets:
Property and equipment, net	36		53
Right-of-use asset	268		230
Total assets	$	47,751	$	72,292
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	488	$	275
Accrued expenses	5,502		6,200
Current portion of lease liability	126		233


Total current liabilities	6,116		6,708
Long-term liabilities:
Royalty obligation payable to Iowa Economic Development Authority	6,000		6,000
Lease liability	143		—

Total liabilities	12,259		12,708
Commitments and contingencies



Stockholders' equity:
Undesignated preferred stock, $0.01 par value: Authorized shares - 5,000,000 at September 30, 2023 and December 31, 2022; issued and outstanding shares - 0 at September 30, 2023 and December 31, 2022	—		—
Common stock, $0.01 par value: Authorized shares - 75,000,000 at September 30, 2023 and December 31, 2022; issued shares - 7,937,755 and 8,283,708 at September 30, 2023 and December 31, 2022, respectively, and outstanding shares - 7,914,582 and 8,267,968 at September 30, 2023 and December 31, 2022, respectively	79		82
Treasury stock, at cost, 23,173 and 15,740 shares at September 30, 2023 and December 31, 2022, respectively	(196)		(170)
Additional paid-in capital	187,673		187,164
Accumulated deficit	(152,060)		(127,483)
Accumulated other comprehensive loss	(4)		(9)
Total stockholders' equity	35,492		59,584
Total liabilities and stockholders' equity	$	47,751	$	72,292
See accompanying notes to condensed consolidated financial statements.

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Lumos Pharma, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(In thousands, except share and per share data)

(unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,

	2023		2022		2023		2022
Revenues:
Royalty revenue	$	7	$	497	$	1,225	$	1,011
Total revenues	7		497		1,225		1,011
Operating expenses:
Research and development	5,046		4,129		15,439		12,995
General and administrative	3,893		3,918		12,396		11,221
Total operating expenses	8,939		8,047		27,835		24,216
Loss from operations	(8,932)		(7,550)		(26,610)		(23,205)
Other income and expense:
Other income, net	186		7		429		19
Interest income	446		292		1,575		371
Other income, net	632		299		2,004		390
Net loss before taxes	(8,300)		(7,251)		(24,606)		(22,815)
Income tax benefit	—		—		29		—
Net loss	$	(8,300)	$	(7,251)	$	(24,577)	$	(22,815)

Net loss per share:
Basic and diluted	$	(1.04)	$	(0.86)	$	(3.01)	$	(2.73)

Weighted average number of common shares outstanding:
Basic and diluted	7,978,457		8,388,029		8,161,904		8,371,449

Other comprehensive loss:
Unrealized gain on short-term investments	7		—		5		—
Total comprehensive loss	$	(8,293)	$	(7,251)	$	(24,572)	$	(22,815)


See accompanying notes to condensed consolidated financial statements.

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Lumos Pharma, Inc.

Condensed Consolidated Statement of Changes in Stockholders' Equity

(In thousands, except share data)

(unaudited)


	Common Stock			Treasury Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders' Equity
	Shares	Amount		Shares	Amount
Balance at December 31, 2022	8,267,968	$	82	15,740	$	(170)	$	187,164	$	(127,483)	$	(9)	$	59,584
Share-based compensation	—	—		—	—		586		—		—		586
Stock issued upon vesting of restricted stock units	4,029	—

SEC Form 10-Q filed by Lumos Pharma Inc.