mnpr20240630

mnpr20240630_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒	Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Quarterly Period Ended June 30, 2024

☐	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: 001-39070

	MONOPAR THERAPEUTICS INC.
	(Exact name of registrant as specified in its charter)

Delaware

32-0463781

(State or other jurisdiction of

incorporation or organization)

(I.R.S. employer

identification number)

1000 Skokie Blvd., Suite 350, Wilmette, IL		60091
(Address of principal executive offices)		(zip code)

(847) 388-0349

(Registrant’s telephone number, including area code)

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, $0.001 par value

MNPR

The Nasdaq Stock Market LLC

(Nasdaq Capital Market)

Securities registered pursuant to Section 12(g) of the Act: None

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 ☐

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 such files). Yes ☒ No ☐

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.

Large accelerated filer	☐	Accelerated filer	☐
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. ☒

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

The number of shares outstanding with respect to each of the classes of our common stock, as of July 31, 2024, is set forth below:

Class		Number of shares outstanding
Common Stock, par value $0.001 per share		17,601,827

		Page
Part I	FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited)	7
	Condensed Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023	7
	Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three and Six Months Ended June 30, 2024 and 2023	8
	Condensed Consolidated Statements of Stockholders’ Equity for the Three and Six Months Ended June 30, 2024 and 2023	9
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2024 and 2023	11
	Notes to Condensed Consolidated Financial Statements	12
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Item 4.	Controls and Procedures	30
Part II	OTHER INFORMATION	31
Item 1A.	Risk Factors	31
Item 5.	Other Information	31
Item 6.	Exhibits	32

Signatures		33

	●	our ability to raise sufficient funds within the next 12 months in order for us to support continued clinical development of our radiopharmaceutical programs; as well as our ability to further raise additional funds in the future to support any existing or future product candidate programs through completion of clinical trials, the approval processes and, if applicable, commercialization;

	●	our ability to regain compliance with the Nasdaq listing standards requiring our stock closing bid price to be at least $1.00 for at least 10 consecutive trading days (and potentially up to 20) by August 26, 2024 (which is expected to be accomplished by effecting a reverse stock split as described herein, and could result in an uncertain impact on our stock price), and if more time is needed to regain compliance our ability to win an appeal to Nasdaq requesting additional time;

	●	our ability to raise funds on acceptable terms;

	●	our ability to find a suitable pharmaceutical partner or partners to further our development efforts, under acceptable financial terms;

	●	risks and uncertainties associated with our or our development partners' research and development activities, including preclinical studies, clinical trials, regulatory submissions, and manufacturing and quality expenses;

	●	known and unknown risks associated with developing new radiopharmaceutical therapeutics and imaging agents;

	●	the uncertainty of timeframes for our clinical trials and regulatory reviews for approval to market products;

	●	our ability to address the fulfillment and logistical challenges posed by the potential time-limited shelf-life of our current radiopharmaceutical programs or future drug candidates;

	●	our ability to obtain an adequate supply at reasonable costs of radioisotopes that we are currently using or that we may incorporate into our drug candidates;

	●	the rate of market acceptance and competitiveness in terms of pricing, efficacy and safety, of any products for which we receive marketing approval, and our ability to competitively market any such products as compared to larger pharmaceutical firms;


	●	the difficulties of commercialization, marketing and product manufacturing and overall strategy;

	●	uncertainties of intellectual property position and strategy including new discoveries and patent filings;

	●	our ability to attract and retain experienced and qualified key personnel and/or to find and utilize external sources of experience, expertise and scientific, medical and commercialization knowledge to complete product development and commercialization of new products;

	●	the risks inherent in our estimates regarding the level of needed expenses, capital requirements and the availability of required additional financing at acceptable terms;

	●	the impact of the U.S. Presidential and Congressional election results affecting the economy and future government laws and regulations including increased governmental control of healthcare and pharmaceuticals, resulting in direct price controls driving lower prices, other governmental regulations affecting cost requirements and structures for selling therapeutic or imaging products, and recent governmental legislation affecting other industries which may indirectly increase our costs of obtaining goods and services and our cost of capital;

	●	the uncertain impact any resurgence of COVID-19 or another pandemic could have on our ability to advance our clinical programs and raise additional financing;

	●	the cumulative impact of domestic and global inflation, volatility in financial markets and/or the potential for an economic recession increasing our costs of obtaining goods and services or making financing more difficult to obtain on acceptable terms or at all;

	●	the uncertain impact of the Russia-Ukraine war or the Israel-Hamas war on our clinical material manufacturing expenses and timelines, as well as on general political, economic, trade and financial market conditions; and

	●	uncertainty of our financial projections and operational timelines and the development of new competitive products and technologies.

	●	We are a clinical stage radiopharmaceutical company with a history of financial losses. We expect to continue to incur significant losses for the foreseeable future and may never achieve or maintain cash self-sufficiency or profitability, which could result in a decline in the market value of our common stock.

	●	Funds raised to date are not sufficient to support clinical development of our radiopharmaceutical programs beyond our ongoing Phase 1 imaging and dosimetry clinical trial in advanced cancers. If we are unable to raise enough funds within the next 12 months from the sale of our common stock or other financing efforts, or conclude a strategic agreement or collaboration such as out-licensing our product candidates, or enter into a clinical or commercial partnership, we will likely have to terminate one or more programs. There can be no assurance that we will be able to secure such financing or find a suitable development partner on satisfactory terms.

	●	On August 28, 2023, we received a notice from Nasdaq stating that we were out of compliance with Nasdaq listing standards giving us 180 days to regain compliance with the minimum bid price requirement. On February 27, 2024, we received a notice from Nasdaq granting us an additional 180-day period to regain compliance. If we do not regain compliance by August 26, 2024, by trading above $1.00 for at least 10 consecutive trading days, which is expected to be accomplished by effecting a reverse stock split as described herein or winning an appeal to extend the deadline, we will face delisting and it may have serious adverse consequences on our stock price and our ability to raise funds, which may cause us to delay, restructure or otherwise reconsider our operations. On August 5, 2024, the stockholders approved the reverse stock split proposal at the Annual Meeting of Stockholders, which provided the Board of Directors with authority to effect a reverse split within the range of ratios approved by stockholders. Subsequently, the Board of Directors approved a reverse stock split of 1 for 5 shares of the Company's common stock in an attempt to regain compliance with the Nasdaq's continued listing requirements. The Company expects that the reverse stock split will become effective at 5:00 pm on Monday August 12, 2024, and its common stock will begin trading on a split-adjusted basis at the open of trading on Tuesday, August 13, 2024.

	●	We do not have and may never have any approved products on the market. Our business is highly dependent upon receiving marketing approvals from various U.S. and international governmental agencies and would be severely harmed if we are not granted approvals to manufacture and sell our product candidates.

	●	Our clinical trials may not yield sufficiently conclusive results for regulatory agencies to approve the marketing and sale of our products, which would adversely affect our financial condition.

	●	If we experience delays or difficulties in the enrollment of patients in clinical trials, our receipt of necessary regulatory approvals will be delayed or prevented, which could materially delay our program schedules and adversely affect our financial condition.

	●	If we or our licensees, development collaborators, or suppliers are unable to manufacture our products in sufficient quantities or at defined quality specifications, or are unable to obtain regulatory approvals for the manufacturing facility, we may be unable to develop and/or meet demand for our products as well as lose time to market and potential revenues.

	●	We rely on qualified third parties to conduct our active pharmaceutical ingredient manufacturing, our drug product manufacturing, non-clinical studies, and our clinical trials. If these third parties do not or cannot successfully carry out their contractual duties and meet expected deadlines or performance goals, the initiation or conduct of our clinical trials would be delayed and we may be unable to obtain regulatory approval for, or commercialize, our current product candidates or any future products, and our financial condition would be adversely affected.

	●	Radiopharmaceutical technology is a relatively novel approach to cancer imaging and treatment, which may create significant and potentially unpredictable challenges for it, including the availability of radioisotopes, potential misconception about the safety of radiopharmaceuticals, and low market uptake due to its novelty. Perceptions of these challenges may make it more difficult to raise funding as we focus efforts on our radiopharmaceutical programs.

	●	The Russia-Ukraine war, and resulting sanctions against Russia and Russian entities, and Russian reduction in gas shipments to the EU and other allies, have increased fuel costs, reduced access to critical supplies and may cause shipping delays. Separately, the Israel-Hamas war has created additional uncertainties. The broader political, economic, trade and financial market consequences are uncertain at this time, which may increase the cost of supplies for our clinical materials, delay the manufacture of our clinical materials, restrict the availability of radioisotopes, increase costs of other goods and services or make it more difficult or costly to raise additional financing, any of which could cause an adverse effect on our clinical and preclinical programs and on our financial condition.

	●	Market variables, such as inflation of product costs, labor rates and fuel, freight and energy costs, as well as geopolitical events could likely cause us to suffer significant increases in our operating and administrative expenses.

	●	Unstable market and economic conditions, such as volatility in the markets due to concerns about bank stability and economic challenges due to inflation, may have serious adverse consequences on our ability to raise funds, which may cause us to delay, restructure or cease our operations.

	●	The results of the U.S. Presidential and Congressional election including the effects on the economy and future political pressure to lower pharmaceutical prices are a major threat to the economic viability of new research-based pharmaceutical products, and any significant decrease in drug prices could materially and adversely affect the financial appeal of our products and prospects for us to raise additional capital.

	●	We face significant competition from other radiopharmaceutical, biotechnology and pharmaceutical companies, and from research-based academic medical institutions, in our targeted medical indications, and our operating results would be adversely affected if we fail to compete effectively. Many competitors in our industry have greater organizational capabilities, much higher available capital resources, and established marketing and sales resources and experience in the targeted markets. Competition and technological change may make our product candidates obsolete or non-competitive.

	●	The termination of third-party licenses would adversely affect our rights to important compounds or technologies which are essential to develop and market our products.

	●	If we and our third-party licensors do not obtain and preserve protection for our respective intellectual property rights, our competitors may be able to develop and market competing drugs, which would adversely affect our financial condition.

	●	If we lose key management leadership, and/or the expertise and experience of our scientific personnel, and if we cannot recruit qualified employees or other highly qualified and experienced personnel for future requirements, we would be at risk to experience significant program delays and increased operational and compensation costs, and our business would be materially disrupted.

	●	Any future or long-term impacts of COVID-19 or any other pandemic remain uncertain, and their scope and impact could have a substantial negative bearing on our business, financial condition, operating results, stock price and ability to raise additional funds.

	*June 30, 2024*			December 31, 2023*

*Assets*

Current assets:
Cash and cash equivalents	$	6,119,931		$	7,266,080
Investments		998,840			—
Other current assets		61,017			66,433
Total current assets		7,179,788			7,332,513

Operating lease right-of-use asset		—			12,646
Total assets	$	7,179,788		$	7,345,159

*Liabilities and Stockholders’ Equity*

Current liabilities:
Accounts payable, accrued expenses and other current liabilities	$	1,089,462		$	1,757,393
Total current liabilities and total liabilities		1,089,462			1,757,393

Commitments and contingencies (Note 8)

Stockholders’ equity:
Common stock, par value of $0.001 per share, 40,000,000 shares authorized, 17,601,827 and 14,904,497 shares issued and outstanding as of June 30, 2024, and December 31, 2023, respectively		17,602			14,905
Additional paid-in capital		69,627,218			65,793,210
Accumulated other comprehensive income (loss)		8,258			(14,132	)
Accumulated deficit		(63,562,752	)		(60,206,217	)
Total stockholders’ equity		6,090,326			5,587,766
Total liabilities and stockholders’ equity	$	7,179,788		$	7,345,159

	Three Months Ended June 30,						Six Months Ended June 30,
	*2024*			*2023*			*2024*			*2023*
Operating expenses:
Research and development	$	1,130,978		$	1,594,713		$	2,097,088		$	3,248,082
General and administrative		657,806			733,496			1,415,087			1,605,171
Total operating expenses		1,788,784			2,328,209			3,512,175			4,853,253
Loss from operations		(1,788,784	)		(2,328,209	)		(3,512,175	)		(4,853,253	)
Interest income		73,475			128,218			155,640			218,706
Net loss		(1,715,309	)		(2,199,991	)		(3,356,535	)		(4,634,547	)
Other comprehensive income (loss):
Foreign currency translation gain (loss)		1,583			(4,385	)		748			(15,184	)
Unrealized gain (loss) on investments		2,444			(20,180	)		21,642			13,464
Comprehensive loss	$	(1,711,282	)	$	(2,224,556	)	$	(3,334,145	)	$	(4,636,267	)
Net loss per share:
Basic and diluted	$	(0.10	)	$	(0.16	)	$	(0.20	)	$	(0.35	)
Weighted average shares outstanding:
Basic and diluted		17,514,637			13,420,029			16,747,198			13,263,770

								*Accumulated*
					*Additional*			*Other*						*Total*
	*Common Stock*				*Paid-*			*Comprehensive*			*Accumulated*			*Stockholders’*
	*Shares*		*Amount*		*in Capital*			*Income (Loss)*			*Deficit*			*Equity*

Balance as of January 1, 2024		14,904,497	$	14,905	$	65,793,210		$	(14,132	)	$	(60,206,217	)	$	5,587,766
Issuance of common stock under a Capital on Demand^TM Sales Agreement with JonesTrading Institutional Services, LLC, net of commissions, fees and offering costs of $81,932		2,545,305		2,545		3,191,765			—			—			3,194,310
Issuance of common stock to employees pursuant to vested restricted stock units, net of taxes		34,373		34		(10,772	)		—			—			(10,738	)
Stock-based compensation (non-cash)		—		—		328,661			—			—			328,661
Net loss		—		—		—			—			(1,641,226	)		(1,641,226	)
Other comprehensive income, net		—		—		—			18,363			—			18,363
Balance as of March 31, 2024		17,484,175		17,484		69,302,864			4,231			(61,847,443	)		7,477,136
Issuance of common stock to employees pursuant to vested restricted stock units, net of taxes		33,652		34		(10,036	)		—			—			(10,002	)
Exercise of stock options		84,000		84		—			—			—			84
Stock-based compensation (non-cash)		—		—		334,390			—			—			334,390
Net loss		—		—		—			—			(1,715,309	)		(1,715,309	)
Other comprehensive income, net		—		—		—			4,027			—			4,027
Balance as of June 30, 2024		17,601,827	$	17,602	$	69,627,218		$	8,258		$	(63,562,752	)	$	6,090,326

	*For the Six Months Ended*
	*June 30,*
	*2024*			*2023*

Cash flows from operating activities:
Net loss	$	(3,356,535	)	$	(4,634,547	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense		663,051			949,505
Changes in operating assets and liabilities, net
Other current assets		14,014			(63,891	)
Accounts payable, accrued expenses and other current liabilities		(656,989	)		(623,648	)
Operating lease right-of-use assets and liabilities, net		4,238			—
Net cash used in operating activities		(3,332,221	)		(4,372,581	)
Cash flows from investing activities:
Purchase of short-term investments		(985,730	)		(4,921,873	)
Maturities of short-term investments		—			6,892,238
Net cash (used in) provided by investing activities		(985,730	)		1,970,365
Cash flows from financing activities:
Cash proceeds from the sales of common stock under a Capital on Demand^TM Sales Agreement		3,192,618			1,479,416
Taxes paid related to net share settlement of vested restricted stock units		(20,740	)		(33,440	)
Cash proceeds from the issuance of stock upon exercise of stock options		84			—
Net cash provided by financing activities		3,171,962			1,445,976
Effect of exchange rates		(160	)		(15,197	)
Net decrease in cash and cash equivalents		(1,146,149	)		(971,437	)
Cash and cash equivalents at beginning of period		7,266,080			8,186,194
Cash and cash equivalents at end of period	$	6,119,931		$	7,214,757

June 30, 2024	*Level 1*		*Total*
Assets:
Cash equivalents⁽¹⁾	$	5,878,877	$	5,878,877
Investments⁽²⁾		998,840		998,840
Total	$	6,877,717	$	6,877,717

	(1)	Cash equivalents as of June 30, 2024 and December 31, 2023, represent the fair value of the Company’s investment in two money market accounts and U.S. Treasury Bills with maturities at the date of purchase of three months or less.
	(2)	Investments represents the fair value of the Company’s investment in U.S. Treasury Bills with maturities at the date of purchase over three months to one year.

As of June 30, 2024	*Cost Basis*		*Unrealized Gains*		*Aggregate Fair Value*

U.S. Treasury Bills	$	3,657,927	$	30,879	$	3,688,806
Money Market Accounts		3,188,911		—		3,188,911
Total	$	6,846,838	$	30,879	$	6,877,717

As of December 31, 2023	*Cost Basis*		*Unrealized Gains*		*Aggregate Fair Value*

U.S. Treasury Bills	$	2,971,103	$	9,237	$	2,980,340
Money Market Accounts		3,564,570		—		3,564,570
Total	$	6,535,673	$	9,237	$	6,544,910

	*Options Outstanding*
	*Number of Shares Subject to Options*			*Weighted-Average Exercise Price*
Balances at December 31, 2023		2,109,001		$	4.01
Granted⁽¹⁾		78,592			0.60
Forfeited⁽²⁾		—			—
Exercised		(84,000	)		0.001
Balances at June 30, 2024		2,103,593			4.05
Unvested options outstanding expected to vest⁽³⁾		539,306			2.96

December 31 2023	*Level 1*		*Total*
Assets:
Cash equivalents⁽¹⁾	$	6,544,910
Total	$	6,544,910	$	—

(1)	78,592 options vest as follows: options to purchase 10,000 shares of the Company’s common stock vest monthly over one year; options to purchase 68,592 shares of the Company's common stock vest 6/48ths on the six-month anniversary of vesting commencement date and 1/48th per month thereafter.

(2)	There were no forfeitures during the six months ended June 30, 2024.

(3)	Forfeitures only include known forfeitures to-date as the Company accounts for forfeitures as they occur due to a limited history of forfeitures.

Exercise Prices	Number of Shares Subject to Options Outstanding		Weighted-Average Remaining Contractual Term in Years		Number of Shares Subject to Options Fully Vested and Exercisable		Weighted-Average Remaining Contractual Term in Years
$0.001 - $5.00		1,366,487		6.94		864,151		6.05
$5.01 - $10.00		617,942		5.00		580,972		4.89
$10.01 - $15.00		113,039		5.59		113,039		5.59
$15.01 - $20.00		6,125		5.59		6,125		5.59
		2,103,593		6.29		1,564,287		5.58

				*Weighted- Average*
	*Restricted*			*Grant Date*
	*Stock Units*			*Fair Value*
	*(#)*			*per Unit ($)*
Unvested balance at December 31, 2023		418,091			3.40
Granted⁽¹⁾		29,973			0.65
Vested		(98,910	)		4.10
Unvested Balance at June 30, 2024		349,154			2.97