Adial Pharmaceuticals(ADIL) - 2024 Q2 - Quarterly Report

Financial Performance - The company reported net losses of approximately $8.9 million and $5.1 million for the six months ended June 30, 2024, and the year ended December 31, 2023, respectively[87]. - Accumulated deficits were approximately $77.7 million and $68.8 million as of June 30, 2024, and December 31, 2023, respectively[87]. - Loss from continuing operations for the six months ended June 30, 2024, was approximately $8.9 million, compared to a loss of $3.75 million for the same period in 2023[102]. - Losses from equity method investment increased by approximately $412,000 due to the acquisition of Adovate, LLC on June 30, 2023[106]. - Loss from discontinued operations decreased by approximately $1,932,000 (100%) as the business of Purnovate, Inc. was sold in June 2023[109]. Expenses - Research and development expenses increased by approximately $671,000 (84%) in the six months ended June 30, 2024, compared to the same period in 2023[104]. - General and administrative expenses decreased by approximately $286,000 (10%) in the six months ended June 30, 2024, compared to the same period in 2023[102]. - Total operating expenses for the six months ended June 30, 2024, were $4.1 million, an increase of $385,000 compared to the same period in 2023[102]. - Inducement expense of approximately $4,464,000 was recognized as a one-time, noncash expense related to the issuance of new warrants[107]. Revenue and Cash Flow - The company has not generated any significant revenue since inception and does not expect current cash and cash equivalents to be sufficient to fund operations for the next twelve months[86][88]. - Net cash used in operating activities increased by approximately $567,000 in the six months ended June 30, 2024, compared to the same period in 2023[118]. - Net cash provided by financing activities increased by approximately $3,625,000, driven by the sale of common stock and warrant exercises[122]. - Total other income increased by $77,000 (2567%) due to higher interest income and a one-time expense in the prior year[108]. Future Financing and Development - The company expects to finance operations through a combination of equity offerings, debt financings, and other collaborations, but may face challenges in raising additional funds[89]. - The company expects to use approximately $10-15 million in cash during the twelve months ended June 30, 2025 for AD04 development costs and general corporate expenses[114]. - The company will require additional financing to execute its overall business strategy, including two additional Phase 3 trials for AD04, expected to require $8-12 million each[115]. - The company initiated a Phase 1 pharmacokinetic study of AD04 with an estimated total cost of approximately $1.4 million[113]. Clinical Development Focus - The company is focused on completing the clinical development program for its investigational drug candidate AD04, primarily in the U.S. and secondarily in Europe/UK[84].