Alto Neuroscience(ANRO) - 2024 Q3 - Quarterly Report

Financial Performance - The company reported net losses of $16.8 million and$46.2 million for the three and nine months ended September 30, 2024, respectively, compared to $9.1 million and$25.1 million for the same periods in 2023[142]. - The company has not generated any revenue from product sales and expects to incur significant operating losses and negative cash flows for the foreseeable future[142][144]. - The company anticipates continued net losses and increased operating expenses as it expands its headcount and develops its product candidates[169]. - Net loss for the three months ended September 30, 2024, was $16.8 million, compared to a net loss of$9.1 million for the same period in 2023, indicating an increase of 84%[160]. - Net cash used in operating activities was $34.4 million for the nine months ended September 30, 2024, compared to$21.9 million for the same period in 2023, an increase of 57%[177]. - Net cash used in operating activities was $(34.4) million for the nine months ended September 30, 2024, compared to$(21.9) million for the same period in 2023[184]. Cash and Funding - As of September 30, 2024, the company had an accumulated deficit of $123.2 million and cash, cash equivalents, and restricted cash of$182.2 million[142][147]. - The company has raised approximately $275.6 million from equity financings since its inception in 2019, including$133.0 million from its IPO in February 2024[141][147]. - Cash, cash equivalents, and restricted cash amounted to $182.2 million as of September 30, 2024, compared to$82.5 million as of December 31, 2023[172]. - The company expects existing cash and cash equivalents of $181.7 million to fund operations into 2027, but actual results may vary[185]. - Net cash provided by financing activities was$135.6 million for the nine months ended September 30, 2024, primarily from the issuance of 9,246,000 shares at $16.00 per share[179]. - Material cash requirements as of September 30, 2024, include obligations under a Term Loan and lease commitments totaling$7.1 million over the next five years[188]. - The company entered into a Convertible Grant Agreement with Wellcome for up to approximately $11.7 million, with$1.3 million funded upon execution[192]. Research and Development - The company is currently evaluating ALTO-100 in a Phase 2b study for bipolar depression, with a target enrollment of approximately 200 patients and topline data expected in 2026[137]. - ALTO-300 is being evaluated in a 200-patient Phase 2b trial for major depressive disorder (MDD), with topline data expected in the first half of 2025[138]. - ALTO-203 is in a Phase 2 proof-of-concept trial for MDD, with topline data expected in the first half of 2025[139]. - ALTO-101 is being evaluated in a Phase 2 proof-of-concept trial for cognitive impairment associated with schizophrenia, with topline data expected in the second half of 2025[140]. - The company intends to develop ALTO-202, a novel NMDA receptor antagonist for the treatment of MDD[140]. - Research and development expenses increased to $13.1 million for the three months ended September 30, 2024, up from$8.0 million in the same period of 2023, representing a 64% increase[162]. - Research and development expenses for the nine months ended September 30, 2024, totaled $36.2 million, up from$20.6 million in the same period of 2023, a 75% increase[167]. Operating Expenses - General and administrative expenses rose to $5.8 million for the three months ended September 30, 2024, compared to$1.8 million in the same period of 2023, marking a 228% increase[163]. - General and administrative expenses for the nine months ended September 30, 2024, were $15.4 million, compared to$5.4 million in the same period of 2023, representing a 185% increase[167]. - Total operating expenses for the three months ended September 30, 2024, were $18.9 million, up from$9.7 million in the same period of 2023, reflecting a 95% increase[160]. - Stock-based compensation expenses increased by $3.8 million to$6.1 million for the nine months ended September 30, 2024, compared to $2.3 million for the same period in 2023[182]. Agreements and Milestones - The company achieved a clinical milestone under the Teva Agreement and paid$0.5 million in cash during the nine months ended September 30, 2024[197]. - A milestone under the MedRx Agreement was achieved in April 2024, resulting in a payment of $0.75 million in cash and the issuance of 46,875 shares, recognizing an expense of$1.5 million[199]. - The company has entered into multiple license agreements, including those with Stanford University, Sanofi, and Cerecor, to expand its product development capabilities[193][194][195]. Company Classification and Reporting - The company is classified as an "emerging growth company" under the JOBS Act, allowing it to rely on certain exemptions from public company reporting requirements for up to five years post-IPO[202]. - The company has opted for an extended transition period for complying with new or revised accounting standards, delaying adoption until those standards apply to private companies[203]. - The company will cease to be an "emerging growth company" upon reaching $1.235 billion in annual revenue or other specified conditions[203]. - The company is also classified as a "smaller reporting company," which allows it to utilize scaled disclosures as long as certain revenue and stock valuation thresholds are met[204]. - The voting and non-voting common stock held by non-affiliates must be less than$250 million or annual revenue must be less than $100 million to maintain smaller reporting company status[204]. - The company is not required to provide quantitative and qualitative disclosures about market risk due to its smaller reporting company status[205].