GLMD 6-K
Galmed Pharmaceuticals Ltd. (GLMD)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
Report of Foreign Private Issuer Pursuant to Rule 13a-16 or 15d-16
Under the Securities Exchange Act of 1934
For the Month of August 2024
(Commission File Number)
(Exact name of Registrant as specified in its charter)
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
This Form 6-K contains the quarterly report of Galmed Pharmaceuticals Ltd. (the “Company”), which includes the Company’s unaudited interim condensed consolidated financial statements for the three and six months ended June 30, 2024, together with related information and certain other information. The Company is not subject to the requirements to file quarterly or certain other reports under Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended. The Company does not undertake to file or cause to be filed any such reports in the future, except to the extent required by law.
This Form 6-K is incorporated by reference into the Company’s Registration Statement on Form S-8 (Registration No. 333-206292 and 333-227441) and the Company’s Registration Statement on Form F-3 (Registration No. 333-272722).
FINANCIAL INFORMATION
Financial Statements
GALMED PHARMACEUTICALS LTD.
Interim Condensed Consolidated Balance Sheets (Unaudited)
U.S. Dollars in thousands, except share data and per share data
| As of | As of | |||||||
| June 30, 2024 | December 31, 2023 | |||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Restricted Cash | ||||||||
| Short-term deposit | ||||||||
| Marketable debt securities | ||||||||
| Other receivables | ||||||||
| Total current assets | ||||||||
| Right of use assets | ||||||||
| Property and equipment, net | ||||||||
| Investment in associate at fair value | ||||||||
| Total non-current assets | ||||||||
| Total assets | $ | $ | ||||||
| Liabilities and stockholders’ equity | ||||||||
| Current liabilities | ||||||||
| Trade payables | $ | $ | ||||||
| Other payables | ||||||||
| Total current liabilities | ||||||||
| Stockholders’ equity | ||||||||
| Ordinary shares par value NIS per share; Authorized ; Issued and outstanding: shares as of June 30, 2024 and shares as of December 31, 2023 | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ equity | ||||||||
| Total liabilities and stockholders’ equity | $ | $ | ||||||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
GALMED PHARMACEUTICALS LTD.
Interim Condensed Consolidated Statements of Operations (Unaudited)
U.S. Dollars in thousands, except share data and per share data
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Research and development expenses | ||||||||||||||||
| General and administrative expenses | ||||||||||||||||
| Total operating expenses | ||||||||||||||||
| Financial income, net | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net loss | $ | $ | $ | $ | ||||||||||||
| Basic and diluted net loss per share | $ | $ | $ | $ | ||||||||||||
| Weighted-average number of shares outstanding used in computing basic and diluted net loss per share | ||||||||||||||||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
GALMED PHARMACEUTICALS LTD.
Interim Condensed Consolidated Statements of Comprehensive Loss (Unaudited)
U.S. Dollars in thousands
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net loss | $ | $ | $ | $ | ||||||||||||
| Other comprehensive loss: | ||||||||||||||||
| Net unrealized loss (gain) on available for sale securities | ( | ) | ( | ) | ( | ) | ||||||||||
| Comprehensive loss | $ | $ | $ | $ | ||||||||||||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
GALMED PHARMACEUTICALS LTD.
Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)
U.S. Dollars in thousands, except share data and per share data
| Ordinary shares | Additional paid-in | Accumulated other Comprehensive | Accumulated | |||||||||||||||||||||
| Shares | Amount | capital | loss | Deficit | Total | |||||||||||||||||||
| Balance - December 31, 2023 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
| Exercise of pre-funded warrants | ( | ) | ||||||||||||||||||||||
| Stock-based compensation | - | |||||||||||||||||||||||
| Unrealized loss from marketable debt securities | - | ( | ) | ( | ) | |||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||||||
| Balance - March 31, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
| Exercise of pre-funded warrants | ( | ) | ||||||||||||||||||||||
| Stock-based compensation | - | |||||||||||||||||||||||
| Unrealized gain from marketable debt securities | - | |||||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||||||
| Balance - June 30, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
| Accumulated | ||||||||||||||||||||||||
| Additional | other | |||||||||||||||||||||||
| Ordinary shares | paid-in | Comprehensive | Accumulated | |||||||||||||||||||||
| Shares | Amount | capital | loss | Deficit | Total | |||||||||||||||||||
| Balance – December 31, 2022 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
| Stock based compensation | - | |||||||||||||||||||||||
| Unrealized gain from marketable debt securities | - | | ||||||||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||||||
| Balance – March 31, 2023 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
| Stock-based compensation | - | |||||||||||||||||||||||
| Unrealized loss from marketable debt securities | - | ( | ) | ( | ) | |||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||||||
| Balance – June 30, 2023 | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
GALMED PHARMACEUTICALS LTD.
Interim Condensed Consolidated Statements of Cash Flows (Unaudited)
U.S. Dollars in thousands
| Six months ended June 30, | ||||||||
| 2024 | 2023 | |||||||
| Cash flow from operating activities | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments required to reconcile net loss to net cash used in operating activities | ||||||||
| Depreciation and amortization | ||||||||
| Stock-based compensation expense | ||||||||
| Amortization of premium on marketable debt securities | ||||||||
| Change in fair value of SAFE investment | ( | ) | ||||||
| Interest income from short-term deposits | ( | ) | ( | ) | ||||
| Loss (gain) from realization of marketable debt securities | ( | ) | ||||||
| Finance expenses | ( | ) | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Decrease in other accounts receivable | ||||||||
| Decrease in trade payables | ( | ) | ( | ) | ||||
| Increase (decrease) in other accounts payable | ( | ) | ||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flow from investing activities | ||||||||
| Purchase of available for sale securities | ( | ) | ( | ) | ||||
| Investment in equity of Onkai | ( | ) | ||||||
| Investment in (withdrawal from) short term deposits | ( | ) | ||||||
| Sale of available-for-sale securities | ||||||||
| Net cash provided by (used in) investing activities | ||||||||
| Decrease in cash and cash equivalents and restricted cash | ( | ) | ( | ) | ||||
| Cash and cash equivalents and restricted cash at the beginning of the period | ||||||||
| Cash and cash equivalents and restricted cash at the end of the period | $ | $ | ||||||
| Supplemental disclosure of cash flow information: | ||||||||
| Cash received from interest | $ | $ | ||||||
| Non-cash investment transaction: | ||||||||
| Conversion of SAFE into equity of OnKai | $ | $ | ||||||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
GALMED PHARMACEUTICALS LTD.
Notes to Interim Condensed Consolidated Financial Statements
Note 1 - Basis of presentation
Galmed
Pharmaceuticals Ltd. (the “Company”) was incorporated in Israel on
The Company holds three wholly-owned subsidiaries, Galmed International Ltd., which is incorporated in Malta, and Galmed Research and Development Ltd. (“GRD”) and Galtopa Therapeutics Ltd., both of which are incorporated in Israel. In July 2023, GRD established a new wholly-owned subsidiary incorporated under the laws of England and Wales called Galmed Therapeutics UK Limited.
The Company is a biopharmaceutical company focused on the development of Aramchol. The Company has focused almost exclusively on developing Aramchol for the treatment of liver disease and is currently developing Aramchol for Primary Sclerosing Cholangitis, or PSC, and exploring the feasibility of developing Aramchol for other fibro-inflammatory indications outside of liver disease. The Company is also collaborating with the Hebrew University in the development of Amilo-5MER. The Company has an operating history limited to pre-clinical and clinical drug development.
The
Company funded its research and development programs and operations to date primarily through proceeds from private placements and public
offerings. The Company currently has no products approved for marketing and has not generated any revenue from product sales to date.
As of June 30, 2024, the Company had cash and cash equivalents of $
The
Company has incurred operating losses in each year since inception. The Company’s loss attributable to holders of its ordinary
shares for the six months ended June 30, 2024 and 2023 was approximately $
The Company will need to raise substantial, additional capital to fund its operations and to develop Aramchol and Amilo-5MER for, and beyond its current development stage and any future commercialization, as well as any additional indications.
Based on the Company’s current operating plan, the Company’s management currently estimates that its cash position will support its current operations as currently conducted for more than 12 months from the date of issuance of these financial statements.
These unaudited interim condensed consolidated financial statements have been prepared as of June 30, 2024 and for the three and six month periods then ended. Accordingly, certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been omitted. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited financial statements and the accompanying notes of the Company for the year ended December 31, 2023 that are included in the Company’s Annual Report on Form 20-F, filed with the Securities and Exchange Commission on April 4, 2024 (the “Annual Report on Form 20-F”). The results of operations presented are not necessarily indicative of the results to be expected for the year ending December 31, 2024.
Note 2 - Summary of significant accounting policies
The significant accounting policies that have been applied in the preparation of the unaudited condensed consolidated interim financial statements are identical to those that were applied in preparation of the Company’s most recent annual financial statements in connection with its Annual Report on Form 20-F.
Note 3 – Investment in Associate at Fair Value
On
May 4, 2023, the Company entered into a definitive agreement (the “Agreement”) for a $
Previously,
on November, 2022 the Company invested $
The
Company’s investment in OnKai was part of an approximately $
Summarized statement of operations (in thousands) of Onkai:
| Three months ended | Six months ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Total operating loss | $ | $ | $ | $ | ||||||||||||
| Net loss | $ | $ | $ | $ | ||||||||||||
Under the terms of the Agreement, during the three-year period following the closing of the Investment Round the Company will have the right to merge with OnKai subject to the approval of the boards of directors of each of the Company and OnKai. The Company was granted certain customary pre-emptive rights as well as registration rights, first refusal rights, co-sale rights and broad based weighted average anti-dilution rights, a board seat, and certain customary protective provisions.
In connection with the Agreement, the Company’s wholly-owned subsidiary GRD entered into a services agreement with OnKai (the “Services Agreement”). The Services Agreement provides that GRD will on a non-exclusive basis (i) provide support services to OnKai relating to finance, business development, strategic planning, execution and others; and (ii) lend its experience to OnKai in building a strategy and for the development of treatments for the underserved and that OnKai shall on a non-exclusive basis (i) take part in plan preparation to serve GRD’s vision of developing drugs for the underserved population and (ii) when relevant, design a process on the clinical trial dashboard that could potentially serve GDR’s future trial.
Note 4 - Stockholders’ Equity
| 1.
On May 15, 2023, the Company effected a reverse share split of the Company’s ordinary
shares at the ratio of | |
| 2.
On July 18, 2023, the Company sold to investors in a public offering (i) ordinary shares, (ii) |
The
Pre-Funded Warrants are immediately exercisable at an exercise price of $
The
Investor Warrants have an exercise price of $
The
net proceeds to the Company were approximately $
As
of June 30, 2024, a total of
Note 5 – Subsequent events
| 1. | Subsequent
to the balance sheet date, a total of | |
| 2. | Subsequent to the balance sheet date, a total of RSU’s were exercised into ordinary shares. | |
| 3. | Subsequent
to the balance sheet date, on August 27, 2024, the Company announced that |
Management’s Discussion and Analysis of Financial Condition and Results of Operations
All references to “we,” “us,” “our,” “the Company” and “our Company”, in this Form 6-K are to Galmed Pharmaceuticals Ltd. and its subsidiaries, unless the context otherwise requires. All references to “shares” or “ordinary shares” are to our ordinary shares, NIS 0.15 nominal par value per share. All references to “Israel” are to the State of Israel. “U.S. GAAP” means the generally accepted accounting principles of the United States. Unless otherwise stated, all of our financial information presented in this Form 6-K has been prepared in accordance with U.S. GAAP. Any discrepancies in any table between totals and sums of the amounts and percentages listed are due to rounding. Unless otherwise indicated, or the context otherwise requires, references in this Form 6-K to financial and operational data for a particular year refer to the fiscal year of our company ended December 31 of that year.
Our reporting currency and financial currency is the U.S. dollar. In this Form 6-K, “NIS” means New Israeli Shekel, and “$,” “US$” and “U.S. dollars” mean United States dollars.
Cautionary Note Regarding Forward-Looking Statements
This Form 6-K contains forward-looking statements about our expectations, beliefs or intentions regarding, among other things, our product development efforts, business, financial condition, results of operations, strategies or prospects. In addition, from time to time, we or our representatives have made or may make forward-looking statements, orally or in writing. Forward-looking statements can be identified by the use of forward-looking words such as “believe,” “expect,” “intend,” “plan,” “may,” “should,” “anticipate,” “could,” “might,” “seek,” “target,” “will,” “project,” “forecast,” “continue” or their negatives or variations of these words or other comparable words or by the fact that these statements do not relate strictly to historical matters. These forward-looking statements may be included in, among other things, various filings made by us with the SEC, press releases or oral statements made by or with the approval of one of our authorized executive officers. Forward-looking statements relate to anticipated or expected events, activities, trends or results as of the date they are made. Because forward-looking statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertainties that could cause our actual results to differ materially from any future results expressed or implied by the forward-looking statements. Many factors could cause our actual activities or results to differ materially from the activities and results anticipated in forward-looking statements, including, but not limited to, the factors summarized below:
| ● | our ability to pursue, evaluate and complete any strategic alternative that yields value for our shareholders; | |
| ● | the timing and cost of our planned PSC clinical trial and our pivotal Phase 3 ARMOR trial, or the ARMOR Study, if re-initiated, for our product candidates, Aramchol and Amilo-5MER, or for any other pre-clinical or clinical trials; | |
| ● | completion and receiving favorable results of our planned PSC clinical trial and the ARMOR Study (if re-initiated) for Aramchol or any other pre-clinical or clinical trial; | |
| ● | regulatory action with respect to Aramchol or any other product candidate by the U.S. Food and Drug Administration, or the FDA, or the European Medicines Authority, or EMA, including but not limited to acceptance of an application for marketing authorization, review and approval of such application, and, if approved, the scope of the approved indication and labeling; | |
| ● | the commercial launch and future sales of Aramchol and any future product candidates; | |
| ● | our ability to comply with all applicable post-market regulatory requirements for Aramchol, Amilo-5MER or any other product candidate in the countries in which we seek to market the product; | |
| ● | our ability to achieve favorable pricing for Aramchol, Amilo-5MER or any other product candidate; |
| ● | our expectations regarding the commercial market for non-alcoholic steato-hepatitis, or NASH, in patients or any other targeted indication; | |
| ● | third-party payor reimbursement for Aramchol, Amilo-5MER or any other product candidate; | |
| ● | our estimates regarding anticipated capital requirements and our needs for additional financing; | |
| ● | market adoption of Aramchol or any other product candidate by physicians and patients; | |
| ● | the timing, cost or other aspects of the commercial launch of Aramchol or any other product candidate; | |
| ● | our ability to obtain and maintain adequate protection of our intellectual property; | |
| ● | the possibility that we may face third-party claims of intellectual property infringement; | |
| ● | our ability to manufacture our product candidates in commercial quantities, at an adequate quality or at an acceptable cost; | |
| ● | our ability to establish adequate sales, marketing and distribution channels; | |
| ● | intense competition in our industry, with competitors having substantially greater financial, technological, research and development, regulatory and clinical, manufacturing, marketing and sales, distribution and personnel resources than we do; | |
| ● | the development and approval of the use of Aramchol or any other product candidate for additional indications or in combination therapy; | |
| ● | our expectations regarding licensing, acquisitions and strategic operations; | |
| ● | current or future unfavorable economic and market conditions and adverse developments with respect to financial institutions and associated liquidity risk; | |
| ● | our ability to maintain the listing of our ordinary shares on The Nasdaq Capital Market; and | |
| ● | security, political and economic instability in the Middle East that could harm our business, including due to the the recent attacks by Hamas and other terrorist organizations from the Gaza Strip and elsewhere in the region and Israel’s war against them and military hostilities with Hezbollah on the northern border of Israel. |
We believe these forward-looking statements are reasonable; however, these statements are only current predictions and are subject to known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from those anticipated by the forward-looking statements. We discuss many of these risks in our Annual Report on Form 20-F for the year ended December 31, 2023 filed with the SEC on April 4, 2024, in greater detail under the heading “Risk Factors” and elsewhere in the Annual Report and this Form 6-K. Given these uncertainties, you should not rely upon forward-looking statements as predictions of future events.
All forward-looking statements attributable to us or persons acting on our behalf speak only as of the date hereof and are expressly qualified in their entirety by the cautionary statements included in this report. We undertake no obligations to update or revise forward-looking statements to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. In evaluating forward-looking statements, you should consider these risks and uncertainties.
Overview
We are a biopharmaceutical company focused on the development of Aramchol. We have focused almost exclusively on developing Aramchol for the treatment of liver disease and have been developing Aramchol for PSC and exploring the feasibility of developing Aramchol for other fibro-inflammatory and oncological indications outside of liver disease. As we continue to explore the feasibility of developing Aramchol for other indications, we do not currently have a timeline for the commencement of the PSC trial we had been planning and can give no assurances that we will commence this trial. We are also collaborating with the Hebrew University in the development of Amilo-5MER, a 5 amino acid synthetic peptide.
While we previously announced that we were no longer evaluating our strategic alternatives following the initiation of our PSC clinical program and our investment and collaboration with Onkai, we have reinitiated the process of evaluating our strategic options alternatives and our structuring to best optimize our resources to enhance shareholder value and achieve our goals.
To date, we have not generated revenue from the sale of any product, excluding the licensing revenue we recorded in connection with the Samil Agreement, and we do not expect to generate any significant revenue other than the amortization of the upfront payments under the license agreement with Samil and of the subsequent royalties and/or milestones that may be earned in connection with the Samil Agreement or potential other license Agreements, unless and until we commercialize Aramchol, or license the product to additional third parties. As of June 30, 2024, we had an accumulated deficit of approximately $195.3 million.
Our financing activities are described below under “Liquidity and Capital Resources.” Obtaining approval of an NDA, MMA, or other similar application is an extensive, lengthy, expensive and uncertain process, and the FDA, EMA, MHRA and other regulatory agencies may delay, limit or deny approval of Aramchol, Amilo-5MER or any other product candidate.
Financial Overview
To date, we have funded our operations primarily through proceeds from private placements and public offerings. As of June 30, 2024, we had current assets of $10.1 million, which includes cash and cash equivalents of $1.8 million, short term deposit of $2.0 million, marketable debt securities of $5.9 million, other receivables of $0.1 million and restricted cash of $0.1 million. This compares with current assets of $13.2 million at December 31, 2023, which includes cash and cash equivalents of $2.9 million, short term deposit of $2.2 million, marketable debt securities of $7.5 million, other receivables of $0.5 million and restricted cash of $0.1 million. Although we provide no assurance, we believe that such existing funds will be sufficient to continue our business and operations as currently conducted for more than 12 months from the date of issuance of this Form 6-K. However, we will continue to incur operating losses, which may be substantial over the next several years, and we expect that we will need to obtain additional funds to further develop our research and development programs.
Costs and Operating Expenses
Our current costs and operating expenses consist of two components: (i) research and development expenses; and (ii) general and administrative expenses.
Research and Development Expenses
Our research and development expenses consist primarily of outsourced development expenses, salaries and related personnel expenses and fees paid to external service providers, patent-related legal fees, costs of pre-clinical studies and clinical trials and drug and laboratory supplies. We account for all research and development expenses as they are incurred. We expect our research and development expense to remain our primary expense in the near future as we continue to develop Aramchol. Increases or decreases in research and development expenditures are primarily attributable to the number and/or duration of the pre-clinical and clinical studies that we conduct.
We expect that a substantial amount of our research and development expense in the future will be incurred in support of our current and anticipated pre-clinical and clinical development projects. Due to the inherently unpredictable nature of pre-clinical and clinical development studies and unpredictability of our evaluation of strategic alternatives, we are unable to estimate with any certainty the costs we will incur in the continued development of Aramchol for NASH and other indications in our pipeline for potential partnering and/or commercialization. Clinical development timelines, the probability of success and development costs can differ materially from expectations. We currently expect to continue testing Aramchol in pre-clinical studies for toxicology, safety and efficacy, and to conduct additional clinical trials for Aramchol. Nevertheless, we expect to decrease our research and development expenses as a result of the discontinuation of the Open Label Part of the ARMOR Study and our evaluation of strategic alternatives.
The lengthy process of completing clinical trials and seeking regulatory approval for Aramchol requires the expenditure of substantial resources. Any failure or delay in completing clinical trials, or in obtaining regulatory approvals, could cause a delay in generating product revenue and cause our research and development expenses to increase and, in turn, have a material adverse effect on our operations. Because of the factors set forth above, we are not able to estimate with any certainty when we would recognize any net cash inflows from our projects.
General and Administrative Expenses
General and administrative expenses consist primarily of compensation for employees in executive and operational roles, including finance/accounting, legal and other operating positions in connection with our activities. Our other significant general and administrative expenses include non-cash stock-based compensation costs and facilities costs (including the rental expense for our offices in Tel Aviv, Israel), professional fees for outside accounting and legal services, travel costs, investors relations, insurance premiums and depreciation.
General and administrative expenses also consist of costs associated with being a public company, including expenses related to services associated with maintaining compliance with The Nasdaq Capital Market and SEC requirements, directors and officers insurance, increased legal and accounting costs and investor relations costs. Our general and administrative expenses may also increase due to increases in professional and advisory fees as we evaluate our strategic alternatives.
Financial Income, Net
Our financial income, net consists mainly of interest income from marketable debt securities, change in fair value of convertible note and foreign currency gains. Our financial expense consists of fees associated with banking activities and losses from realization of marketable debt securities.
Results of Operations
The table below provides our results of operations for the three and six months ended June 30, 2024, as compared to the three and six months ended June 30, 2023.
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||
| (In thousands, except per share data) | ||||||||||||||||
| Research and development expenses | 534 | 809 | 1,169 | 1,892 | ||||||||||||
| General and administrative expenses | 688 | 1,062 | 1,454 | 1,981 | ||||||||||||
| Total operating expenses | 1,222 | 1,871 | 2,623 | 3,873 | ||||||||||||
| Financial income, net | (103 | ) | (278 | ) | (229 | ) | (450 | ) | ||||||||
| Net loss | 1,119 | 1,593 | 2,394 | 3,423 | ||||||||||||
| Other comprehensive loss: | (20 | ) | 17 | (19 | ) | (83 | ) | |||||||||
| Comprehensive loss | 1,099 | 1,610 | 2,375 | 3,340 | ||||||||||||
| Basic and diluted net loss per share | $ | 0.18 | $ | 0.95 | $ | 0.41 | $ | 2.04 | ||||||||
Research and Development Expenses
Our research and development expenses amounted to approximately $0.5 million and approximately $1.2 million during the three and six months ended June 30, 2024, respectively, representing a decrease of approximately $0.3 million, or 38%, and approximately $0.7 million, or 38%, respectively, compared to approximately $0.8 million and approximately $1.9 million, respectively for the comparable period in 2023.
The decrease during the three and six months ended June 30, 2024 primarily resulted from a decrease in clinical trial expenses of approximately $0.3 million and $0.5 million, respectively.
General and Administrative Expenses
Our general and administrative expenses amounted to approximately $0.7 million and approximately $1.5 million during the three and six months ended June 30, 2024, respectively, representing a decrease of approximately $0.4 million, or 36%, and approximately $0.5 million, or 25%, respectively, to approximately $1.1 million and approximately $2.0 million, respectively, for the comparable period in 2023,
The decrease in general and administrative expenses for the three and six months ended June 30, 2024 resulted primarily from a decrease in salary and related expenses of $0.2 million and $0.2 million, respectively, and as well, a decrease in insurance costs of $0.1 million and $0.2 million, respectively.
Operating Loss
As a result of the foregoing, for the three and six months ended June 30, 2024, our operating loss was approximately $1.2 million and approximately $2.6 million, respectively, representing a decrease of $0.7 million, or 37%, and a decrease of $1.3 million, or 33%, respectively, as compared to approximately $1.9 million and approximately $3.9 million, respectively, for the comparable period in 2023.
Financial Income, Net
Our financial income, net amounted to approximately $0.1 million and approximately $0.2 million during the three and six months ended June 30, 2024, respectively, representing a decrease of approximately $0.2 million and approximately $0.3 million, respectively, compared to financial income, net of $0.3 million and $0.5 million, respectively, for the comparable period in 2023. The decrease in financial income, net for the three and six months ended June 30, 2024 resulted primarily from exchange rate differences.
Net Loss
As a result of the foregoing, for the three and six months ended June 30, 2024, our net loss was approximately $1.1 million and approximately $2.4 million, respectively, representing a decrease of $0.5 million, or 31%, and a decrease of $1.0 million, or 29%, respectively, as compared to approximately $1.6 million and approximately $3.4 million, respectively, for the comparable period in 2023.
Liquidity and Capital Resources
To date, we have funded our operations primarily through proceeds from private placements and public offerings and we have incurred substantial losses since our inception. As of June 30, 2024, we had an accumulated deficit of approximately $195.3 million and positive working capital (current assets less current liabilities) of approximately $8.5 million. We expect that operating losses will continue for the foreseeable future.
As of June 30, 2024, we had cash and cash equivalents of approximately $1.8 million, short term deposit of $2.1 million, restricted cash of approximately $0.1 million, and marketable debt securities of approximately $5.9 million invested in accordance with our investment policy, totaling approximately $9.9 million, as compared to approximately $2.9 million, $2.2 million, $0.1 million and $7.5 million as of December 31, 2023, respectively, totaling approximately $12.7 million. The decrease is mainly attributable to the $2.8 million negative cash flow from operating activities during the six months ended June 30, 2024.
We had negative cash flow from operating activities of approximately $2.8 million for the six months ended June 30, 2024, as compared to negative cash flow from operating activities of approximately $3.1 million for the six months ended June 30, 2023. The negative cash flow from operating activities for the six months ended June 30, 2024, is mainly attributable to our net loss of approximately $2.4 million.
We had positive cash flow from investing activities of approximately $1.8 million for the six months ended June 30, 2024, as compared to a positive cash flow from investing activities of approximately $2.1 million for the six months ended June 30, 2023. The positive cash flow from investing activities for the six months ended June 30, 2024, was primarily due to net withdrawal of marketable securities of approximately $1.4 million from available for sale securities.
We had no cash flow from financing activities for the six months ended June 30, 2024.
Although we provide no assurance, we believe that our existing funds will be sufficient to continue our business and operations as currently conducted for more than 12 months from the date of issuance of this Report on Form 6-K. However, significant additional funding will be necessary to fund our ARMOR Study, our Amilo-5MER program and ongoing research and development work, to advance our product candidates through regulatory approval and into commercialization, if approved and the evaluation of our strategic alternatives. We intend to obtain additional funding through debt or equity financings, governmental grants or through entering into collaborations, strategic alliances or license agreements to increase the funds available to support our operating and capital needs. Although we have been successful in raising capital in the past, there is no assurance that we will be successful in obtaining additional financing on terms acceptable to us. If funds are not available, we may be required to delay, reduce the scope of or eliminate research or development plans for, or commercialization efforts with respect to Aramchol, Amilo-5MER and/or our other pre-clinical and clinical programs. This may raise substantial doubts about our ability to continue as a going concern.
The extent of our future capital requirements will depend on many other factors, including:
| ● | the progress and costs of our pre-clinical studies, clinical trials and other research and development activities; |
| ● | the regulatory pathway of Aramchol, Amilo-5MER or any other product candidate; |
| ● | the scope, prioritization and number of our clinical trials and other collaboration research and development programs; |
| ● | the amount of revenues and contributions we receive under future licensing, development and commercialization arrangements with respect to Aramchol or any other product candidate; |
| ● | the costs of the development and expansion of our operational infrastructure; |
| ● | the costs and timing of obtaining regulatory approval for Aramchol, Amilo-5MER or any other product candidate; |
| ● | the ability of us, or our collaborators, to achieve development milestones, marketing approval and other events or developments under our potential future licensing agreements; |
| ● | the costs of filing, prosecuting, enforcing and defending patent claims and other intellectual property rights; |
| ● | the costs and timing of securing manufacturing arrangements for clinical or commercial production; |
| ● | the costs of contracting with third parties to provide sales and marketing capabilities for us; |
| ● | the costs of acquiring or undertaking development and commercialization efforts for any future products, product candidates or platforms; |
| ● | the magnitude of our general and administrative expenses; |
| ● | any cost that we may incur under future in- and out-licensing arrangements relating to Aramchol, Amilo-5MER or any other product candidate; |
| ● | market conditions; |
| ● | our ability to main the listing of our ordinary shares on The Nasdaq Capital Market; |
| ● | our ability to identify, evaluate and complete any strategic alternative that yields value for our shareholders; and |
| ● | the impact of any resurgence of the COVID-19 pandemic and the war between Hamas and Israel, which may exacerbate the magnitude of the factors discussed above. |
Trend Information
We are a development stage company, and it is not possible for us to predict with any degree of accuracy the outcome of our research, development or commercialization efforts. As such, it is not possible for us to predict with any degree of accuracy any significant trends, uncertainties, demands, commitments or events that are reasonably likely to have a material effect on our net loss, liquidity or capital resources, or that would cause financial information to not necessarily be indicative of future operating results or financial condition. However, to the extent possible, certain trends, uncertainties, demands, commitments and events are in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations”.
Controls and Procedures
As a “foreign private issuer”, we are only required to conduct the evaluations required by Rules 13a-15(b) and 13a-15(d) of the Exchange Act as of the end of each fiscal year and therefore have elected not to provide disclosure regarding such evaluations at this time.
Reverse Split
On August 27, 2024, we announced that on August 29, 2024, we will effect a reverse share split (the “August 2024 Reverse Split”) of our ordinary shares at the ratio of 1-for-12, such that each twelve (12) ordinary shares, par value NIS 0.015 per share, will be consolidated into one (1) ordinary share, par value NIS 1.80. Since the August 2024 Reverse Split has not been effected prior to the date of this Form 6-K, the information in this Form 6-K has not been adjusted for the periods presented in this Form 6-K.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Galmed Pharmaceuticals Ltd. | ||
| Date: August 28, 2024 | By: | /s/ Allen Baharaff |
| Allen Baharaff | ||
| President and Chief Executive Officer | ||