MNOV 10-Q
Medicinova Inc (MNOV)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
FOR THE QUARTERLY PERIOD ENDED
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:
(Exact name of registrant as specified in its charter)
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(Address of Principal Executive Offices) |
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(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
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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.
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).
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 “accelerated filer”, “large accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
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Accelerated filer |
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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 Exchange Act). Yes ☐ No
As of August 11, 2026, the registrant had
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q, in particular "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations," and the information incorporated by reference herein contains “forward-looking statements”. The forward-looking statements are contained principally in the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” but are also contained elsewhere in this report. Forward-looking statements include all statements that are not historical facts and, in some cases, can be identified by terms such as "believe," "may," "will," "estimate," "continue," "anticipate," "design," "intend," "expect," "could," "plan," "potential," "predict," "seek," "should," "would" or the negative version of these words and similar expressions.
Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including those described in "Risk Factors" and elsewhere in this report. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our beliefs and assumptions only as of the date of this report. Considering the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation or warranty by us or any other person that we will achieve our objectives and plans in any specified time frame, or at all. You should read this report completely and with the understanding that our actual future results may be materially different from what we expect.
The following factors are among those that may cause actual results to differ materially from our forward-looking statements:
2
Unless the context requires otherwise, references in this Quarterly Report on Form 10-Q to “MediciNova,” “we,” “us” and “our” refer to MediciNova, Inc.
3
MEDICINOVA, INC.
TABLE OF CONTENTS
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ITEM 1. |
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ITEM 2. |
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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
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ITEM 3. |
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ITEM 4. |
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ITEM 1. |
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ITEM 1A. |
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ITEM 2. |
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ITEM 3. |
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ITEM 4. |
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ITEM 5. |
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ITEM 6. |
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4
PART I. FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
MEDICINOVA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
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June 30, |
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December 31, |
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2026 |
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2025 |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Prepaid expenses and other current assets |
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Total current assets |
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Goodwill |
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In-process research and development |
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Property and equipment, net |
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Right-of-use asset |
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Other non-current assets |
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Total assets |
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$ |
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$ |
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Liabilities and Stockholders’ Equity |
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Current liabilities: |
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Accounts payable |
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$ |
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$ |
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Accrued liabilities and other current liabilities |
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Deferred revenue |
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Operating lease liability |
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Total current liabilities |
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Deferred tax liability |
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Other non-current liabilities |
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Total liabilities |
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Stockholders’ equity: |
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Common stock, $ |
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Additional paid-in capital |
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Accumulated other comprehensive loss |
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Accumulated deficit |
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Total stockholders’ equity |
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Total liabilities and stockholders' equity |
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$ |
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$ |
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The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
5
MEDICINOVA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited)
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Three months ended |
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Six months ended |
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June 30, |
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June 30, |
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2026 |
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2025 |
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2026 |
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2025 |
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Revenues |
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$ |
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$ |
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$ |
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$ |
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Operating expenses: |
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Costs of services |
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Research, development and patents |
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General and administrative |
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Total operating expenses |
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Operating loss |
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Interest income |
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Other income (expense), net |
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( |
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Net loss |
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$ |
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$ |
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$ |
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$ |
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Basic and diluted net loss per common share |
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$ |
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$ |
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$ |
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$ |
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Shares used to compute basic and diluted net loss per common share |
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Net loss |
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$ |
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$ |
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$ |
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$ |
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Other comprehensive loss, net of tax: |
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Foreign currency translation adjustments |
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Comprehensive loss |
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$ |
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$ |
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$ |
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$ |
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The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
6
MEDICINOVA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited)
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Six Months Ended June 30, 2026 |
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Common stock |
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Additional |
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Accumulated |
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Accumulated |
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Total |
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Shares |
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Amount |
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capital |
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loss |
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deficit |
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equity |
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Balance at December 31, 2025 |
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$ |
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$ |
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$ |
( |
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$ |
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$ |
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Share-based compensation |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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Foreign currency translation adjustments |
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— |
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— |
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— |
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— |
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Balance at March 31, 2026 |
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( |
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Share-based compensation |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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( |
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( |
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Foreign currency translation adjustments |
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— |
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— |
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— |
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— |
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Balance at June 30, 2026 |
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$ |
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$ |
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$ |
( |
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$ |
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$ |
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Six Months Ended June 30, 2025 |
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Common stock |
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Additional |
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Accumulated |
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Accumulated |
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Total |
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Shares |
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Amount |
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capital |
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loss |
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deficit |
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equity |
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Balance at December 31, 2024 |
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$ |
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$ |
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$ |
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$ |
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$ |
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Share-based compensation |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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( |
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Foreign currency translation adjustments |
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— |
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— |
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— |
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— |
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Balance at March 31, 2025 |
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( |
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Share-based compensation |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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( |
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( |
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Foreign currency translation adjustments |
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— |
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— |
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Balance at June 30, 2025 |
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$ |
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$ |
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$ |
( |
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$ |
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$ |
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The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
7
MEDICINOVA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
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Six months ended |
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June 30, |
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2026 |
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2025 |
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Operating activities: |
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Net loss |
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$ |
( |
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$ |
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Adjustments to reconcile net loss to net cash used in operating activities: |
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Non-cash stock-based compensation |
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Depreciation and amortization |
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Change in carrying amount of right-of-use asset |
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Changes in assets and liabilities: |
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Accounts receivable |
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Prepaid expenses and other assets |
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Accounts payable, accrued liabilities and other liabilities |
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Deferred revenue |
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Operating lease liability |
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Net cash used in operating activities |
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Investing activities: |
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Purchases of property and equipment |
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Net cash used in investing activities |
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Effect of exchange rate changes on cash and cash equivalents |
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Net change in cash and cash equivalents |
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( |
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Cash and cash equivalents, beginning of period |
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Cash and cash equivalents, end of period |
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$ |
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$ |
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The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
8
MEDICINOVA, INC.
Notes to Condensed Consolidated Financial Statements
(Unaudited)
1. Interim Financial Information
Organization and Business
MediciNova, Inc. (the Company or MediciNova) was incorporated in the state of Delaware in September 2000 and is a public company. The Company’s common stock is listed in both the United States and Japan and trades on the Nasdaq Global Market and the Standard Market of the Tokyo Stock Exchange. The Company is a biopharmaceutical company focused on developing novel therapeutics for the treatment of serious diseases with unmet medical needs and a commercial focus on the United States market. The Company’s current strategy is to focus its development activities on MN-166 (ibudilast) for neurological and other disorders such as progressive multiple sclerosis (MS), amyotrophic lateral sclerosis (ALS), chemotherapy-induced peripheral neuropathy, degenerative cervical myelopathy, glioblastoma, and prevention of acute respiratory distress syndrome (ARDS), and MN-001 (tipelukast) for fibrotic and other metabolic disorders such as nonalcoholic fatty liver disease (NAFLD) and hypertriglyceridemia.
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information and with the instructions of the Securities and Exchange Commission (SEC) on Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, they do not include all the information and disclosures required by GAAP for complete financial statements. In the opinion of management, the condensed consolidated financial statements include all adjustments necessary, which are of a normal and recurring nature, for the fair presentation of the Company’s financial position and of the results of operations and cash flows for the periods presented. The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries.
These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2025 included in the Company’s Annual Report on Form 10-K filed with the SEC. The results of operations for the interim period shown in this report are not necessarily indicative of the results that may be expected for any other interim period or for the full year. The balance sheet at December 31, 2025 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by GAAP for complete financial statements.
Liquidity
The Company has incurred net losses since its inception and has negative operating cash flows. As of June 30, 2026, the Company had $
Principles of Consolidation
9
Segment Reporting
An operating segment is identified as a component of an enterprise that engages in business activities about which separate discrete financial information and operating results is regularly reviewed by the chief operating decision-maker (CODM) in making decisions regarding resource allocation and assessing performance. The Company's CODM is the senior executive committee which is comprised of the . The Company operates in a operating segment – the acquisition and development of small molecule therapeutics for the treatment of serious diseases with unmet medical needs.
The following table presents financial information, including significant segment expenses, which are regularly provided to the CODM and included within segment and consolidated net loss:
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Three months ended June 30, |
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Six months ended June 30, |
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2026 |
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2025 |
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2026 |
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2025 |
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Revenues |
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$ |
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$ |
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$ |
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$ |
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Operating expenses, excluding stock-based compensation |
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Costs of services |
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Research, development and patents |
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General and administrative |
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Total operating expenses, excluding stock-based compensation |
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Stock-based compensation |
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Research, development and patents |
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General and administrative |
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Total stock-based compensation |
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Total operating expenses |
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Operating loss |
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( |
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( |
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( |
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Interest income |
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Other income (expense), net |
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Segment and consolidated net loss |
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$ |
( |
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$ |
( |
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$ |
( |
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$ |
( |
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Cash and Cash Equivalents
Cash and cash equivalents consist of cash and other highly liquid investments including money market and mutual fund accounts, with original maturities of three months or less from the date of purchase.
Accounts Receivable
Accounts receivable is recorded net of allowance for credit losses. There was
Research, Development and Patents
Research and development costs are expensed in the period incurred. Research and development costs primarily consist of salaries and related expenses for personnel, facilities and depreciation, research and development supplies, licenses and outside services. Such research and development costs totaled $
10
Costs related to filing and pursuing patent applications are expensed as incurred, as recoverability of such expenditures is uncertain. The Company includes all external costs related to the filing of patents in Research, Development and Patents expenses. Such patent-related expenses totaled $
Clinical Trial Accruals and Prepaid Expenses
Costs for preclinical studies, clinical studies and manufacturing activities are recognized as research and development expenses based on an evaluation of the progress by Company vendors towards completion of specific tasks, using data such as patient enrollment, clinical site activations or information provided to the Company by such vendors regarding their actual costs incurred. Payments for these activities are based on the terms of individual contracts and payment timing may differ significantly from the period in which the services are performed. The Company determines accrual estimates through reports from and discussions with applicable personnel and outside service providers as to the progress or state of completion of studies, or the services completed. The Company’s estimates of accrued expenses as of each balance sheet date are based on the facts and circumstances known at the time. Costs that are paid in advance of performance are deferred as a prepaid expense and amortized over the service period as the services are provided.
Leases
The Company determines if an arrangement is a lease at inception and if so, determines whether the lease qualifies as an operating or finance lease. The Company does not recognize right-of-use assets and lease liabilities for leases with a term of 12 months or less and does not separate non-lease components from lease components. Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. Operating lease expense is recognized on a straight-line basis over the lease term and is included in general and administrative expenses. As most of the Company’s operating leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The incremental borrowing rate is the rate that the Company would expect to pay to borrow on a collateralized and fully amortizing basis over a similar term an amount equal to the lease payments in a similar economic environment.
Use of Estimates
The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and the accompanying notes. Actual results could differ from those estimates.
Recently Issued Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. ASU 2024-03 requires additional disclosure of the nature of expenses included in the financial statements. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the potential impact that this standard will have on its consolidated financial statements and related disclosures.
2. Revenue Recognition
Revenue Recognition Policy
11
Mayo Foundation for Medical Education and Research
In December 2024, the Company entered into an agreement with Mayo Foundation for Medical Education and Research (Mayo), to support clinical research services to evaluate the efficacy of MN-166 (ibudilast) in ALS. The agreement has an initial one year term, with automatic successive one year terms unless either party gives written notice of non-renewal to the other party not less than 90 days prior to the end of the then-current term, with payment for services due within 60 days from invoice. The agreement can be terminated by either party upon the occurrence of certain events, including by either party, without cause, upon not less than 30 days prior written notice. In August 2025, the Mayo agreement was amended to extend the initial term until August 2026. The Company assessed the services in accordance with the authoritative guidance and concluded that it met the definition of a contract per ASC 606 with one performance obligation. The performance obligation identified was for pharmacovigilance and clinical research support services satisfied over time using the cost-to-cost method. In March 2025, the first study site enrolled the first patients into the study and principal services under the agreement began in April 2025. In August 2025, the Company received $
3. Fair Value Measurements
Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, a three-tier fair value hierarchy has been established, which prioritizes the inputs used in measuring fair value as follows:
Level 1: |
Observable inputs such as quoted prices in active markets; |
|
|
Level 2: |
Inputs are quoted prices for similar items in active markets or quoted prices for identical or similar items in markets that are not active near the measurement date; and |
|
|
Level 3: |
Unobservable inputs due to little or no market data, which require the reporting entity to develop its own assumptions. |
The carrying amount and approximate fair value of financial instruments as of June 30, 2026 and December 31, 2025, were as follows:
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June 30, 2026 |
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December 31, 2025 |
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||||||||||
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Carrying Amount |
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Fair Value |
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Carrying Amount |
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Fair Value |
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Valuation Inputs |
||||
Cash and cash equivalents: |
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|
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|
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|
||||
Mutual funds |
|
$ |
|
|
$ |
|
|
$ |
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|
$ |
|
|
Level 1 |
||||
4. Commitments and Contingencies
Lease Commitments
The Company has operating leases primarily for real estate in the United States and Japan. The United States lease is for the Company’s headquarters in San Diego and has a term of
12
Information related to the Company’s right-of-use assets and related lease liabilities are as follows:
|
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Three months ended |
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Six months ended |
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||||||||||
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June 30, |
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June 30, |
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||||||||||
|
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2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Cash paid for operating lease liabilities |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Operating lease costs |
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|
|
|
|
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||||
|
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June 30, |
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December 31, |
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||
|
|
2026 |
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|
2025 |
|
||
Current operating lease liabilities |
|
$ |
|
|
$ |
|
||
|
|
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|
|
|
|||
Total operating lease liabilities |
|
$ |
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|
$ |
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||
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|
|
|
|
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||
Weighted-average remaining lease term (in years) |
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|
||
Weighted-average discount rate |
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% |
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|
% |
||
Maturities of operating lease liabilities as of June 30, 2026 were as follows: |
|
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|
|
|
|
2026 (remaining six months) |
|
|
|
$ |
|
|
2027 |
|
|
|
|
|
|
Total minimum payments |
|
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|
|
|
|
Less imputed interest |
|
|
|
|
( |
) |
Total lease liabilities |
|
|
|
$ |
|
|
License and Research Agreements
The Company has entered into in-licensing agreements with various pharmaceutical companies. Under the terms of these agreements, the Company has received licenses to research, know-how and technology claimed in specified patents or patent applications. Under these license agreements, the Company is generally required to make upfront payments and additional payments upon the achievement of milestones and/or royalties on future sales of products until the later of the expiration of the applicable patent or the applicable last date of market exclusivity after the first commercial sale, on a country-by-country basis.
Legal Proceedings
From time to time, the Company may be subject to legal proceedings and claims in the ordinary course of business. The Company is not aware of any such proceedings or claims that it believes will have, individually or in aggregate, a material adverse effect on its business, financial condition or results of operations.
5. Stock-based Compensation
Stock Incentive Plans
In June 2013, the Company adopted the 2013 Equity Incentive Plan (2013 Plan) under which the Company granted equity-based awards, including stock options, stock appreciation rights, restricted stock, and restricted stock units to individuals who were then employees, officers, non-employee directors or consultants of the Company or its subsidiaries. A total of
13
In June 2023, the Company adopted the 2023 Equity Incentive Plan (2023 Plan) under which the Company may grant stock options, stock appreciation rights, restricted stock, restricted stock units and other awards to individuals who are then employees, officers, non-employee directors or consultants of the Company or its subsidiaries. The 2023 Plan is the successor to the 2013 Plan. The number of shares of common stock that may be issued under the 2023 Plan is equal to the sum of (a) shares subject to awards granted under the 2013 Plan that were outstanding upon expiration of the 2013 Plan and are subsequently forfeited, expire or lapse unexercised or unsettled and shares issued pursuant to awards granted under the 2013 Plan that were outstanding upon expiration of the 2013 Plan and are subsequently forfeited to or reacquired by the Company and (b) shares reserved under the 2013 Plan that were not issued or subject to outstanding awards under the 2013 Plan upon expiration of the 2013 Plan. While a maximum of
As of June 30, 2026,
Certain of the employee stock options granted contain performance conditions, the vesting of which is based on a determination made by the compensation committee followed by an approval of the board of directors as to the achievement of certain corporate objectives at the end of the performance period. The grant date of such awards is the date on which the board of directors makes its determination. For periods preceding the grant date, the expense related to these awards is measured based on their fair value at each reporting date. The estimated fair value of the performance awards granted and the resulting expense is based upon a certain level of achievement of the corporate objectives and other assumptions in determining fair value. The amount of expense ultimately recognized upon the grant date at completion of the performance period could change from the estimate as a result of various factors, including the level of achievement of the corporate objectives, changes in the assumptions used in the Black-Scholes model in determining fair value or fluctuations in the Company’s stock price during the performance period. As of June 30, 2026, there were a total of
Stock Options
Options granted under the 2023 Plan and the 2013 Plan have terms of
A summary of stock option activity and related information as of June 30, 2026 is as follows:
|
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Number of |
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|
Weighted Average |
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|
||
Outstanding at December 31, 2025 |
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$ |
|
|
||
Granted |
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|
||
Exercised |
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— |
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— |
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Forfeited |
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( |
) |
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Expired |
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( |
) |
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Outstanding at June 30, 2026 |
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$ |
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||
Exercisable at June 30, 2026 |
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|
|
$ |
|
|
||
Compensation Expense
Stock-based compensation expense for stock option awards are reflected in total operating expenses for each respective period.
14
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Three months ended |
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Six months ended |
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June 30, |
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June 30, |
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2026 |
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2025 |
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2026 |
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2025 |
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Research, development and patents |
|
$ |
|
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$ |
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$ |
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$ |
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||||
General and administrative |
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Total stock-based compensation expense |
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$ |
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$ |
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|
$ |
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$ |
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||||
The Company uses the Black-Scholes valuation model for determining the estimated fair value for stock-based awards granted to employees and considers management’s current expectations of the achievement of the performance objectives for the year.
|
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Six months ended June 30, |
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2026 |
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2025 |
Stock Options |
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Risk-free interest rate |
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Expected volatility of common stock |
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Dividend yield |
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Expected term (in years) |
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||
As of June 30, 2026, there was $
The weighted-average fair value of each stock option granted during the six months ended June 30, 2026 and 2025, estimated as of the grant date using the Black-Scholes option valuation model, was $
6. Stockholders’ Equity
At-The-Market Issuance Sales Agreements and Private Placement Transactions
On August 23, 2019, the Company entered into an at the market issuance sales agreement, which was amended on August 26, 2022 (as amended, the ATM Agreement) with B. Riley FBR, Inc. (B. Riley FBR) for the offer and sale of common stock through B. Riley FBR from time to time up to an aggregate offering price of $
The ATM agreement was terminated effective March 8, 2026.
Standby Equity Purchase Agreement
On July 30, 2025, the Company entered into a Standby Equity Purchase Agreement, or the SEPA with YA II PN, LTD., a Cayman Islands exempt limited company, or Yorkville. Pursuant to the SEPA, the Company has the right, but not the obligation, to sell to Yorkville from time to time up to $
15
would result in the beneficial ownership of Yorkville and its affiliates (on an aggregated basis) exceeding 4.99% of the then outstanding voting power or number of outstanding shares of the Company's common stock.
Pursuant to a financial advisory agreement between the Company and D. Boral Capital LLC (D. Boral), the Company has also agreed to pay D. Boral a fee equal to three percent of the gross proceeds received from any shares that the Company sells to Yorkville pursuant to the SEPA.
Equity Distribution Agreement
On December 29, 2025, the Company entered into an equity distribution agreement, with Lucid Capital Markets, LLC (Lucid) pursuant to which the Company may sell common stock through Lucid from time to time up to an aggregate offering price of $
7. Net Loss Per Share
The Company computes basic net loss per share using the weighted average number of common shares outstanding during the period. Diluted net loss per share is based upon the weighted average number of common shares and potentially dilutive securities (common share equivalents) outstanding during the period. Common share equivalents outstanding, determined using the treasury stock method, are comprised of shares that may be issued under the Company’s stock option agreements. Common share equivalents are excluded from the diluted net loss per share calculation if their effect is anti-dilutive.
Potentially dilutive outstanding stock options excluded from diluted net loss per common share due to their anti-dilutive effect totaled
16
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q and the audited financial statements and notes thereto as of and for the year ended December 31, 2025 included in our Annual Report on Form 10-K, as filed with the Securities and Exchange Commission (SEC) on March 10, 2026 (Annual Report on Form 10-K). Past operating results are not necessarily indicative of results that may occur in future periods.
This Quarterly Report on Form 10-Q contains forward-looking statements that are subject to risks and uncertainties, many of which are beyond our control. Our actual results may differ from those anticipated in these forward-looking statements as a result of various factors, including those set forth in Part II of this Quarterly Report on Form 10-Q under the caption “Item 1A. Risk Factors” and under the caption “Item 1A. Risk Factors” in our Annual Report on Form 10-K. The differences may be material. Forward-looking statements discuss matters that are not historical facts. Forward-looking statements include, but are not limited to, statements regarding our plans, strategies, objectives, product development programs, clinical trials, industry, financial condition, liquidity and capital resources, future performance and other statements that are not historical facts. Such forward-looking statements include statements preceded by, followed by or that otherwise include the words “may,” “might,” “will,” “intend,” “should,” “could,” “can,” “would,” “expect,” “believe,” “estimate,” “anticipate,” “predict,” “potential,” “plan” or similar words. For such statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. You should not rely unduly on these forward-looking statements, which speak only as of the date hereof. We undertake no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by law.
Overview
We are a biopharmaceutical company focused on developing novel therapeutics for the treatment of serious diseases with unmet medical needs and a commercial focus on the United States (U.S.) market. Our current strategy is to focus our development activities on MN-166 (ibudilast) for neurological and other disorders such as progressive multiple sclerosis (MS), amyotrophic lateral sclerosis (ALS), chemotherapy-induced peripheral neuropathy, degenerative cervical myelopathy, glioblastoma, and prevention of acute respiratory distress syndrome (ARDS), and MN-001 (tipelukast) for fibrotic and other metabolic disorders such as nonalcoholic fatty liver disease (NAFLD) and hypertriglyceridemia. We were incorporated in Delaware in September 2000.
We have incurred significant net losses since our inception. As of June 30, 2026, from inception, our accumulated deficit was $443.6 million. We expect to incur substantial net losses for the next several years as we continue to develop certain of our existing product development programs, and over the long-term if we expand our research and development programs and acquire or in-license products, technologies or businesses that are complementary to our own.
Our goal is to build a sustainable biopharmaceutical business through the successful development of differentiated products for the treatment of serious diseases with unmet medical needs in high-value therapeutic areas. Key elements of our strategy are as follows:
We intend to advance our diverse MN-166 (ibudilast) program through a combination of investigator-sponsored clinical trials, trials funded through government grants or other grants, and trials funded by us. We intend to pursue additional strategic alliances to help support further clinical development of MN-166 (ibudilast).
We intend to advance development of MN-001 (tipelukast) through a variety of means, which may include investigator-sponsored trials with or without grant funding as well as trials funded by us.
We develop and maintain relationships with pharmaceutical companies that are therapeutic category leaders. We intend to discuss strategic alliances with leading pharmaceutical companies who seek product candidates, such as MN-166 (ibudilast) and MN-001 (tipelukast), which could support our clinical development and product commercialization.
17
Revenues — Mayo Foundation for Medical Education and Research
In December 2024, we entered into an agreement with Mayo Foundation for Medical Education and Research (Mayo), to support clinical research services to evaluate the efficacy of MN-166 (ibudilast) in ALS. In March 2025, the first study site enrolled the first patients into the study and principal services under the agreement began in April 2025. The agreement has an initial one year term, with automatic successive one year terms unless either party gives written notice of non-renewal to the other party not less than 90 days prior to the end of the then-current term, with payment for services due within 60 days from invoice. In August 2025, the Mayo agreement was amended to extend the initial term until August 2026. We perform pharmacovigilance and clinical research support services under this agreement and recognize revenue using the cost-to-cost method.
Research, Development and Patents Expenses
Our research, development and patents expenses consist primarily of license fees related to our product candidates, salaries and related employee benefits, costs associated with the preclinical and clinical development of our product development programs, costs associated with non-clinical activities, such as regulatory expenses, and pre-commercialization manufacturing development activities. We use external service providers to manufacture our compounds to be used in clinical trials and for the majority of the services performed in connection with the preclinical and clinical development of our product candidates. Research, development and patents expenses include fees paid to consultants, contract research organizations, contract manufacturers and other external service providers, including professional fees and costs associated with legal services, patents and patent applications for our intellectual property. Internal research and development expenses include costs of compensation and other expenses for research and development personnel, supplies, facility costs and depreciation. Research, development and patents costs are expensed as incurred and we expect to maintain such costs through the remainder of 2026 as our development programs progress.
The following table summarizes our research, development and patents expenses for the periods indicated for each of our product development programs. To the extent that costs, including personnel costs, are not tracked to a specific product development program, such costs are included in the “Other R&D expense” category (in thousands):
|
|
Three months ended |
|
|
Six months ended |
|
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|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
External development expense: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
MN-166 |
|
$ |
503 |
|
|
$ |
1,535 |
|
|
$ |
1,158 |
|
|
$ |
2,618 |
|
MN-001 |
|
|
73 |
|
|
|
187 |
|
|
|
168 |
|
|
|
406 |
|
Other |
|
|
3 |
|
|
|
4 |
|
|
|
7 |
|
|
|
7 |
|
Total external development expense |
|
|
579 |
|
|
|
1,726 |
|
|
|
1,333 |
|
|
|
3,031 |
|
R&D personnel expense |
|
|
275 |
|
|
|
270 |
|
|
|
646 |
|
|
|
658 |
|
R&D facility and depreciation expense |
|
|
16 |
|
|
|
17 |
|
|
|
32 |
|
|
|
33 |
|
Patent expenses |
|
|
117 |
|
|
|
150 |
|
|
|
210 |
|
|
|
250 |
|
Other R&D expense |
|
|
42 |
|
|
|
26 |
|
|
|
71 |
|
|
|
56 |
|
Total research, development and patent expense |
|
$ |
1,029 |
|
|
$ |
2,189 |
|
|
$ |
2,292 |
|
|
$ |
4,028 |
|
General and Administrative Expenses
Our general and administrative costs primarily consist of salaries, stock-based compensation, benefits and consulting and professional fees related to our administrative, finance, human resources, business development, legal, information systems support functions, facilities and insurance costs. General and administrative costs are expensed as incurred.
Our general and administrative expenses may increase in future periods if we are required to expand our infrastructure based on the success of our product development programs and in raising capital to support our product development programs or otherwise in connection with increased business development activities related to partnering, out-licensing or product disposition.
Critical Accounting Estimates
This discussion and analysis of our financial condition and results of operations is based on our condensed consolidated financial statements, which we have prepared in accordance with United States generally accepted accounting principles. The preparation of these condensed consolidated financial statements requires us to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of expenses during the reporting periods. We base our estimates on historical experience and on various other factors and assumptions that we believe are reasonable under the circumstances at the time the estimates are made, the results of which form the basis for making judgments about the book values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We periodically evaluate our estimates and judgments in light of changes in circumstances, facts and experience.
18
Our critical accounting policies are those accounting principles generally accepted in the United States that require us to make subjective estimates and judgments about matters that are uncertain and are likely to have a material impact on our financial condition and results of operations, as well as the specific manner in which we apply those principles. For a description of our critical accounting estimates, please see the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Estimates” contained in our Annual Report on Form 10-K, for the year ended December 31, 2025. There have not been any material changes to the critical accounting policies discussed therein during the six months ended June 30, 2026.
IPR&D and Goodwill
Amounts incurred related to in-process research and development (IPR&D) or asset purchases of IPR&D are expensed as incurred. Amounts allocated to IPR&D in connection with a business combination are recorded at fair value and are considered indefinite-lived intangible assets until completion or abandonment of the associated research and development efforts. During the period the assets are considered indefinite-lived, they will not be amortized but will be tested annually for impairment or more frequently if indicators of impairment exist. Goodwill and indefinite lives of intangible assets are reviewed for impairment annually (as of December 31st) or more frequently if indicators of impairment exist.
As of December 31, 2025, we performed a qualitative impairment assessment of goodwill and indefinite-lived intangible assets which included an evaluation of changes in industry, market, and macroeconomic conditions as well as consideration of our financial performance and any significant trends. The qualitative assessment indicated that it was not more likely than not that goodwill and indefinite-lived intangible assets are impaired as of December 31, 2025. If we experience a sustained decline in our stock price or other material changes in the significant assumptions that affect the determination of the fair value of our single reporting unit, it may result in a goodwill and/or intangible asset impairment charge in future periods, and such charge may be material.
Results of Operations
Comparison of the three months ended June 30, 2026 and 2025
Revenues
Revenues were $0.5 million and $0.1 million for the three months ended June 30, 2026 and 2025, respectively, all of which related to services we performed under our agreement with Mayo. The increase of $0.4 million was primarily due to changes in estimates related to the measure of progress of our services to be performed under our agreement with Mayo.
Cost of Services
Cost of services were $0.1 million and $0.1 million for the three months ended June 30, 2026 and 2025, respectively. The costs incurred for services provided related to the Mayo agreement were relatively the same quarter over quarter.
Research, Development and Patents Expenses
Research, development and patents expenses were $1.0 million and $2.2 million for the three months ended June 30, 2026 and 2025, respectively. The decrease of $1.2 million was primarily driven by a $1.0 million decrease in MN-166 related expenses relating to a MRC-001 Pharmacokinetic (PK) study, a degenerative cervical myelopathy (DCM) study, and an ALS study, as well as a $0.1 million decrease in MN-001 clinical trial expenses.
General and Administrative Expenses
General and administrative expenses were $1.8 million and $1.4 million for the three months ended June 30, 2026 and 2025, respectively. The increase of $0.4 million was primarily driven by increased professional fees.
Interest Income
Interest income was $0.2 million and $0.3 million for the three months ended June 30, 2026 and 2025, respectively. The decrease of $0.1 million was primarily driven by a decrease in our cash balance generating interest.
Comparison of the six months ended June 30, 2026 and 2025
Revenues
Revenues were $0.6 million and $0.1 million for the six months ended June 30, 2026 and 2025, respectively, all of which related to services we performed under our agreement with Mayo. The increase of $0.5 million was primarily due to changes in
19
estimates related to the measure of progress of our services to be performed under our agreement with Mayo and the additional quarter of services provided in 2026 compared to 2025.
Cost of Services
Cost of services were $0.3 million and $0.1 million for the six months ended June 30, 2026 and 2025, respectively. The increase of $0.2 million was due to the additional three months of costs incurred for services provided related to the Mayo agreement in 2026 compared to 2025.
Research, Development and Patents Expenses
Research, development and patents expenses were $2.3 million and $4.0 million for the six months ended June 30, 2026 and 2025, respectively. The decrease of $1.7 million was primarily driven by a $1.5 million decrease in MN-166 related expenses relating to a MRC-001 Pharmacokinetic (PK) study, a degenerative cervical myelopathy (DCM) study, and an ALS study, as well as a $0.2 million decrease in MN-001 clinical trial expenses.
General and Administrative Expenses
General and administrative expenses were $3.4 million and $2.8 million for the six months ended June 30, 2026 and 2025, respectively. The increase of $0.6 million was primarily driven by increased professional fees and stock-based compensation expense.
Interest Income
Interest income was $0.5 million and $0.7 million for the six months ended June 30, 2026 and 2025, respectively. The decrease of $0.2 million was primarily driven by a decrease in our cash balance generating interest.
Liquidity and Capital Resources
Net cash used in operating activities during the six months ended June 30, 2026 was $5.4 million compared to $6.1 million during the same period in 2025. The $0.7 million change is primarily related to the changes in operating assets and liabilities for those periods.
As of June 30, 2026, we had available cash and cash equivalents of $25.4 million and working capital of $23.0 million. As of the date of this report, we believe we have working capital sufficient to fund operations at least through November 2027. However, we cannot provide assurance that these capital resources will be sufficient to conduct all our research and development programs as planned.
Equity Financing
On July 30, 2025, we entered into a SEPA, with YA II PN, LTD., a Cayman Islands exempt limited company, or Yorkville. Pursuant to the SEPA, we have the right, but not the obligation, to sell to Yorkville from time to time up to $30.0 million of our common stock, during the 36 months following the execution of the SEPA, subject to the restrictions and satisfaction of the conditions in the SEPA. At our option, the shares of common stock would be purchased by Yorkville from time to time at a price equal to 97% of the lowest of the three daily volume weighted average prices (VWAPs), during a three consecutive trading day period commencing on the date that we, subject to certain limitations, deliver to Yorkville a notice that we are committing Yorkville to purchase such shares of common stock. We may also specify a certain minimum acceptable price per share for a drawdown under the SEPA. As consideration for Yorkville's irrevocable commitment to purchase common stock, we paid Yorkville a $25,000 structuring fee along with a commitment fee of $375,000, recorded as General and Administrative expense. Under the applicable rules of Nasdaq and pursuant to the SEPA, in no event may we issue or sell to Yorkville more than 9,804,345 shares of common stock, or the Exchange Cap, which is 19.99% of the shares of common stock outstanding immediately prior to the execution of the SEPA, unless (i) we obtain stockholder approval to issue shares of common stock in excess of the Exchange Cap or (ii) the average price of all applicable shares of common stock under the SEPA equals or exceeds $1.33 per share (which represents the lower of (i) the Nasdaq Official Closing Price (as reflected on Nasdaq.com) on the trading day immediately preceding July 30, 2025 or (ii) the average Nasdaq Official Closing Price of the common stock (as reflected on Nasdaq.com) for the five trading days immediately preceding July 30, 2025). Pursuant to the SEPA, Yorkville shall not be obliged to purchase or acquire any shares of common stock under the SEPA which, when aggregated with all other shares of our common stock beneficially owned by Yorkville and its affiliates, would result in the beneficial ownership of Yorkville and its affiliates (on an aggregated basis) exceeding 4.99% of the then outstanding voting power or number of outstanding shares of our common stock.
Pursuant to a financial advisory agreement between us and D. Boral Capital LLC (D. Boral), we have also agreed to pay D. Boral a fee equal to three percent of the gross proceeds received from any shares that we sell to Yorkville pursuant to the SEPA.
No shares of common stock were sold under the SEPA in six months ended June 30, 2026.
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On December 29, 2025, we entered into an equity distribution agreement, with Lucid Capital Markets, LLC (Lucid) pursuant to which we may sell common stock through Lucid from time to time up to an aggregate offering price of $50.0 million (the Equity Distribution Agreement). Sales of our common stock through Lucid, if any, will be made by any method that is deemed to be an "at-the-market" equity offering as defined in Rule 415 promulgated under the Securities Act of 1933, as amended, including sales made directly on Nasdaq, on any other existing trading market for the common stock or through a market maker. Lucid may also sell the common stock in privately negotiated transactions, subject to our prior approval. We agreed to pay Lucid an aggregate commission rate of 3.0% of the gross proceeds of any common stock sold under this agreement. Proceeds from sales of common stock will depend on the number of shares of common stock sold to Lucid and the per share purchase price of each transaction.
No shares of common stock were sold under the Equity Distribution Agreement in the six months ended June 30, 2026.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Not applicable.
ITEM 4. CONTROLS AND PROCEDURES.
We maintain disclosure controls and procedures that are designed to provide reasonable assurance that the information required to be disclosed in our filings under the Securities Exchange Act of 1934, as amended (the Exchange Act), is (1) recorded, processed, summarized and reported within the time periods specified in SEC’s rules and forms, and (2) accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure.
Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our procedures or our internal controls will prevent or detect all errors and all fraud. Any internal control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of our controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.
Evaluation of Disclosure Controls and Procedures
As required by Rule 13a-15(b) of the Exchange Act, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level.
Changes in Internal Control over Financial Reporting
There has been no change in our internal control over financial reporting during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
We are not involved in any material legal proceedings as of June 30, 2026. We may become involved in various disputes and legal proceedings which arise in the ordinary course of business or otherwise. While it is not possible to accurately predict or determine the outcome of these matters, an adverse result in any litigation matter may occur which could harm our business.
ITEM 1A. RISK FACTORS.
In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K, for the year ended December 31, 2025, which are incorporated herein by reference and which could materially affect our business, financial condition or future results. The risks described in our Annual Report on Form 10-K are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results. We do not believe that there have been any material changes from the risk factors previously disclosed in our Annual Report on Form 10-K, for the year ended December 31, 2025.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable
ITEM 5. OTHER INFORMATION.
Securities Trading Plans of Directors and Executive Officers
During the quarter ended June 30, 2026, none of our officers or directors, as defined in Rule 16a-1(f), informed us of the
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ITEM 6. EXHIBITS.
Exhibit Number |
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Description |
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3.1 |
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3.2 |
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31.1(1) |
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31.2(1) |
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32.1(1)* |
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32.2(1)* |
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101.INS(1) |
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Inline XBRL Instance Document - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document. |
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101.SCH(1) |
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Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents. |
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104(1) |
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Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
*
The certifications attached as Exhibit 32.1 and 32.2 that accompany this Quarterly Report on Form 10-Q are not deemed filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of MediciNova, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Quarterly Report on Form 10-Q, irrespective of any general incorporation language contained in such filing.
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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.
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MEDICINOVA, INC. |
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Date: August 13, 2026 |
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By: |
/s/ YUICHI IWAKI |
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Yuichi Iwaki, M.D., Ph.D. |
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President and Chief Executive Officer |
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(on behalf of the registrant and |
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as the registrant’s Principal Executive Officer) |
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By: |
/s/ JASON KRUGER |
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Jason Kruger |
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Chief Financial Officer |
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(on behalf of the registrant and |
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as the registrant’s Principal Financial Officer) |
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