Actinium Pharmaceuticals, Inc. 10-Q

ITEM 1. FINANCIAL STATEMENTS The accompanying consolidated financial statements have been prepared by the Company and are unaudited. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position at March 31, 2024 and December 31, 2023, and the results of operations and cash flows for the three months ended March 31, 2024 and 2023, respectively, have been made. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s audited financial statements for the year ended December 31, 2023 in the Company’s Annual Report on Form 10-K. The results of operations for the three months ended March 31, 2024 are not necessarily indicative of the operating results for the full year. 1 Actinium Pharmaceuticals, Inc. Condensed Consolidated Balance Sheets (Unaudited) (amounts in thousands, except share and per share data) March 31, 2024 December 31, 2023 (Unaudited) Assets Current Assets: Cash and cash equivalents $ 84,057 $ 76,677 Prepaid expenses and other current assets 1,316 1,586 Total Current Assets 85,373 78,263 Property and equipment, net of accumulated depreciation of $ 760 and $ 694 496 550 Restricted cash – long term 316 313 Operating leases right-of-use assets 2,140 2,289 Finance leases right-of-use assets 27 30 Total Assets $ 88,352 $ 81,445 Liabilities and Stockholders’ Equity Current Liabilities: Accounts payable and accrued expenses $ 7,513 $ 7,953 Operating leases current liability 540 530 Finance leases current liability 11 11 Total Current Liabilities 8,064 8,494 Long-term license revenue deferred 35,000 35,000 Long-term operating lease obligations 1,414 1,553 Long-term finance lease obligations 17 19 Total Liabilities 44,495 45,066 Commitments and contingencies Stockholders’ Equity: Preferred stock, $ 0.001 par value; 50,000,000 shares authorized, 0 shares issued and outstanding - - Common stock, $ 0.001 par value; 1,000,000,000 shares authorized; 29,396,411 and 27,634,213 shares issued and outstanding, respectively 29 28 Additional paid-in capital 390,081 373,934 Accumulated deficit ( 346,253 ) ( 337,583 ) Total Stockholders’ Equity 43,857 36,379 Total Liabilities and Stockholders’ Equity $ 88,352 $ 81,445 See accompanying notes to the condensed consolidated financial statements. 2 Actinium Pharmaceuticals, Inc. Condensed Consolidated Statements of Operations (Unaudited) (amounts in thousands, except share and per share data) For the Three Months Ended March 31 2024 2023 Revenue: Revenue $ - $ - Other revenue - - Total revenue - - Operating expenses: Research and development, net of reimbursements 6,635 7,849 General and administrative 2,962 3,735 Total operating expenses 9,597 11,584 Loss from operations ( 9,597 ) ( 11,584 ) Other income: Interest income - net 927 547 Total other income 927 547 Net loss $ ( 8,670 ) $ ( 11,037 ) Net loss per share of common stock – basic and diluted $ ( 0.31 ) $ ( 0.43 ) Weighted average shares of common stock outstanding – basic and diluted 27,886,486 25,696,623 See accompanying notes to the condensed consolidated financial statements. 3 Actinium Pharmaceuticals, Inc. Condensed Consolidated Statement of Changes in Stockholders’ Equity For the Period from January 1, 2024 to March 31, 2024 (Unaudited) (amounts in thousands, except share amounts) Common Stock Additional Paid-In Accumulated Stockholders’ Shares Amount Capital Deficit Equity Balance, January 1, 2024 27,634,213 $ 28 $ 373,934 $ ( 337,583 ) $ 36,379 Stock-based compensation - - 1,378 - 1,378 Sale of common stock, net of offering costs 1,752,050 1 14,694 - 14,695 Issuance of common stock from exercise of stock options 10,148 - 75 - 75 Net loss - - - ( 8,670 ) ( 8,670 ) Balance, March 31, 2024 29,396,411 $ 29 $ 390,081 $ ( 346,253 ) $ 43,857 See accompanying notes to the condensed consolidated financial statements. 4 Actinium Pharmaceuticals, Inc. Condensed Consolidated Statement of Changes in Stockholders’ Equity For the Period from January 1, 2023 to March 31, 2023 (Unaudited) (amounts in thousands, except share amounts) Common Stock Additional Paid-In Accumulated Stockholders’ Shares Amount Capital Deficit Equity Balance, January 1, 2023 25,674,823 $ 26 $ 355,220 $ ( 288,765 ) $ 66,481 Stock-based compensation - - 993 - 993 Sale of common stock, net of offering costs 54,414 - 770 - 770 Issuance of common stock from exercise of stock options 133 - 1 - 1 Net loss - - - ( 11,037 ) ( 11,037 ) Balance, March 31, 2023 25,729,370 $ 26 $ 356,984 $ ( 299,802 ) $ 57,208 See accompanying notes to the condensed consolidated financial statements. 5 Actinium Pharmaceuticals, Inc. Condensed Consolidated Statements of Cash Flows (Unaudited) (amounts in thousands) For the Three Months Ended March 31, 2024 2023 Cash Flows Used In Operating Activities: Net loss $ ( 8,670 ) $ ( 11,037 ) Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation expense 1,378 993 Depreciation & amortization expenses 216 182 Changes in operating assets and liabilities: Prepaid expenses and other current assets 271 ( 1,989 ) Accounts payable and accrued expenses ( 440 ) ( 2,770 ) Operating lease right-of-use assets - ( 336 ) Operating lease liabilities ( 129 ) ( 120 ) Net Cash Used In Operating Activities ( 7,374 ) ( 15,077 ) Cash Flows Used In Investing Activities: Purchase of property and equipment ( 11 ) ( 76 ) Net Cash Used In Investing Activities ( 11 ) ( 76 ) Cash Flows Provided By Financing Activities: Payments on finance leases ( 2 ) ( 1 ) Sales of shares of common stock, net of costs 14,695 770 Proceeds from the exercise of stock options 75 1 Net Cash Provided By Financing Activities 14,768 770 Net change in cash, cash equivalents, and restricted cash 7,383 ( 14,383 ) Cash, cash equivalents, and restricted cash at beginning of period 76,990 109,608 Cash, cash equivalents, and restricted cash at end of period $ 84,373 $ 95,225 Supplemental disclosure of cash flow information: Cash paid for interest $ - $ - Cash paid for income taxes $ - $ - See accompanying notes to the condensed consolidated financial statements. 6 Actinium Pharmaceuticals, Inc. Notes to Condensed Consolidated Financial Statements (Unaudited) Note 1 - Description of Business and Summary of Significant Accounting Policies Nature of Business - Actinium Pharmaceuticals, Inc. is a biopharmaceutical company developing ARCs and other targeted radiotherapies to deliver cancer-killing radiation with cellular level precision to treat patients with high unmet medical needs. Basis of Presentation - Unaudited Interim Financial Information - The accompanying unaudited interim condensed consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, and in accordance with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) with respect to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim condensed financial statements furnished reflect all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. Interim results are not necessarily indicative of the results for the full year. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s annual report on Form 10-K for the year ended December 31, 2023. Principles of Consolidation - The basis of consolidation is unchanged from the disclosure in the Company’s Notes to the Consolidated Financial Statements section in its Report on Form 10-K for the year ended December 31, 2023. The unaudited condensed consolidated financial statements include the Company’s accounts and those of the Company’s wholly owned subsidiaries. Use of Estimates - The preparation of these unaudited interim condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. Cash, Cash Equivalents and Restricted Cash - The Company considers all highly liquid accounts with original maturities of three months or less to be cash equivalents. The Company holds most of its cash equivalents in a Money Market account comprised of US Treasury notes. Balances held by the Company are typically in excess of Federal Deposit Insurance Corporation insured limits. The following is a summary of cash, cash equivalents and restricted cash at March 31, 2024 and December 31, 2023: (in thousands) March 31, 2024 December 31, 2023 Cash and cash equivalents $ 84,057 $ 76,677 Restricted cash – long-term 316 313 Cash, cash equivalents and restricted cash $ 84,373 $ 76,990 Restricted cash relates to a certificate of deposit held as collateral for a letter of credit issued in connection with the Company’s lease of corporate office space. Leases – The Company has an operating lease for corporate office space and a finance lease for office equipment located at the corporate office space. Leases with an initial term of 12 months or less are not recorded on the balance sheet; lease expense for these leases is recognized on a straight-line basis over the lease term. Fair Value Measurement - Fair value is defined as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants. A fair value hierarchy has been established for valuation inputs that gives the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. 7 Revenue Recognition - The Company recognizes revenue in accordance with Accounting Standards Codification (ASC) Topic 606, Revenue From Contracts With Customers (“ASC 606”). Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements within the scope of ASC 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price, including variable consideration, if any; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue as the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration to which it is entitled in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses whether the promised goods or services promised within each contract are distinct and, therefore, represent a separate performance obligation. Goods and services that are determined not to be distinct are combined with other promised goods and services until a distinct bundle is identified. In determining whether goods or services are distinct, the Company evaluates certain criteria, including whether (i) the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (capable of being distinct) and (ii) the good or service is separately identifiable from other goods or services in the contract (distinct in the context of the contract). The Company then determines the transaction price, which is the amount of consideration it expects to be entitled from a customer in exchange for the promised goods or services for each performance obligation and recognizes the associated revenue as each performance obligation is satisfied. The Company’s estimate of the transaction price for each contract includes all variable consideration to which it expects to be entitled. Variable consideration includes payments in the form of collaboration milestone payments. If an arrangement includes collaboration milestone payments, the Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. ASC 606 requires the Company to allocate the arrangement consideration on a relative standalone selling price basis for each performance obligation after determining the transaction price of the contract and identifying the performance obligations to which that amount should be allocated. The relative standalone selling price is defined in the revenue standard as the price at which an entity would sell a promised good or service separately to a customer. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation as each performance obligation is satisfied, either at a point in time or over time, and if over time, recognition is based on the use of an output or input method. Collaborative Arrangements - The Company follows the accounting guidance for collaboration agreements with third parties, which requires that certain transactions between the Company and collaborators be recorded in its consolidated statements of operations on either a gross basis or net basis, depending on the characteristics of the collaborative relationship, and requires enhanced disclosure of collaborative relationships. The Company evaluates its collaboration agreements for proper classification in its consolidated statements of operations based on the nature of the underlying activity. When the Company has concluded that it has a customer relationship with one of its collaborators, the Company follows the guidance of ASC 606 . Grant Revenue – The Company has a grant from a government-sponsored entity for research and development related activities that provided for payments for reimbursed costs, which included overhead and general and administrative costs as well as an administrative fee. The Company recognizes revenue from grants as it performed services under this arrangement. Associated expenses are recognized when incurred as research and development expense. Revenue and related expenses are presented gross in the consolidated statements of operations. 8 License Revenue – The Company entered into a product licensing agreement whereby the Company allowed a third party to commercialize a certain product in specified territories using the Company’s trademarks. The terms of this arrangement includes payment to the Company for a combination of one or more of the following: upfront license fees; development, regulatory and sales-based milestone payments; and royalties on net sales of licensed products. The Company uses its judgment to determine whether milestones or other variable consideration should be included in the transaction price. Upfront license fees : If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company will recognize revenue from upfront license fees allocated to the license when the license is transferred to the licensee and the licensee is able to use and benefit from the license. For licenses that are bundled with other promises, the Company determines whether the combined performance obligation is satisfied over time or at a point in time. Development, regulatory or commercial milestone payments : At the inception of each arrangement that includes payments based on the achievement of certain development, regulatory and sales-based or commercial events, the Company evaluates whether the milestones are considered probable of being achieved and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the Company’s or the licensee’s control, such as regulatory approvals, are not considered probable of being achieved until regulatory approval is received. At the end of each subsequent reporting period, the Company will re-evaluate the probability of achieving such development and regulatory milestones and any related constraint, and if necessary, adjust the Company’s estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis and recorded as part of license revenue during the period of adjustment. Sales-based milestone payments and royalties : For arrangements that include sales-based royalties, including milestone payments based on the volume of sales, the Company will determine whether the license is deemed to be the predominant item to which the royalties or sales-based milestones relate and if such is the case, the Company will recognize revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). Upfront payments and fees may require deferral of revenue recognition to a future period until the Company performs its obligations under these arrangements or when it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur or when the uncertainty associated with any variable consideration is subsequently resolved. Amounts payable to the Company are recorded as accounts receivable when the Company’s right to consideration is unconditional. Research and Development Costs - Research and development costs are expensed as incurred. These costs include the costs of manufacturing drug product, the costs of clinical trials, costs of employees and associated overhead, and depreciation and amortization costs related to facilities and equipment. Research and development reimbursements are recorded by the Company as a reduction of research and development costs. Share-Based Payments - The Company estimates the fair value of each stock option award at the grant date by using the Black-Scholes option pricing model. The fair value determined represents the cost for the award and is recognized over the vesting period during which an employee is required to provide service in exchange for the award. The Company accounts for forfeitures of stock options as they occur. Net Loss Per Common Share - Basic loss per common share is computed by dividing the net loss available to common stockholders by the weighted average number of shares of common stock outstanding during the reporting period. For periods of net loss, diluted loss per share is calculated similarly to basic loss per share because the impact of all potential dilutive common shares is anti-dilutive. For the three months ended March 31, 2024 and 2023, the Company’s potentially dilutive shares, which include outstanding common stock options, restricted stock units and warrants, have not been included in the computation of diluted net loss per share as the result would have been anti-dilutive. 9 (in thousands) March 31, 2024 March 31, 2023 Stock Options 5,421 3,324 Restricted Stock Units 305 325 Warrants 1,439 1,443 Total 7,165 5,092 Recently Issued Accounting Pronouncements – In December 2023, FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , to enhance the transparency and decision usefulness of income tax disclosures. The amendments in ASU 2023-09 provide improvements primarily related to the rate reconciliation and income taxes paid information included in income tax disclosures. The Company would be required to disclose additional information regarding reconciling items equal to or greater than five percent of the amount computed by multiplying pretax income (loss) by the applicable statutory tax rate. Similarly, the Company would be required to disclose income taxes paid (net of refunds received) equal to or greater than five percent of total income taxes paid (net of refunds received). The amendments in ASU 2023-09 are effective January 1, 2025, including interim periods. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The Company will evaluate the impact of ASU 2023-09 on its financial statements. In November 2023, FASB issued ASU 2023-07, Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures , which provides improvements to reportable segment disclosure requirements, primarily through enhanced disclosures around segment expenses. ASU 2023-07 requires the Company to disclose significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss. ASU 2023-07 also requires that the Company disclose an amount for other segment items by reportable segment, a description of their composition and provide all annual disclosures about a reportable segment’s profit or loss and assets pursuant to Topic 280 during interim periods. The Company must also disclose the CODM’s title and position, as well as certain information around the measures used by the CODM and an explanation of how the CODM uses the reported measures in assessing segment performance and deciding how to allocate resources. For public entities with a single reportable segment, the entity must provide all the disclosures required pursuant to ASU 2023-07 and all existing segment disclosures under Topic 280. The amendments of ASU 2023-07 are effective for the Company for annual periods beginning January 1, 2024, and effective for interim periods beginning January 1, 2025. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The Company will evaluate the impact of ASU 2023-07 on its financial statements. In October 2021, FASB issued ASU 2021-08, Business Combinations (Topic 805), Account for Contract Assets and Contract Liabilities from Contracts with Customers , which provides guidance on accounting for contract assets and contract liabilities acquired in a business combination in accordance with ASC 606. To achieve this, an acquirer may assess how the acquiree applied ASC 606 to determine what to record for the acquired revenue contracts. Generally, this should result in an acquirer recognizing and measuring the acquired contract assets and contract liabilities consistent with how they were recognized and measured in the acquiree’s financial statements. The amendments of ASU 2021-08 are effective January 1, 2023, including interim periods. The Company will evaluate the impact of ASU 2021-08 on any future business combinations the Company may enter in the future. Note 2 - Commitments and Contingencies On June 15, 2012, the Company entered into a license and sponsored research agreement with Fred Hutchinson Cancer Research Center (“FHCRC”) to build upon previous and ongoing clinical trials with apamistamab (licensed antibody). FHCRC has completed both a Phase 1 and Phase 2 clinical trial with apamistamab. The Company has been granted exclusive rights to the antibody and related master cell bank developed by FHCRC. A milestone payment of $ 1 million will be due to FHCRC upon U.S. Food and Drug Administration (“FDA”) approval of the first drug utilizing the licensed antibody. Upon commercial sale of the drug, royalty payments of 2 % of net sales will be due to FHCRC. 10 Note 3 - Leases The Company determines if an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys to the Company the right to control the use of a fixed asset for a period of time in exchange for consideration. Control of an underlying asset is conveyed to the Company if the Company obtains the rights to direct the use of and to obtain substantially all of the economic benefits from using the underlying asset. The Company has lease agreements which include lease and non-lease components, which the Company has elected to account for as a single lease component for all classes of underlying assets. Lease expense for variable lease components are recognized when the obligation is probable. The Company made an accounting policy election to exclude from balance sheet reporting those leases with initial terms of 12 months or less. Right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. ASC 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. As an implicit interest rate was not readily determinable in the Company’s leases, the incremental borrowing rate was used based on the information available at commencement date in determining the present value of lease payments. The lease term for all of the Company’s leases includes the non-cancellable period of the lease plus any additional periods covered by either a Company option to extend (or not to terminate) the lease that the Company is reasonably certain to exercise, or an option to extend (or not to terminate) the lease controlled by the lessor. Options for lease renewals have been excluded from the lease term (and lease liability) for the majority of the Company’s leases as the reasonably certain threshold is not met. At March 31, 2024, the Company has two leases which have been capitalized in accordance with ASC 842, one for corporate office space and one for office equipment. The Company entered into a lease for corporate office space effective June 1, 2022. The lease has a term of 5 years 2 months , with an expiration date on July 30, 2027 and current annual rent of $ 0.6 million. The Company is also responsible for certain other costs, such as insurance, utilities and maintenance. During 2023, the Company spent $ 0.5 million in improvements at its corporate office space, which has been included in the value of the operating right-to-use asset. The components of lease expense are as follows: Three months ended (in thousands) March 31, 2024 March 31, 2023 Operating lease expense $ 173 $ 162 Finance lease cost Amortization of right-to-use assets $ 2 $ 1 Interest on lease liabilities $ 1 $ 1 Total finance lease cost $ 3 $ 2 11 Supplemental cash flow information related to leases are as follows: Cash flow information: Three months ended (in thousands) March 31, 2024 March 31, 2023 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flow use from operating leases $ 153 $ 150 Operating cash flow use from finance leases $ 3 $ 1 Financing cash flow use from finance leases $ 2 $ 1 Non-cash activity: Right-of-use assets obtained in exchange for lease obligations: Operating leases $ - $ - Finance Leases $ - $ - Weighted average remaining lease terms are as follows at March 31, 2024: Weighted average remaining lease term: Operating leases 3.3 years Finance Leases 2.8 years As the interest rate implicit in the leases was not readily determinable at the time that the leases were evaluated, the Company used its incremental borrowing rate based on the information available in determining the present value of lease payments. The Company’s incremental borrowing rate was based on the term of the lease, the economic environment of the lease and reflects the rate the Company would have had to pay to borrow on a secured basis. Below is information on the weighted average discount rates used at the time that the leases were evaluated: Weighted average discount rates: Operating leases 4.8 % Finance Leases 6.2 % Maturities of lease liabilities are as follows: (in thousands) Year ending December 31, Operating Leases Finance Leases 2024 (excluding three months ended March 31, 2024) 466 8 2025 630 11 2026 643 11 2027 380 - Total lease payments $ 2,119 $ 30 Less imputed interest ( 165 ) ( 2 ) Present value of lease liabilities $ 1,954 $ 28 Note 4 – Other revenue The Company has a grant from a government-sponsored entity for research and development related activities that provides payments for reimbursed costs, which included overhead and general and administrative costs, as well as an administrative fee. The Company recognizes revenue from grants as it performed services under this arrangement. Associated expenses are recognized when incurred as research and development expense. There was no other revenue recognized from this grant for the three months ended March 31, 2024 and 2023, respectively. On April 7, 2022, the Company entered into a license and supply agreement (the “License Agreement”) with Immedica Pharma AB (“Immedica”), pursuant to which Immedica licensed the exclusive product rights for commercialization of Iomab-B (I-131 apamistamab) in the European Economic Area, Middle East and North Africa (EUMENA) including Algeria, Andorra, Bahrain, Cyprus, Egypt, Iran, Iraq, Israel, Jordan, Kuwait, Lebanon, Libya, Monaco, Morocco, Oman, Palestine, Qatar, San Marino, Saudi Arabia, Switzerland, Syria, Tunisia, Turkey, the United Arab Emirates, the United Kingdom, the Vatican City and Yemen. Upon signing, the Company was entitled to an upfront payment of $ 35 million from Immedica, which was received in May 2022. Under the terms of the License Agreement, the Company is eligible to receive regulatory and commercial milestone payments and is entitled to receive royalties in the mid-20 percent range on net sales of the product in certain countries that may result from the License Agreement. The Company will continue to be responsible for certain clinical development activities and the manufacturing of Iomab-B and will retain commercialization rights in the U.S. and rest of the world. 12 The Company’s contract liabilities are recorded within Other revenue deferred – current liability or Long-term license revenue deferred in its condensed consolidated balance sheets, depending on the short-term or long-term nature of the payments to be recognized. The Company’s contract liabilities primarily consist of advanced payments from licensees. Long-term license revenue deferred was $ 35.0 million at March 31, 2024 and March 31, 2023; this deferred revenue will be recognized upon European Union regulatory approval of Iomab B. Note 5 - Equity In August 2020, the Company entered into the Capital on Demand™ Sales Agreement with JonesTrading Institutional Services LLC, “JonesTrading”, pursuant to which the Company may sell, from time to time, through or to JonesTrading, up to an aggregate of $ 200 million of its common stock. On June 28, 2022, the Company entered into an Amended and Restated Capital on Demand™ Sales Agreement (the “A&R Sales Agreement”) with JonesTrading and B. Riley Securities, Inc. (“B. Riley”). The A&R Sales Agreement modifies the original Capital on Demand™ Sales Agreement to include B. Riley Securities as an additional sales agent thereunder. Shares of common stock are offered pursuant to a shelf registration statement on Form S-3 (File No. 333-242322) filed with the SEC on August 7, 2020 (the “Prior Shelf Registration Statement”). On August 11, 2023, the Company filed a new registration statement on Form S-3 (File No. 333-273911), which registration statement was amended on February 2, 2024, and declared effective on February 5, 2024, to replace the Prior Shelf Registration Statement, including a base prospectus which covers the offering, issuance and sale of up to $ 500 million of common stock, preferred stock, warrants, units and/or subscription rights; and a sales agreement prospectus covering the offering, issuance and sale of up to a maximum aggregate offering price of $ 200 million of common stock that may be issued and sold under the Amended Sales Agreement. For the three months ended March 31, 2024, the Company sold 1.8 million shares of common stock, resulting in gross proceeds of $ 15.0 million and net proceeds of $ 14.7 million. For the three months ended March 31, 2023, the Company sold 0.1 million shares of common stock, resulting in gross proceeds and net proceeds of $ 0.8 million. Stock Options The following is a summary of stock option activity for the three months ended March 31, 2024: (in thousands, except for per-share amounts) Number of Shares Weighted Average Exercise Price ($) Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Outstanding, January 1, 2024 5,445 $ 6.80 8.70 $ 373 Granted - - Exercised ( 10 ) 7.39 Cancelled ( 14 ) 5.76 Outstanding, March 31, 2024 5,421 6.80 8.49 12,545 Exercisable, March 31, 2024 1,797 9.84 7.32 3,144 During the three months ended March 31, 2024, the Company did not grant any stock options. The fair values of all options issued and outstanding are being amortized over their respective vesting periods. The unrecognized compensation expense at March 31, 2024 was $ 13.2 million related to unvested options, which is expected to be expensed over a weighted average of 3.2 years. During the three months ended March 31, 2024 and 2023, the Company recorded compensation expense related to stock options of $ 1.2 million and $ 0.8 million, respectively. 13 Restricted Stock Units The following is a summary of restricted stock unit activity for the three months ended March 31, 2024: (in thousands, except for per-share amount) RSUs Weighted Average Grant date Fair Value Per Share ($) Outstanding, January 1, 2024 305 5.89 Granted - - Vested - - Outstanding, March 31, 2024 305 5.89 The RSUs vest at the earliest of a change of control event, the termination of the recipient’s continuous service status for any reason other than by the Company for cause and the third anniversary of the date of the grant. The fair value of the RSUs, $ 1.8 million, was determined based on the stock prices on the dates of the grants and is being recognized over three years . The unrecognized compensation expense at March 31, 2024 of $ 0.8 million is expected to be expensed over 1.4 years. During the three months ended March 31, 2024 and 2023, the Company recorded compensation expense related to RSUs of $ 0.1 million and $ 0.2 million, respectively. Warrants Following is a summary of warrant activity for the three months ended March 31, 2024: (in thousands, except for per-share amounts) Number of Shares Weighted Average Exercise Price ($) Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Outstanding, January 1, 2024 1,442 $ 16.42 0.34 $ - Granted - - Expired ( 3 ) 166.50 Outstanding, March 31, 2024 1,439 $ 16.08 0.09 $ - Exercisable, March 31, 2024 1,436 $ 15.58 0.08 $ - Note 6 - Subsequent Events Since March 31, 2024, the Company sold 0.4 million shares of common stock under its A&R Capital on Demand Sales Agreement, resulting in net proceeds of $ 3.4 million. On April 23, 2024, outstanding warrants to purchase up to 1.4 million shares of the Company’s common stock, with an exercise price of $ 15.00 per share, expired, according to their terms. Following the expiration of such warrants, the Company has less than thirteen thousand warrants outstanding. 14