What changed in this filing

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Item 1. Financial Statements

2025-10-30 compared with 2025-08-07 · 160 added, 146 removed, 601 unchanged (34% of the section changed)

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(In thousands, except share and per share amounts)

December 31, 2024

September 30,

CURRENT ASSETS

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TOTAL CURRENT ASSETS

Equipment, net

Operating lease – right of use asset

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For the Three Months Ended

For the Six Months Ended

September 30,

For the Nine Months Ended

September 30,

OPERATING EXPENSES

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COMPREHENSIVE LOSS

Other comprehensive income (loss) – foreign currency translation

Other comprehensive loss – foreign currency translation

Total comprehensive loss

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IN STOCKHOLDERS’ EQUITY

FOR THE THREE AND SIX MONTHS ENDED JUNE 30,

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER

(In thousands, except share amounts)

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Balance as of June 30, 2025

Stock-based compensation

Loss on foreign currency translation

Balance as of September 30, 2025

$ ( 203,773 )

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IN STOCKHOLDERS’ EQUITY

FOR THE THREE AND SIX MONTHS ENDED JUNE 30,

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER

(In thousands, except share amounts)

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$ ( 141,793 )

Stock-based compensation

Common stock and warrants issued for cash

Reclassification from redeemable common stock

Loss on foreign currency translation

Balance as of September 30, 2024

The accompanying

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(In thousands)

For the Six Months

Ended June 30,

For the Nine Months Ended

September 30,

CASH FLOWS FROM OPERATING ACTIVITIES:

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Accretion of debt discount

Gain on settlement of accounts payable

Depreciation expense

Impairment of acquired in-process research and development intangible assets

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Cash paid for interest expense

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

Right of use assets obtained in exchange for lease obligations

The accompanying notes are an integral part of

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INmune Bio Inc.

(the “Company” or

“INmune Bio”) was organized in the State of Nevada on September 25, 2015 and is a clinical stage biotechnology pharmaceutical

company focused on developing and commercializing its product candidates to treat diseases where the innate immune system is not functioning

normally and contributing to the patient’s disease.

(the “Company” or “INmune Bio”)

was organized in the State of Nevada on September 25, 2015 and is a clinical stage biotechnology pharmaceutical company focused on developing

and commercializing its product candidates to treat diseases where inflammation and immunology cause a dysfunctional immune system contributing

INmune Bio has three product platforms.

The DN-TNF product platform utilizes

dominant-negative technology to selectively neutralize soluble TNF, a key driver of innate immune dysfunction and mechanistic target of

many diseases and was used for its Alzheimer’s clinical trial (“XPro”).

The CORDStrom product platform is a pooled,

human umbilical cord mesenchymal stem cell product currently being developed to treat recessive dystrophic epidermolysis bullosa (“RDEB”).

The Natural Killer Cell Priming Platform includes INKmune aimed at priming the patient’s NK cells to eliminate minimal residual

disease in patients with cancer.

INmune Bio’s product platforms utilize a precision medicine approach for the treatment of a wide

variety of hematologic malignancies, solid tumors and chronic inflammation.

The DN-TNF product platform utilizes dominant-negative technology to selectively

neutralize soluble TNF, a key driver of innate immune dysfunction and mechanistic target of many diseases and was used for its Alzheimer’s

clinical trial (“XPro”).

The CORDStrom product platform is a pooled, human umbilical cord mesenchymal stem cell product currently

being developed to treat recessive dystrophic epidermolysis bullosa (“RDEB”).

The Natural Killer Cell Priming Platform includes

INKmune aimed at priming the patient’s NK cells to eliminate minimal residual disease in patients with cancer.

product platforms utilize a precision medicine approach for the treatment of a wide variety of hematologic malignancies, solid tumors

and chronic inflammation.

NOTE 2 – GOING CONCERN

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revenue from the commercialization of its product candidates.

During the six months ended June 30, 2025, the Company incurred a net loss

of $ 34.2 million and had net cash flows used in operating activities of $ 14.2 million.

Given the Company’s projected operating

requirements and its existing cash and cash equivalents, the Company is projecting insufficient liquidity to sustain its operations through

one year following the date that the financial statements are issued.

These conditions and events raise substantial doubt about the Company’s

ability to continue as a going concern.

During the nine months ended September 30, 2025, the Company incurred a

net loss of $ 40.7 million and had net cash flows used in operating activities of $ 19.6 million.

Given the Company’s projected

operating requirements and its existing cash and cash equivalents, the Company is projecting insufficient liquidity to sustain its operations

through one year following the date that the financial statements are issued.

These conditions and events raise substantial doubt about

the Company’s ability to continue as a going concern.

In response to these conditions, management is

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and maintenance costs are charged to expense as incurred.

At June 30, 2025, the Company’s equipment was not yet placed into service.

Intangible Assets

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equal to that excess.

During the six months ended June 30, 2025, the

Company released the Phase 2 clinical trial results for our Alzheimer’s drug candidate, XPro, which failed to meet the primary endpoint,

During the second quarter of 2025, the Company

released the Phase 2 clinical trial results for our Alzheimer’s drug candidate, XPro, which failed to meet the primary endpoint,

though a subgroup showed potential benefits.

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Following a quantitative impairment assessment, the Company estimated the asset’s fair value

at $ 0 as of June 30, 2025, resulting in a recorded impairment of $ 16,514,000 .

at $ 0 , resulting in a recorded impairment of $ 16,514,000 which was recorded during the second quarter of 2025.

Basic and Diluted Loss per Share

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basic and diluted shares outstanding due to the Company’s net loss position.

At June 30, 2025 and 2024, the Company had potentially

issuable shares as follows:

At September 30, 2025 and 2024, the Company had

potentially issuable shares as follows:

September 30,

Stock options

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The Company’s chief operating decision maker

(“CODM”) is its Chief Financial Officer who evaluates performance and makes operating decisions about allocating resources

(“CODM”) is its Chief Executive Officer who evaluates performance and makes operating decisions about allocating resources

based on financial data presented on a consolidated basis.

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financial statement disclosures.

Subsequent Events

evaluates events that have occurred after the balance sheet date of June 30, 2025, through the date which the financial statements are

On July 4, 2025, the One Big Beautiful Bill Act

(“OBBBA”) was enacted in the U.S.

The OBBBA includes significant provisions, such as expensing of U.S.

research expenditures

and eligible capital expenditures, the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications

to the international tax framework and the restoration of favorable tax treatment for certain business provisions.

The impacts of the

OBBBA are reflected in our results for the quarter ended September 30, 2025, and there was no impact to our income tax expense or effective

income tax rate.

NOTE 4 – RESEARCH AND DEVELOPMENT

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The Company’s Australian subsidiary submits R&D tax credit requests annually for research and development expenses incurred.

At June 30, 2025 and December 31, 2024, the Company recorded a research and development tax credit receivable of $ 1,605,000 and $ 1,181,000 ,

At September 30, 2025 and December 31, 2024, the Company recorded a research and development tax credit receivable of $ 1,704,000 and $ 1,181,000 ,

respectively, for R&D expenses incurred in Australia.

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in such country.

During the six months ended June 30, 2025, the

Company released the Phase 2 clinical trial results for our Alzheimer’s drug candidate, XPro, which failed to meet the primary endpoint,

During the second quarter of 2025, the Company

released the Phase 2 clinical trial results for our Alzheimer’s drug candidate, XPro, which failed to meet the primary endpoint,

though a subgroup showed potential benefits.

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Following a quantitative impairment assessment, the Company estimated the asset’s fair value

at $ 0 as of June 30, 2025, resulting in a recorded impairment of $ 16,514,000 .

at $ 0 , resulting in a recorded impairment of $ 16,514,000 during the second quarter of 2025.

CORDStrom License Agreement

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of CORDStrom for treatment of pediatric RDEB in each of the FDA, EMA, and MHRA.

Terms of the license agreement include an upfront payment

of £ 250,000 (approximately $ 0.3 million at June 30, 2025) and a single milestone payment of up to £ 6,000,000 (approximately

$ 8.2 million as of June 30, 2025) due on the first to occur marketing authorization to be granted by the FDA, EMA or MHRA, which had not

occurred as of June 30, 2025.

At June 30, 2025 and December 31, 2024, the Company recorded $ 0.3 million and $ 0 , respectively, payable

to GOSH within accounts payable and accrued liabilities in the consolidated balance sheets.

Terms of the license agreement include a milestone payment

of up to £ 6,000,000 (approximately $ 8.1 million as of September 30, 2025) due on the first to occur marketing authorization to be

granted by the FDA, EMA or MHRA, which had not occurred as of September 30, 2025.

The Company was also required to make an upfront payment

to GOSH of approximately $ 0.3 million, which the Company paid during July 2025 and recorded in research and development expense.

Pursuant to the GOSH license agreement, the Company

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The License is owned by Immune Ventures.

the Company’s President and a member of our Board of Directors, David Moss, its Chief Financial Officer and Treasurer and Mark Lowdell,

its Chief Scientific Officer, are the owners of Immune Ventures.

Moss, the Company’s Chief Executive Officer, Mark Lowdell, its Chief Scientific Officer, and RJ Tesi, former Chief Executive Officer

of the Company, are the owners of Immune Ventures.

No sales have occurred under this license.

During December 2023, the

Company initiated a Phase I trial with INKmune in patients with metastatic castration-resistant prostate cancer.

At December 31, 2024

and June 30, 2025, the Company recorded $ 25,000 payable to Immune Ventures within accounts payable and accrued liabilities –

related parties in the consolidated balance sheet.

During December 2023, the Company initiated

a Phase I trial with INKmune in patients with metastatic castration-resistant prostate cancer.

At December 31, 2024 and September 30,

2025, the Company recorded $ 25,000 payable to Immune Ventures within accounts payable and accrued liabilities – related parties

in the consolidated balance sheet.

The term of the agreement began on October 29,

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the PITT Agreement in the amount of $ 25,000 payable on June 26 of each year until the first commercial sale.

At June 30, 2025, the Company

owed the University of Pittsburgh $ 25,000 for annual maintenance fees.

At September 30, 2025, the

Company owed the University of Pittsburgh $ 25,000 for annual maintenance fees.

Upon first commercial sale of a product making

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(in thousands)

June 30, 2025:

September 30, 2025:

Cash equivalents

Money market funds

Treasury Bills

Money market fund

Total cash equivalents

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The lease commencement date is August 2025.

As of June 30, 2025, the maturities

of our lease liabilities are as follows:

As of September 30, 2025, the

maturities of our lease liabilities are as follows:

(in thousands, except years)

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Weighted-average discount rate 12.0 %

During the three and six months ended June 30, 2025 the Company recognized

$ 55,000 and $ 95,000 , respectively, in operating lease expense, which is included in general and administrative expenses in the Company’s

consolidated statement of operations.

During the three and six months ended June 30,

2024, the Company recognized $ 41,000 and $ 80,000 , respectively, in operating lease expense, which is included in general and administrative

expenses in the Company’s consolidated statement of operations

During April 2025, the Company’s wholly-owned subsidiary, INmune Bio International.

Ltd., entered into a 2 -year collaboration agreement

with a vendor whereby it shall make fixed payments to the vendor in exchange for services pursuant to manufacturing CORDStrom in the United

A summary of the commitments payable for these services pursuant to the agreement is as follows as of June 30, 2025:

During the three and nine months ended September

30, 2025 the Company recognized $ 134,000 and $ 229,000 , respectively, of lease expense.

During the three and nine months ended September

30, 2024, the Company recognized $ 40,000 and $ 120,000 , respectively, of lease expense.

During April 2025, the Company’s wholly-owned

subsidiary, INmune Bio International.

Ltd., entered into a 2 -year collaboration agreement with a vendor whereby it makes fixed payments

to the vendor in exchange for services pursuant to manufacturing CORDStrom in the United Kingdom.

A summary of the commitments payable

for these services pursuant to the agreement is as follows as of September 30, 2025:

(in thousands, except years)

NOTE 7 – RELATED PARTY TRANSACTIONS

30, 2025 and December 31, 2024, the Company recorded a payable to UCL of $ 133,000 and $ 0 , respectively, for medical research performed

on behalf of the Company.

During the six months ended June 30, 2025 and 2024, the Company made no payments to UCL.

UCL is a wholly owned

subsidiary of the University of London.

The Company’s Chief Scientific and Manufacturing Officer is a professor at the University

the nine months ended September 30, 2025 and 2024, the Company made payments to UCL of $ 132,000 and $ 252,000 , respectively, for medical

research performed on behalf of the Company.

UCL is a wholly owned subsidiary of the University of London.

The Company’s Chief

Scientific and Manufacturing Officer is a professor at the University of London.

30, 2025 and December 31, 2024, the Company recorded a payable to AmplifyBio of $ 26,000 and $ 0 , respectively, for medical research performed

on behalf of the Company.

During the six months ended June 30, 2025 and 2024, the Company paid AmplifyBio $ 41,000 and $ 233,000 , respectively.

During the nine months ended September 30, 2025 and 2024, the Company paid AmplifyBio $ 41,000 and $ 324,000 ,

respectively.

During 2025, AmplifyBio ceased operations.

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with the Lenders whereby the Term Loan was terminated.

three and six months ended June 30, 2024, the Company recognized interest expense of $ 250,000 and $ 607,000 , respectively, related

three and nine months ended September 30, 2024, the Company recognized interest expense of $ 145,000 and $ 752,000 , respectively, related

to the Term Loan

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for gross proceeds of $ 18.9 million (net proceeds of approximately $ 17.4 million).

During September 2024, the Company entered into

securities purchase agreements with investors whereby the Company sold 2,341,260 shares of the Company’s common stock

and warrants to purchase an additional 2,341,260 shares of the Company’s common stock in a registered direct offering

in exchange for gross proceeds of $ 13.0 million (net proceeds of approximately $ 12.0 million).

Directors and officers

that participated in the offering paid a combined offering price of $ 6.50 per share and warrant, and other investors paid a combined

offering price of $ 5.50 per share and warrant.

The warrants are exercisable until March 16, 2030 and the exercise price is $ 6.40 .

The Company determined the warrants were equity classified.

The fair value of the warrants was approximately $ 9.1 million and was

calculated using the Black-Scholes option-pricing model.

Variables used in the Black-Scholes option-pricing model include:

rate of 3.41 % based on the applicable US Treasury bill rate (2) expected life of 5.5 years, (3) expected volatility of

approximately 92 % based on the trading history of the Company, and (4) zero expected dividends.

During April 2024, the Company entered into a

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The Company is required to pay BTIG a commission of 3 % of the gross proceeds from the sale of shares.

six months ended June 30, 2024, the Company issued and sold 198,364 shares of common stock at an average price of $ 10.56 per

nine months ended September 30, 2024, the Company issued and sold 198,364 shares of common stock at an average price of $ 10.56 per

share under the ATM program.

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to the offer and sale of shares of our common stock with an aggregate offering price of up to $ 75.0 million.

The Company is required

to pay the Sales Agents a commission of 3 % of the gross proceeds from the sale of shares.

the six months ended June 30, 2025, the Company issued and sold 1,304,707 shares of common stock at an average price of $ 8.01 per

This amended and restated

at-the-market sales agreement replaced the Sales Agreement entered into with BTIG in March 2021, as amended in August 2023.

is required to pay the Sales Agents a commission of 3 % of the gross proceeds from the sale of shares.

During the nine months

ended September 30, 2024, the Company issued and sold 48,762 shares of common stock at an average price of $ 6.96 per share

under the ATM program.

The aggregate net proceeds were approximately $ 0.3 million after commission expenses.

During the nine months

ended September 30, 2025, the Company issued and sold 1,304,707 shares of common stock at an average price of $ 8.01 per

share under the ATM program.

The aggregate net proceeds were approximately $ 10.1 million after commission expenses.

At June 30, 2025,

30, 2025, the Company had $ 64.5 million of common stock available under the amended and restated at-the-market agreement.

During July 2023, the Company sold 75,697 shares of its common

stock at an average price of $ 10.56 per share under the ATM program.

The aggregate net proceeds were approximately $ 775,000 after

offering expenses.

These shares were inadvertently sold under a registration statement filed with the SEC that had in fact expired prior

to the time the shares were sold.

The Company reclassified 75,697 shares, with an aggregate purchase price of $ 799,000 of

its common stock as temporary equity presented outside stockholders’ equity as a result of potential rescission rights.

of September 30, 2024, the rescission rights for these shares lapsed and the shares were reclassified to permanent equity.

Stock options

During August 2025, the Company modified stock

option awards held by its former Chief Executive Officer to extend the post-termination exercise period and provide that unvested stock

options shall continue to vest pursuant to the severance agreement, which will result in additional stock-based compensation expense of

up to $ 2.4 million to be expensed over the remaining original vesting term, if any, of the stock option awards.

The following

table summarizes stock option activity during the six months ended June 30, 2025:

table summarizes stock option activity during the nine months ended September 30, 2025:

(in thousands, except share and per share amounts) Number of

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Options cancelled ( 107,965 ) $ 7.50 - -

Outstanding at June 30, 2025 7,281,307 $ 8.29 6.03 $ -

Exercisable at June 30, 2025 5,379,014 $ 8.78 4.94 $ -

During the three and six months ended June 30,

2025, the Company recognized stock-based compensation expense of approximately $ 1.5 million and $ 3.6 million, respectively, related to

the vesting of stock options.

During the three and six months ended June 30, 2024, the Company recognized stock-based compensation expense

of approximately $ 2.3 million and $ 4.1 million, respectively, related to the vesting of stock options.

As of June 30, 2025, there was

approximately $ 9.2 million of total unrecognized compensation cost related to non-vested stock options which is expected to be recognized

over a weighted-average period of 2.67 years.

Outstanding at September 30, 2025 7,195,342 $ 8.29 5.80 $ -

Exercisable at September 30, 2025 5,379,014 $ 8.80 4.81 $ -

During the three and nine months ended September

30, 2025, the Company recognized stock-based compensation expense of approximately $ 3.0 million and $ 6.6 million, respectively, related

to the vesting of stock options.

During the three and nine months ended September 30, 2024, the Company recognized stock-based compensation

expense of approximately $ 1.7 million and $ 5.8 million, respectively, related to the vesting of stock options.

As of September 30, 2025,

there was approximately $ 8.0 million of total unrecognized compensation cost related to non-vested stock options which is expected to

be recognized over a weighted-average period of 2.63 years.

The Company issued warrants to the Company’s

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The warrants have a 10 -year term and an exercise price of $ 14.05 .

At June 30, 2025, respectively, 45,386 of

At September 30, 2025, 45,386 of

these warrants are outstanding and the intrinsic value of these warrants is $ 0 .

2024, the Company issued 1,557,592 warrants to investors in connection with the sale of common stock.

At June 30, 2025, 1,557,592 of

At September 30, 2025, 1,557,592 of

these warrants are outstanding and are exercisable for cash at a weighted average price of $ 9.59 per share.

The intrinsic value of

these warrants was $ 0 as of June 30, 2025.

these warrants was $ 0 as of September 30, 2025.

During September

2024, the Company issued 2,341,260 warrants to investors in connection with the sale of common stock.

At June 30, 2025, 2,341,160 of

At September 30, 2025, 2,341,160 of

these warrants are outstanding and are exercisable for cash at a weighted average price of $ 6.40 per share.

The intrinsic value of

these warrants was $ 0 as of June 30, 2025.

these warrants was $ 0 as of September 30, 2025.

Stock-based Compensation by Class of Expense

The following summarizes the components of stock-based

compensation expense in the consolidated statements of operations for the six months ended June 30, 2025 and 2024 respectively:

compensation expense in the consolidated statements of operations for the nine months ended September 30, 2025 and 2024 respectively:

(in thousands)

September 30,

Research and development

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The Rights Agreement was amended in 2021, 2022, 2023 and 2024 to extend the expiration date and shall expire on December 30, 2025.

NOTE 10 – GOVERNMENT GRANT

The Company has a grant awarded by the National

Institutes of Health for approximately $ 2.0 million to support a Phase 2 study of XPro in patients with treatment resistant depression.

The Company has decided it will not initiate a treatment resistant depression study using XPro.

As of June 30, 2025, the Company has not

received any proceeds pursuant to this grant.

NOTE 10 – LEGAL

has an ongoing dispute with a vendor in which the Company believes that the vendor did not properly provide services for which they have

invoiced the Company.

As of June 30, 2025, the Company has outstanding invoices with the vendor which aggregate approximately $ 1.6 million,

of which the Company has recorded approximately $ 0.2 million, which is the Company’s estimate of the obligation incurred, and

the remaining $ 1.4 million has not been recorded by the Company as the Company believes the invoices were sent erroneously.

and the vendor are still attempting to resolve the dispute and legal proceedings have not been threatened.

had a dispute with a vendor in which the Company believed that the vendor did not properly provide services for which they have invoiced

The vendor invoiced the Company approximately $ 1.6 million, of which the Company recorded $ 0.2 million.

During August 2025,

the Company and the vendor settled the obligation for approximately $ 0.2 million.

is subject to claims and suits that arise from time to time in the ordinary course of our business.

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change in the future.

NOTE 12 – SUBSEQUENT EVENTS

On August 4, 2025, Dr.

Tesi informed the Company of his intention to retire and resign from his roles as President, Chief Executive Officer, Chief Medical

Officer, Chairman of the Board of Directors (the “Board”) and all positions from the Company and its subsidiaries, effective

on the Effective Date (as defined below).

Tesi’s resignation is not the result of any dispute or disagreement with the Company

or the Board on any matter relating to the Company’s operations, policies or practices.

In connection with Dr.

Tesi’s retirement,

Tesi and the Company entered into a Separation Agreement and Mutual Release, dated August 4, 2025 (the “Severance Agreement”),

pursuant to which, the Company agreed to pay Dr.

Tesi $ 166,000 of severance within thirty days, pay Dr.

Tesi for accrued but unused vacation

days, and pay the cost of health insurance coverage for Dr.

Tesi and his spouse through December 31, 2025.

The Severance Agreement is

subject to a seven-day revocation period following execution and shall become effective on August 12, 2025, if not revoked before (the

“Effective Date”).

Under the terms of the Severance

Agreement, all unvested stock options held by Dr.

Tesi will remain outstanding and continue to vest in accordance with their original

terms, provided that Dr.

Tesi remains in compliance with the Severance Agreement.

All vested stock options will remain exercisable for

the later of five years following the Effective Date or their original expiration date.

The agreement also imposes resale limitations

Tesi’s beneficial ownership of Company securities, restricting him from selling more than 25 % of his beneficially owned shares

of common stock in any calendar month during the 18-month period following the Effective Date.

The Company further agreed

to maintain directors’ and officers’ liability insurance for Dr.

Tesi for a period of at least three years following the Effective

Date on terms no less favorable than those applicable to its then-serving officers and directors.

The Severance Agreement also reaffirms

Tesi’s right to indemnification under Nevada law, the Company’s articles of incorporation and bylaws, as amended and in

effect as of the date hereof, and provides for contribution rights in the event indemnification is unavailable.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements