What changed in this filing

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Item 1. Financial Statements

2022-11-10 compared with 2022-08-11 · 177 added, 149 removed, 503 unchanged (39% of the section changed)

Financial Statements (unaudited)

Condensed Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021

Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and six months ended June 30, 2022 and 2021

Condensed Consolidated Statements of Changes in Stockholders' Equity for the three and six months ended June 30, 2022 and 2021

Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2022 and 2021

Condensed Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021

Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2022 and 2021

Condensed Consolidated Statements of Changes in Stockholders' Equity for the three and nine months ended September 30, 2022 and 2021

Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2022 and 2021

Notes to Condensed Consolidated Financial Statements

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(In thousands, except share and per share data)

September 30,

Current assets:

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5,000,000 shares authorized

as of June 30, 2022 and December 31, 2021;

as of September 30, 2022 and December 31, 2021;

no shares issued and

outstanding as of June 30, 2022 and December 31, 2021

outstanding as of September 30, 2022 and December 31, 2021

Common stock, $ 0.001 par value per share;

115,000,000 shares

authorized as of June 30, 2022 and December 31, 2021;

17,710,450 shares issued and outstanding as of

June 30, 2022 and December 31, 2021

authorized as of September 30, 2022 and December 31, 2021;

43,269,200 shares and 17,710,450 shares issued and outstanding as of

September 30, 2022 and December 31, 2021, respectively

Additional paid-in capital

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(In thousands, except share and per share data)

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Operating expenses:

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Other comprehensive loss:

Unrealized loss on marketable debt securities

Total other comprehensive loss

Unrealized gain (loss) on marketable debt securities

Total other comprehensive income (loss)

Total comprehensive loss

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Stock-based compensation expense

Unrealized loss on marketable debt securities

Unrealized gain on marketable debt securities

Balances as of June 30, 2022

Stock-based compensation expense

Issuance of Common Stock, net

Unrealized gain on marketable debt securities

Balances as of September 30, 2022

The accompanying notes are an integral part of these condensed consolidated financial statements.

LARIMAR THERAPEUTICS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN

STOCKHOLDERS’

(In thousands, except share data)

Comprehensive

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Balances as of June 30, 2021

Stock-based compensation expense

Issuance of Common Stock, net

Unrealized gain on marketable debt securities

Balances as of September 30, 2021

The accompanying notes are an integral part of these condensed consolidated financial statements.

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(In thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

Cash flows from operating activities:

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Depreciation expense

Amortization of premium on marketable securities

Amortization of premium on marketable debt securities

Changes in operating assets and liabilities:

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Maturities and sales of marketable debt securities

Net cash provided by (used in) investing activities

Net cash (used in)/provided by investing activities

Cash flows from financing activities:

Proceeds from issuance of equity securities, net of issuance costs

Net cash provided by financing activities

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Property and equipment included in accounts payable and accrued expenses

Issuance costs included in accounts payable and accrued expenses

The accompanying notes are an integral part of these condensed consolidated financial statements.

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In May 2021, Larimar reported positive topline data from its Phase 1 Friedreich’s ataxia, ("FA") program after completing dosing of the single ascending dose ("SAD") trial in December 2020 and of the multiple ascending dose ("MAD") trial in March 2021.

Also in May 2021, the FDA placed a clinical hold on the Company's CTI-1601 clinical program after the Company notified the agency of mortalities at the highest dose levels of the 26-week non-human primate toxicology study that was designed to support extended dosing of patients with CTI-1601.

Also in May 2021, the United States Food and Drug Administration ("FDA") placed a clinical hold on the Company's CTI-1601 clinical program after the Company notified the agency of mortalities at the highest dose levels of the 26-week non-human primate toxicology study that was designed to support extended dosing of patients with CTI-1601.

At the time the hold was placed, Larimar had no interventional clinical trials with patients enrolling or enrolled.

In February 2022, in response to the Company's complete response to the clinical hold discussed above, the Agency stated that it was maintaining the clinical hold and that additional data are needed to resolve the clinical hold.

Larimar subsequently submitted a request for an FDA Type C meeting.

In the third quarter of 2022, the Company and the FDA had a Type-C meeting.

The purpose of the Type C Meeting was to obtain FDA feedback on the information needed to resolve CTI-1601's current clinical hold in full or in part, as well as to discuss a proposed change in CTI-1601’s clinical development plan to introduce a Phase 2 dose exploration study to precede initiation of an open label extension study.

The Company plans to submit a complete response to the CTI-1601 clinical hold later in the third quarter of 2022.

In conjunction with the complete response, Larimar is proposing as CTI-1601’s next clinical trial a Phase 2, four-week dose exploration study in FA patients starting at the lower dose levels tested in the Company’s Phase 1 multiple-ascending dose clinical trial.

This study will provide data on extended dosing of lower doses of CTI-1601, providing insights into safety and tolerability as well as whether lower doses for longer periods of time can increase frataxin levels, while still maintaining acceptable exposures.

Throughout the course of the interactions with the FDA, Larimar intends to continue to work with the Agency to enable resolution of the clinical hold and to agree on the study design and timing of the next proposed clinical trial.

Larimar does not know when, or if the clinical hold will be lifted.

In February 2022, in response to the Company's complete response to the clinical hold discussed above, the FDA stated that it was maintaining the clinical hold and that additional data are needed to resolve the clinical hold.

Larimar subsequently submitted a request for an FDA Type C meeting, which was granted and was held in July 2022.

Following the Type C meeting, the Company submitted a complete response to the FDA.

In September 2022, the FDA cleared the initiation of the 25 mg cohort of a Phase 2, four-week, placebo-controlled, dose exploration trial of CTI-1601 in Friedreich’s ataxia (FA) patients.

In a written communication to Larimar, the FDA indicated it was lifting its full clinical hold on the CTI-1601 program and imposing a partial hold.

With this decision, the FDA cleared CTI-1601 for a return to the clinic and the initiation of a 25 mg dose cohort of a phase 2 dose exploration study.

The conduct of additional cohorts and/or other clinical trials of CTI-1601 in this study are subject to approval by the FDA.

Larimar does not know when, or if, the partial clinical hold will be lifted.

The Company is subject to risks and uncertainties common to pre-commercial companies in the biotechnology industry, including, but not limited to, development by competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with governmental regulations, failure to secure regulatory approval for its drug candidates or any other product candidates and the ability to secure additional capital to fund its operations.

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In late 2019, an outbreak of a novel strain of the Coronavirus 2019 Disease (COVID-19) was identified and infections have been found in a number of countries around the world, including the United States.

The Company’s business, results of operations, financial condition and cash flows could be materially and adversely affected.

Specifically, the Company could experience additional delays in future clinical trial timelines as a result of additional travel and hospital restrictions related to the COVID-19 pandemic and the efforts to mitigate it which may be imposed or could experience supply shortages or manufacturer shutdowns impacting the manufacture of drug substance or drug product, which could also impact clinical trial timelines.

The condensed consolidated financial statements do not reflect any adjustments as a result of the pandemic.

In 2020, the pandemic resulted in a four-month temporary stoppage of the Company’s CTI-1601Phase 1 clinical trials in patients with Friedreich’s ataxia.

Both of the Company's SAD and MAD clinical trials were completed in 2021.

In the future, the COVID-19 pandemic and responsive measures thereto may result in negative impacts on the Company, including possible delays in our clinical and regulatory activities.

We cannot be certain what the overall impact of the COVID-19 pandemic will be on our business and it has the potential to materially adversely affect our business, financial condition, results of operations, and prospects.

Basis of Presentation

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Since its inception, the Company has incurred significant recurring operating losses and negative cash flows from operations.

The Company has incurred net losses of $ 17.6 million and $ 24.7 million for the six months ended June 30, 2022 and 2021, respectively.

In addition, as of June 30, 2022, the Company had an accumulated deficit of $ 133.9 million .

The Company has incurred net losses of $ 25.9 million and $ 41.5 million for the nine months ended September 30, 2022 and 2021, respectively.

In addition, as of September 30, 2022, the Company had an accumulated deficit of $ 142.2 million .

The Company expects to continue to generate operating losses for the foreseeable future.

As of June 30, 2022, the Company had approximately $ 54.9 million of cash, cash equivalents and marketable debt securities available for use to fund its operations and capital requirements.

In August 2020, the Company entered into an Equity Distribution Agreement (the “ATM Agreement”) with an investment bank in connection with the establishment of an “at-the-market”

offering program under which the Company could sell up to an aggregate of $ 50,000,000 of shares of its common stock from time to time through this investment bank as sales agent.

In 2021, the Company sold 2,342,720 shares pursuant to the ATM Agreement for gross proceeds of $ 20.5 million.

As of June 30, 2022, $ 29.2 million of additional shares of common stock remained available for sale by the Company under the ATM Agreement.

See Note 7 for a further discussion of the ATM Agreement.

As of September 30, 2022, the Company had approximately $ 124.7 million of cash, cash equivalents and marketable debt securities available for use to fund its operations and capital requirements.

The Company has funded its operations to date primarily with proceeds from sales of common stock, proceeds from the sale of prefunded warrants for the purchase of common stock, the acquisition in 2020 of cash, cash equivalents, restricted cash, cash equivalents and marketable debt securities upon the merger with Zafgen, Inc.

and prior to the 2020 merger with Zafgen, capital contributions from Chondrial Holdings, LLC.

In accordance with Accounting Standards Update (“ASU”) No.

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The Company has not yet commercialized any products and does not expect to generate revenue from the commercial sale of any products for several years, if at all.

The Company expects that its research and development and general and administrative expenses will continue to increase and, as a result, it will need additional capital to fund its future operating and capital requirements.

The Company expects that its research and development and general and administrative expenses will continue to increase and, as a result, that it will need additional capital to fund its future operating and capital requirements.

Until the Company can generate substantial revenue, if ever, management continuously evaluates different strategies to obtain the required funding for future operations.

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The incurrence of indebtedness would result in increased fixed payment obligations and the Company may be required to agree to certain restrictive covenants, such as limitations on its ability to incur additional debt, limitations on its ability to acquire, sell or license intellectual property rights, minimum required cash balances and other operating restrictions that could adversely impact the Company's ability to conduct its business.

Any additional fundraising efforts may divert the Company's management from their day-to-day activities, which may adversely affect its ability to develop and commercialize our product candidates.

Any additional fundraising efforts may divert the Company's management from their day-to-day activities, which may adversely affect its ability to develop and commercialize its product candidates.

There can be no assurance that the Company will be able to raise sufficient additional capital on acceptable terms, if at all.

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The Company could also be required to seek funds through arrangements with collaborative partners or otherwise at an earlier stage than otherwise would be desirable and it may be required to relinquish rights to some of its technologies or product candidates or otherwise agree to terms unfavorable to it, any of which may have a material adverse effect on the Company's business, operating results and prospects.

In addition, geopolitical unrest including the potential impact of the Russian invasion of Ukraine, the possibility that the conflict could expand beyond eastern Europe, the impact of the COVID-19 pandemic and/or other health crises on the global financial markets may reduce the Company's ability to access capital, which could negatively affect its liquidity and ability to continue as a going concern.

If the Company is unable to obtain funding when needed and/or on acceptable terms, the Company may be required to significantly curtail, delay or discontinue one or more of its research and development programs, the manufacture of clinical and commercial supplies, product portfolio expansion or pre commercialization efforts, which could adversely affect its business prospects, or the Company may be unable to continue operations.

In addition, geopolitical unrest, the impact of the COVID-19 pandemic and/or the potential impact of other health crises on the global financial markets may reduce the Company's ability to access capital, which could negatively affect its liquidity and ability to continue as a going concern.

If the Company is unable to obtain sufficient funding when needed and/or on acceptable terms, the Company may be required to significantly curtail, delay or discontinue one or more of its research and development programs, the manufacture of clinical and commercial supplies, product portfolio expansion or pre commercialization efforts, which could adversely affect its business prospects, or the Company may be unable to continue operations.

Summary of Significant Accounting Policies

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The condensed consolidated balance sheet as of December 31, 2021 was derived from the Company’s audited financial statements but does not include all disclosures required by GAAP.

The accompanying unaudited condensed consolidated financial statements as of June 30, 2022 and for the three and six months ended June 30, 2022 and 2021, have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), for interim financial statements.

The accompanying unaudited condensed consolidated financial statements as of September 30, 2022 and for the three and nine months ended September 30, 2022 and 2021, have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial statements.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations.

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These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 25, 2022.

In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s condensed consolidated financial position as of June 30, 2022, condensed consolidated results of operations for the three and six months ended June 30, 2022 and condensed consolidated statement of cash flows for the six months ended June 30, 2022 have been made.

The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2022 .

In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s condensed consolidated financial position as of September 30, 2022, condensed consolidated results of operations for the three and nine months ended September 30, 2022 and condensed consolidated statement of cash flows for the nine months ended September 30, 2022 have been made.

The results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2022 .

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period.

Significant estimates and assumptions reflected in these condensed consolidated financial statements include, but are not limited to, the accrual of research and development expense, the recording as prepaid expense of payments made in advance of the actual provision of goods or services, valuation of stock-based awards and valuation of leases.

Due to inherent uncertainty involved in making estimates, actual results reported in future periods may be affected by changes in these estimates.

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Costs associated with internal research and development and external research and development services, including drug development, clinical studies and non-clinical studies, are expensed as incurred.

Research and development expenses include costs for salaries, employee benefits, subcontractors, facility-related expenses, depreciation, stock-based compensation, third-party license fees, laboratory supplies, and external costs of outside vendors engaged to conduct discovery, non-clinical and clinical development activities, and clinical trials as well as to manufacture clinical trial materials, and other costs.

Research and development expenses include costs for salaries, employee benefits, subcontractors, stock-based compensation, facility-related expenses, third-party license fees, laboratory supplies, and external costs of outside vendors engaged to conduct discovery, non-clinical and clinical development activities, and clinical trials as well as to manufacture clinical trial materials, depreciation and other costs.

The Company recognizes external research and development costs based on an evaluation of the progress to completion of specific tasks using information provided to the Company by its service providers.

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Basic shares outstanding includes the weighted average effect of the Company’s prefunded warrants issued in June 2020, the exercise of which requires little or no consideration for the delivery of shares of common stock.

Basic and diluted weighted average shares of common stock outstanding for the three and six months ended June 30, 2022 and 2021 includes the weighted average effect of 628,403 prefunded warrants for the purchase of shares of common stock, for which the remaining unfunded exercise price is $ 0.01 per share.

Basic and diluted weighted average shares of common stock outstanding for the three and nine months ended September 30, 2022 and 2021 includes the weighted average effect of 628,403 prefunded warrants for the purchase of shares of common stock, for which the remaining unfunded exercise price is $ 0.01 per share.

Diluted net loss per share attributable to common stockholders is computed by dividing the diluted net loss attributable to common stockholders by the weighted average number of common shares, including potentially dilutive common shares assuming the dilutive effect of outstanding stock options and unvested restricted common shares, as determined using the treasury stock method.

For periods in which the Company has reported net losses, diluted net loss per common share attributable to common stockholders is the same as basic net loss per common share attributable to common stockholders, since dilutive common shares are not assumed to have been issued if their effect is antidilutive.

The Company excluded 3,130,370 and 2,546,962 common stock equivalents outstanding as of June 30, 2022 and 2021, respectively, from the computation of diluted net loss per share for the three and six months ended June 30, 2022 and 2021 because they had an anti-dilutive impact due to the net loss incurred for the periods presented.

The Company excluded 3,136,776 and 2,545,962 common stock equivalents outstanding as of September 30, 2022 and 2021, respectively, from the computation of diluted net loss per share for the three and nine months ended September 30, 2022 and 2021 because they had an anti-dilutive impact due to the net loss incurred for the periods presented.

Recently Issued and Adopted Accounting Pronouncements

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Fair Value Measurements

The Company’s assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021 are measured in accordance with the standards of ASC 820, Fair Value Measurements and Disclosures , which establishes a three-level valuation hierarchy for measuring fair value and expands financial statement disclosures about fair value measurements.

The Company’s assets and liabilities that are measured at fair value on a recurring basis as of September 30, 2022 and December 31, 2021 are measured in accordance with the standards of ASC 820, Fair Value Measurements and Disclosures , which establishes a three-level valuation hierarchy for measuring fair value and expands financial statement disclosures about fair value measurements.

The valuation hierarchy is based on the transparency of inputs to the valuation of an asset or liability as of the measurement date.

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The Company’s financial instruments consist primarily of cash, cash equivalents, marketable debt securities, accounts payable and accrued liabilities.

For accounts payable and accrued liabilities, the carrying amounts of these financial instruments as of June 30, 2022 and December 31, 2021 were considered representative of their fair values due to their short term to maturity.

The following tables summarize the Company’s cash equivalents and marketable debt securities as of June 30, 2022 and cash equivalents as of December 31, 2021:

For accounts payable and accrued liabilities, the carrying amounts of these financial instruments as of September 30, 2022 and December 31, 2021 were considered representative of their fair values due to their short term to maturity.

The following tables summarize the Company’s cash equivalents and marketable debt securities as of September 30, 2022 and cash equivalents as of December 31, 2021:

(in thousands)

June 30, 2022

September 30, 2022

Cash equivalents:

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Marketable debt securities:

Government securities

Government and agency securities

Total marketable debt securities

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Total cash equivalents

The accrued interest receivable related to the Company’s investments was $ 0.1 million as of June 30, 2022 and is included in prepaid expenses and other current assets on the condensed consolidated balance sheet.

accrued interest receivable and December 31, 2021.

The accrued interest receivable related to the Company’s investments was $ 0.2 million as of September 30, 2022 and is included in prepaid expenses and other current assets on the condensed consolidated balance sheet.

There was no accrued interest receivable and December 31, 2021.

The Company classifies its money market funds which are valued based on quoted market prices in active markets with no valuation adjustment, as Level 1 assets within the fair value hierarchy.

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These inputs include reported trades of and broker/dealer quotes on the same or similar securities, issuer credit spreads, benchmark securities, prepayment/default projections based on historical data and other observable inputs.

As of June 30, 2022 and December 31, 2021, the unrealized losses for available-for-sale investments were non-credit related, and the Company does not intend to sell the investments that were in an unrealized loss position, nor will it be required to sell those investments before recovery of their amortized cost basis, which may be maturity.

As of June 30, 2022 and December 31, 2021, no allowances for credit losses for the Company’s investments were recorded.

During the three and six months ended June 30, 2022 and 2021, the Company did no t recognize any impairment losses related to investments.

As of September 30, 2022 and December 31, 2021, the unrealized losses for available-for-sale investments were non-credit related, and the Company does not intend to sell the investments that were in an unrealized loss position, nor will it be required to sell those investments before recovery of their amortized cost basis, which may be maturity.

As of September 30, 2022 and December 31, 2021, no allowances for credit losses for the Company’s investments were recorded.

During the three and nine months ended September 30, 2022 and 2021 , the Company did no t recognize any impairment losses related to investments.

Marketable debt securities

The following table summarizes the Company's marketable debt securities as of June 30, 2022 .

The following table summarizes the Company's marketable debt securities as of September 30, 2022 .

The Company held no marketable debt securities as of December 31, 2021.

(in thousands)

June 30, 2022

Government securities

September 30, 2022

Government and agency securities

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following:

September 30,

(in thousands)

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Fixed assets, net consisted of the following:

September 30,

(in thousands)

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Accumulated depreciation

Depreciation expense during the three and six months ended June 30, 2022 was $ 0.1 million, respectively.

Depreciation expense during the three and six months ended June 30, 2021 was $ 0.1 million and $ 0.2 million, respectively.

Depreciation expense during the three and nine months ended September 30, 2022 was $ 0.1 million and $ 0.2 million, respectively.

Depreciation expense during the three and nine months ended September 30, 2021 was also $ 0.1 million and $ 0.2 million, respectively.

Accrued Expenses

September 30,

(in thousands)

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Common Stock and Prefunded Warrants

As of June 30, 2022 , the Company’s Certificate of Incorporation, as amended and restated, authorized the Company to issue up to 115,000,000 shares of $ 0.001 par value common stock, of which 17,710,450 shares were issued and outstanding, and up to 5,000,000 shares of $ 0.001 par value undesignated preferred stock, of which no shares were issued or outstanding.

As of September 30, 2022 , the Company’s Certificate of Incorporation, as amended and restated, authorized the Company to issue up to 115,000,000 shares of $ 0.001 par value common stock, of which 43,269,200 shares were issued and outstanding, and up to 5,000,000 shares of $ 0.001 par value undesignated preferred stock, of which no shares were issued or outstanding.

The voting, dividend, and liquidation rights of the holders of the Company’s common stock are subject to and qualified by the rights, powers, and preferences of the holders of the preferred stock.

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As partial compensation for these services, the Company issued MTS Health Partners 35,260 shares of common stock.

Equity Distribution Agreement

On August 14, 2020, the Company entered into the ATM Agreement with an investment bank in connection with the establishment of an “at-the-market”

offering program under which the Company may sell up to an aggregate of $ 50,000,000 of shares of common stock (the “ATM Shares”) from time to time (the “Offering”).

In July 2021, the Company sold 2,342,720 shares under an “at-the-market”

equity distribution agreement (the "Prior ATM Agreement") with Piper Sandler & Co.

for net proceeds of $ 19.9 million.

The Prior ATM Agreement was terminated in November 2022 in connection with the establishment of a new "at-the-market' offering program (see 2022 ATM Agreement below).

An aggregate of 2,354,244 shares of common stock were sold pursuant to the Prior ATM Agreement for net proceeds of $ 20.1 million

In September 2022, the Company sold 25,558,750 shares of common stock at a public offering price of $ 3.15 per share and received net proceeds, net of underwriting discounts and commissions and offering costs of $ 75.2 million.

2022 ATM Agreement

On November 10, 2022, the Company entered into a sales agreement (the "ATM Agreement") with an investment bank (Guggenheim Securities, LLC) in connection with the establishment of an “at-the-market”

offering program under which the Company may sell up to an aggregate of $ 50.0 million of shares of common stock (the “ATM Shares”) from time to time.

Under the ATM Agreement, the Company sets the parameters for the sale of ATM Shares, including the number of ATM Shares to be issued, the time period during which sales are requested to be made, limitations on the number of ATM Shares that may be sold in any one trading day and any minimum price below which sales may not be made.

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as defined in Rule 415 under the Securities Act.

The Company pays its investment bank a commission equal to 3.0 % of the gross proceeds of any ATM Shares sold through its investment bank under the ATM Agreement and reimburses the investment bank for certain specified expenses.

The Company pays its investment

bank a commission equal to 3.0 % of the gross proceeds of any ATM Shares sold through its investment bank under the ATM Agreement and reimburses the investment bank for certain specified expenses.

The ATM Agreement contains customary representations, warranties and agreements by the Company, indemnification obligations of the Company and its investment bank, other customary obligations of the parties and termination provisions.

The Company has no obligation to sell any of the ATM Shares and may at any time suspend offers under the ATM Agreement.

In 2021, the Company sold 2,342,720 shares under the ATM Agreement for net proceeds of $ 19.9 million.

As of June 30, 2022 , 2,354,244 shares of Common Stock have been sold under the ATM Agreement for net proceeds of $ 20.1 million.

As of June 30, 2022, approximately $ 29.2 million shares of common stock still remained available for sale by the Company under the ATM Agreement.

The ATM Shares will be offered and sold pursuant to the Company’s Registration Statement on Form S-3, filed by the Company on November 10, 2022 (the “Registration Statement”), and the sales agreement prospectus that forms a part of such Registration Statement, following such time, if ever, as the Registration Statement is declared effective by the SEC.

As of the date of this Quarterly Report on Form 10-Q, no ATM Shares have been sold pursuant to the ATM Agreement.

2020 Equity Incentive Plan

The Board adopted the 2020 Equity Incentive Plan (the "2020 Plan") on July 16, 2020 and the stockholders of the Company approved the 2020 Plan on September 29, 2020.

The 2020 Plan replaces the predecessor plans (the "Prior Plans") that the Company assumed following its merger with Zafgen, Inc.

("Zafgen") in May 2020.

The 2020 Plan replaces the predecessor plans (the "Prior Plans") that the Company assumed following its merger with Zafgen in May 2020.

Options outstanding under the Prior Plans will remain outstanding, unchanged, and subject to the terms of the Prior Plans and the respective award agreements, and no further awards will be made under the Prior Plans.

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The maximum aggregate number of shares that may be issued under the 2020 Plan is 8,000,000 over the ten-year term of the 2020 Plan.

During the six months ended June 30, 2022 and twelve months ended December 31, 2021, respectively, options to purchase 130,308 and 56,966 shares issued under the Prior Plans were cancelled and became available for grant under the 2020 Plan.

During the nine months ended September 30, 2022 and twelve months ended December 31, 2021, respectively, options to purchase 130,516 and 56,966 shares issued under the Prior Plans were cancelled and became available for grant under the 2020 Plan.

As permitted by the 2020 Plan, the Company added 614,709 and 708,418 shares available for grant to the 2020 Plan on January 1, 2021 and January 1, 2022, respectively.

As of June 30, 2022 , 998,301 shares of common stock were available for grant under the 2020 Plan.

As of September 30, 2022 , 991,687 shares of common stock were available for grant under the 2020 Plan.

Stock Valuation

The following table presents, on a weighted average basis, the assumptions used in the Black-Scholes option-pricing model to determine the grant-date fair value of stock options granted to employees:

September 30,

Risk-free interest rate

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Stock Options

The following table summarizes the Company’s stock option activity for the six months ended June 30, 2022 (amounts in millions, except for share and per share data):

The following table summarizes the Company’s stock option activity for the nine months ended September 30, 2022 (amounts in millions, except for share and per share data):

Weighted Average

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Forfeited/Expired

Outstanding as of June 30, 2022

Exercisable as of June 30, 2022

Vested and expected to vest as of June 30, 2022

(a) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the fair value of the common stock for the options that were "in the money" at June 30, 2022 .

At June 30, 2022, none of the Company's stock options were "in the money."

Outstanding as of September 30, 2022

Exercisable as of September 30, 2022

Vested and expected to vest as of September 30, 2022

2022 Option Grants

During the six months ended June 30, 2022 , the Company granted options to purchase 852,450 shares of common stock to employees and directors of the Company under the 2020 Plan.

During the nine months ended September 30, 2022 , the Company granted options to purchase 868,450 shares of common stock to employees and directors of the Company under the 2020 Plan.

The options have an exercise price equal to the closing stock price as of the grant date.

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The remaining 41,500 options were annual grants to the Company's directors and vest one year from the grant date.

The weighted-average grant date fair value of options granted during the six months ended June 30, 2022 was $ 5.31 .

The weighted-average grant date fair value of options granted during the nine months ended September 30, 2022 was $ 5.24 .

Stock-Based Compensation

Stock-based compensation expense was classified in the condensed consolidated statements of operations as follows:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Research and development

General and administrative

As of June 30, 2022 , total unrecognized compensation expense related to unvested stock options was $ 15.7 million, which is expected to be recognized over a weighted average period of 2.47 years.

As of September 30, 2022 , total unrecognized compensation expense related to unvested stock options was $ 14.0 million, which is expected to be recognized over a weighted average period of 2.36 years.

Commitments and Contingencies

Intellectual Property Licenses

The Company is party to an exclusive License Agreement (the “WFUHS License”), dated November 30, 2016 with Wake Forest University Health Sciences (“WFUHS”) and an exclusive License Agreement (the “IU License”), dated November 30, 2016, as amended, with Indiana University (“IU”).

The Company is party to an exclusive License Agreement (the “WFUHS License”), dated November 30, 2016, as amended, with Wake Forest University Health Sciences (“WFUHS”) and an exclusive License Agreement (the “IU License”), dated November 30, 2016, as amended, with Indiana University (“IU”).

Such agreements provide for a transferable, worldwide license to certain patent rights regarding technology used by the Company with respect to the development of CTI-1601.

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In the event that the Company is required to pay WFUHS consideration, then the Company may deduct 60 % of such WFUHS consideration on a dollar-for-dollar basis from the consideration due to IU.

During the three and six months ended June 30, 2022 , no milestones were achieved and no milestone expense was recognized.

Both agreements continue from their effective date through the last to expire of the licensed patents unless earlier terminated by either party in accordance with their terms.

On August 8, 2019, the Company entered into an operating lease for office space in Bala Cynwyd, Pennsylvania, effective as of December 15, 2019, for a period of three years and six months with an option to extend the lease for three additional years.

Due to required tenant improvements to be completed by the landlord, the Company did not take immediate possession of the leased property and the lease term commenced on February 15, 2020 .

On May 28, 2020, the Company acquired a non-cancellable operating lease for approximately 17,705 square feet of office space (the “Premises”).

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The Company has determined this lease extension qualifies as a short-term lease and have applied the accounting policy election to not record the related right-of-use asset and lease liabilities.

Expense arising from operating leases was $ 0.1 million and $ 0.2 million during the three and six months ended June 30, 2022 and $ 0.1 million during the three and six months ended June 30, 2021, respectively.

For operating leases, the weighted-average remaining lease term for leases at June 30, 2022 and December 31, 2021 was 7.2 and 7.6 years, respectively.

For operating leases, the weighted average discount rate for leases at June 30, 2022 and December 31, 2021 was 11.0 %.

Expense arising from operating leases was $ 0.1 million and $ 0.2 million during the three and nine months ended September 30, 2022 and also $ 0.1 million and $ 0.2 million during the three and nine months ended September 30, 2021, respectively.

For operating leases, the weighted-average remaining lease term for leases at September 30, 2022 and December 31, 2021 was 7.0 and 7.6 years, respectively.

For operating leases, the weighted average discount rate for leases at September 30, 2022 and December 31, 2021 was 11.0 %.

The Company has not entered into any financing leases.

Maturities of lease liabilities due under these lease agreements as of June 30, 2022 are as follows:

Maturities of lease liabilities due under these lease agreements as of September 30, 2022 are as follows:

(in thousands)

Six months ending December 31, 2022

Three months ending December 31, 2022

Year ended December 31, 2023

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In November 2016, the Company entered into a consulting agreement with Mark Payne, M.D (the “Consulting Engagement”).

Payne was a director of Chondrial at that time, a full-time employee of IU and one of the inventors of the licensed IU intellectual property, and as such is entitled to a certain share of the revenues received by IU under the IU License.

Payne was a director of Chondrial Therapeutics, Inc.

("Chondrial") at that time.

Chondrial was the name of the Company prior to its merger with Zafgen in May 2020.

Payne was, and continues to be, a full-time employee of IU and one of the inventors of the licensed IU intellectual property, and as such is entitled to a certain share of the revenues received by IU under the IU License.

Pursuant to the terms of his consulting agreement the Company agreed to pay Dr.

Payne $ 0.1 million per year over the term of the agreement and granted Dr.

Payne 123,853 restricted Common Units in Chondrial Holdings, LLC, the sole investor in Chondrial Therapeutics which merged into the Company in May of 2020 ("Holdings") .

Payne $ 0.1 million per year over the term of the agreement and granted to Dr.

Payne 123,853 restricted Common Units in Chondrial Holdings, LLC, the sole investor in Chondrial .

On November 30, 2016, 30 % immediately vested and was associated with Chondrial Therapeutics IP, LLC (“IP LLC”) becoming a subsidiary of Holdings, which was subsequently contributed to the Company on December 31, 2018.

The remaining 70 % vested ratably over 48 months beginning on December 1, 2016 and were fully vested as of December 31, 2020.

The consulting agreement has a four-year term, subject to earlier termination.

The consulting agreement had a four-year term, subject to earlier termination.

On November 30, 2020, the Company entered into a 1 -month extension of the Consulting Engagement, expiring on December 31, 2020 and on January 1, 2021, the Company entered into a new consulting agreement with Dr.

Payne which extended the term of the Consulting Engagement for a four-year term beginning on January 1, 2021.

During the three and six months ended June 30, 2022 and 2021 the Company recognized less than $ 0.1 million and $ 0.1 million, respectively, related to this consulting agreement, recorded as research and development expense in the Condensed Consolidated Statements of Operations.

During the three and nine months ended September 30, 2022 and 2021 the Company recognized less than $ 0.1 million and $ 0.1 million, respectively, related to this consulting agreement, recorded as research and development expense in the Condensed Consolidated Statements of Operations.

During 2021, the Company purchased a piece of laboratory equipment and lab supplies for a cumulative $ 0.1 million from a supplier of which one of the Company's directors is also a current director.

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You should read the “Risk Factors”

section included in our 2021 Annual Report and our subsequently filed Quarterly Report on Form 10-Q for the period ended March 31, 2022, in addition to the "Risk Factors" and “Forward-Looking Statements”

sections of this Quarterly Report on Form 10-Q for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

section included in our 2021 Annual Report and our subsequently filed Quarterly Reports on Form 10-Q in addition to the "Risk Factors" and “Cautionary Note Regarding Forward-Looking Statements”

sections of this Quarterly Report for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

We are a clinical-stage biotechnology company focused on developing treatments for patients suffering from complex rare diseases using our novel cell penetrating peptide technology platform.

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At the time the hold was placed, we had no interventional clinical trials with patients enrolling or enrolled.

In February 2022, in response to the complete response we submitted to the FDA, the Agency stated that it was maintaining the clinical hold and that additional data are needed to resolve the clinical hold.

We subsequently submitted a request to the FDA for a Type C meeting.

In the third quarter of 2022, we had a Type-C meeting with the FDA.

We plan to submit a complete response to the CTI-1601 clinical hold later in the third quarter of 2022.

In conjunction with the complete response, we are proposing as CTI-1601’s next clinical trial, a Phase 2, four-week dose exploration study in FA patients starting at the lower dose levels tested in the Company’s Phase 1 multiple-ascending dose clinical trial.

Throughout the course of the interactions with the FDA, we intend to continue to work with the Agency to enable resolution of the clinical hold and to agree on the study design and timing of the next proposed clinical trial.

We do not know when, or if the clinical hold will be lifted.

In February 2022, in response to the complete response we submitted to the FDA, the FDA stated that it was maintaining the clinical hold and that additional data are needed to resolve the clinical hold.

We subsequently submitted a request to the FDA for a Type C meeting, which was granted and was held in July 2022.

We submitted a complete response incorporating additional information requested by the FDA at the meeting as well as information on the proposed study in August 2022.

In September 2022, following the Type C meeting and the submission of our complete response, the FDA cleared the initiation of the 25 mg cohort of a Phase 2, four-week, placebo-controlled, dose exploration trial of CTI-1601 in Friedreich’s ataxia (FA) patients.

In connection therewith, the FDA lifted its full clinical hold on the CTI-1601 program and imposed a partial clinical hold.

This trial is designed to further characterize CTI-1601’s safety and PD and PK profiles to provide information about the preferred long-term dose and dose regimen.

We have since initiated the Phase 2 dose exploration trial, with top-line data expected in the second half of 2023.

In connection with the FDA’s partial clinical hold, the FDA will review the data from the 25 mg cohort prior to our being authorized to initiate a second cohort and/or other clinical trials.

Larimar does not know when, or if the partial clinical hold will be lifted.

Financing Activities

We have funded our operating and capital requirements to date primarily with proceeds from sales of common stock and prefunded warrants for the purchase of common stock and, prior to our May 2020 merger with Zafgen, with capital contributions from Chondrial Holdings, LLC ("Holdings").

In August 2020, we entered into an Equity Distribution Agreement ("the ATM Agreement") with an investment bank in connection with the establishment of an “at-the-market”

offering program under which we could sell up to an aggregate of $50,000,000 of shares of our common stock from time to time through this investment bank as sales agent.

In July 2021, we sold 2,342,720 shares pursuant to the ATM Agreement for net proceeds of $19.9 million, after issuance costs.

As of June 30, 2022, $29.2 million of additional shares of common stock remained available for sale by us under the ATM Agreement.

We have funded our operations to date primarily with proceeds from sales of common stock, proceeds from the sale of prefunded warrants for the purchase of common stock, the acquisition in 2020 of cash, cash equivalents, restricted cash, cash equivalents and marketable debt securities upon the merger with Zafgen, Inc.

and, prior to the 2020 merger with Zafgen, capital contributions from Chondrial Holdings, LLC.

In August 2020, we entered into an Equity Distribution Agreement ("the Prior ATM Agreement") with an investment bank in connection with the establishment of an “at-the-market”

offering program providing for the sale of up to an aggregate of 50,000,000 of shares of our common stock from time to time through the investment bank as sales agent.

In July 2021, we sold 2,342,720 shares pursuant to the Prior ATM Agreement for net proceeds of $19.9 million, after issuance costs.

The Prior ATM Agreement was terminated in November 2022 in connection with the establishment of a new "at-the-market" offering program.

In November 2022, we entered into a Sales Agreement (the "ATM Agreement") with an investment bank in connection with the establishment of an “at-the-market”

offering program providing for the sale of up to an aggregate of $50.0 million of shares of our common stock from time to time through this investment bank as sales agent.

In September 2022, the Company sold 25,558,750 shares of common stock, for a price of $3.15 per share, in an underwritten offering for net proceeds of $75.2 million.

COVID-19 Update

Our business, results of operations, financial condition and cash flows could be materially and adversely affected.

Specifically, we could experience additional delays in future clinical trial timelines as a result of additional travel and hospital restrictions related to the COVID-19 pandemic and the efforts to mitigate it which may be imposed or could

experience supply shortages or manufacturer shutdowns impacting the manufacture of drug substance or drug product, which could also impact clinical trial timelines.

In 2020, the pandemic resulted in a four-month temporary stoppage of the Company’s CTI-1601Phase 1 clinical trials in patients with Friedreich’s ataxia.

Both of the Company's SAD and MAD clinical trials were completed in 2021.

In the future, the COVID-19 pandemic and responsive measures thereto may result in negative impacts on the Company, including possible delays in our clinical and regulatory activities.

Financial Operations Overview

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General and Administrative Expenses

General and administrative expenses consist primarily of personnel costs, composed of salaries, related benefits and stock-based compensation, costs related to our executive, finance, information technology, and costs related to other administrative functions.

General and administrative expenses (consisting primarily of personnel costs, composed of salaries, related benefits and stock-based compensation), costs related to our executive, finance, information technology, and costs related to other administrative functions.

General and administrative expenses also include insurance expenses and professional fees for auditing, tax, and legal services, including legal expenses to pursue patent protection for our intellectual property.

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Results of Operations

Comparison of three months ended June 30, 2022 and 2021

The following table summarizes our results of operations for the three months ended June 30, 2022 and 2021:

Three Months Ended June 30,

Comparison of three months ended September 30, 2022 and 2021

The following table summarizes our results of operations for the three months ended September 30, 2022 and 2021:

Three Months Ended September 30,

(in thousands)

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Research and development expenses

Research and development expenses for the three months ended June 30, 2022 decreased $3.5 million compared to the three months ended June 30, 2021.

The decrease in research and development expenses was primarily driven by a decrease in nonclinical costs of $2.5 million and a decrease of $1.1 million in clinical trial costs, partially offset by an increase of $0.2 million in stock-based compensation expense associated with stock option grants made in 2021 and 2022.

Research and development expenses for the three months ended September 30, 2022 decreased $8.4 million compared to the three months ended September 30, 2021.

The decrease in research and development expenses was primarily driven by a decrease of $6.7 million in drug manufacturing costs, a decrease of $1.0 million in nonclinical development costs, a decrease of $0.5 million in consulting expenditures, a decrease of $0.5 million in clinical expense and a decrease of $0.3 million in internal lab costs.

These decreases were partially offset by an increase of $0.4 million in personnel expense and an increase of $0.1 million in non-cash, stock-based compensation expense associated with stock option grants made in 2021 and 2022.

General and administrative expenses

General and administrative expenses for the three months ended June 30, 2022 decreased $0.4 million compared to the three months ended June 30, 2021.

The decrease was primarily driven by a decrease in professional fees associated with legal and accounting services of $0.5 million, partially offset by an increase of $0.1 million in stock-based compensation expense associated with stock option grants made in 2021 and 2022.

General and administrative expenses for the three months ended September 30, 2022 increased $0.2 million compared to the three months ended September 30, 2021.

The increase in general and administrative expense was primarily driven by an increase of $0.2 million in professional fees associated with legal and accounting services and an increase of $0.2 million in personnel expense, partially offset by a decrease of $0.2 million in operational costs primarily related to insurance, technology and recruiting services.

Results of Operations

Comparison of six months ended June 30, 2022 and 2021

The following table summarizes our results of operations for the six months ended June 30, 2022 and 2021:

Six Months Ended June 30,

Comparison of nine months ended September 30, 2022 and 2021

The following table summarizes our results of operations for the nine months ended September 30, 2022 and 2021:

Nine Months Ended September 30,

(in thousands)

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Research and development expenses

Research and development expenses for the six months ended June 30, 2022 decreased $6.6 million compared to the six months ended June 30, 2021.

The decrease in research and development expenses compared to the prior year period was primarily driven by a decrease of $3.0 million in clinical trial costs, a decrease in clinical supply manufacturing costs of $2.3 million, a decrease in nonclinical costs of $2.3 million, partially offset by an increase of $0.4 million in personnel related costs due to annual compensation increases and an increase of $0.4 million in stock-based compensation expense associated with stock option grants made in 2021 and 2022.

Research and development expenses for the nine months ended September 30, 2022 decreased $15.1 million compared to the nine months ended September 30, 2021.

The decrease in research and development expenses was primarily driven by a decrease of $9.0 million in drug manufacturing costs, a decrease of $3.5 million in clinical trial expense, a decrease of $3.3 million in nonclinical development costs, a decrease of $0.5 million in consulting expenses and a decrease of $0.4 million in internal lab costs.

These decreases were partially offset by an increase of $0.8 million in personnel expense and an increase of $0.5 million in non-cash, stock-based compensation expense associated with stock option grants made in 2021 and 2022.

General and administrative expenses

General and administrative expenses for the six months ended June 30, 2022 decreased $0.4 million compared to the six months ended June 30, 2021.

The decrease in general and administrative expenses was primarily driven by a decrease in professional fees associated with legal and accounting services of $0.6 million, a decrease in operational expenses of $0.3 million, partially offset by an increase of $0.4 million in stock-based compensation expense associated with stock option grants made in 2021 and 2022.

General and administrative expenses for the nine months ended September 30, 2022 decreased $0.2 million compared to the nine months ended September 30, 2021.

The decrease in general and administrative expense was primarily driven by a decrease of $0.5 million in operational costs primarily related to technology and recruiting services and a decrease of $0.4 million in professional fees primarily associated with legal and consulting expense, partially offset by an increase of $0.5 million in stock-based compensation expense associated with stock option grants made in 2021 and 2022 and an increase of $0.2 million in personnel expense.

Liquidity and Capital Resources

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The following table summarizes our sources and uses of cash for each of the periods presented below:

Six Months Ended June 30,

Nine Months Ended September 30,

(in thousands)

Net cash used in operating activities

Net cash provided by (used in) investing activities

Net cash (used in)/provided by investing activities

Net cash provided by financing activities

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Net cash used in operating activities

During the six months ended June 30, 2022, operating activities used $15.0 million of cash, resulting from our net loss of $17.6 million, adjusted for noncash expenses of $3.5 million and changes in our operating assets and liabilities of $0.9 million.

During the nine months ended September 30, 2022, operating activities used $20.9 million of cash, resulting from our net loss of $25.9 million, adjusted for noncash expenses of $5.2 million and changes in our operating assets and liabilities resulting in a source of cash of $0.1 million.

Our net loss was primarily attributed to research and development activities related to our CTI-1601 program and our general and administrative expenses as described above.

Noncash expenses are primarily stock-based compensation expense.

The change in operating assets and liabilities was primarily due to decreases in prepaid expenses and accounts payable.

During the six months ended June 30, 2021, operating activities used $22.0 million of cash, resulting from our net loss of $24.7 million, adjusted for noncash expenses of $2.7 million.

During the nine months ended September 30, 2021, operating activities used $34.2 million of cash, resulting from our net loss of $41.5 million, adjusted for noncash expenses of $4.2 million.

Our net loss was primarily attributable to research and development activities related to our CTI-1601 program and our general and administrative expenses as described above.

Noncash expenses primarily include stock-based compensation expense.

The change in operating assets and liabilities was primarily due to decreases in prepaid expenses and accounts payable.

Net cash provided by (used in) investing activities

During the six months ended June 30, 2022, investing activities used $35.3 million of cash, including $35.2 million in purchases of new marketable debt securities and $0.1 million in purchases of property and equipment.

During the six months ended June 30, 2021, investing activities provided $24.5 million of cash, resulting from a $26.3 million increase from maturities of marketable debt securities, partially offset by $1.7 million in purchases of new marketable debt securities.

For the nine months ended September 30, 2021 the increase in accrued expenses and prepaid expenses, partially offset by the paydown of accounts payable resulted in a source of cash of $3.1 million.

Net cash (used in)/provided by investing activities

During the nine months ended September 30, 2022, investing activities used $38.7 million of cash, including $61.6 million in purchases of new marketable debt securities and $0.1 million in purchases of property and equipment, partially offset by a $23.0 million increase from maturities of marketable debt securities.

During the nine months ended September 30, 2021, investing activities provided $17.7 million of cash, resulting from maturities of marketable debt securities of $26.3 million, partially offset by $8.3 million in purchases of new marketable debt securities.

Net cash provided by financing activities

During the six months ended June 30, 2022 and 2021 there were no financing activities.

During the nine months ended September 30, 2022, financing activities provided $75.6 million of cash from sale of common stock in an underwritten public offering, net of issuance costs.

During the nine months ended September 30, 2021 financing activities provided $19.9 million of net cash, from sale of common stock under the Prior ATM Agreement, after issuance costs.

Operating Capital Requirements

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We have to date incurred net losses.

We incurred net losses of approximately $17.6 million and $24.7 million for the six months ended June 30, 2022 and 2021, respectively.

As of June 30, 2022, we had an accumulated deficit of $133.9 million and cash, cash equivalents and marketable debt securities of $54.9 million, excluding restricted cash of $1.3 million.

We incurred net losses of approximately $25.9 million and $41.5 million for the nine months ended September 30, 2022 and 2021, respectively.

As of September 30, 2022, we had an accumulated deficit of $142.2 million and cash, cash equivalents and marketable debt securities of $124.7 million, excluding restricted cash of $1.3 million.

Losses have resulted principally from costs incurred in connection with research and development activities, and general and administrative costs associated with the development of CTI-1601 and our operations.

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We could also be required to seek funds through arrangements with collaborative partners or otherwise at an earlier stage than otherwise would be desirable and we may be required to relinquish rights to some of our technologies or product candidates or otherwise agree to terms unfavorable to us, any of which may have a material adverse effect on our business, operating results and prospects.

In addition, geopolitical unrest including the potential impact of the Russian invasion of Ukraine and the possibility that the conflict could expand beyond eastern Europe, the impact of the COVID-19 pandemic and/or other health crises on the global financial markets may reduce our ability to access capital, which could negatively affect our liquidity and ability to continue as a going concern.

If we are unable to obtain funding when needed and/or on acceptable terms, we may be required to significantly curtail, delay or discontinue one or more of our research and development programs, the manufacture of clinical and commercial supplies, product portfolio expansion or pre commercialization efforts, which could adversely affect our business prospects, or we may be unable to continue operations.

In addition, geopolitical unrest, the impact of the COVID-19 pandemic and/or the potential impact of other health crises on the global financial markets may reduce our ability to access capital, which could negatively affect our liquidity and ability to continue as a going concern.

If we are unable to obtain sufficient funding when needed and/or on acceptable terms, we may be required to significantly curtail, delay or discontinue one or more of our research and development programs, the manufacture of clinical and commercial supplies, product portfolio expansion or pre commercialization efforts, which could adversely affect our business prospects, or we may be unable to continue operations.

Certain restrictive covenants, such as limitations on our ability to incur additional debt, limitations on our ability to acquire, sell or license intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our business.

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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