What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2024-03-22 compared with 2023-03-30 · 53 added, 88 removed, 148 unchanged (49% of the section changed)

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Market Information

Our common stock and warrants are traded on the Nasdaq Capital Market under the symbols “REVB”

and “REVBW”, respectively.

Our common stock and Public Warrants are traded on the Nasdaq Capital Market under the symbols “REVB” and “REVBW”, respectively.

Holders of Record

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Any determination to pay dividends to holders of shares of our common stock will be at the discretion of our board of directors and will depend on many factors, including our financial condition, results of operations, projections, liquidity, earnings, legal requirements, restrictions in the agreements governing any indebtedness we may enter into and other factors that our board of directors deems relevant.

Issuer Purchases of Equity Securities

The following table summarizes all of the repurchases of the Company’s equity securities during the year ended December 31, 2022:

Total number of shares purchased

Average price paid per share

Total number of shares purchased as part of publicly announced plans or programs

Maximum number of shares that may yet be purchased under the plans or programs

January 1, 2022 to January 31, 2022

February 1, 2022 to February 28, 2022

March 1, 2022 to March 31, 2022

April 1, 2022 to April 30, 2022

May 1, 2022 to May 31, 2022

June 1, 2022 to June 30, 2022

July 1, 2022 to July 31, 2022

August 1, 2022 to August 31, 2022

September 1, 2022 to September 30, 2022

October 1, 2022 to October 31, 2022

November 1, 2022 to November 30, 2022

December 1, 2022 to December 31, 2022

Shares repurchased as part of the February 4, 2022 exercise of the Forward Share Purchase Agreement dated December 21, 2021, with a total repurchase amount of $7,652,325.

The Forward Share Purchase Agreement expired 30 days after the Closing Date of the Business Combination.

The shares of common stock repurchased have been retired.

Not applicable.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

You should read the following discussion of our financial condition and results of operations in conjunction with our audited financial statements and the notes included elsewhere in this Form 10-K.

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Our actual results could differ materially from those discussed in these statements.

Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Form 10-K, particularly under the “Risk Factors”

and “Cautionary Note Regarding Forward-Looking Statements and Risk Factors Summary”

Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Form 10-K, particularly under the “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements and Risk Factors Summary” sections.

Revelation is a clinical-stage biopharmaceutical company founded in May 2020.

We are focused on the development or commercialization of innate immune system therapeutics and diagnostics.

Our current product candidates were developed by us to potentially prevent, treat and detect disease.

Our therapeutic product candidates are based on our therapeutic platform and consist of REVTx-300, which is being developed as a potential therapy for the prevention and treatment of acute organ injury (e.g.

AKI, MI) and chronic organ disease including CKD;

REVTx-100, which is being developed for the prevention and treatment of infections including healthcare-associated bacterial infection resulting from surgery, severe burns, and antibiotic resistance;

REVTx-200, which is being developed as a potential intranasal therapy that will be administered concurrently with a traditional commercially available IM vaccine;

and REVTx-99b, which is being developed for the treatment of food allergies.

REVTx-99a was being developed as a broad anti-viral nasal drop solution for the potential prevention or potential treatment of respiratory viral infections and REVTx-99b was being developed as a prevention or treatment for chronic nasal congestion and allergic rhinitis until June of 2022.

Our diagnostic, REVDx-501 (REVID TM Rapid Test Kit), was being developed as a rapid point of care diagnostic product that can potentially be used to detect various respiratory viral infections.

Since our inception in May 2020, we have devoted substantially all of our resources to organizing and staffing our Company, business planning, raising capital, and research and development of REVTx-300, REVTx-100, REVTx-200, REVTx-99a/b and REVDx-501, our product candidates.

We are focused on the development or commercialization of innate immune system therapeutics.

Our current product candidates were developed by us and licensed to potentially prevent, treat and detect disease.

Our therapeutic product candidates are based on our therapeutic platform and consist of GEM-SSI, which is being developed for the prevention and treatment of surgical sit infection;

GEM-AKI, which is being developed as a potential therapy for the prevention and treatment of acute kidney injury as a result of cardiac surgery;

and GEM-CKD, which is being developed as a potential therapy for the prevention and treatment of chronic kidney disease.

Until June of 2022 we were developing REVTx-99a as a broad anti-viral nasal drop solution for the potential prevention or potential treatment of respiratory viral infections and REVTx-99b as a prevention or treatment for chronic nasal congestion and allergic rhinitis.

Since our inception in May 2020, we have devoted substantially all of our resources to organizing and staffing our Company, business planning, raising capital, and research and development of GEM-SSI, GEM-AKI and GEM-CKD, our product candidates.

We have funded our operations since our inception in May 2020 to December 31, 2023 through the issuance and sale of our capital stock, from which we have raised net proceeds of $43.9 million.

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Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our clinical studies and our expenditures on other research and development activities.

We have never generated revenue and do not expect to generate revenue from product sales unless and until we successfully complete development and obtain regulatory approval for REVTx-300, REVTx-100, REVTx-200, REVTx-99b, REVDx-501 or other product candidates, which we expect will not be for at least several years, if ever.

Accordingly, until such time as we can generate significant revenue from sales of REVTx-300, REVTx-100, REVTx-200, REVTx-99b, REVDx-501 or other product candidates, if ever, we expect to finance our cash needs through a combination of public or private equity offerings, debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements.

We have never generated revenue and do not expect to generate revenue from product sales unless and until we successfully complete development and obtain regulatory approval for GEM-SSI, GEM-AKI, GEM-CKD or other product candidates, which we expect will not be for at least several years, if ever.

Accordingly, until such time as we can generate significant revenue from sales of GEM-SSI, GEM-AKI, GEM-CKD or other product candidates, if ever, we expect to finance our cash needs through a combination of public or private equity offerings, debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements.

However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all.

Our failure to raise capital or enter into such other arrangements when needed would have a negative impact on our financial condition and could force us to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

On January 10, 2022, we consummated the Business Combination, pursuant to the terms of the agreement and plan of merger, dated as of August 29, 2021 with Petra and Merger Sub.

Pursuant to the Business Combination Agreement, on the Closing Date, (i) Merger Sub merged with and into Revelation Sub, with Revelation Sub as the surviving company in the Business Combination, and became a wholly-owned subsidiary of Petra and (ii) Petra changed its name to “Revelation Biosciences, Inc.”

Recent Developments

2024 Reverse Stock Split

On January 17, 2024, at a special meeting of stockholders, our stockholders approved a Certificate of Amendment to our Third Amended and Restated Certificate of Incorporation to effect a reverse stock split of our outstanding shares of common stock at a specific ratio within a range of one-for-two (1-for-2) to a maximum of a one-for-fifty (1-for-50) split.

On January 22, 2024, we filed the Certificate of Amendment which effected a 1-for-30 reverse stock split of our outstanding shares of common stock as of 12:01 a.m.

Eastern Standard Time on January 25, 2024.

2023 Change in Authorized Shares and Reverse Stock Split

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Eastern Standard Time on February 1, 2023.

Business Combination

On January 10, 2022, we consummated the previously announced Business Combination, pursuant to the terms of the agreement and plan of merger, dated as of August 29, 2021 with Petra and Merger Sub.

Research and Development

Research and development expenses consist primarily of costs incurred for the development of our product candidates, REVTx-300, REVTx-100, REVTx-200, REVTx-99a/b and REVDx-501.

Our research and development

expenses consist primarily of external costs related to clinical development, costs related to contract research organizations, costs related to consultants, costs related to acquiring and manufacturing clinical study materials, costs related to contract manufacturing organizations and other vendors, costs related to the preparation of regulatory submissions, costs related to laboratory supplies and services, and personnel costs.

Research and development expenses consist primarily of costs incurred for the development of our product candidates GEM-SSI, GEM-AKI, GEM-CKD and REVTx-99a/b.

Our research and development expenses consist primarily of external costs related to clinical development, costs related to contract research organizations, costs related to consultants, costs related to acquiring and manufacturing clinical study materials, costs related to contract manufacturing organizations and other vendors, costs related to the preparation of regulatory submissions, costs related to laboratory supplies and services, and personnel costs.

Personnel and related costs consist of salaries, employee benefits and stock-based compensation for personnel involved in research and development efforts.

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We adjust our accrual as actual costs become known.

We expect our research and development expenses to increase substantially for the foreseeable future as we continue the development of REVTx-300, REVTx-100, REVTx-200, REVTx-99b and REVDx-501 and continue to invest in research and development activities.

The process of conducting the necessary clinical research and product development to obtain regulatory approval is costly and time consuming, and the successful development of REVTx-300, REVTx-100, REVTx-200, REVTx-99b, REVDx-501 and any future product candidates is highly uncertain.

We expect our research and development expenses to increase substantially for the foreseeable future as we continue the development of GEM-SSI, GEM-AKI and GEM-CKD and continue to invest in research and development activities.

The process of conducting the necessary clinical research and product development to obtain regulatory approval is costly and time consuming, and the successful development of GEM-SSI, GEM-AKI, GEM-CKD and any future product candidates is highly uncertain.

To the extent that our product candidates continue to advance into larger and later stage clinical studies, our expenses will increase substantially and may become more variable.

The actual probability of success for REVTx-300, REVTx-100, REVTx-200, REVTx-99b, REVDx-501 or any future product candidate may be affected by a variety of factors, including the safety and efficacy of our product candidates, investment in the development of REVDx-501, investment in our clinical programs, manufacturing capability and competition with other products.

As a result, we are unable to determine the timing of initiation, duration and completion costs of our research and development efforts or when and to what extent we will generate revenue from the commercialization and sale of REVTx-300, REVTx-100, REVTx-200, REVTx-99b, REVDx-501 or any future product candidate.

The actual probability of success for GEM-SSI, GEM-AKI, GEM-CKD or any future product candidate may be affected by a variety of factors, including the safety and efficacy of our product candidates, investment in our clinical programs, manufacturing capability and competition with other products.

As a result, we are unable to determine the timing of initiation, duration and completion costs of our research and development efforts or when and to what extent we will generate revenue from the commercialization and sale of GEM-SSI, GEM-AKI, GEM-CKD or any future product candidate.

General and Administrative

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We expect our general and administrative expenses to increase for the foreseeable future as we increase the size of our administrative function to support the growth of our business and support our continued research and development activities.

We also anticipate increased expenses as a result of operating as a public company, including increased expenses related to financial advisory services, audit, legal, regulatory, investor relations costs, director and officer insurance premiums associated with maintaining compliance with exchange listing and SEC requirements.

We also anticipate increased expenses as we continue to operate as a public company, including increased expenses related to financial advisory services, audit, legal, regulatory, investor relations costs, director and officer insurance premiums associated with maintaining compliance with exchange listing and SEC requirements.

Other Income (Expense), Net

Other income (expense), net primarily consists of foreign currency transaction gains and losses, interest expense for the Promissory Notes Payable and Convertible Note and interest income from our cash balances in savings accounts.

Other income (expense), net primarily consists of the change in fair value of warrant liability, foreign currency transaction gains and losses, interest expense and interest income from our cash balances in savings accounts.

Results of Operations

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REVTx-99b clinical study expenses

REVTx-99a/b manufacturing expenses

REVDx-501 diagnostic development

Personnel expenses (including stock-based compensation)

GEM-SSI and GEM-AKI clinical study expenses

Manufacturing expenses

Other program expenses

Other expenses

Personnel expenses (including stock-based compensation)

Total research and development expenses

Research and development expenses decreased by $1.2 million, from $5.4 million for the year ended December 31, 2022 to $4.1 million for the year ended December 31, 2023.

The decrease was primarily due to decreases of $1.3 million in diagnostic development expenses related to REVDx-501, $0.5 million in personnel expenses and $0.2 million in REVTx-99a/b manufacturing expenses.

The decrease in personnel expenses is primarily due to the release of employees in July 2022, including a decrease of $0.1 million due to the reversal of accrued bonus expense and share-based compensation expense related to forfeited, unvested equity awards, offset by an increase in severance expense.

These decreases were offset by an increase of $0.3 million in clinical study expenses related to REVTx-99a.

The decrease was primarily due to decreases of $3.1 million in clinical study expenses related to REVTx-99a, $0.5 million in clinical study expenses related to REVTx-99b and $0.4 million in personnel expenses, offset by increases of $2.2 million in other program expenses and $0.5 million in manufacturing expenses.

Other program expenses include pre-clinical costs and clinical preparation costs primarily for programs GEM-SSI and GEM-AKI.

General and Administrative Expenses

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Total general and administrative expenses

General and administrative expenses increased by $0.5 million, from $5.0 million for the year ended December 31, 2021 to $5.5 million for the year ended December 31, 2022.

The increase was primarily due to an increase of $1.4 million in other expense as a result of an increase in D&O Insurance.

These increases were offset by a decrease of $0.7 million in personnel expenses and $0.3 million in financial advisory fees, legal fees and professional consulting service fees.

The decrease in personnel expenses is primarily due to the release of employees

in July 2022, including a decrease of $0.1 million due to the reversal of accrued bonus expense and share-based compensation expense related to forfeited, unvested equity awards, offset by an increase in severance expense.

General and administrative expenses decreased by $1.0 million, from $5.5 million for the year ended December 31, 2022 to $4.5 million for the year ended December 31, 2023.

The decrease was primarily due to a decrease of $1.1 million in other expenses as a result of a decrease in D&O Insurance.

Other Income (Expense), Net

Other income (expense), net was $36,352 for the year ended December 31, 2021 and $34,962 for the year ended December 31, 2022, related to interest expense for the Promissory Notes Payable and Convertible Note, foreign currency transaction gains and losses, and interest income from our cash balances in savings accounts.

Other income (expense), net was $34,962 for the year ended December 31, 2022, related to interest expense for the Promissory Notes Payable and Convertible Note, foreign currency transaction gains and losses, and interest income from our cash balances in savings accounts.

Other income (expense), net was $8,536,410 for the year ended December 31, 2023, related to the change in fair value of the warrant liability, foreign currency transaction gains and losses, and interest income from our cash balances in savings accounts.

Liquidity and Capital Resources

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As of December 31, 2023, we had available cash and cash equivalents of $12.0 million and an accumulated deficit of $25.5 million.

Our use of cash is to fund operating expenses, which consist primarily of research and development expenditures related to our therapeutic product candidate, REVTx-300, REVTx-100 and REVTx-200.

Our use of cash is to fund operating expenses, which consist primarily of research and development expenditures related to our therapeutic product candidates, GEM-SSI, GEM-AKI and GEM-CKD.

We plan to increase our research and development expenses substantially for the foreseeable future as we continue the clinical development of our current and future product candidates.

At this time, due to the inherently unpredictable nature of product development, we cannot reasonably estimate the costs we will incur and the timelines that will be required to complete development, obtain marketing approval, and commercialize our current product candidate, diagnostic product or any future product candidates.

For the same reasons, we are also unable to predict when, if ever, we will generate revenue from product sales or any future license agreements which we may enter into or whether, or when, if ever, we may achieve profitability.

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To the extent that we raise additional capital through partnerships or licensing arrangements with third parties, we may have to relinquish valuable rights to our product candidates, future revenue streams or research programs or to grant licenses on terms that may not be favorable to us.

If we raise additional capital through public or private equity offerings, the ownership interest of our then-existing stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect our stockholders’

If we raise additional capital through debt financing, we may be subject to covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends.

If we are unable to obtain adequate financing when needed, we may have to delay, reduce the scope of or suspend one or more of our clinical studies or preclinical studies, research and development programs or commercialization efforts or grant rights to develop and market our product candidates or diagnostic product even if we would otherwise prefer to develop and market such product candidates or diagnostic product ourselves.

If we are unable to obtain adequate financing when needed, we may have to delay, reduce the scope of or suspend one or more of our clinical studies or preclinical studies, research and development programs or commercialization efforts or grant rights to develop and market our product candidates even if we would otherwise prefer to develop and market such product candidates ourselves.

Going Concern

We have incurred recurring losses since our inception, including a net loss of $0.1 million for the year ended December 31, 2023.

As of December 31, 2022 we had an accumulated deficit of $25.3 million, a stockholders’

equity of $1.1 million and available cash and cash equivalents of $5.3 million.

As of December 31, 2023 we had an accumulated deficit of $25.5 million, a stockholders’ equity of $6.6 million and available cash and cash equivalents of $12.0 million.

Additionally, taking into consideration the net proceeds of approximately $5.4 million received in connection with the public offering completed in February of 2024, we expect to continue to incur significant operating and net losses, as well as negative cash flows from operations, for the foreseeable future as we continue to complete all necessary product development or future commercialization efforts.

We have never generated revenue and do not expect to generate

revenue from product sales unless and until we successfully complete development and obtain regulatory approval for REVTx-300, REVTx-100, REVTx-200, REVTx-99b, REVDx-501 or other product candidates, which we expect will not be for at least several years, if ever.

We have never generated revenue and do not expect to generate revenue from product sales unless and until we successfully complete development and obtain regulatory approval for GEM-SSI, GEM-AKI, GEM-CKD or other product candidates, which we expect will not be for at least several years, if ever.

We do not anticipate that our current cash and cash equivalents balance will be sufficient to sustain operations within one-year after the date that our audited financial statements for December 31, 2023 were issued, which raises substantial doubt about our ability to continue as a going concern.

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Net cash used in operating activities

Net cash used in investing activities

Net cash provided by financing activities.

Net increase (decrease) in cash and cash equivalents

Net increase in cash and cash equivalents

Net Cash Used in Operating Activities

During the year ended December 31, 2023, net cash used in operating activities was $7.3 million, which consisted of a net loss of $0.1 million and non-cash charges of $8.1 million comprised of the change in fair value of the warrant liability, stock-based compensation expense and depreciation expense, offset by a net change of $1.0 million in our net operating assets and liabilities.

During the year ended December 31, 2022, net cash used in operating activities was $11.2 million, which consisted of a net loss of $10.8 million and a net change of $0.7 million in our net operating assets and liabilities, offset by non-cash charges of $0.3 million comprised of stock-based compensation expense, non-cash lease expense and depreciation expense.

During the year ended December 31, 2021, net cash used in operating activities was $11.1 million, which consisted of a net loss of $12.0 million, offset by a net change of $0.4 million in our net operating assets and liabilities and non-cash charges of $0.5 million comprised of stock-based compensation expense, non-cash lease expense and depreciation expense.

Net Cash Used in Investing Activities

During the year ended December 31, 2022, there was no cash used in investing activities.

During the year ended December 31, 2021, net cash used in investing activities consisted of $0.1 million for purchases of lab equipment.

Net Cash Provided by Financing Activities

Forward Share Purchase Agreement of $7.7 million, net proceeds of $7.3 million received from the PIPE, and net proceeds of approximately $4.5 million received from the July 2022 Public Offering, offset by $0.8 million in repayments of Promissory Notes Payable, including interest expense.

During the year ended December 31, 2021, net cash provided by financing activities was $8.0 million, from the sale of our common stock, Series A Preferred Stock and Series A-1 Preferred Stock.

During the year ended December 31, 2023, net cash provided by financing activities was $14.0 million, from cash proceeds of $14.0 million received from the February 2023 Public Offering.

During the year ended December 31, 2022, net cash provided by financing activities was $15.2 million, from net proceeds of $4.2 million received in connection with the Business Combination, after exercise of the Forward Share Purchase Agreement of $7.7 million, net proceeds of $7.3 million received from the PIPE, and net proceeds of approximately $4.5 million received from the July 2022 Public Offering, offset by $0.8 million in repayments of Promissory Notes Payable, including interest expense.

Contractual Obligations and Other Commitments

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Foreign Currency Risk

Our expenses are generally denominated in the currencies in which our operations are located, which is primarily in the United States and Australia.

Our expenses are generally denominated in the currencies in which our operations are located, which is primarily in the United States, England and Australia.

We make payments to vendors for research and development services with payments denominated in foreign currencies including Australian Dollars and British Pounds.

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Critical Accounting Policies and Significant Judgements and Estimates

Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with the U.S.

generally accepted accounting principles (“GAAP”).

Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with the U.S.

generally accepted accounting principles (“GAAP”).

The preparation of the consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions about future events that affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenue and expenses.

These estimates and assumptions are based on management’s best estimates and judgment.

Management regularly evaluates its estimates and assumptions using industry experience and other factors;

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Determination of the Fair Value of Common Stock

Prior to the Business Combination, given the absence of a public trading market for our shares of common stock, our board of directors exercises its judgment and considers a number of objective and subjective factors to determine the best estimate of the fair value of our shares of common stock, including timely valuations of our shares of common stock prepared by an unrelated third-party valuation firm, important developments in our operations, sales of common stock and convertible preferred shares, actual operating results and financial performance, the conditions in the biotechnology industry and the economy in general, the stock price performance and volatility of comparable public companies, and the lack of liquidity of our shares of common stock, among other factors.

Prior to the Business Combination, given the absence of a public trading market for our shares of common stock, our board of directors exercised its judgment and considered a number of objective and subjective factors to determine the best estimate of the fair value of our shares of common stock, including timely valuations of our shares of common stock prepared by an unrelated third-party valuation firm, important developments in our operations, sales of common stock and convertible preferred shares, actual operating results and financial performance, the conditions in the biotechnology industry and the economy in general, the stock price performance and volatility of comparable public companies, and the lack of liquidity of our shares of common stock, among other factors.

After the Business Combination, the fair value of each share of common stock is based on the closing price of our shares of common stock as reported on the date of grant.

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JOBS Act Accounting Election

We are an “emerging growth company,”

as defined in the JOBS Act.

We are an “emerging growth company,” as defined in the JOBS Act.

Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies.

We have elected to use this extended transition period to enable us to comply with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act.

As a result, our financial statements and our interim financial statements

may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.

As a result, our financial statements and our interim condensed financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.

Quantitative and Qualitative Disclosures About Market Risk.

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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-K

Item 5. Market for Registrant’s Common Equity