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Akari Therapeutics Plc (AKTX)·Q2 2024 Earnings Summary

Executive Summary

  • Q2 2024 delivered strategic progress (FDA Pre-IND feedback, full-scale GMP batch release) alongside higher operating loss; net loss was $7.56M vs $4.00M in Q2 2023, driven by increased R&D and restructuring/merger costs .
  • Liquidity improved sequentially with cash of $4.18M at June 30, 2024 (vs $1.31M at March 31, 2024), supported by $7.6M gross private placement and $1.0M unsecured convertible notes from insiders .
  • Portfolio prioritization: focus on PAS‑nomacopan for geographic atrophy (GA) and Peak Bio’s ADC platform; HSCT‑TMA program suspended as part of restructuring .
  • Management targets an IND filing for PAS‑nomacopan in GA in 2H 2025; merger with Peak Bio progressing toward expected Q4 2024 closing .

What Went Well and What Went Wrong

What Went Well

  • Positive and constructive FDA Pre‑IND feedback for PAS‑nomacopan GA program; company plans IND filing in 2025 for Phase 1 studies .
  • First full-scale GMP drug substance batch released with sufficient clinical material for IND‑enabling and initial clinical development—supported by Wacker Biotech .
  • Financing momentum: raised $7.6M gross in private placement and issued $1.0M in unsecured convertible notes to interim CEO and Chairman, bolstering near-term liquidity .
    • “We have released our first full-scale batch of drug substance… suitable for clinical use… Sufficient clinical material has been produced to support both the final IND‑enabling studies and initial clinical development in GA.” — Dr. Samir R. Patel .

What Went Wrong

  • Operating loss widened: Q2 2024 loss from operations $7.45M vs $4.62M in Q2 2023, reflecting higher R&D (PAS‑nomacopan manufacturing) and restructuring costs .
  • Restructuring and other costs of $1.64M in Q2 to execute the reduction‑in‑force and operational changes; merger-related costs of $0.25M in Q2 .
  • HSCT‑TMA program suspended as part of prioritization, removing a near-term clinical asset and increasing reliance on GA and ADC strategy execution .

Financial Results

Income Statement (Quarterly)

Metric (USD)Q2 2023Q1 2024Q2 2024
Research and development (R&D)$1.524M $2.279M $3.314M
General and administrative (G&A)$3.091M $3.710M $2.241M
Merger-related costs——$0.254M
Restructuring and other costs——$1.640M
Loss from operations$(4.615)M $(5.989)M $(7.449)M
Change in fair value of warrant liability$0.560M $0.649M $(0.151)M
Other (expense) income, net$0.055M $(0.226)M $0.042M
Net (loss) income$(4.000)M $(5.566)M $(7.558)M
Net loss per share (basic/diluted)$(0.00) $(0.00) $(0.00)
Weighted-average shares (basic/diluted)10,115,006 13,453,147,979 18,836,479

Notes:

  • Q2 2023 quarterly comparatives for R&D, G&A, and net loss provided in Q2 2024 press release; detailed line items limited for Q2 2023 .

Balance Sheet Snapshot

Metric (USD)Dec 31, 2023Mar 31, 2024Jun 30, 2024
Cash$3.845M $1.310M $4.177M
Other assets$0.510M $1.462M $0.899M
Total assets$4.355M $2.772M $5.076M
Total liabilities$4.584M $6.325M $8.779M
Shareholders’ (deficit) equity$(0.229)M $(3.553)M $(3.703)M

KPIs/Segments: No revenue or segment reporting disclosed; company is pre-revenue with focus on R&D and regulatory milestones .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
PAS‑nomacopan GA IND filing2H 2025Not previously specifiedPlan to file IND in 2H 2025 Raised visibility (timeline set)
Merger with Peak Bio closing2024Expected Q3 2024 (Q1 release) Expected Q4 2024 (Q2 release) Timing updated (pushed)
HSCT‑TMA programOngoingActive Phase 3 Part A enrollment (FY 2023 release) Suspended due to prioritization Lowered (suspended)
Operating structure2024Not specifiedReduction‑in‑force and restructuring implemented Cost base reduced
Financial guidance (Revenue, margins, OpEx)2024Not providedNot providedMaintained (no quantitative guidance)

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4/FY 2023)Previous Mentions (Q1 2024)Current Period (Q2 2024)Trend
Merger with Peak BioDefinitive agreement; pipeline expansion; strategic assessment planned Expected close in Q3 2024; continued work toward completion On track for Q4 2024 close Slight delay; progressing
Portfolio prioritizationFour-program assessment (ADC, NEI, HSCT‑TMA, PAS‑nomacopan GA) Prioritization plan announced; HSCT‑TMA suspended Reinforced prioritization: focus on ADC platform and PAS‑nomacopan GA Focus sharpened
PAS‑nomacopan GA regulatoryAdvancing to final pre‑clinical stages Advancing GA program FDA PIND feedback; IND planned 2025; GMP batch released Accelerating toward clinic
Manufacturing readinessHigh‑yield process for intravitreal use —Full‑scale GMP batch released; clinical material sufficient Execution milestone achieved
Cost structure2023 OpEx reductions vs 2022 RIF ~67% to reduce costs Restructuring costs in Q2; G&A down YoY Near‑term costs to enable lower run‑rate
HSCT‑TMA programPart A enrollment; designations (Orphan, Fast Track, Rare Pediatric) Active, but prioritization underway Suspended as part of portfolio focus Deprioritized
FinancingPlanning to secure capital in Q2 2024 $1.0M insider notes $7.6M gross private placement + insider notes Strengthened liquidity

Management Commentary

  • “Moving into my fourth month as Interim CEO of Akari, we continue to make progress on multiple fronts… we received positive and constructive Pre‑IND feedback from the US FDA… we plan on filing an IND application in 2025 for our Phase 1 clinical studies of PAS‑nomacopan in geographic atrophy… we have released our first full‑scale batch of drug substance under… GMP conditions, which will be suitable for clinical use.” — Dr. Samir R. Patel .
  • “Our merger with Peak Bio continues to progress and we remain on track for a fourth quarter closing… We continue to explore licensing and partnership opportunities for both nomacopan and PAS‑nomacopan.” — Dr. Samir R. Patel .
  • “We continue to work towards completion of the merger with Peak Bio, advance PAS‑nomacopan in geographic atrophy, and explore value creation through business opportunities with nomacopan, a phase 3 ready compound.” — Dr. Samir R. Patel (Q1 release) .

Q&A Highlights

  • No Q2 2024 earnings call transcript was found for AKTX; therefore, Q&A details, guidance clarifications, and tone shifts from live commentary are unavailable [SearchDocuments: no results].

Estimates Context

  • Wall Street consensus estimates for Q2 2024 EPS and Revenue via S&P Global were unavailable due to access limitations at request time; coverage may be limited for pre‑revenue micro‑cap biopharma. Values could not be retrieved from S&P Global at this time.
    • Attempted metrics: Primary EPS Consensus Mean, Revenue Consensus Mean, and number of estimates for Q2 2024 [GetEstimates error].

Key Takeaways for Investors

  • Liquidity improved sequentially; cash rose to $4.18M by quarter‑end, aided by $7.6M gross financing and $1.0M insider notes—critical bridge to upcoming IND and merger milestones .
  • Strategic narrowing increases focus on GA and ADC platform; near‑term value hinges on timely IND filing (2H 2025) and successful merger integration with Peak Bio .
  • Operating loss widened due to targeted investments (PAS‑nomacopan manufacturing) and one‑time restructuring/merger costs; watch for normalization of G&A post‑RIF and absence of restructuring charges in future quarters .
  • HSCT‑TMA suspension concentrates resources but removes a proximate rare disease catalyst; monitor any licensing/divestiture efforts for nomacopan .
  • Near‑term trading sensitivity likely tied to merger timeline updates, regulatory interactions for GA, and additional financing actions; the absence of revenue and limited estimate coverage heighten event‑driven volatility .
  • Manufacturing readiness (GMP batch) de‑risks early clinical execution for GA; next inflection will be IND submission and acceptance .
  • Keep an eye on balance sheet leverage (liabilities increased to $8.78M); any additional capital raises, deal‑related costs, or warrant liability re‑measurements can drive reported P&L swings .