Eledon Pharmaceuticals, Inc. (ELDN)·Q3 2024 Earnings Summary

Executive Summary

• Q3 2024 showcased clinical execution and balance sheet strengthening: BESTOW Phase 2 enrollment completed four months early (120 participants), positive initial islet transplantation data with tegoprubart, and an oversubscribed $85M underwritten offering extending cash runway to end-2026 .
• Financials were driven by a non-cash fair value gain: reported net income of $77.0M; basic EPS $1.05, while diluted EPS was -$0.32 due to warrant-related effects. Excluding the $96.4M non-cash gain, underlying net loss was $19.5M, reflecting higher R&D spend from clinical activity .
• No product revenues; operating model remains R&D-focused with Q3 R&D at $16.5M (+$8.6M YoY) and G&A at $4.0M (+$0.7M YoY), consistent with accelerated program cadence .
• Catalysts: accelerated BESTOW timeline (topline in Q4 2025), islet transplant data showing insulin independence without tacrolimus, and mid-2025 kidney transplant interim data; these drive narrative on tegoprubart’s potential as a calcineurin-inhibitor alternative .

What Went Well and What Went Wrong

What Went Well

• Accelerated clinical execution: Completed BESTOW Phase 2 enrollment (~4 months early), positioning topline for Q4 2025. CEO: “The accelerated pace of enrollment reflects the strong interest... we now anticipate reporting top-line results for the BESTOW trial in the fourth quarter of 2025.” .
• Positive islet transplantation data: First two patients achieved insulin independence and normal HbA1c; third reduced insulin use >60% within days; regimen was generally well tolerated without unexpected AEs—potential first human cases using anti-CD40L without tacrolimus .
• Strengthened capital position: Oversubscribed $85M offering (net ~$79.5M) extending runway to end-2026; participation by leading healthcare investors .

What Went Wrong

• Underlying operating loss: Excluding the non-cash $96.4M fair value gain, Q3 underlying net loss was $19.5M, reflecting increased clinical and CMC spending as trials scaled .
• Expense ramp: R&D rose to $16.5M from $7.9M YoY; G&A increased to $4.0M from $3.3M, driven by headcount, clinical development, and professional services .
• Accounting complexity in prior quarter: In Q2, the company determined warrant reclassification (liability treatment) requiring restatements and delayed its Q2 10-Q filing; while non-cash, it added reporting friction .

Financial Results

Notes:

• The quarter’s net income reflects a non-cash gain from changes in warrant and related instruments’ fair value ($96.4M); excluding this, underlying net loss was $19.5M .
• Company reported no product revenue in these periods; loss from operations reflects R&D/G&A only .

Cash and Liquidity

Additional items:

• Net proceeds from Oct 2024 offering: ~$79.5M (received after 9/30/24), extending runway to end-2026 .
• Change in fair value of warrant liabilities and related instruments in Q3 2024: $96.439M .

Segment breakdown: Not applicable; Eledon does not report segments .

KPIs

Guidance Changes

Earnings Call Themes & Trends

Note: A Q3 2024 earnings call transcript could not be located; themes are derived from press releases and 8‑K .

Management Commentary

• “We believe tegoprubart has best-in-class potential as a novel immunosuppressive treatment option to prevent transplant rejection, with promising clinical results across kidney, xenograft, and now islet transplantations...” — David‑Alexandre C. Gros, M.D., CEO .
• “The accelerated pace of enrollment reflects the strong interest among both clinicians and patients... we now anticipate reporting top-line results... in the fourth quarter of 2025.” — David‑Alexandre C. Gros, M.D., CEO (BESTOW update) .
• “These data are another step in our quest to achieve a path for functional cures in type 1 diabetes... tegoprubart may offer a favorable safety and efficacy profile compared to tacrolimus-based regimens.” — Piotr Witkowski, M.D., Ph.D., Director, Pancreas and Islet Transplant Program, UChicago Medicine .

Q&A Highlights

• An earnings call transcript for Q3 2024 was not available; key clarifications were provided in the press release, notably that net income was primarily driven by a non-cash $96.4M fair value gain and that the underlying net loss would have been $19.5M without this gain .
• Cash runway guidance was explicitly tied to the October 2024 financing, extending to end-2026 .
• Clinical timing milestones reaffirmed: mid-2025 interim kidney data and Q4 2025 BESTOW topline .

Estimates Context

• SPGI/Capital IQ consensus EPS and revenue estimates for Q3 2024 were unavailable to us at the time of analysis due to access limitations. Anchor comparisons to Wall Street consensus could not be performed; Eledon remains pre‑revenue and coverage may be limited [GetEstimates error; no values].
• Given the large non-cash fair value gain in Q3, we expect analysts to focus on operating metrics (R&D spend, clinical milestones) and adjusted loss ($19.5M underlying) rather than GAAP EPS volatility from warrant accounting .

Key Takeaways for Investors

• Clinical momentum is the core driver: BESTOW enrollment completion ahead of plan and mid-2025 kidney data create a clear cadence into Q4 2025 topline, a pivotal inflection for the tegoprubart thesis .
• The islet transplantation readout is strategically meaningful: insulin independence without tacrolimus and favorable tolerability supports broader positioning of anti‑CD40L immunomodulation beyond kidney allograft .
• Balance sheet materially de‑risked near term: $85M raise extends runway to end‑2026, enabling execution through key data events without near-term financing risk .
• Expect continued expense intensity: R&D growth reflects advancing trials; investors should track spend vs. milestones and the durability of runway as programs progress .
• GAAP EPS is noisy: warrant liability fair value changes can swing reported EPS; focus on operating loss and cash trajectory for assessing burn and funding .
• Near-term trading catalysts: additional islet data presentations, mid‑2025 kidney interim data, and any regulatory interactions or program updates may move sentiment and the stock .
• Medium-term thesis: If BESTOW topline supports efficacy and safety vs. tacrolimus, tegoprubart could advance toward Phase 3 and potentially redefine immunosuppression standards in transplant, expanding TAM and strategic optionality .

Citations:

• Q3 2024 8-K and Exhibit 99.1 press release: .
• Press releases (Nov 12, 2024; Oct 29, 2024; Sep 4, 2024; Jul 29, 2024): .