# Mira Pharmaceuticals, Inc.: Form 10-Q for the period ended Sep 30, 2024

- Company: [Mira Pharmaceuticals, Inc.](/companies/mira.md) (CIK 1904286)
- Form: 10-Q
- Filed: 2024-11-12
- Accepted by EDGAR: Nov 12, 2024, 21:05 ET
- Period: 2024-09-30
- Accession: 0001493152-24-044747
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/1904286/000149315224044747/form10-q.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1904286/000149315224044747/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2024-09-30.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Research and development | 3 months, 2024-07-01 to 2024-09-30 | $1.1m | us-gaap:ResearchAndDevelopmentExpense |
| Research and development | 9 months, 2024-01-01 to 2024-09-30 | $2.4m | us-gaap:ResearchAndDevelopmentExpense |
| Interest expense | 3 months, 2024-07-01 to 2024-09-30 | −$37.8k | us-gaap:InterestExpense |
| Interest expense | 9 months, 2024-01-01 to 2024-09-30 | −$127.6k | us-gaap:InterestExpense |
| Net income | 3 months, 2024-07-01 to 2024-09-30 | −$2.0m | us-gaap:NetIncomeLoss |
| Net income | 9 months, 2024-01-01 to 2024-09-30 | −$5.5m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2024-07-01 to 2024-09-30 | −$0.14 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 9 months, 2024-01-01 to 2024-09-30 | −$0.36 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2024-07-01 to 2024-09-30 | −$0.14 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 9 months, 2024-01-01 to 2024-09-30 | −$0.36 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2024-07-01 to 2024-09-30 | 15,071,915 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Diluted shares (weighted) | 9 months, 2024-01-01 to 2024-09-30 | 15,071,915 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 9 months, 2024-01-01 to 2024-09-30 | −$3.8m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Cash and equivalents | at 2024-09-30 | $4.1m | us-gaap:Cash |
| Current assets | at 2024-09-30 | $4.2m | us-gaap:AssetsCurrent |
| Total assets | at 2024-09-30 | $4.3m | us-gaap:Assets |
| Current liabilities | at 2024-09-30 | $692.8k | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2024-09-30 | $692.8k | us-gaap:Liabilities |
| Shareholders' equity | at 2024-09-30 | $3.6m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 10,554 characters.

*The following discussion and analysis should be read in conjunction with the Condensed Financial Statements and Notes thereto included elsewhere in this Quarterly Report. This discussion contains certain forward-looking statements that involve risks and uncertainties. The Company’s actual results and the timing of certain events could differ materially from those discussed in these forward-looking statements as a result of certain factors, including, but not limited to, those set forth herein and elsewhere in this Quarterly Report and in the Company’s other filings with the SEC. See “Cautionary Note Regarding Forward Looking Statements” below.*

*As used in this Management’s Discussion and Analysis of Financial Condition and Results of Operations, unless otherwise indicated, the terms “the Company”, “we”, “us”, “our” and similar terminology refer to MIRA Pharmaceuticals, Inc.*

### Background of the Company

We are a pre-clinical-stage pharmaceutical development company with two neuroscience programs targeting a broad range of neurologic and neuropsychiatric disorders. We hold exclusive license rights in the U.S., Canada and Mexico for *Ketamir-2*, a novel, patent pending oral ketamine analog under pre-clinical investigation to potentially deliver ultra-rapid antidepressant effects, providing hope for individuals battling NP, TRD, MDSI and potentially PTSD.

Additionally, our novel oral pharmaceutical marijuana molecule, *MIRA-55*, is being studied for its potential to alleviate neuropathic pain, as well as anxiety and cognitive decline, symptoms commonly associated with early-stage dementia. MIRA-55, if approved by the FDA, could mark a significant advancement in addressing various neuropsychiatric, inflammatory, and neurologic diseases and disorders.

The DEA’s scientific review of Ketamir-2 and MIRA-55 concluded that neither would be considered a controlled substance or listed chemical under the CSA and its governing regulations.

We were incorporated under the laws of the State of Florida in September 2020 and commenced substantive operations, including our pharmaceutical development program, in late 2020.

### Critical Accounting Estimates

See Note 1 of the Notes to Condensed Financial Statements included in Item 1 of this Quarterly Report for a summary of significant accounting policies and information on recently issued accounting pronouncements.

### Results of Operations

### For the three months ended September 30, 2024 compared to the three months ended September 30, 2023

*Research and Development Expenses.* During the three months ended September 30, 2024, we incurred $1.1 million in research and development expenses, which were primarily related to initial payments for pre-clinical research projects. We incurred $1.0 million in research and development expenses during the three months ended September 30, 2023, relating to initial payment for toxicology study costs. Research and development expenses include pre-clinical, toxicology and consultant expenses.

*General and Administrative Expenses*. We incurred $1.0 million and $2.1 million in general and administrative expenses during the three months ended September 30, 2024 and September 30, 2023, respectively. General and administrative expenses are composed primarily of compensation, insurance, professional fees, stock-based compensation, administration and other related costs. The decrease is primarily due to stock-based compensation, debt issuance costs, and compensation related to the IPO efforts of the executive team that occurred in 2023 and is not reoccurring.

*Interest income (expense), net*. We earned $0.04 million in interest income (expense), net during the three months ended September 30, 2024 and incurred $(0.43) million interest income (expense), net during the three months September 30, 2023, respectively. Interest income in during 2024 related primarily to money market account interest whereas interest expense during 2023 included $0.44 million of debt issuance costs and $0.02 million of interest income.

### For the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023

*Research and Development Expenses.* During the nine months ended September 30, 2024, we incurred $2.4 million in research and development expenses which were primarily related to initial payments for pre-clinical research projects. We incurred $1.2 million in research and development expenses during the nine months ended September 30, 2023, relating to initial payments for several toxicology projects. Research and development expenses include pre-clinical, toxicology and consultant expenses and we expect our 2024 costs to be consistent going forward.

*General and Administrative Expenses.* We incurred general and administrative expenses of $3.1 million and $3.8 million during the nine months ended September 30, 2024 and September 30, 2023, respectively. General and administrative expenses consists of payroll, consulting fees, IT-related costs, legal and accounting costs, office and rent expenses, investor relations and stock-based compensation expenses. The decrease is due primarily to stock-based compensation, debt issuance costs, and compensation related to the IPO efforts of the executive team that occurred in 2023. We would expect our 2024 costs to be consistent going forward.

*Related Party Travel Costs*. We incurred no in related party travel costs during the nine months ended September 30, 2024, compared to $0.5 million in September 30, 2023. The related party travel costs incurred in 2023 consisted of a lease and use of an airplane with an entity under common control. The airplane lease was terminated in March 2023 and no further costs are expected to be incurred.

*Interest income (expense), net*. We earned $0.13 million in interest income (expense), net during the nine months ended September 30, 2024 and incurred $0.73 million in interest income (expense), net during the nine months ended September 30, 2023, respectively. Interest expense during 2023 included $0.74 million of debt issuance costs and $0.02 million of interest income. Whereas in 2024 the Company earned $0.13 million in interest income from to money market accounts.

### Liquidity and Capital Resources

### Sources of Liquidity

Since our inception in September 2020, we have financed our operations primarily through an unsecured line of credit with a major shareholder and an affiliated company, through a private placement of shares of our common stock that occurred during the fourth quarter 2021 and during 2022, by the proceeds from our completed initial public offering in August 2023 and through the proceeds of an ATM offering during the third quarter of 2024. We intend to finance our clinical development programs and working capital needs from existing cash, and potentially new sources of debt and equity financing. We may enter into new licensing and commercial partnership agreements.

Historically, we have been primarily engaged in developing MIRA-55 and, more recently, have also been focusing on the development of Ketamir-2. During these activities, we have sustained substantial losses. Our ability to fund ongoing operations and future pre-clinical and clinical trials required for FDA approval is dependent on our ability to obtain significant additional external funding in the near term. We expect to be able to fund operations through the fourth quarter of 2025, with the issuance of common stock under our shelf registration as described in Note 7 of the accompanying financial statements.

On August 12, 2024, the Company filed a shelf registration statement on Form S-3 with the SEC. The terms of any offering under the shelf registration statement will be established at the time of such offering and will be described in a prospectus supplement filed with the SEC prior to completion of any such offering.

We expect to continue to generate losses in the foreseeable future. Our liquidity needs will be determined largely by the budgeted operational expenditure incurred in regard to the progression of our product candidates. We do not have sufficient cash and cash equivalents as of the date of filing this Report to support our operations for at least 12 months. These conditions raise substantial doubt about our ability to continue as a going concern through 12 months after the date the financial statements included in this Report are issued.

#### Cash Flows

The following table provides information regarding our cash flows for the periods presented:

| Net cash flows from: | Nine Months Ended September 30, 2024 | 2023 |
| --- | ---: | ---: |
| Operating activities | $(3,755,576) | $(3,497,388) |
| Financing activities | 3,297,570 | 9,014,740 |
| Net change in cash | $(458,006) | $5,517,352 |

#### Net Cash Used in Operating Activities

For the nine months ended September 30, 2024, operating activities used $3.8 million of cash, primarily due to a net loss of $5.5 million, offset by $1.4 million in stock-based compensation expense and $0.3 million in change in accounts payable, accrued and prepaid expenses. Accounts payable, accrued and prepaid expenses were primarily composed of research and development payables, consultant costs, insurance costs and investor relations expenses.

For the nine months ended September 30, 2023, operating activities used $3.5 million of cash, primarily due to a net loss of $6.2 million, a $0.4 million change in accounts payable, accrued and prepaid expenses, offset by $2.3 million in stock-based compensation expense and $0.7 million in amortization of debt issuance costs. Accounts payable, accrued and prepaid expenses were primarily composed of research and development payables, consultant costs, insurance costs and investor relations expense.

#### Net Cash Provided by Financing Activities

For the nine months ended September 30, 2024, financing activities provided $3.3 million of cash, resulting primarily from $3.1 million in proceeds from sale of common stock, less offering costs from the ATM agreement, and $0.2 million in proceeds from short swing disgorgement and related party advances.

For the nine months ended September 30, 2023, financing activities provided $9.0 million of cash, resulting primarily from $7.7 million in proceeds from sale of common stock, less offering costs, $1.4 million of issuance of common stock for conversion of debt and issuance of common stock in lieu of investor relation fees, and offset by $0.1 million of repayments under related party line of credit.

## Market risk

As filed, 189 characters.

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act, and therefore are not required to provide the information under this item per Item 305(e) of Regulation S-K.

## Controls and procedures

As filed, 8,674 characters.

#### Evaluation of Disclosure Controls and Procedures

Our management, our Chief Executive Officer (our principal executive officer) and our Chief Financial Officer (our principal financial officer) (the “Certifying Officers”), has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act) as of June 30, 2024. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by the company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal accounting officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and our management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. The Certifying officers have concluded, based on their evaluation as of the end of the period covered by this Report that our disclosure controls and procedures were not effective to provide reasonable assurance that the objectives of our disclosure control system were met. Management is in process of implementing plans to remediate the ineffectiveness of its disclosure controls and procedures through enhancements to its internal control environment as more fully described below.

#### Changes in Internal Control over Financial Reporting

During 2024, the Company has designed and implemented new and enhanced controls to strengthen the Company’s internal controls over financial reporting, including hiring additional experienced accounting personnel, among other enhancements. Management believes these enhancements will be sufficient to remediate previously identified material weaknesses. However, the new and enhanced controls have not operated for a sufficient amount of time to conclude that the Company’s disclosure controls and procedures were effective.

Other than as described above, there were no additional changes in our internal control over financial reporting (as defined in Rule 13(a)-15(f) of the Exchange Act) that occurred during the period covered by this quarterly report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting

### CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential”, or “continue” or the negative of these terms or other similar expressions. In particular, statements about the markets in which we operate, including growth of our various markets, and our expectations, beliefs, plans, strategies, objectives, prospects, assumptions, or future events or performance contained in this quarterly report under the headings “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business” are forward-looking statements. We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates, and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. These and other important factors, including those discussed in this quarterly report under the headings “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business,” may cause our actual results, performance, or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements, or could affect our share price. Important factors that could cause actual results or events to differ materially from those expressed in forward-looking statements include, but are not limited to, the following:

- our use of the net proceeds from our offerings;
- our ability to obtain and maintain regulatory approval of our product candidates;
- our ability to successfully commercialize and market our product candidates, if approved;
- our ability to contract with third-party suppliers, manufacturers and other service providers and their ability to perform adequately;
- the potential market size, opportunity, and growth potential for our product candidates, if approved;
- our ability to obtain additional funding for our operations and development activities;
- the accuracy of our estimates regarding expenses, capital requirements and needs for additional financing;
- the initiation, timing, progress and results of our pre-clinical studies and clinical trials, and our research and development programs;
- the timing of anticipated regulatory filings;
- the timing of availability of data from our clinical trials;
- our future expenses, capital requirements, need for additional financing, and the period over which we believe that the net proceeds from this offering, together with our existing cash and cash equivalents, will be sufficient to fund our operating expenses and capital expenditure requirements;
- our ability to retain the continued service of our key professionals and to identify, hire and retain additional qualified professionals;
- our ability to advance product candidates into, and successfully complete, clinical trials;
- our ability to recruit and enroll suitable patients in our clinical trials;
- the timing or likelihood of the accomplishment of various scientific, clinical, regulatory, and other product development objectives;
- the pricing and reimbursement of our product candidates, if approved;
- the rate and degree of market acceptance of our product candidates, if approved;
- the implementation of our business model and strategic plans for our business, product candidates, and technology;
- the scope of protection we are able to establish and maintain for intellectual property rights covering our product candidates and technology;
- developments relating to our competitors and our industry;
- the development of major public health concerns, including the novel coronavirus outbreak or other pandemics arising globally, and the future impact of it and COVID-19 on our clinical trials, business operations and funding requirements; and
- other risks and factors listed under “Risk Factors” and elsewhere in this quarterly report.

Given the risks and uncertainties set forth in this quarterly report, you are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements contained in this quarterly report are not guarantees of future performance and our actual results of operations, financial condition, and liquidity, and the development of the industry in which we operate, may differ materially from the forward-looking statements contained in this quarterly report. In addition, even if our results of operations, financial condition and liquidity, and events in the industry in which we operate, are consistent with the forward-looking statements contained in this quarterly report, they may not be predictive of results or developments in future periods.

Any forward-looking statement that we make in this quarterly report speaks only as of the date of such statement. Except as required by federal securities laws, we do not undertake any obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements, whether as a result of new information, future events or otherwise, after the date of this quarterly report.

## Risk factors

As filed, 2,568 characters.

Our business, financial condition, results of operations and cash flows are subject to, and could be materially adversely affected by, various risks and uncertainties, including, without limitation, those set forth below, any one of which could cause our actual results to vary materially from recent results or our anticipated future results.

***We expect to rely on third parties to conduct our pre-clinical trials and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such trials or failing to comply with regulatory requirements or our pre-clinical protocols.***

We currently rely on contract research organizations (CROs) to conduct our pre-clinical trials, as we currently do not plan to independently conduct pre-clinical trials of any of our product candidates. Our agreements with these CROs, and other third parties might terminate for a variety of reasons, including a failure to perform by the third parties. If we were ever to need to enter into alternative arrangements or if we were to need to change a CRO for an ongoing pre-clinical trial, we might experience delays in our pre-clinical development activities

***Geopolitical events and global economic conditions, such as the Israel-Hamas war may impact our third parties that we engage to supply any materials or to manufacture any products for our preclinical tests and clinical trials, which increases the risk of potential delay of development efforts, as applicable.***

If the third parties that we engage to supply any materials or to manufacture any products for our preclinical tests and clinical trials should cease to continue to do so for any reason, including due to the effects of global economic conditions, including the Israel-Hamas war, we likely would experience delays in advancing these tests and trials while we identify and qualify replacement suppliers or manufacturers and we may be unable to obtain replacement supplies on terms that are favorable to us. In addition, if we are not able to obtain adequate supplies of our product, or the substances used to manufacture them, it will be more difficult for us to develop our product, and compete effectively.

Our current and anticipated dependence upon third-party suppliers may adversely affect our ability to develop our product, and product candidates and could delay our clinical trials and development programs as well as marketing and commercialization efforts, and otherwise harm our operations and financial condition and increase our costs and expenses.

Filed Nov 12, 2024.
Source: SEC EDGAR, the filing index for accession 0001493152-24-044747. Last ingested by Listed: Oct 24, 2026, 15:16 ET. No prices; not investment advice.