On May 16, 2024 Akari Therapeutics, Plc (Nasdaq: AKTX), a late-stage biotechnology company developing advanced therapies for autoimmune and inflammatory diseases, reported financial results for the first quarter ended March 31, 2024 as well as recent company highlights (Press release, Akari Therapeutics, MAY 16, 2024, View Source [SID1234643385]).
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"My first few weeks as Interim CEO of Akari have been filled with non-stop activity and optimism," said Samir R. Patel, MD, Akari Interim President and CEO. "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. In addition, we continue to be incredibly optimistic about the potential opportunities afforded by Peak’s ADC platform technology."
Recent Company Highlights
Entered into a definitive agreement with Peak Bio Inc. (Peak Bio) to merge as equals in an all-stock transaction. The combined entity will operate as Akari Therapeutics, Plc, which is expected to continue to be listed and trade on the Nasdaq Capital Market as AKTX. The merger is expected to close in the third quarter of 2024.
Announced portfolio prioritization plan for combined go-forward company which will focus on Peak’s antibody drug conjugate (ADC) platform technology and Akari’s PAS-nomacopan Geographic Atrophy (GA) program. As a result of this prioritization, the Company’s HSCT-TMA program was suspended.
Announced key leadership changes, including the appointment of experienced life sciences entrepreneur Samir R. Patel, M.D. as interim CEO, following the departure of Rachelle Jacques.
Commenced implementation of a reduction-in-force of approximately 67% of the Company’s total workforce as part of an operational restructuring plan, which included the elimination of certain senior management positions, to reduce operating costs while supporting the Company’s long-term strategic plan.
In May 2024, issued unsecured convertible, short-term promissory notes to Samir R. Patel, M.D, the Company’s President and Chief Executive Officer, and Ray Prudo, M.D., the Company’s Chairman of the Board, each in the amount of $500,000 to provide operating capital.
First Quarter 2024 Financial Results
As of March 31, 2024, the Company had cash of approximately $1.3 million.
Research and development expenses were approximately $2.3 million for the three months ended March 31, 2024, as compared to approximately $1.7 million for the same period in 2023.
General and administrative expenses were approximately $3.7 million for the three months ended March 31, 2024, as compared to approximately $2.9 million for the same period in 2023.
Total other income, net was approximately $0.4 million for the three months ended March 31, 2024, as compared to approximately $5.6 million for the same period in 2023, of which $0.6 million and $5.6 million was the result of net non-cash gains related to the company’s liability-classified warrants issued in connection with the company’s September 2022 private placement transaction.
Net loss was approximately $5.6 million for the three months ended March 31, 2024, as compared to net income of approximately $1.0 million for the same period in 2023. Excluding the non-cash gains of approximately $0.6 million and $5.6 million for the three months ended March 31, 2024 and 2023, respectively, related to the company’s liability-classified warrants, net loss was $6.2 million and $4.6 million, respectively.
Readers are referred to, and encouraged to read in its entirety, the company’s Quarterly Report on Form 10-Q for the three months ended March 31, 2024, as filed with the Securities and Exchange Commission on March 15, 2024, which includes further detail on the Company’s business plans, operations, financial condition, and results of operations.
About the Merger
On March 5, 2024, Akari and Peak Bio announced a definitive agreement to merge as equals in an all-stock transaction. The combined entity will operate as Akari Therapeutics, Plc, which is expected to continue to be listed and trade on the Nasdaq Capital Market as AKTX, under the Chairmanship of Hoyoung Huh, MD, PhD. Under the terms of the agreement, Peak stockholders will receive a number of Akari ordinary shares (represented by American Depositary Shares) for each share of Peak stock they own, as determined on the basis of the exchange ratio described in the agreement. The exchange is expected to result in implied equity ownership in the combined company of approximately 50% for Akari shareholders and approximately 50% for Peak stockholders on a fully diluted basis, subject to adjustment under certain circumstances, including based on each party’s relative level of net cash at the closing of the proposed transaction. The transaction is expected to close by the third quarter of this year subject to the satisfaction of customary closing conditions, including approval by the shareholders of both companies.