UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM

10-Q

☒	Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended ~~September~~June 30, ~~2017~~

2020

☐	Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from
to

Commission File

No. 001-31791

GALECTIN THERAPEUTICS INC.


Nevada		04-3562325
(State or other jurisdiction of incorporation)		(I.R.S. Employer Identification No.)

4960 Peachtree Industrial Blvd., Suite 240, Norcross, GA		30071
(Address of Principal Executive Offices)		(Zip Code)

(678)

620-3186

(Registrant’s Telephone Number, Including Area Code)

Securities registered or to be registered pursuant to Section 12(b) of the Act.


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	GALT	Nasdaq

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation

S-T ~~(§232.05~~

(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a

non-accelerated

filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company”, and “emerging growth company” in

Rule 12b-2

of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule

12b-2

of the Exchange Act). ☐ Yes ☒ No

The number of shares outstanding of the registrant’s common stock as of ~~November 3, 2017~~August 6, 2020 was ~~35,638,698.~~

57,043,661.

GALECTIN THERAPEUTICS INC.

INDEX TO FORM

10-Q

FOR THE QUARTER ENDED ~~SEPTEMBER~~JUNE 30, ~~2017~~

2020


			PAGE
	PART I — FINANCIAL INFORMATION

ITEM 1.	Unaudited Condensed Consolidated Financial Statements (unaudited)
	Condensed Consolidated Balance Sheets as of ~~September~~June 30, ~~2017~~2020 and December 31, ~~2016 (unaudited)~~2019			3
	Condensed Consolidated Statements of Operations for the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2017~~2020 and ~~2016 (unaudited)~~2019			4
	Condensed Consolidated Statements of Cash Flows for the ~~Nine~~Six Months Ended ~~September~~June 30, ~~2017~~2020 and ~~2016 (unaudited)~~2019			5
	~~Notes to Unaudited~~ Condensed Consolidated ~~Financial~~ Statements of Changes in Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) for the Three and Six Months ended June 30, 2020 and 2019			6

~~ITEM 2.~~ Notes to Unaudited Condensed Consolidated Financial Statements		9
ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations			1214

ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk			2124

ITEM 4.	Controls and Procedures			2124

	PART II — OTHER INFORMATION

ITEM 1.	Legal Proceedings			2125

ITEM 1A.	Risk Factors			2125

ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds			2126

ITEM 3.	Defaults Upon Senior Securities			2126

ITEM 4.	Mine Safety Disclosures			2226

ITEM 5.	Other Information			2226

ITEM 6.	Exhibits			2226

SIGNATURES				2327

GALECTIN THERAPEUTICS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

   September 30,
2017 December 31,
2016
   (in thousands)
ASSETS

Current assets:

Cash and cash equivalents
   $ 6,958 $ 15,362
Prepaid expenses and other current assets
   53 432


Total current assets
   7,011 15,794


Intangible assets, net
   —   1


Total assets
   $ 7,011 $ 15,795


LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable
   $ 166 $ 910
Accrued expenses
   4,175 2,802
Accrued dividends payable
   —   68


Total current liabilities
   4,341 3,780


Total liabilities
   4,341 3,780


Commitments and contingencies (Note 8)

Series C super dividend convertible preferred stock; 1,000 shares authorized, 176 shares issued and outstanding at September 30, 2017 and December 31, 2016, redemption value: $7,130,000, liquidation value: $1,760,000 at September 30, 2017
   1,723 1,723
Stockholders’ equity:

Undesignated stock, $0.01 par value; 20,000,000 shares authorized, 20,000,000 and 14,001,000 designated at September 30, 2017 and December 31, 2016, respectively
   —   —
Series A 12% convertible preferred stock; 1,742,500 shares authorized, 1,377,500 issued and outstanding at September 30, 2017 and December 31, 2016, liquidation value $1,377,500 at September 30, 2017
   557 557
SeriesB-1 12% convertible preferred stock; 900,000 shares authorized, issued and outstanding at September 30, 2017 and December 31, 2016, liquidation value $1,800,000 at September 30, 2017
   1,761 1,761
SeriesB-2 12% convertible preferred stock; 2,100,000 shares authorized, issued and outstanding at September 30, 2017 and December 31, 2016, liquidation value $4,200,000 at September 30, 2017
   3,697 3,697
SeriesB-3 8% convertible preferred stock; 2,508,000 shares authorized, 2,508,000 issued and outstanding at September 30, 2017 and December 31, 2016, liquidation value $2,508,000 at September 30, 2017
   1,224 1,224
Common stock, $0.001 par value; 50,000,000 shares authorized at September 30, 2017 and December 31, 2016, 35,638,698 and 32,912,942 issued and outstanding at September 30, 2017 and December 31, 2016, respectively
   36 33
Additionalpaid-in capital
   172,053 166,721
Retained deficit
   (178,381 ) (163,701 )


Total stockholders’ equity
   947 10,292


Total liabilities, redeemable convertible preferred stock and stockholders’ equity
   $ 7,011 $ 15,795


	June 30, 2020			December 31, 2019
	(in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	40,768		$	47,480
Prepaid expenses and other current assets		352			729

Total current assets		41,120			48,209

Other assets		197			258

Total assets	$	41,317		$	48,467

LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	206		$	1,661
Accrued expenses and other		4,003			1,093
Accrued dividends payable		66			66

Total current liabilities		4,275			2,820

Other liabilities		31			52

Total liabilities		4,306			2,872

Commitments and contingencies (Note 10)
Series C super dividend redeemable convertible preferred stock; 1,000 shares authorized, 176 shares issued and outstanding at June 30, 2020 and December 31, 2019, redemption value: $8,599,000, liquidation value: $1,760,000 at June 30, 2020		1,723			1,723
Stockholders’ equity:
Undesignated stock, $0.01 par value; 20,000,000 shares authorized, 20,000,000 designated at June 30, 2020 and December 31, 2019, respectively		—			—
Series A 12% convertible preferred stock; 1,742,500 shares authorized, 1,327,500 issued and outstanding at June 30, 2020 and December 31, 2019, liquidation value $1,327,500 at June 30, 2020		537			537
Common stock, $0.001 par value; 100,000,000 shares authorized at June 30, 2020 and December 31, 2019, 57,043,661 and 56,894,642 issued and outstanding at June 30, 2020 and December 31, 2019, respectively		56			56
Additional paid-in capital		260,820			259,673
Retained deficit		(226,125	)		(216,394	)

Total stockholders’ equity		35,288			43,872

Total liabilities, redeemable convertible preferred stock and stockholders’ equity	$	41,317		$	48,467

See notes to unaudited condensed consolidated financial statements.

3

Table of Contents

GALECTIN THERAPEUTICS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

   Three Months Ended
September 30, Nine Months Ended
September 30,
   2017 2016 2017 2016
   (in thousands, except
per share data) (in thousands, except
per share data)
Operating expenses:

Research and development
   $ 3,503 $ 3,289 $ 10,719 $ 11,892
General and administrative
   911 1,248 3,155 4,990


Total operating expenses
   4,414 4,537 13,874 16,882


Total operating loss
   (4,414 ) (4,537 ) (13,874 ) (16,882 )


Other income (expense):

Interest income
   6 11 21 37


Total other income (expense)
   6 11 21 37


Net loss
   $ (4,408 ) $ (4,526 ) $ (13,853 ) $ (16,845 )


Preferred stock dividends
   (254 ) (63 ) (827 ) (466 )
Preferred stock accretion
   —   (56 ) —   (173 )


Net loss applicable to common stockholders
   $ (4,662 ) $ (4,645 ) $ (14,680 ) $ (17,484 )


Net loss per common share — basic and diluted
   $ (0.13 ) $ (0.16 ) $ (0.42 ) $ (0.60 )
Weighted average common shares outstanding — basic
and diluted
   35,165 29,282 34,600 29,045


	Three Months Ended June 30,						Six Months Ended June 30,
	2020			2019			2020			2019
	(in thousands, except per share data)						(in thousands, except per share data)
Operating expenses:
Research and development	$	4,681		$	1,522		$	6,825		$	2,168
General and administrative		1,421			1,498			2,861			3,219

Total operating expenses		6,102			3,020			9,686			5,387

Total operating loss		(6,102	)		(3,020	)		(9,686	)		(5,387	)

Other income (expense):
Interest income		9			43			59			57
Interest expense		(21	)		(21	)		(43	)		(43	)

Total other income (expense)		(12	)		22			16			14

Net loss	$	(6,114	)	$	(2,998	)	$	(9,670	)	$	(5,373	)

Preferred stock dividends		(66	)		(67	)		(60	)		(163	)
Warrant modification (Note 9)		—			—			—			(6,622	)

Net loss applicable to common stockholders	$	(6,180	)	$	(3,065	)	$	(9,730	)	$	(12,158	)

Net loss per common share — basic and diluted	$	(0.11	)	$	(0.06	)	$	(0.17	)	$	(0.26	)
Weighted average common shares outstanding — basic and diluted		57,035			50,301			56,995			47,653

See notes to unaudited condensed consolidated financial statements.

4

GALECTIN THERAPEUTICS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

   Nine Months Ended
September 30,
   2017 2016
   (in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss
   $ (13,853 ) $ (16,845 )
Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization
   1 5
Stock-based compensation expense
   829 2,001
Issuance of common stock for services
   27 —
Changes in operating assets and liabilities:

Prepaid expenses and other assets
   379 501
Accounts payable and accrued expenses
   629 2,794


Net cash used in operating activities
   (11,988 ) (11,544 )


CASH FLOWS FROM FINANCING ACTIVITIES:

Net proceeds from issuance of SeriesB-3 preferred stock and warrants
   —   1,500
Net proceeds from issuance of common stock and warrants
   3,584 257


Net cash provided by financing activities
   3,584 1,757


NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS
   (8,404 ) (9,787 )
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
   15,362 25,846


CASH AND CASH EQUIVALENTS, END OF PERIOD
   $ 6,958 $ 16,059


NONCASH FINANCING ACTIVITIES:

Payment of preferred stock dividends in common stock
   $ 894 $ 534


	Six Months Ended June 30,
	2020			2019
	(in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(9,670	)	$	(5,373	)
Adjustments to reconcile net loss to net cash flows from operating activities:
Payment of preferred stock dividends		—			(396	)
Stock-based compensation expense		824			855
Amortization of right to use lease asset		17			18
Non-cash interest expense		43			43
Changes in operating assets and liabilities:
Prepaid expenses and other assets		377			(277	)
Accounts payable and accrued expenses		1,434			(484	)

Net cash from operating activities		(6,975	)		(5,614	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of common stock and warrants		263			49,404

Net cash flows from financing activities		263			49,404

NET DECREASE IN CASH AND CASH EQUIVALENTS		(6,712	)		43,790
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		47,480			8,253

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	40,768		$	52,043

NONCASH FINANCING ACTIVITIES:
Payment of preferred stock dividends in common stock	$	60		$	—

See notes to unaudited condensed consolidated financial statements.

5

GALECTIN THERAPEUTICS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (UNAUDITED)

(amounts in thousands except share data)


	Series C Super Dividend Redeemable Convertible Preferred Stock
	Number of Shares		Amount
Balance at December 31, 2018		176	$	1,723

Balance at June 30, 2019		176	$	1,723

Balance at December 31, 2019		176	$	1,723

Balance at June 30, 2020		176	$	1,723

6

GALECTIN THERAPEUTICS INC.

CONSOLIDATED STATEMENTS OF CHANGES IN REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) — (Continued)

For the Three Months Ended June 30, 2020 and 2019

(amounts in thousands except share data)


	Series A 12% Convertible Preferred Stock				Series B-1 12% Convertible Preferred Stock				Series B-2 12% Convertible Preferred Stock				Series B-3 8% Convertible Preferred Stock				Common Stock
	Number of Shares		Amount		Number of Shares		Amount		Number of Shares		Amount		Number of Shares		Amount		Number of Shares		Amount		Additional Paid-In Capital		Retained Deficit			Total Stockholders’ Equity (Deficit)
Balance at March 31, 2019		1,327,500	$	537		—	$	—		—	$	—		—	$	—		45,594,411	$	45	$	209,845	$	(205,308	)	$	5,119
Series A 12% convertible preferred stock dividend																								(40	)		(40	)
Series C super dividend redeemable convertible preferred stock dividend																								(27	)		(27	)
Issuance of common stock																		10,488,161		10		44,879					44,889
Issuance of common stock for exercise of warrants and options																		508,706		1		2,511					2,512
Stock-based compensation expense																						443					443
Net loss																								(2,998	)		(2,998	)

Balance at June 30, 2019		1,327,500	$	537		—	$	—		—	$	—		—	$	—		56,591,278	$	56	$	257,678	$	(208,373	)	$	49,898

Balance at March 31, 2020		1,327,500	$	537					$						$		$	57,029,209	$	56	$	260,382	$	(219,945	)	$	41,030
Series A 12% convertible preferred stock dividend																								(40	)		(40	)
Series C super dividend redeemable convertible preferred stock dividend																								(26	)		(26	)
Issuance of common stock																		14,452				44					44
Stock-based compensation expense																						394					394
Net loss																								(6,114	)		(6,114	)

Balance at June 30, 2020		1,327,500	$	537		—	$	—		—	$	—		—	$	—		57,043,661	$	56	$	260,820	$	(226,125	)	$	35,288

See notes to consolidated financial statements.

7

GALECTIN THERAPEUTICS INC.

CONSOLIDATED STATEMENTS OF CHANGES IN REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) — (Continued)

For the Six Months Ended June 30, 2020 and 2019

(amounts in thousands except share data)


	Series A 12% Convertible Preferred Stock				Series B-1 12% Convertible Preferred Stock						Series B-2 12% Convertible Preferred Stock						Series B-3 8% Convertible Preferred Stock						Common Stock
	Number of Shares		Amount		Number of Shares			Amount			Number of Shares			Amount			Number of Shares			Amount			Number of Shares		Amount		Additional Paid-In Capital		Retained Deficit			Total Stockholders’ Equity (Deficit)
Balance at December 31, 2018		1,327,500	$	537		900,000		$	1,761			2,100,000		$	3,697			2,508,000		$	1,224			41,190,905	$	41	$	194,130	$	(196,215	)	$	5,175
Series A 12% convertible preferred stock dividend																														(80	)		(80	)
Series B-1 12% convertible preferred stock dividend																														(6	)		(6	)
Series B-2 12% convertible preferred stock dividend																														(15	)		(15	)
Series B-3 8% convertible preferred stock dividend																														(9	)		(9	)
Series C super dividend redeemable convertible preferred stock dividend																														(53	)		(53	)
Issuance of common stock																								10,883,394		10		46,744					46,754
Conversion of Series B Convertible Preferred to common						(900,000	)		(1,761	)		(2,100,000	)		(3,697	)		(2,508,000	)		(1,224	)		3,789,346		4		6,678
Issuance of common stock for exercise of warrants and options																								727,633		1		2,649					2,650
Warrant modification (Note 9)																												6,622		(6,622	)
Stock-based compensation expense																												855					855
Net loss																														(5,373	)		(5,373	)

Balance at June 30, 2019		1,327,500	$	537		—		$	—			—		$	—			—		$	—			56,591,278	$	56	$	257,678	$	(208,373	)	$	49,898

Balance at December 31, 2019		1,327,500	$	537																				56,894,642	$	56	$	259,673	$	(216,394	)	$	43,872
Series A 12% convertible preferred stock dividend																								13,275				26		(26	)
Series C super dividend redeemable convertible preferred stock dividend																								17,600				34		(35	)		(1	)
Issuance of common stock																								14,452				44					44
Issuance of common stock for exercise of warrants and options																								84,624				219					219
Stock-based compensation expense																								19,068				824					824
Net loss																														(9,670	)		(9,670	)

Balance at June 30, 2020		1,327,500	$	537		—		$	—			—		$	—			—		$	—			57,043,661	$	56	$	260,820	$	(226,125	)	$	35,288

See notes to consolidated financial statements.

8

GALECTIN THERAPEUTICS INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation

and Liquidity

Galectin Therapeutics Inc. and subsidiaries (the “Company”) is a clinical stage biopharmaceutical company that is applying its leadership in galectin science and drug development to create new therapies for fibrotic disease ~~skin diseases~~ and cancer. These candidates are based on the Company’s targeting of galectin proteins which are key mediators of biologic and pathologic function. These compounds also may have application for drugs to treat other diseases and chronic health conditions.

The unaudited condensed consolidated financial statements as reported in this Quarterly Report on Form

10-Q

reflect all adjustments which are, in the opinion of management, necessary to present fairly the financial position of the Company as of ~~September~~June 30, ~~2017~~2020 and the results of its operations for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2020 and ~~2016~~2019 and its cash flows for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2020 and ~~2016.~~2019. All adjustments made to the interim financial statements include all those of a normal and recurring nature. Amounts presented in the condensed consolidated balance sheet as of December 31, ~~2016~~2019 are derived from the Company’s audited consolidated financial statements as of that date, but do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. The Company considers events or transactions that occur after the balance sheet date but before the financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated through the date these financial statements are available to be issued. The results for interim periods are not necessarily indicative of results ~~which~~that may be expected for any other interim period or for the full year. The unaudited condensed consolidated financial statements of the Company should be read in conjunction with its Annual Report on Form

10-K

for the year ended December 31, ~~2016.~~

2019.

The Company has operated at a loss since its inception and has had no ~~significant~~ revenues. The Company anticipates that losses will continue for the foreseeable future. At ~~September~~June 30, ~~2017,~~2020, the Company had ~~$7.0 million~~$40,768,000 of unrestricted cash and cash equivalents available to fund future operations. The Company believes ~~that with the cash on hand at September 30, 2017,~~ there is sufficient cash, including availability of the $10 million line of credit (see Note 3), to fund currently planned operations at least through ~~February 2018 which creates uncertainty about~~September 30, 2021. We will require more cash to fund our operations after September 30, 2021 and believe we will be able to obtain additional financing. The currently planned operations include costs related to a planned adaptively designed

NASH-RX

Phase 2b/3 clinical trial. The costs of the ~~Company’s ability~~trial along with drug manufacturing and other scientific support activities and general overhead during the first stage of the trial are currently estimated to ~~continue as a going concern. The Company’s ability~~be approximately $90 million. These costs will require additional funding. However, there can be no assurance that we will be successful in obtaining such new financing or, if available, that such financing will be on terms favorable to us. If we are unsuccessful in raising additional capital to fund operations ~~after its current cash resources are exhausted depends on its ability~~before September 30, 2021, we may be required to ~~obtain additional financing or achieve profitable operations, as to which no assurances can be given.~~cease operations. Accordingly, based on the forecasts and estimates underlying ~~the Company’s~~our current operating plan, ~~substantial doubt exists about~~ the ~~ability for the Company to continue as a going concern. The~~ financial statements do not currently include any adjustments that might be necessary if ~~the Company is~~we are unable to continue as a going concern.

The Company was founded in July 2000, was incorporated in the State of Nevada in January 2001 under the name

“Pro-Pharmaceuticals,

Inc.,” and changed its name to “Galectin Therapeutics Inc.” on May 26, 2011.

2. Accrued Expenses

and Other

Accrued expenses consist of the following:

   September 30,
2017    December 31,
2016
   (in thousands)
Legal and accounting fees
   $ 115    $ 14
Accrued compensation
   361    614
Accrued research and development costs and other
   3,699    2,174




Total
   $ 4,175    $ 2,802


	June 30, 2020		December 31, 2019
	(in thousands)
Legal and accounting fees	$	129	$	81
Accrued compensation		861		973
Lease liability		41		39
Accrued research and development costs and other		2,972		—

Total	$	4,003	$	1,093

Research and development expenses, including personnel costs, allocated facility costs, lab supplies, outside services, contract laboratory costs are charged to research and development expense as incurred. The Company accounts for nonrefundable advance payments for goods and services that will be used in future research and development activities as expense when the service has been performed or when the goods have been received. Our current

NASH-RX

clinical trial is being supported by third-party contract research organizations, or CROs, and other vendors. We accrue expenses for clinical trial activities performed by CROs based upon the estimated amount of work completed on each trial. For clinical trial expenses and related expenses associated with the

9

conduct of clinical trials, the significant factors used in estimating accruals include the number of patients enrolled, the number of active clinical sites, and the duration for which the patients have been enrolled in the trial. We monitor patient enrollment levels and related activities to the extent possible through internal reviews, review of contractual terms and correspondence with CROs. We base our estimates on the best information available at the time. We monitor patient enrollment levels and related activities to the extent possible through discussions with CRO personnel and based our estimates of clinical trial costs on the best information available at the time. However, additional information may become available to us which will allow us to make a more accurate estimate in future periods. In that event, we may be required to record adjustments to research and development expenses in future periods when the actual level of activity becomes more certain.

3. Line of Credit

On December 19, 2017, the Company entered into a $10 million Line of Credit arrangement with Richard E. Uihlein, a director and shareholder. Originally, borrowings may be made by the Company through December 31, 2018. Borrowings bear interest at the Applicable Federal Rate for short term loans published by the Internal Revenue Service (1.6% in December 2019). All borrowings and interest were originally due on December 31, 2019 but may be prepaid without penalty. In connection with the Line of Credit agreement, the Company issued to Mr. Uihlein warrants to purchase 1 million shares of the Company’s common stock for $5 per share. Half of the warrants vested at closing of the Line of Credit and the other half vest ratably with borrowings under the agreement. There have been 0 borrowings under the Line of Credit to date.

On December 20, 2018, the Line of Credit arrangement was extended for one year for both borrowings and maturity. At the time of the conversion of the Series B Convertible Preferred stock into common stock (See Note 9), on January 11, 2019, the Line of Credit arrangement was extended for an additional two years for both borrowings and maturity. After the second amendment to the Line of Credit arrangement, borrowings may be made through December 31, 2021 with repayment due on December 31, 2022. There was no additional consideration or benefits provided to Mr. Uihlein for any of the extensions of the Line of Credit.

The fair value of the 500,000 warrants vested at closing in December 2017 was $696,000 at the date of issuance based on the following assumptions: an expected life of 7 years, volatility of 98%, risk free interest rate of 2.05% and 0 dividends. The fair value of the vested warrants was recorded in other current assets and other assets

(non-current)

as a deferred financing cost and were to be amortized on a straight-line basis from December 19, 2017 through December 31, 2019. The remaining unamortized balance of the deferred financing cost on January 11, 2019 was adjusted to be recorded as expense on a straight-line basis through December 31, 2022. Amortization for the six months ended June 30, 2020 and 2019 of $43,000 and $43,000, respectively, was recorded as interest expense. The fair value of warrants that vest in the future based on borrowings will be computed when those borrowings occur and amortized over the remaining period through December 31, 2022 reflecting the second extension.

4. Stock-Based Compensation

Following is the stock-based compensation expense related to common stock options, common stock, restricted common stock and common stock warrants:

   Three Months Ended
September 30,    Nine Months Ended
September 30,
   2017    2016    2017    2016
Research and development
   $ 109    $ 165    $ 407    $ 598
General and administrative
   121    211    422    1,403








Total stock-based compensation expense
   $ 230    $ 376    $ 829    $ 2,001


	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Research and development	$	83	$	83	$	240	$	170
General and administrative		311		360		584		685

Total stock-based compensation expense	$	394	$	443	$	824	$	855

The following table summarizes the stock option activity in the Company’s equity incentive plans, including

non-plan

grants to Company executives, from December 31, ~~2016~~2019 through ~~September~~June 30, ~~2017:~~

   Shares    Weighted Average
Exercise Price
Outstanding, December 31, 2016
   4,656,888    $ 4.30
Granted
   —      —
Exercised
   —      —
Options forfeited/cancelled
   —      —



Outstanding, September 30, 2017
   4,656,888    $ 4.30

2020:


	Shares			Weighted Average Exercise Price
Outstanding, December 31, 2019		3,000,256		$	4.88
Granted		845,000			2.47
Exercised		(84,624	)		2.61
Options forfeited/cancelled		(23,057	)		1.80

Outstanding, June 30, 2020		3,737,575		$	4.40

10

As of ~~September~~June 30, ~~2017,~~2020, there was ~~$366,000~~$1,361,000 of unrecognized compensation related to ~~907,489~~845,000 unvested options, which is expected to be recognized over a ~~weighted-average~~weighted–average period of approximately ~~0.58~~2.09 years. The weighted-average grant date fair value for options granted during the ~~nine~~six months ended ~~September~~June 30, ~~2016~~2020 was ~~$1.05.~~$1.92. The Company granted ~~277,500~~845,000 stock options during the ~~nine~~six months ended ~~September~~June 30, ~~2016, of which 69,375 options vested upon grant with the remaining 208,125 options vesting over 3 years. Approximately $73,000 ofnon-cash,~~ ~~stock-based compensation expense was recorded during the nine months ended September 30, 2016 related to the options granted during the quarter that were vested upon the grant date.~~

2020.

The fair value of all other options granted is determined using the Black-Scholes option-pricing model. The following weighted average assumptions were used:


	~~Nine~~ ~~Months Ended~~ ~~September 30,~~ ~~2016~~
~~Risk-free interest rate~~		~~1.7~~	%
~~Expected life of the options~~		~~6.0 years~~
~~Expected volatility of the underlying stock~~		94	%
~~Expected dividend rate~~		0	%

~~The following table summarizes the~~


	Six Months Ended June 30,			Six Months Ended June 30,
	2020			2019
Risk-free interest rate		1.55	%		2.68	%
Expected life of the options		6 years			6 years
Expected volatility of the underlying stock		100	%		104	%
Expected dividend rate		0	%		0	%

In January 2019, two directors elected to take restricted stock ~~grant activity~~grants in ~~the Company’s equity incentive plans from December 31, 2016 through September 30, 2017:~~


	~~Shares~~
~~Outstanding, December 31, 2016~~		~~754,605~~
~~Granted~~		—
~~Exercised~~		—
~~Options forfeited/cancelled~~		—

~~Outstanding, September 30, 2017~~		~~754,605~~

~~On March 12, 2015, the Company granted 81,352~~lieu of cash retainers for 2019. A total of 19,068 shares of restricted stock to~~non-employee~~ ~~directors as a component of their compensation. A total of 77,784 shares were issued~~valued at approximately $90,000 was amortized to ~~seven directors representingnon-cash~~ ~~compensation cost of $280,000 which was recognized~~expense on a straight-line basis ~~from the grant date through December 15, 2016,~~until January 16, 2020 when the ~~restricted shares~~stock vested in full.

In January 2020, two directors elected to take restricted stock grants in lieu of cash retainers for 2020. A total of ~~3,568~~32,693 shares ~~were issued~~of restricted stock valued at approximately $93,500 is being amortized to ~~two directors, who were not nominated for reelection, representingnon-cash~~ ~~compensation cost of $12,845 that was recognized~~expense on a straight-line basis ~~from the grant date through May 21, 2016,~~until January 9, 2021 when the ~~restricted shares vested~~stock vests in full.

4.

5. Common Stock Warrants

The following table summarizes the common stock warrant activity from December 31, ~~2016~~2019 through ~~September~~June 30, ~~2017:~~

   Shares    Weighted Average
Exercise Price
Outstanding, December 31, 2016
   13,488,296    $ 3.44
Granted
   78,455    5.00
Exercised
   —      —
Forfeited/cancelled
   (1,317,161 )    5.63



Outstanding, September 30, 2017
   12,249,590    $ 3.22

5.2020:


	Shares		Weighted Average Exercise Price
Outstanding, December 31, 2019		12,538,204	$	4.22
Granted		—		—
Exercised		—		—
Forfeited/cancelled		—		—

Outstanding, June 30, 2020		12,538,204	$	4.22

The weighted average expiration of the warrants outstanding as of June 30, 2020 is 3.9 years.

6. Fair Value of Financial Instruments

The Company has certain financial assets and liabilities recorded at fair value. Fair values determined by Level 1 inputs utilize observable data such as quoted prices in active markets. Fair values determined by Level 2 inputs utilize data points other than quoted prices in active markets that are observable either directly or indirectly. Fair values determined by Level 3 inputs utilize unobservable data points in which there is little or no market data, which require the reporting entity to develop its own assumptions. The carrying amounts reflected in the consolidated balance sheets for cash equivalents, accounts payable and accrued expenses approximate their carrying value due to their short-term nature. There were no level 2 or level 3 assets or liabilities at ~~September~~June 30, ~~2017~~2020 or December 31, ~~2016.~~

6.2019.

7. Loss Per Share

Basic net loss per common share is computed by dividing the net loss available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted net loss per common share is computed by dividing the net loss available to common stockholders by the weighted average number of common shares and other potential common shares then outstanding. Potential common shares consist of common shares issuable upon the assumed exercise of

in-the-money

stock options and warrants and potential common shares related to the conversion of the preferred stock. The computation of diluted net loss per share does not assume the issuance of common shares that have an anti-dilutive effect on net loss per share.

Dilutive shares which could exist pursuant to the exercise of outstanding stock instruments and which were not included in the calculation because their affect would have been anti-dilutive are as follows:

   September 30, 2017
(shares)    September 30, 2016
(shares)
Warrants to purchase shares of common stock
   12,249,590    10,452,844
Options to purchase shares of common stock
   4,656,888    3,499,638
Shares of common stock issuable upon conversion of preferred stock
   4,312,282    3,415,285
Unvested shares of restricted common stock
   —      337,935




   21,218,760    17,705,702

7.

11


	June 30, 2020 (shares)		June 30, 2019 (shares)
Warrants to purchase shares of common stock		12,538,204		12,540,679
Options to purchase shares of common stock		3,737,575		3,062,338
Shares of common stock issuable upon conversion of preferred stock		514,602		514,602

		16,790,381		16,117,619

8. Common Stock

~~2014~~

2020 At Market Issuance of Common Stock

On ~~March 30, 2014,~~May 11, 2020, the Company entered into an At Market Issuance Sales Agreement (the ~~“2014~~“2020 At Market Agreement”) with a sales agent under which the Company may issue and sell shares of its common stock having an aggregate offering price of up to ~~$30.0~~$40.0 million from time to time through the sales agent. Sales of the Company’s common stock through the sales agent, if any, will be made by any method that is deemed an “at the market” offering as defined by the U.S. Securities and Exchange Commission. The Company will pay to the sales agent a commission rate equal to 3.0% of the gross proceeds from the sale of any shares of common stock sold through the sales agent under the ~~2014~~2020 At Market Agreement. InDuring the three months ended June 30, ~~2016,~~2020, the Company issued ~~176,950~~14,452 shares of its common stock under the 2020 At Market Agreement for net proceeds of approximately $257,000 under the 2014 At Market Agreement. In three months ended March 31, 2017, the Company issued 1,496,797 shares of common stock for net proceeds of approximately $1,946,000 under the 2014 At Market Agreement. The 2014 At Market Agreement expired in March 2017.

$44,000.

2017 At Market Issuance of Common Stock

On May 19, 2017, the Company entered into an At Market Issuance Sales Agreement (the “2017 At Market Agreement”) with a sales agent under which the Company may issue and sell shares of its common stock having an aggregate offering price of up to $30.0 million from time to time through the sales agent. Sales of the Company’s common stock through the sales agent, if any, will be made by any method that is deemed an “at the market” offering as defined by the U.S. Securities and Exchange Commission. The Company will pay to the sales agent a commission rate equal to 3.0% of the gross proceeds from the sale of any shares of common stock sold through the sales agent under the 2017 At Market Agreement. During the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2019, the Company issued ~~716,563~~395,233 shares of its common stock under the 2017 At Market Agreement for net proceeds of approximately $1,865,000. There were 0 issuances of common stock under the 2017 At Market Agreement in 2020, and the 2017 At Market Agreement was terminated in May 2020.

For the six months ended June 30, 2020, the Company has issued a total of 30,875 shares of common stock for ~~net proceeds of approximately $1,438,000 under the 2017 At Market Agreement.~~

~~2017 Private Placement~~

dividends on Series A and Series C Preferred Stock.

Rights Offering

On ~~February 28, 2017,~~May 23, 2019, the Company ~~closed a transaction with five individual investors through a private placement~~completed an offering of common stock and ~~warrants.~~warrants to its shareholders of record as of April 29, 2019. In ~~total,~~the offering, the Company ~~issued 102,368~~received approximately $44.9 million for the issuance of 10,488,161 shares of common stock and warrants which may be exercised for ~~proceeds of $200,000. The Company also issued, to the five investors, warrants to purchase 76,776~~2,622,154 shares of common ~~stock at $5.00 per share.~~stock. The warrants ~~have an expiration date~~may be exercised at $7.00 per share of ~~February 28, 2024. The exercise price of each warrant is adjustable in the event of a~~common stock ~~split or stock combination, capital reorganization, merger or similar event.~~and expire on May 23, 2026. The warrants were valued at approximately ~~$101,000~~$8.2 million as of the issuance, using the closing price of ~~$1.86,~~$4.01, a life of 7 years, a volatility of ~~97%~~101% and a risk-free interest rate of ~~1.92%~~2.33%. Based upon the Company’s analysis of the criteria contained in ASC Topic

815-40, ~~“Derivatives~~

“Derivatives and Hedging — Contracts in Entity’s Own Equity” the Company has determined that warrants issued in connection with this financing transaction were not derivative liabilities and therefore, were recorded as additional

paid-in

capital.

~~Other~~

9. Preferred Stock Conversion into Common Stock

On January 11, 2019, 10X Fund L.P. (“10X Fund”), converted all of its Series B Convertible Preferred Stock into Common Stock of Galectin Therapeutics. Pursuant to the terms of the conversion, as of January 11, 2019, 10X Fund converted 5,508,000 shares of its Series

B-1,

B-2

and

B-3

Convertible Preferred Stock into 3,789,346 shares of Common Stock of Galectin Therapeutics. All special voting rights and protective provisions that previously benefited the Series B Preferred Stock were extinguished by the conversion to Common Stock.

In ~~2017,~~connection with the conversion of the Series B Preferred Stock, the Company ~~entered~~extended by five years the exercise date of warrants for 3,579,642 shares of Common Stock issued by the Company in connection with sale of the Series

B-1

and Series

B-2

Preferred Stock. Before the extension, the warrants had various expiration dates in 2019 and 2020. The warrant amendments give 10X Fund the right to nominate one director to the Company’s board of directors. Previously, under the now extinguished voting rights of the Series B Preferred, 10X Fund had the right to name two directors and nominate an ~~agreement with a vendor~~additional three directors.

12

Table of Contents

The Company has accounted for the modified terms of the warrants pursuant to ASC 718, Stock Compensation, whereby the Company ~~will issue common stock to vendor in lieu of paying in cash in amount up to $100,000~~has recognized a charge for the ~~year. Through September 30, 2017,~~change in fair value of the warrants immediately before and immediately after the modification. In January 2019, the Company ~~has issued 16,793 shares~~recognized a

one-time

non-cash

charge of ~~common stock~~$6,622,000 related to the extension of the 3,579,642 warrants. The following assumptions were used to value the extension of the warrants immediately before and ~~1,680 warrants~~immediately after the modification: a) immediately before the modification — an expected life range of 0.09 to ~~purchase shares~~1.33 years, volatility of ~~common stock pursuant~~98%, risk free interest rate range of 2.4% to ~~this agreement~~2.59% and 0 dividends and; b) immediately following the ~~value~~modification — an expected life range of ~~such shares has been recorded as research~~5.09 to 6.33 years, volatility range of 106%, risk free interest rate range of 2.56% to 2.6% and ~~development expense.~~

~~Through September 30, 2017, the Company has issued a total of 393,235 shares of common stock for dividends on Series A, Series B and Series C Preferred Stock for 2017.~~

8.zero dividends.

10. Commitments and Contingencies

~~Shareholder Class Actions and Derivative Lawsuits~~

On August 1 and 25, 2014, persons claiming to be Galectin shareholders filed putative shareholder derivative complaints in the Nevada District Court, seeking recovery on behalf of the Company against certain of the Company’s directors and officers. On September 10, 2014, the Nevada District Court entered an order consolidating the two cases, relieving the defendants of any obligation to respond to the initial complaints, and providing that defendants may respond to a consolidated complaint to be filed by the plaintiffs. On January 5, 2015, the Nevada District Court granted Defendants’ motion to transfer the consolidated putative derivative litigation to the United States District Court for the Northern District of Georgia (hereinafter referred to as the “Georgia Federal Derivative Action.”). The plaintiffs filed a consolidated complaint on February 27, 2015. On April 6, 2015, the Company and defendants filed motions to dismiss the consolidated complaint. Rather than respond to those motions, the plaintiffs sought and obtained leave to file an amended complaint. Plaintiffs filed their amended complaint (the “Complaint”) on May 26, 2015. The Complaint alleges that certain of the Company’s directors and officers (the “Derivative Action Individual Defendants”) breached their fiduciary duties to the Company’s shareholders by causing or permitting the Company to make allegedly false and misleading public statements concerning the Company’s financial and business prospects. The Complaint also alleges that the Derivative Action Individual Defendants violated the federal securities laws by allegedly making false or misleading statements of material fact in the Company’s proxy filings, committed waste of corporate assets, were unjustly enriched, and that certain defendants breached their fiduciary duties through allegedly improper sales of Galectin stock. In addition, the Complaint alleges that the Derivative Action Individual Defendants and one of the Company’s shareholders aided and abetted the alleged breaches of fiduciary duties. The Complaint seeks unspecified monetary damages on behalf of the Company, corporate governance reforms, disgorgement of profits, benefits and compensation by the defendants, costs, and attorneys’ and experts’ fees. The Company and defendants filed motions to dismiss the Complaint on July 8, 2015. On December 30, 2015, the United States District Court for the Northern District of Georgia dismissed the Georgia Federal Derivative Action with prejudice and entered a final judgment in favor of the defendants. Plaintiffs filed a notice of appeal seeking review of the dismissal order and final judgment. On July 7, 2016, the United States Court of Appeals for the Eleventh Circuit dismissed the appeal as the Plaintiffs failed to timely file their appeal brief. In September 2016, the Board received a demand letter from one of the plaintiffs in the Georgia Federal Derivative Action. The demand letter, among other things, requests that the Board investigate the conduct alleged in the Complaint and implement certain remedial measures purportedly designed to address the alleged conduct. It is expected that the Board will consider the demand letter in due course and in light of the related pending shareholder litigation described herein.

On August 29, 2014, another alleged Galectin shareholder filed a putative shareholder derivative complaint in state court in Las Vegas, Nevada, seeking recovery on behalf of the Company against the same Galectin directors and officers who are named as defendants in the derivative litigation pending in the Georgia Federal Derivative Action. The plaintiff in the Nevada action subsequently filed first and second amended complaints. The second amended complaint alleges claims for breach of fiduciary duties, unjust enrichment, and waste of corporate assets, based on allegations that are substantially similar to those asserted in the Georgia Federal Derivative Action (except that the Nevada action does not allege violations of the federal securities laws and does not assert any claim against the Galectin shareholder named as a defendant in the Georgia Federal Derivative Action), and seeks unspecified monetary damages on behalf of the Company, corporate governance reforms, disgorgement of profits, benefits and compensation by the defendants, costs, and attorneys’ and experts’ fees. The Company and defendants filed motions to dismiss the second amended complaint on April 22, 2015. On April 29, 2015, the plaintiffs in the Georgia Federal Derivative Action (the “Intervenor Plaintiffs”) filed a motion to intervene in the Nevada action which, among other things, raised questions regarding the Nevada plaintiff’s standing. Thereafter, the Nevada plaintiff filed a motion to join additional plaintiffs. At a hearing held on June 11, 2015, the Nevada court: (i) granted the Intervenor Plaintiffs’ motion to intervene; (ii) directed the Intervenor Plaintiffs to file a complaint in intervention; (iii) directed the Nevada plaintiff to file a motion for leave to file a further amended complaint to add additional plaintiffs; (iv) stated that the defendants’ motions to dismiss the second amended complaint were denied “at this point;” (v) ordered the Nevada action stayed until December 11 , 2015; and (vi) directed the parties to submit a status report on December 11, 2015, updating the court on the progress and status of the Georgia Federal Derivative Action. On July 9, 2015, pursuant to the Nevada State Court’s instruction, the Intervenor Plaintiffs filed a~~complaint-in-intervention~~ in Nevada State Court, asserting similar claims to the ones they alleged in the Georgia Federal Derivative Action described above. On December 11, 2015, further to the Nevada State Court’s instruction, the parties submitted status reports detailing the status of the Georgia Federal Derivative Action. On January 5, 2016, the Nevada State Court held a status conference during which the dismissal of the Georgia Federal Derivative Action was discussed. Subsequent to that conference, on January 19, 2016, the defendants filed a motion to dismiss the Nevada State Court litigation based on the dismissal of the similar Georgia Federal Derivative Action, among other grounds. Following full briefing and a hearing on March 3, 2016, the Nevada State Court granted dismissal of the Nevada State Court litigation. Notice of Entry of the Nevada State Court’s order dismissing the Nevada State Court litigation was docketed on June 21, 2016. The Nevada plaintiff and Intervenor Plaintiffs (“Appellants”) filed notices of appeal seeking review of the Nevada State Court’s order and judgment dismissing the claims. The appeal is now fully briefed and awaiting a decision from the Nevada Supreme Court.

Estimating an amount or range of possible losses resulting from litigation proceedings is inherently difficult and requires an extensive degree of judgment, particularly where the matters involve indeterminate claims for monetary damages, are in the early stages of the proceedings, and are subject to appeal. In addition, because most legal proceedings are resolved over extended periods of time, potential losses are subject to change due to, among other things, new developments, changes in legal strategy, the outcome of intermediate procedural and substantive rulings and other parties’ settlement posture and their evaluation of the strength or weakness of their case against us. For these reasons, we are currently unable to predict the ultimate timing or outcome of, or reasonably estimate the possible losses or a range of possible losses resulting from, the matters described above. Based on information currently available, the Company does not believe that any reasonably possible losses arising from currently pending legal matters will be material to the Company’s results of operations or financial condition. However, in light of the inherent uncertainties involved in such matters, an adverse outcome in one or more of these matters could materially and adversely affect the Company’s financial condition, results of operations or cash flows in any particular reporting period.

Other Legal Proceedings

The Company records accruals for such contingencies to the extent that the Company concludes that their occurrence is probable and the related damages are estimable. There are no ~~other~~significant pending legal ~~proceedings except~~proceedings.

11. Leases

The Company has one operating lease for its office space which was amended effective January 1, 2019 for a term of 38 months with no residual value guarantees or material restrictive covenants. The amended lease provided for free rent for the first two months of the lease and continues the security deposit of $6,000. In addition to base rental payments included in the contractual obligations table above, the Company is responsible for our

pro-rata

share of the operating expenses for the building. Our lease cost for the

six-month

periods ended June 30, 2020 and 2019 was $22,000 for each period and is included in general and administrative expenses. As of June 30, 2020, the right to use lease asset consisted of $66,000 and is included in other assets. Also, at June 30, 2020, current lease liability of $41,000 is included in accrued expenses and other and noncurrent lease liability of $31,000 is in other liabilities.

Maturity of operating lease as ~~noted above.~~

9.of June 30, 2020 in thousands:


2020	$	23
2021		48
2022		8

Total		79
Less imputed interest		7

Present value of lease liability	$	72

The discount rate used in calculating the present value of the lease payments was 11.04%

12. Galectin Sciences LLC

In January 2014, we created Galectin Sciences, LLC (the “LLC” or “Investee”), a collaborative joint venture

co-owned

by SBH Sciences, Inc. (“SBH”), to research and develop small organic molecule inhibitors of

galectin-3

for oral administration. The LLC was initially capitalized with a $400,000 cash investment to fund future research and development activities, which was provided by the Company, and specific

in-process

research and development (“IPR&D”) contributed by SBH. The estimated fair value of the IPR&D contributed by SBH, on the date of contribution, was $400,000. Initially, the Company and SBH each had a 50% equity ownership interest in the LLC, with neither party having control over the LLC. Accordingly, from inception through the fourth quarter of 2014, the Company accounted for its investment in the LLC using the equity method of accounting. Under the equity method of accounting, the Company’s investment was initially recorded at cost with subsequent adjustments to the carrying value to recognize additional investments in or distributions from the Investee, as well as the Company’s share of the Investee’s earnings, losses and/or changes in capital. The estimated fair value of the IPR&D contributed to the LLC was immediately expensed upon contribution as there was no alternative future use available at the point of contribution. The operating agreement provides that if either party does not desire to contribute its equal share of funding required after the initial capitalization, then the other party, providing all of the funding, will have its ownership share increased in proportion to the total amount contributed from inception. In the fourth quarter of 2014, after the LLC had expended the $400,000 in cash, SBH decided not to contribute its share of the funding required. ~~As a result,~~Since then, the Company has contributed ~~the $73,000 needed~~a total of $2,260,000, including $309,000 for the ~~fourth quarter of 2014~~six months ended June 30, 2020, for expenses of the LLC. ~~The Company~~Since the end of 2014, SBH has contributed ~~$659,000 and $687,000~~$158,000 for ~~the LLC~~ expenses in ~~2016 and 2015, respectively, and SBH contributed $50,000 in 2016. The Company contributed $45,000, $29,000 and $30,000 during~~ the ~~quarters ended March 31, 2017,~~LLC. As of June 30, ~~2017, and September 30, 2017, respectively. As of September 30, 2017,~~2020, the Company’s ownership percentage in the LLC was ~~81.2%~~82.6%. The Company accounts for the interest in the LLC as a consolidated, less than wholly owned subsidiary. Because the LLC’s equity is immaterial, the value of the

non-controlling

interest is also deemed to be immaterial.

13

Table of Contents

~~Item 2.~~

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

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

In addition to historical information, the following Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements as defined under Section 21E of the Securities Exchange Act of 1934, as amended, and is subject to the safe harbor created therein for forward-looking statements. Such statements include, but are not limited to, statements concerning our anticipated operating results, research and development, clinical trials, regulatory proceedings, and financial resources, and can be identified by use of words such as, for example, “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe” and “would,” “should,” “could” or “may.” All statements, other than statements of historical facts, included herein that address activities, events, or developments that the Company expects or anticipates will or may occur in the future, are forward-looking statements, including statements regarding: plans and expectations regarding clinical trials; plans and expectations regarding regulatory approvals; our strategy and expectations for clinical development and commercialization of our products; potential strategic partnerships; expectations regarding the effectiveness of our products; plans for research and development and related costs; statements about accounting assumptions and estimates; expectations regarding liquidity and the sufficiency of cash to fund currently planned operations through ~~February 2018;~~at least September 30, 2021; our commitments and contingencies; and our market risk exposure. Forward-looking statements are based on current expectations, estimates and projections about the industry and markets in which Galectin Therapeutics operates, and management’s beliefs and assumptions. These statements are not guarantees of future performance and involve certain known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties are related to and include, without limitation,

our early stage of development,

we have incurred significant operating losses since our inception and cannot assure you that we will generate revenue or profit,

our dependence on additional outside capital,

we may be unable to enter into strategic partnerships for the development, commercialization, manufacturing and distribution of our proposed product candidates,

~~uncertainties related to any litigation, including shareholder class actions and derivative lawsuits filed,~~

uncertainties related to our technology and clinical trials, including expected dates of availability of clinical data,

we may be unable to demonstrate the efficacy and safety of our developmental product candidates in human trials,

we may be unable to improve upon, protect and/or enforce our intellectual property,

we are subject to extensive and costly regulation by the U.S. Food and Drug Administration (FDA) and by foreign regulatory authorities, which must approve our product candidates in development and could restrict the sales and marketing and pricing of such products,

competition and stock price volatility in the biotechnology industry,

limited trading volume for our stock, concentration of ownership of our stock, and other risks detailed herein and from time to time in our SEC reports,

challenges presented by the

COVID-19

pandemic, and

other risks detailed herein and from time to time in our SEC reports, including our Annual Report on Form

10-K

filed with the SEC for the fiscal year ended December 31, 2019, and our subsequent SEC filings.

The following discussion should be read in conjunction with the accompanying consolidated financial statements and notes thereto of Galectin Therapeutics appearing elsewhere herein.

Overview

We are a clinical stage biopharmaceutical company engaged in drug research and development to create new therapies for fibrotic disease, ~~certain severe skin diseases,~~cancer and ~~cancer.~~selected other diseases. Our drug candidates are based on our method of targeting galectin proteins, which are key mediators of biologic and pathologic functions. We use naturally occurring, readily-available plant products as starting material in manufacturing processes to create proprietary, patented complex carbohydrates with specific molecular weights and other pharmaceutical properties. These complex carbohydrate molecules are appropriately formulated into acceptable pharmaceutical formulations. Using these unique carbohydrate-based candidate compounds that largely bind and inhibit galectin proteins, particularly

galectin-3,

we are undertaking the focused pursuit of therapies for indications where galectins have a demonstrated role in the pathogenesis of a given disease. We focus on diseases with serious, life-threatening consequences to patients and those where current treatment options are limited. Our strategy is to establish and implement clinical development programs that add value to our business in the shortest period of time possible consistent with the natural history of the disease and to seek strategic partners when a program becomes advanced and requires significant additional resources.

14

Our lead

galectin-3

inhibitor is~~GR-MD-02,~~ belapectin

(GR-MD-02),

which has been demonstrated in preclinical models to reverse liver fibrosis and cirrhosis.~~GR-MD-02~~ Belapectin has the potential to treat many diseases due to

galectin-3’s

involvement in multiple key biological pathways such as fibrosis, immune cell function and immunity, cell differentiation, cell growth, and apoptosis (cell death). The importance of

galectin-3

in the fibrotic process is supported by experimental evidence. Animals with the gene responsible for

galectin-3

“knocked-out”

can no longer develop fibrosis in response to experimental stimuli compared to animals with an intact

galectin-3

gene. Galectin Therapeutics Inc. is using ~~this~~ its

galectin-3

inhibitor to treat advanced liver fibrosis and liver cirrhosis in NASH

(non-alcoholic

steatohepatitis) patients. We have completed two Phase 1 clinical studies, ~~one~~a Phase 2 clinical study in NASH patients with advanced fibrosis

(NASH-FX)

and ~~have one~~

~~ongoing~~a second Phase 22B clinical ~~study~~trial in NASH patients with well compensated cirrhosis

(NASH-CX).

We announced, in December 2017 top line results from our

NASH-CX

trial and results of an End of Phase 2 meeting with the FDA in May 2018 that provided direction on potentially acceptable end points for a Phase 3 trial. The~~NASH-CX~~ latter was confirmed in a Type C meeting with FDA in February 2019. Thereafter, the Company with its external NASH consultants designed a Phase 3 study that was sent to various contract research organizations (CROs) for their input on feasibility, timing costs and other important considerations. At the request of the United States Food and Drug Administration (FDA), the trial ~~patients have completed all infusions/dosing~~protocol and ~~final HVPG~~answers to questions raised by FDA at the February meeting was submitted as a Type C (Written Response Only) request to FDA on July 17, 2019; this response sought FDA feedback and ~~liver biopsy~~agreement with regards to the proposed clinical program. Further details on results of the

NASH-CX

trial were published in the journal Gastroenterology (Gastroenterology 2020;158:1334–1345).

Comments from FDA were received in late October 2019 and have been ~~obtained~~incorporated into the final version of the clinical trial protocol by the Company in conjunction with its hepatology consultants and medical and other experts at Covance, its chosen CRO. This modified trial design was discussed with FDA in a meeting on ~~all patients.~~November 14, 2019 at which FDA indicated the design was reasonable (subject to a review of the protocol). The Company together with its advisors and Covance has modified the protocol and associated statistical analysis plans in conformance with the feedback received from FDA. and filed the protocol and various other documents with FDA on April 30, 2020. The study officially consented its first patient in June 2020. In addition, the Company has been working to some additional information requested by FDA which mostly relate to reporting of completed developmental toxicity studies.

Additionally, a study protocol entitled “A Single-dose, Open-label, Pharmacokinetic Study of

Belapectin

(GR-MD-02)

in Subjects With Normal Hepatic Function and Subjects With Varying Degrees of Hepatic Impairment” has been filed with FDA to examine the effects of the drug in subjects with normal hepatic function and subjects with varying degrees of hepatic impairment (study details are listed under study NCT04332432 on

www.clinicaltrials.gov

); this study is began enrolling patients in

Q2-2020.

A study protocol was filed with FDA on April 30, 2020 for a seamless adaptively-designed Phase 2b/3 clinical study, the

NASH-RX

trial, ~~is expected to complete with 151 patients~~evaluating the safety and ~~to report top line data~~efficacy of its

galectin-3

inhibitor, belapectin

(GR-MD-02),

for the prevention of esophageal varices in December 2017. NASH cirrhosis is a progressive disease, currently not treatable and ultimately may result in liver failure that has poor prognosis and no effective, approved medical therapies other than liver transplant.~~Galectin-3~~ ~~expression is highly increased in the liver of~~ patients with ~~liver fibrosis and liver cirrhosis. We believe that ourgalectin-3~~ ~~inhibitor, by reducinggalectin-3~~

non-alcoholic

steatohepatitis (NASH) cirrhosis (Further details are available at ~~the extra-cellular level, ultimately showing a strong anti-fibrotic potential may provide a novel treatment for various forms of liver fibrosis.~~

www.clinicaltrials.gov

under study NCT04365868); this study began enrolling patients in

Q2-2020..

We endeavor to leverage our scientific and product development expertise as well as established relationships with outside sources to achieve cost-effective and efficient drug development. These outside sources, amongst others, provide us with expertise in preclinical models, pharmaceutical development, toxicology, clinical trial operations, pharmaceutical manufacturing, sophisticated physical and chemical characterization, and commercial development. We also have established several collaborative scientific discovery programs with leading experts in carbohydrate chemistry and characterization. These discovery programs are generally aimed at the targeted development of new carbohydrate molecules that bind galectin proteins and offer alternative options to larger market segments in our primary disease indications. We also have established through Galectin Sciences LLC, a discovery program aimed at the targeted development of small molecules~~(non-carbohydrate)~~ (generally,

non-carbohydrate)

that bind galectin proteins and may afford options for alternative means of drug delivery (e.g., oral) and as a result expand the potential uses of our

galectin-3

inhibitor compounds. Initial results of the efforts at Galectin Sciences LLC were presented by Dr. E. Zomer at the AFDD meeting in Boston in Fall, 2019. Three series of composition of matter patents covering discoveries at Galectin Sciences have been filed. We are also pursuing a development pathway to clinical enhancement and commercialization for our lead compounds in ~~immune enhancement~~immuno-oncology for cancer ~~therapy and certain severe skin diseases including moderate to severe plaque psoriasis and severe atopic dermatitis. Our~~therapy. However, our clinical development efforts are primarily focused on ~~both~~ liver fibrosis and ~~fatty liver disease as represented by a Phase 2 clinical trial in NASH-cirrhosis which will report top line data in December 2017.~~NASH. All of our proposed products are presently in development, including

pre-clinical

and clinical trials.

Our Drug Development Programs

Galectins are a class of proteins that are made by many cells in the body, but predominantly in cells of the immune system. As a group, these proteins are able to bind to sugar molecules that are part of other proteins, glycoproteins, in and on the cells of our body. Galectin proteins act as a kind of molecular glue, bringing together molecules that have sugars on them. Galectin proteins, in particular

galectin-3,

are known to be markedly increased in a number of important diseases including inflammatory diseases, scarring of organs (e.g. liver, lung, kidney, and heart) and cancers of many kinds. The increase in galectin protein promotes the disease and is detrimental to the patient. Published data ~~show that mice lacking~~substantiating the importance of

galectin-3

in the fibrotic process arises from gene knockout experiments in animal studies. Mice genetically altered to eliminate the

galectin-3

gene, and thus unable to produce

galectin-3,

are incapable of developing liver fibrosis in response to toxic insult to the liver and in fatty liver ~~disease; they are also incapable~~disease as well as development of ~~developing~~ fibrosis in other ~~tissues such as lung, kidney and cardiac.~~

tissues.

15

We have one new proprietary chemical entity (NCE) in development,~~GR-MD-02,~~ belapectin, which has shown promise in preclinical and early clinical studies in treatment of fibrosis, ~~certain~~ severe skin ~~diseases,~~disease, and in cancer therapy. Currently we are focusing on development of~~GR-MD-02~~ belapectin intended to be used in the treatment of liver fibrosis associated with fatty liver disease (NASH) and more specifically onin NASH cirrhosis. We have also leveraged our relationships with well-known investigators to demonstrate clinical effects of~~GR-MD-02~~ belapectin in treating moderate to severe plaque psoriasis, severe atopic dermatitis, and in cancer therapy in combination with immune-system modifying agent(s).~~GR-MD-02~~ Belapectin is a proprietary, patented compound derived from natural, readily available, plant-based starting materials, which, following chemical processing, exhibits the properties of binding to and inhibiting

galectin-3

proteins. A second NCE,

GM-CT-01

is a proprietary, patented compound that is made from a completely different starting source plant material and also binds and inhibits galectin proteins. Previously in clinical development for cancer indications, ~~this~~

GM-CT-01

compound ~~continues to be~~has been explored in limited other preclinical studies.

Our product pipeline is shown below:


Indication	Drug	Status

Fibrosis
NASH with Advanced Fibrosis: NASH-CX trial and NASH-FX trial	~~GR-MD-02~~belapectin	IND submitted January 2013. Results from the Phase 1 clinical trial were reported in 2014, with final results reported in January 2015. ~~End of~~ The Phase ~~1 meeting held with FDA in 2014. Two Phase~~ 2 ~~clinical trials were designed. The NASH CX trial, was designed for patients with cirrhosis, and the~~ NASH FX trial was designed for patients with advanced fibrosis but not cirrhosis. Its principal purpose was to evaluate various imaging modalities. The NASH FX trial top line data was reported in September 2016 ~~and the~~

		The Phase 2 NASH CX trial, was designed for patients with well compensated cirrhosis. The NASH CX trial top line data ~~is expected~~was reported in December ~~2017.~~2017 and was published in Gastroenterology in 2020.

NASH – RX		Based on recent FDA feedback, the NASH-RX trial is designed as an adaptive Phase 2b/3 trial for the prevention of varices in NASH patients with well compensated cirrhosis. An interim efficacy analysis will be incorporated to confirm previous Phase 2 data, confirm an optimal dose and reaffirm efficacy, and the end of study endpoints will include development of varices and a composite clinical endpoint including progression to varices requiring treatment (large varices or varices with a red wale). See www.clinicaltrials.gov NCT04365868. Patient enrollment commenced in June 2020. A protocol for a hepatic impairment study was filed with FDA on March 30, 2020 This study is being conducted in subjects with normal hepatic function and subjects with varying degrees of hepatic impairment (CF: www.clinicaltrials.gov NCT04332432) and began enrolling patients in the second quarter of 2020.

Lung Fibrosis	~~GR-MD-02~~belapectin	In pre-clinical development

Kidney Fibrosis	~~GR-MD-02~~belapectin	In pre-clinical development

16


Indication	Drug	Status
Cardiac and Vascular Fibrosis	~~GR-MD-02~~belapectin and GM-CT-01	In pre-clinical development

Cancer Immunotherapy

Melanoma, Head, Neck Squamous Cell Carcinoma (HNSCC)	~~GR-MD-02~~belapectin	Investigator IND submitted in December 2013. Phase 1B study in process. A second Phase 1B study began in Q-1 2016. Investigator IND for that study submitted in September 2015. Early data was reported in ~~February 2017 and studies will continue.~~

		February 2017 and studies with the 3 rd cohort were reported in September 2018. Continuation of trial is ongoing to expand the dataset of melanoma and HNSCC patients at the 4 mg/Kg dose to determine if a possible Phase 2 trial is warranted.

Psoriasis

Moderate to Severe Plaque Psoriasis Severe Atopic Dermatitis	~~GR-MD-02~~belapectin	IND submitted March 2015. A phase 2a trial in moderate to severe plaque psoriasis patients began in January 2016. Interim data on the first four patients were positive and were reported in May 2016. Further positive data was reported in September 2016. Investigator initiated IND submitted for treatment of three patients with severe atopic dermatitis, with positive preliminary data presented in February 2017. ~~Studies~~Further studies are ~~now completed.~~dependent on finding a suitable strategic partner.

Fibrosis. ~~GR-MD-02~~

Belapectin is our lead product candidate for treatment of fibrotic disease. Our preclinical data show that~~GR-MD-02~~ belapectin has a significant therapeutic effect on liver fibrosis as shown in several relevant animal models. In addition, in NASH animal models,~~GR-MD-02~~ belapectin has been shown to reduce liver fat, inflammation, and ballooning degeneration ~~or death~~(death of liver ~~cells.~~cells). Therefore, we chose~~GR-MD-02~~ belapectin as the lead candidate in a development program targeted initially at fibrotic liver disease associated with

non-alcoholic

steatohepatitis ~~(NASH, or fatty liver disease)~~(NASH). In January 2013, an Investigational New Drug (“IND”) was submitted to the FDA with the goal of initiating a Phase 1 study in patients with NASH and advanced liver fibrosis to evaluate the human safety of~~GR-MD-02~~ belapectin and pharmacodynamics biomarkers of disease. On March 1, 2013, the FDA indicated we could proceed with a US Phase 1 clinical trial for~~GR-MD-02~~ belapectin with a development program aimed at obtaining support for a proposed indication of~~GR-MD-02~~ belapectin for treatment of NASH with advanced fibrosis. The Phase 1 trial was completed and demonstrated that~~GR-MD-02~~ belapectin up to 8 mg/kg Lean Body Mass (LBM), i.v. was safe and well ~~tolerated and the human pharmacokinetic data defined a drug dose for use in the planned Phase 2 trials. Additionally, there was evidence of a pharmacodynamic effect ofGR-MD-02~~ ~~at the 8 mg/kg dose with a decrease in alpha 2 macroglobulin, a serum marker of fibrotic activity, and a reduction in liver stiffness as determined by FibroScan~~^®~~. An “End of Phase 1 Meeting” was held with FDA which, amongst other items, provided guidance on the primary endpoint for the Phase 2 clinical trial.~~

tolerated.

Additionally, an open label drug-drug interaction study was completed in healthy volunteers during the second quarter of 2015 with~~GR-MD-02~~ belapectin and it showed that with 8 mg/kg LBM dose of~~GR-MD-02~~ belapectin and 2 mg/kg dose of midazolam there was no drug-drug interaction and no serious adverse events or drug-related adverse events were observed. ~~This study was required by the U.S. Food and Drug Administration (FDA) and the primary objective was to determine if single or multiple intravenous (IV) doses ofGR-MD-02~~ ~~affect the pharmacokinetics (PK) of midazolam.~~ The secondary objective was to assess the safety and tolerability of~~GR-MD-02~~ belapectin when administered concomitantly with midazolam. ~~The lack of a drug interaction in this study enabled Galectin to expand the number of patients eligible for its Phase 2 clinical trial. In addition, shouldGR-MD-02~~ ~~be approved for marketing, the success of this study supports a broader patient population for the drug label.~~

Our Phase 2 program in fibrotic disease ~~consists~~consisted of two separate human clinical trials. The ~~first~~primary clinical trial iswas the Phase 2b

NASH-CX

study for one year for patients with NASH with compensated cirrhosis, which began enrolling in June 2015. This study iswas the primary focus of our program and is a randomized, placebo-controlled, double-blind, parallel-group Phase 22b trial to evaluate the safety and efficacy of~~GR-MD-02~~ belapectin for treatment of liver fibrosis and resultant portal hypertension in NASH patients with compensated cirrhosis. A smaller, exploratory

NASH-FX

trial was conducted to explore potential use of various

non-invasive

imaging techniques in NASH patients with advanced fibrosis but not cirrhosis.

17

NASH-FX

Trial:

The

NASH-FX

trial, a Phase 2a pilot trial for patients with NASH and advanced fibrosis, explored use of three

non-invasive

imaging technologies, was completed. It was a short, single site, four-month trial in 30 NASH patients with advanced fibrosis (F3), but not cirrhosis (F4), randomized 1:1 to either

9 bi-weekly

doses of 8 mg/kg LBM of belapectin or placebo. The trial did not meet its primary biomarker endpoint as measured using multi-parametric magnetic resonance imaging (LiverMultiScan

(R)

, Perspectum Diagnostics). The trial also did not meet secondary endpoints that measure liver stiffness as a surrogate for fibrosis using, magnetic resonance-elastography and FibroScan

®

score. We, and many experts in the field, now believe that a four-month treatment period may not be sufficient to show efficacy results in established advanced liver fibrosis. This small study was also not adequately powered for the secondary endpoints. In the trial, belapectin was found to be safe and well tolerated with no serious adverse events and evidence of a pharmacodynamic effect. These results provided support for further development in NASH.

NASH-CX

Trial:

The

NASH-CX

trial was a larger multi-center clinical trial that explored the use of belapectin for the treatment of liver fibrosis and resultant portal hypertension in patients with well-compensated NASH cirrhosis. Enrollment in this trial was completed in September 2016, and a total of 162 patients at 36 sites in the United States were randomized to receive either 2 mg/kg LBM of~~GR-MD-02,~~ belapectin, 8 mg/kg LBM of~~GR-MD-02~~ belapectin or placebo, with ~~approximately~~ 54 patients in each group. Approximately 50% of patients at baseline had esophageal varices (a complication of portal hypertension). The primary endpoint iswas a reduction ~~in change~~ in hepatic venous pressure gradient (HVPG). Patients ~~are receiving~~received an infusion of belapectin or placebo every other week for one year, a total of 26 infusions, and ~~will be~~were evaluated to determine the change in HVPG as compared with placebo. ~~HVPG will be correlated with secondary~~Secondary or exploratory endpoints ofincluded fibrosis on liver biopsy, ~~as well as with~~ measurement of liver stiffness (FibroScan^{(R)
) and assessment of liver metabolism (^{13
C-methacetin
breath test, Exalenz), which arenon-invasive measures. Top line data readout was reported in December 2017. The study demonstrated a favorable safety profile and clinically meaningful efficacy results in patients without esophageal varices at baseline demonstrated by a prevention of development of varices when compared to placebo.}}

In the total patient population, the primary endpoint HVPG showed a trend toward benefit with belapectin treatment, but the difference from placebo was not statistically significant. The mean change in HVPG of placebo from baseline to week 54 was 0.3 mm Hg. The mean change in HVPG from baseline was

-0.37

and

-0.42

for the 2 mg/kg LBM dose and 8 mg/kg LBM dose of belapectin, respectively.

In those NASH cirrhosis patients without varices at baseline (about 50% of the ~~liver that may be used in future studies. A late-breaking abstract on screening data results correlating clinically~~total population), there was a statistically significant ~~portal hypertension and methacetin breath test results was presented at The International Liver Congress™ in Amsterdam on April 20, 2017. The DSMB concluded its third and final review~~effect of the ~~safety and conduct~~2 mg/kg LBM dose of belapectin on the~~in-life~~ ~~phase of ourNASH-CX~~ ~~trial and indicated it concurrence with continuation~~ absolute change in HVPG

(-1.08

mm Hg, p<0.01). The effect of the ~~trial~~8 mg/Kg LBM dose of belapectin on absolute or percent change in HVPG from baseline to week 54 was not significant.

Also because of the clinical relevance of this population, a responder analysis was performed on those patients without varices at baseline. Analysis was performed looking at two groups: those with an equal to or greater than 2 mm Hg decrease in HVPG from baseline or those with an equal to or greater than 2 mm Hg and a greater than or equal to 20% decrease in HVPG from baseline. In both cases, the change observed in the belapectin 2 mg/kg LBM group was statistically significant (p<0.01) while that of the 8 mg/kg LBM group was not.

Over the

54-week

treatment period, in patients without varices there were statistically significantly fewer new varices that developed in the belapectin treatment groups (0% and 4% in the 2 mg/kg LBM and the ~~‘clean’ safety profile.~~8 mg/kg LBM, respectively) vs placebo (18%). As esophageal varices can lead to hemorrhagic complication, that can be fatal, we believe the prevention of ~~the time~~esophageal varices may represent a clinically relevant measure of ~~their evaluation, therapy had been completed~~clinical efficacy in ~~68% of subjects in theNASH-CX~~ trial. As of September 30, 2017, 151 patients (100%) have completed all 52 weeks of infusions in this Phase 2b clinical trial. All of the doses have already been administered and end of study HVPG and liver biopsies have been completed. The dropout rate remains at approximately 7%, which is well below expectations, which may increase the power of the trial. We currently expect approximately 151 subjects will complete the trial in November 2017. This trial was designed, and is being conducted, with a primary endpoint that the U.S. Food and Drug Administration views may be a surrogate for outcomes for registration trials in this patient population. After completion of study endpoints and initial analysis of data, the Company remains on track to report top line data from the~~NASH-CX~~ ~~trial in early December 2017.~~

~~The second trial, our Phase 2a pilot trialNASH-FX~~ ~~for~~ patients with NASH ~~advanced fibrosis that explored use~~cirrhosis.

The major conclusions from the

NASH-CX

trial results are that: i) belapectin had a statistically significant and clinically meaningful effect in improving HVPG vs placebo in patients with NASH cirrhosis who did not have esophageal varices at baseline. This effect was seen regardless of ~~threenon-invasive~~ ~~imaging technologies, is now complete. It~~the patient’s baseline portal hypertension. ii) There was an important drug effect of belapectin in the total patient population on liver biopsy with a statistically significant improvement in hepatocyte ballooning (ie cell death), (iii) There was a ~~shorter, single site, four-month trial~~statistically significant reduction (p=0.02) in ~~30 NASH~~the development of new esophageal varices in drug-treated patients ~~with advanced fibrosis, but not cirrhosis, randomized 1:1~~compared to ~~either 9bi-weekly~~ ~~doses of~~placebo. We believe that this is a clinically relevant endpoint related to patient outcomes, (iv) While there was a drug effect in both the 2 mg/kg LBM and 8 mg/kg LBM groups on the development of~~GR-MD-02~~ ~~or placebo. The trial did not meet its primary biomarker endpoint as measured using multi-parametric magnetic resonance imaging (LiverMultiScan~~^(R)~~, Perspectum Diagnostics). The trial also did not meet secondary endpoints that measure~~ varices and liver ~~stiffness as~~biopsy there was a ~~surrogate for fibrosis using, magnetic resonance-elastography~~consistently greater and ~~FibroScan score. After analysis~~statistically significant effect of the data, we do not believe that a four-month treatment period was likely long enough in the NASH population to show efficacy results. This small study was not powered for the secondary endpoints and thus, not surprisingly did not meet the secondary endpoints. In the trial,~~GR-MD-02~~ ~~was found~~2 mg/kg LBM dose of belapectin, (v) belapectin appears to be safe and well tolerated ~~among~~in this one year clinical trial, a feature that is of prime importance for a cirrhotic population and (vi) We believe this is the ~~patient population with no serious adverse events.~~

~~Although there was no apparent~~first large, randomized clinical trial to demonstrate a clinically meaningful improvement in portal hypertension or liver biopsy in patients with compensated NASH cirrhosis who have not yet developed esophageal varices.

Further information and details on the

NASH-CX

results summarized above is available in public presentations posted to our website and filed with the ~~threenon-invasive~~ ~~tests~~ SEC and in a peer reviewed publication in

Gastroenterology

(Gastroenterology 2020;158:1334–1345).

18

NASH-RX

Trial:

Building on the experience of the

NASH-CX

trial, the

NASH-RX

Trial is a seamless adaptively-designed Phase 2b/3 clinical study evaluating the safety and efficacy of our

galectin-3

inhibitor, belapectin

(GR-MD-02),

for ~~assessment~~the prevention of esophageal varices in patient with

non-alcoholic

steatohepatitis (NASH) cirrhosis. The major features of this innovative Phase 2b/3 study design are: i) In patients with NASH cirrhosis and clinical signs of portal hypertension but without esophageal varices at baseline, this trial will assess the effect of belapectin on the incidence of new varices (the primary endpoint) – as well as assessing effect on the incidence of long-term, clinically significant cirrhosis-related outcomes (a key secondary efficacy endpoint), (ii) The study targets NASH patients with a clearly identified unmet medical need: patients with compensated cirrhosis who are at risk of developing esophageal varices, a potentially life-threatening complication of cirrhosis (bleeding varices are a cause of death in about

one-third

of cirrhotic patients). There is no approved treatment for preventing varices in these patients. In addition, the development of esophageal varices reflects the progression of hepatic cirrhosis and thus portends the development of other cirrhosis complications such as ascites, hepatic encephalopathy, and liver ~~fibrosis~~failure, and (iii) During the first 18 months, two belapectin dose levels (2 mg/kg LBM and 4 mg/kg LBM) will be compared to placebo (phase 2b). Then, at the interim analysis (IA), one belapectin dose will be selected based on efficacy and safety, for continued evaluation (Phase 3). The belapectin dose selected for the phase 2b/3 are based on the analysis of the

NASH-CX

trial, including a dose response pharmacokinetic analysis of the hepatic venous gradient pressure (HVPG, a reflection of portal hypertension). Prior belapectin clinical studies have also indicated the good tolerance and safety profile of belapectin with doses of up to 8 mg/kg LBM for 52 weeks (Phase 2b Study

NASH-CX),

an important feature of the future risk benefit analysis in patients with NASH cirrhosis.

The study design provides for a

pre-specified

interim analysis (IA). The IA of efficacy and safety data will be conducted after all planned subjects in Phase 2b component have completed at least 78 weeks (18 months) of treatment and an esophago-gastro-duodeno endoscopic assessment. The purpose of the IA is to allow potential seamless adaptive modifications of the study, including: (1) the selection of the optimal dose of belapectin for Phase 3, (2) the

re-estimation

of the study sample size for Phase 3 portion of the trial, (3) the

re-evaluation

of the randomization ratio for the Phase 3 portion of the trial, (4) the refinement of the inclusion and exclusion criteria for the Phase 3 portion of the trial, including the cirrhosis status, (5) and/or termination of the study for overwhelming efficacy or for futility.

The trial design also includes a blinded sample size

re-estimation

(“SSR”) during the Phase 2b, prior to the IA, to allow for potential sample size readjustment. The SSR will be conducted when 50% of the patients have completed 18 months of therapy. This will allow to confirm the underlying assumption regarding the rate of varices development, currently estimated from our prior Phase 2b trial

(NASH-CX).

The study design also minimizes invasive testing requirements, such as the measurement of HVPG or repeated liver biopsies, which we believe will facilitate enrollment and retention of patients. It also provides for a seamless transition of patients from the phase 2b component into the phase 3 stage, including the potential addition of new patients. The trial design preserves the surrogate

end-point

concepts (development of new varices versus variceal hemorrhage) previously discussed with FDA.

We believe that these adaptations taken together are innovative and optimize conduct of the

NASH-RX

trial with a relevant primary outcome giving belapectin the best opportunity to show a positive therapeutic effect to address an unmet medical need. If the results of the

NASH-RX

trial are compelling, there could be the potential for accelerated FDA approval and/or partnership opportunity with a pharmaceutical company.

In the Phase 3 component of this trial, as proposed in the ~~four-monthNASH-FX~~ ~~trial,~~protocol, the ~~principal investigator~~primary endpoint remain the development of ~~theNASH-FX~~ ~~trial has stated that the inhibition~~varices. Secondary endpoints include a composite clinical outcomes endpoint, including varices requiring treatment (development of~~galectin-3~~ large varices or varices with~~GR-MD-02~~ ~~remains promising for the treatment~~ a red wale), decompensating events,

all-cause

mortality, MELD score increase, liver transplant. Also, NASH

non-invasive

biomarkers will be evaluated. To target a population at risk of ~~NASH fibrosis. Of note is thatGR-MD-02~~ ~~has demonstrated~~developing esophageal varices, patient selection will be based on clinical signs of portal hypertension, including, a low platelet count, an ~~improved clinical effect inmoderate-to-severe~~ ~~psoriasis and inmoderate-to-severe~~ ~~atopic dermatitis patients, suggesting the compound has activity in an immune-mediated inflammatory human disease that can occur in association with NASH and in whichgalectin-3~~ ~~is believed to play a role. We believe our drug candidate provides a promising new approach for the therapy~~increased spleen size and/or evidence of fibrotic diseases, and liver fibrosis in particular. Fibrosis is the formation of excess connective tissue (collagen and other proteins plus cellular elements such as myofibroblasts) in response to damage, inflammation or repair. When the fibrotic tissue becomes confluent, it obliterates the cellular architecture, leading to scarring and dysfunction of the underlying organ. Given~~galectin-3’s~~ broad biological functionality, it has been demonstrated to be involved in cancer, inflammation and fibrosis, heart disease, and renal disease. We have further demonstrated the broad applicability of the actions of our~~galectin-3~~ ~~inhibitor’s biological effect in ameliorating fibrosis involving lung, kidney, blood vessels, and cardiac tissues in a variety of animal models.~~

collaterals circulation.

The focus and goal of the therapeutic program is to stop the progression of ~~and~~and/or reverse ~~the fibrosis in the liver~~portal hypertension and thereby ~~improve liver function and~~ prevent the development of ~~complications~~varices, potentially one of ~~fibrosis/~~the most immediately life-threatening complication of cirrhosis. Based on the results of the

NASH-CX

trial and subject to confirmation in later stage clinical trials, we believe that this goal is achievable in a significant portion of the NASH cirrhosis patient population i.e. those NASH cirrhosis patients with clinical signs of portal hypertension.

We currently expect enrollment in the Phase 2(b) portion of the trial to be require

12-14

months and ~~liver-related mortality~~enrollment began in June 2020. This remains subject to potential site delays due to the impact of the global

COVID-19

pandemic.

Our CRO has identified more than 125 clinical trial sites in 11 countries interested in the trial.

Further details on the

NASH-RX

trial can be found on

www.clinicaltrials.gov

under study NCT04365868.

The Company also has commenced a Hepatic Impairment Study, which will run in parallel with the phase 2b/3 trial as part of the Phase 3 development program. The Hepatic Impairment Study will be conducted at up to four sites and will involve approximately 40 patients (divided amongst normal healthy volunteers, and patients with hepatic impairment categorized as Child-Turcotte-Pugh (CTP) classes A (mild), B (moderate), and C (severe)). Each subject will receive a single infusion of belapectin (4 mg/kg LBM) and their serum belapectin levels will be monitored for up to approximately two weeks to define the effects of various stages of cirrhosis on serum belapectin levels and safety. Based on the results from this hepatic impairment study, the Company may consider including patients with more advanced cirrhosis in the Phase 3 portion of its

NASH-RX

trial. Until dosing and safety profile is further informed in CTP Class B and/or Class C patients, the

NASH-RX

trial will enroll only CTP Class A patients.

Further details on this hepatic impairment study can be found on

www.clinicaltrials.gov

study NCT04332432.

19

Cancer Immunotherapy.

We believe there is potential for galectin inhibition to play a key role in the burgeoning area of cancer immunotherapy. For example, there have been several recent approvals of drugs that enhance a patient’s immune system to fight cancer. It is our goal to use a galectin inhibitor to further enhance the immune system function to fight cancer in a way that complements other approaches to this type of therapy. This hypothesis is supported by the fact that

galectin-3

is expressed at high levels in multiple types of tumors, adds to the malignant nature of the tumors, and protects the tumors from immune system attack. Our drug candidates provide a promising new therapeutic approach to enhance the activity of the immune system against cancer cells. Preclinical studies have indicated that~~GR-MD-02~~ belapectin enhances the immune response to cancer cells, increased tumor shrinkage and enhanced survival in immune competent mice with prostate, breast, melanoma and sarcoma cancers when combined with one of the immune checkpoint inhibitors,

anti-CTLA-4

or

anti-PD-1, ~~and~~

or with the immune cell activator anti-OX40. These preclinical data led to the filing of two Investigator-sponsored INDs and the initiation of studies of~~GR-MD-02~~ belapectin in combination with Yervoy^{®
(ipilimumab) and KEYTRUDA (pembrolizumab) in Phase 1B studies of patients with metastatic melanoma. The KEYTRUDA trial has also been expanded to include patients withnon-small
cell lung cancer and head and neck squamous cell carcinoma. These studies are being conducted under the sponsorship of Providence Portland Medical Center’s Earle A. Chiles Research Institute (EACRI).}

Data on this combination immunotherapy program was initially presented on February 7, 2017 at the 9th GTCBio Immunotherapeutics & Immunomonitoring Conference in San Diego, CA by Dr. William L. Redmond, Providence Cancer Center. Preclinical results in mouse models of multiple types of cancers showed important anti-tumor activity and increased survival effects of combining~~GR-MD-02~~ belapectin with different types of immune modulators, providing a case for progressing studies into human patients with cancer. Seven patients were treated in the~~GR-MD-02~~ belapectin trial in combination with ~~Yervoy trial,~~ipilimumab (Yervoy

®

), with no safety concerns in these low dose cohorts. Due to changes in the standard of care for metastatic melanoma (i.e., approval of

anti-PD-1),

recruitment has been slowed significantly in this trial.

Promising results were reported in the Phase 1b trial combining~~GR-MD-02~~ belapectin with pembrolizumab ~~(KEYTRUDA)~~(KEYTRUDA

®

). Cohort 1 was completed (n=6, 5 with melanoma, one with head and ~~neck)~~neck cancer) with one partial response and one mixed response in 5the melanoma patients. There was a rapid and marked tumor response after 3 doses of combined~~GR-MD-02~~ belapectin and pembrolizumab in the one partial response patient who had failed high-dose

IL-2

and oncolytic virus + ipilimumab. ~~This Phase 1b clinical trial that combinesGR-MD-02~~ ~~with pembrolizumab (KEYTRUDA~~^®~~) continues to enroll patients and recently completed the second cohort, which used 4 mg/kgGR-MD-02.~~ ~~The third cohort, which will start 85 days following the final patient enrollment in the second cohort, will enroll 10 patients at a dose of 8 mg/kgGR-MD-02.~~ ~~There will likely be additional data reported in early 2018.~~ The study is ongoing and progression to further development will be based on response rate as compared to historical response rates to pembrolizumab alone.

In September 2018 we announced additional preliminary clinical data from cohort 3 of this investigator-initiated trial. When aggregated with cohorts previously reported, the data shows a 50% objective response rate in advanced melanoma with belapectin in combination with KEYTRUDA, and a significant decrease in the frequency of suppressive myeloid-derived suppressor cells following treatment in the responding patients (on day 85 post-treatment). Fourteen advanced melanoma patients across three dose cohorts now have Objective Response Rate (ORR) and Disease Control Rate (DCR) data. Six patients completed in cohort 3 (8 mg/kg) have now been added to the three patients completed in cohort 2 (4 mg/kg) and five patients completed in cohort 1 (2 mg/kg). Cohorts 1 and 3 each had two patients with an objective response. All three patients in cohort 2 had an objective response. In addition to the fourteen advanced melanoma patients, six patients with head and neck cancer were enrolled in this trial with a 33% ORR and 67% DCR. These data, taken together with the observed favorable safety and tolerability of the combination, in the view of the principal investigator, provide compelling rationale to move forward. Given that all three melanoma patients were responders at the 4 mg/kg dose, the investigators plan to continue the trial with the expansion of the 4 mg/Kg cohort to include additional advanced melanoma patients and additional head and neck cancer patients. The expansion cohort will target to include 15 patients and is planned to have continued belapectin dosing as long as pembrolizumab is administered. Currently more than 40% of the patients in the expansion cohort have been enrolled and further information will be reported as it becomes available. Assuming these additional data are positive, the next logical step could be a Phase II trial.

Severe skin diseases.

~~Psorasis.~~

During our Phase 1 NASH fibrosis trial with~~GR-MD-02,~~ belapectin, a clinical effect on plaque psoriasis was observed in a NASH patient who also had this disease. This patient had marked improvement in her psoriasis, with improvement beginning after the third infusion. She reported that her psoriasis was “completely gone” and her skin was “normal” after the fourth infusion. Her skin remained normal for 17 months after the final infusion of study drug. The patient is convinced that the improvement in her psoriasis is related to the study drug.

This serendipitous finding, combined with

galectin-3

protein being markedly upregulated in the capillary epithelia (small blood vessels) of the psoriatic dermis (plaque lesions), led to a phase 2a trial in patients with moderate to severe plaque psoriasis.~~GR-MD-02~~ Belapectin inhibition of

galectin-3

may attenuate capillary changes in the psoriatic dermis and inflammatory cell recruitment, perhaps explaining the improvements observed in the NASH fibrosis trial patient. In this open-label, unblinded trial (no placebo, all patients knowingly receive active drug), 5 patients with moderate to severe plaque psoriasis were administered~~GR-MD-02~~ belapectin every two weeks for 24 weeks. In May 2016, we reported positive results on the first four patients after 12 weeks of therapy. Based on these results, we modified the trial to include 24 weeks of therapy. In August 2016, we reported on four patients after 24 weeks of therapy and one patient after 12 weeks of therapy. The four patients who received 24 weeks of therapy experienced an average of 48% improvement in their plaque

20

psoriasis. At this time, the average response in all five patients remains at 50% with one patient having an 82% improvement. However, there are existing drugs on the market in this disease that produce 75% and higher improvements in

60-90%

of patients. While we are encouraged that this study has demonstrated clinically meaningful results in a human disease with~~GR-MD-02,~~ belapectin, the next steps would entail a controlled, does-ranging clinical trial which we do not expect to conduct absent a strategic partnership. The results of this Phase 2a clinical trial was presented at the Maui Derm for Dermatologists meeting in March 2017. The results have been published in the Journal of the American Academy of Dermatology in October 2017.

~~Atopic Dermatitis~~. Atopic Dermatitis (AD) is a chronic pruritic (itching), immune-mediated, inflammatory skin disease that for some adult patients can be severe and debilitating. There is an important unmet medical need in adults with severe disease who are not adequately treated with topical medicines. Our findings in psoriasis led to an interest in exploring the potential utility of the compound in treatment of AD. A Phase 2a open label trial was initiated in 3 adult patients who were treated with~~GR-MD-02~~ ~~at 8 mg/Kg every other week for 12 weeks, and dosage could be increased to 12 mg/Kg for weeks12-24~~ if an incomplete response was observed. The response was objectively evaluated using two validated scores: the EASI (eczema area and severity index) and SCORAD (severity scoring of atopic dermatitis index). All three patients showed clinical responses as determined by reduction of EASI and SCORAD during the study. but no subject achieved a primary endpoint. Upon completion of the~~24-week~~ ~~treatment phase subject 1 met both secondary endpoints ofSCORAD-50~~ ~~andEASI-50,~~ ~~and subject 2 met one secondary endpoint(EASI-50).~~ Subject 3 approached a secondary endpoint with an EASI reduction of 49% at week 24. There were no drug related adverse events during this trial. These initial findings are believed to suggest a clinically relevant effect. Additionally, the 12 mg/Kg dosage was administered safely in this patient population.

We believe the mechanism of action for~~GR-MD-02~~ ~~in moderate to severe skin diseases~~ belapectin is based upon interaction with, and inhibition of, galectin proteins, particularly

galectin-3,

which are expressed at high levels in certain pathological states including inflammation, fibrosis ~~skin diseases~~ and cancer. While~~GR-MD-02~~ belapectin is capable of binding to multiple galectin proteins, we believe that it has the greatest affinity for

galectin-3,

the most prominent galectin implicated in pathological processes. Blocking galectin in cancer and liver fibrosis has specific salutary effects on the disease ~~process.~~

process, as discussed previously.

21

Results of Operations

Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2017~~2020 Compared to Three and Six Months Ended ~~September~~June 30, ~~2016~~

2019

Research and Development Expense.

   Three Months Ended
September 30,    Nine Months Ended
September 30,    2017 as Compared to 2016
         Three Months Nine Months
   2017    2016    2017    2016    $ Change    % Change $ Change % Change
   (In thousands, except %)
Research and development
   $ 3,503    $ 3,289    $ 10,719    $ 11,892    $ 214    7 % $ (1,173 ) (10 %)


	Three Months Ended				Six Months Ended				2020 as Compared to 2019
	June 30,				June 30,				Three Months					Six Months
	2020		2019		2020		2019		$ Change		% Change			$ Change		% Change
	(In thousands, except %)
Research and development	$	4,681	$	1,522	$	6,825	$	2,168	$	3,159		208	%	$	4,657		215	%

We generally categorize research and development expenses as either direct external expenses, comprised of amounts paid to third party vendors for services, or all other research and development expenses, comprised of employee payroll and general overhead allocable to research and development. We consider a clinical program to have begun upon acceptance by the FDA, or similar agency outside of the United States, to commence a clinical trial in humans, at which time we begin tracking expenditures by the product candidate. Clinical program expenses comprise payments to vendors related to preparation for, and conduct of, all phases of the clinical trial, including costs for drug manufacture, patient dosing and monitoring, data collection and management, oversight of the trials and reports of results.

Pre-clinical

expenses comprise all research and development amounts incurred before human trials begin, including payments to vendors for services related to product experiments and discovery, toxicology, pharmacology, metabolism and efficacy studies, as well as manufacturing process development for a drug candidate.

~~We have two product candidates,GR-MD-02~~ ~~andGM-CT-01;~~ ~~however onlyGR-MD-02~~ ~~is in active development. We filed for an IND forGR-MD-02~~ ~~in January 2013 and in February 2013 we entered into an agreement with CTI to conduct a Phase 1 clinical trial ofGR-MD-02.~~ ~~In March 2013, the FDA indicated we could proceed with a Phase 1 human clinical trial ofGR-MD-02,~~ and we began enrolling patients in the third quarter of 2013. In January 2014, we completed the enrollment of the first cohort of patients in the Phase 1 trial with no serious adverse events being reported. We reported initial safety and tolerability results from the first cohort of patients on March 31, 2014. The second cohort of this Phase 1 trial began and enrollment was completed in April 2014. In July 2014, we reported the results from the second cohort of patients. Enrollment of the third cohort of Phase 1 began in July 2014 with interim results presented in November 2014 with the final report on cohort 3 presented in January 2015. The results of the Phase 1 study demonstrate that~~(i) GR-MD-02~~ was safe and well tolerated by patients with advanced NASH liver fibrosis after IV administration of four doses of 2 mg/kg, 4 mg/kg and 8mg/kg lean body weight, (ii) Pharmacokinetics revealed drug exposure in humans at the 8 mg/kg dose that was equivalent to the upper range of the targeted therapeutic dose determined from effective doses in NASH animal models, (iii) Disease Serum Marker Effect showed there was a statistically significant, dose-dependent reduction in FibroTest ^® ~~scores due to a statistically significant reduction inalpha-2~~ ~~macroglobulin (A2M) serum levels, and (iv) Liver Stiffness Effect, as measured by FibroScan~~ ^® ~~showed that there was a signal of reduced liver stiffness in patients receivingGR-MD-02.~~ ~~The reduction seen in A2M does~~~~not~~ necessarily mean fibrosis got better in this short study, but does suggest changes in the fibrogenic process that might lead to an improvement in fibrosis with longer-term therapy. These Phase 1 results in NASH patients with advanced fibrosis provide a firm foundation for entry into a Phase 2 development program.

The Company held an “End of Phase 1 meeting” with the FDA and, amongst other things, received guidance on the primary endpoints for a Phase 2 trial. Our Phase 2 program in fibrotic disease consists of two separate human clinical trials. The first clinical trial is the Phase 2b~~NASH-CX~~ study for patients with NASH with cirrhosis, which began enrolling in June 2015. This study is the primary focus of our program and is a randomized, placebo-controlled, double-blind, parallel-group Phase 2 trial to evaluate the safety and efficacy of~~GR-MD-02~~ for the treatment of liver fibrosis and resultant portal hypertension in patients with NASH cirrhosis. Enrollment in this trial was completed in September 2016, and a total of 162 patients at 36 sites in the United States were be randomized to receive either 2 mg/kg of~~GR-MD-02,~~ ~~8 mg/kg ofGR-MD-02~~ or placebo, with approximately 54 patients in each group. The primary endpoint is a reduction in change in hepatic venous pressure gradient (HVPG). Patients are receiving an infusion every other week for one year, total of 26 infusions, and will be evaluated to determine the change in HVPG as compared with placebo. HVPG will be correlated with secondary endpoints of fibrosis on liver biopsy as well as with measurement of liver stiffness (FibroScan^(R)~~) and assessment of liver metabolism (~~¹³~~C-methacetin~~ ~~breath test, Exalenz), which arenon-invasive~~ ~~measures of the liver that may be used in future studies. Data readout is expected in early December 2017.~~

~~The second trial, our Phase 2a pilot trialNASH-FX~~ ~~for patients with NASH advanced fibrosis which explored use of threenon-invasive~~ ~~imaging technologies, is now complete. It was a shorter, four-month trial in 30 NASH patients with advanced fibrosis, but not cirrhosis, randomized 1:1 to either 9bi-weekly~~ ~~doses of 8 mg/kg ofGR-MD-02~~ ~~or placebo. The trial did not meet its primary biomarker endpoint as measured using multi-parametric magnetic resonance imaging (LiverMultiScan~~^(R), Perspectum Diagnostics). The trial also did not meet secondary endpoints that measure liver stiffness as a surrogate for fibrosis using, magnetic resonance-elastography and FibroScan score. After analysis of the data, we do not believe that a four-month treatment period was likely long enough in the NASH population to show efficacy results. This small study was not powered for the secondary endpoints and thus, not surprisingly did not meet the secondary endpoints. In the trial,~~GR-MD-02~~ ~~was found to be safe and well tolerated among the patient population with no serious adverse events.~~

~~Although there was no apparent improvement in the threenon-invasive~~ ~~tests for assessment of liver fibrosis in the four-monthNASH-FX~~ ~~trial, the principal investigator of theNASH-FX~~ ~~trial has stated that the inhibition ofgalectin-3~~ ~~withGR-MD-02~~ ~~remains promising for the treatment of NASH fibrosis. Of note is thatGR-MD-02~~ ~~has demonstrated an improved clinical effect inmoderate-to-severe~~ psoriasis, suggesting the compound has activity in a human disease that can occur in association with NASH. We believe our drug candidate provides a promising new approach for the therapy of fibrotic diseases, and liver fibrosis in particular. Fibrosis is the formation of excess connective tissue (collagen and other proteins plus cellular elements such as myofibroblasts) in response to damage, inflammation or repair. When the fibrotic tissue becomes confluent, it obliterates the cellular architecture, leading to scarring and dysfunction of the underlying organ. Given~~galectin-3’s~~ broad biological functionality, it has been demonstrated to be involved in cancer, inflammation and fibrosis, heart disease, renal disease and stroke. We have further demonstrated the broad applicability of the actions of our~~galectin-3~~ ~~inhibitor’s biological effect in ameliorating fibrosis involving lung, kidney and cardiac tissues in a variety of animal models.~~

The focus and goal of the therapeutic program is to stop the progression of and reverse the fibrosis in the liver and, thereby improve liver function and prevent the development of complications of fibrosis/cirrhosis and liver-related mortality in patients.

~~Additionally, during the Phase 1 clinical trial, there appeared to be a potential beneficial effect on at least one patient’s moderate to severe psoriasis. This serendipitous finding, combined withgalectin-3~~ protein being markedly upregulated in the capillary epithelia (small blood vessels) of the psoriatic dermis (plaque lesions), led to a phase 2a trial in patients with moderate to severe plaque psoriasis.~~GR-MD-02~~ ~~inhibition ofgalectin-3~~ may attenuate capillary changes in the psoriatic dermis and inflammatory recruitment, perhaps explaining the improvements observed in the NASH fibrosis trial patient. In this open-label, unblinded trial (no placebo, all patients knowingly receive active drug), 4 patients with moderate to severe plaque psoriasis were administered~~GR-MD-02~~ every two weeks for 12 weeks. In May 2016, we reported positive results on the first four patients after 12 weeks of therapy. Based on these results, we modified the trial to include 24 weeks of therapy. In August 2016, we reported on four patients after 24 weeks of therapy and one patient after 12 weeks of therapy. The four patients who received 24 weeks of therapy experienced an average of 48% improvement in their plaque psoriasis. However, there are existing drugs on the market in this disease that produce 75% and higher improvements. While we are encouraged that this study has demonstrated clinically meaningful results in a human disease with~~GR-MD-02,~~ ~~we do not expect to conduct further trials in this area absent a strategic partnership.~~

~~An open label drug-drug interaction study was completed withGR-MD-02~~ ~~and it showed that with 8 mg/kg dose ofGR-MD-02~~ and 2 mg/kg dose of midazolam there was no drug-drug interaction and no serious adverse events or drug-related adverse events were observed. This study was required by the FDA and the primary objective was to determine if single or multiple intravenous (IV) doses of~~GR-MD-02~~ ~~affect the pharmacokinetics (PK) of midazolam. The secondary objective was to assess the safety and tolerability ofGR-MD-02~~ when administered concomitantly with midazolam. The lack of a drug interaction in this study enables Galectin to expand the number of patients eligible for its Phase 2 clinical trial. In addition, should~~GR-MD-02~~ ~~be approved for marketing, the success of this study supports a broader patient population for the drug label.~~

~~Based on guidance from FDA and in furtherance of its understanding of theGR-MD-02~~ ~~molecule, we continue to enhance its chemistry, manufacturing and control procedures onGR-MD-02~~ active pharmaceutical ingredient (API) as well as on the finished, sterile, pharmaceutical dosage form. Various state of the art and cutting-edge analytical technologies are being utilized, for example, to characterize and quantify the backbone vs. side-chain constituents and their quantitation, use of sophisticated linkage analysis with~~2-D~~ NMR to provide both qualitative and quantitative information on the proportion of oligomers, degree of methylation, as well as other monoclonal specific antibody techniques to map GR oligomer integrity and distribution. The Company has also characterized how the GR molecule behaves under conditions of forced degradation.

Our research and development expenses were as follows:

   Three Months Ended
September 30,    Nine Months Ended
September 30,
   2017    2016    2017    2016
   (in thousands)
Direct external expenses:

Clinical programs
   $ 2,945    $ 2,499    $ 8,973    $ 9,272
Pre-clinical activities
   39    213    105    787
All other research and development expenses
   519    577    1,641    1,833








   $ 3,503    $ 3,289    $ 10,719    $ 11,892


	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020			2019
	(in thousands)
Direct external expenses:
Clinical programs	$	3,779	$	944	$	4,798	��	$	930
Pre-clinical activities		121		17		363			101
All other research and development expenses		781		561		1,664			1,137

	$	4,681	$	1,522	$	6,825		$	2,168

Clinical programs expenses increased primarily due to costs related to our

NASH-RX

trial during the three ~~months~~and six month periods ended ~~September~~June 30, ~~2017 as compared to the prior year and decreased during nine months ended September 30, 2017~~2020 as compared to the same ~~period in 2016 primarily due to timing of costs incurred in theNASH-CX~~ clinical trial. As we continue our Phase 2 trial, we expect our clinical activities costs will increase although they may fluctuate from quarter to quarter as the trials progress. Clinical activities expenses primarily decreased due to reduced expenses associated with drug manufacturing and preparation.~~Pre-clinical~~ ~~activities decreased primarily because we have completedpre-clinical~~ ~~work directly related to our Phase 2 clinical trial program.~~periods ended June 30, 2019. Other research and development expense ~~decreased in the nine months ended September 30, 2017 compared to 2016~~increased primarily due to ~~a decrease~~increased payroll related to the hiring of Dr. Pol Boudes as Chief Medical Officer in~~non-cash~~ ~~stock-based compensation expense of approximately $191,000.~~

March 2020.

Both the time required and costs we may incur in order to commercialize a drug candidate that would result in material net cash inflow are subject to numerous variables, and therefore we are unable at this stage of our development to forecast useful estimates. Variables that make estimates difficult include the number of clinical trials we may undertake, the number of patients needed to participate in the clinical trial, patient recruitment uncertainties, trial results as to the safety and efficacy of our product, and uncertainties as to the regulatory agency response to our trial data prior to receipt of marketing approval. Moreover, the FDA or other regulatory agencies may suspend clinical trials if we or an agency believes patients in the trial are subject to unacceptable risks or find deficiencies in the conduct of the clinical trial. Delays or rejections may also occur if governmental regulation or policy changes during our clinical trials or in the course of review of our clinical data. Due to these uncertainties, accurate and meaningful estimates of the ultimate cost to bring a product to market, the timing of costs and completion of our program and the period during which material net cash inflows will commence are unavailable at this time.

22

General and Administrative Expense.

   Three Months Ended
September 30,    Nine Months Ended
September 30,    2017 as Compared to 2016
         Three Months Nine Months
   2017    2016    2017    2016    $ Change % Change $ Change % Change
   (In thousands, except %)
General and administrative
   $ 911    $ 1,248    $ 3,155    $ 4,990    $ (337 ) (27 %) $ (1,835 ) (37 )%


									2020 as Compared to 2019
	Three Months Ended June 30,				Six Months Ended June 30,				Three Months					Six Months
	2020		2019		2020		2019		$ Change		% Change			$ Change		% Change
	(In thousands, except %)
General and administrative	$	1,421	$	1,498	$	2,861	$	3,219	$	(77)		(5	)%	$	(358)		(11	)%

General and administrative expenses consist primarily of salaries including ~~stock based~~stock-based compensation, legal and accounting fees, insurance, investor relations, business development and other office related expenses. The primary reasons for the decrease in general and administrative expenses for the ~~three months~~three-months ended ~~September~~June 30, ~~2017~~2020 as compared to the same period in ~~2016 are reduced legal expenses of approximately $163,000 and decreased~~2019 is due to a decrease in

non-cash

stock compensation expense of approximately ~~$90,000.~~$48,000. The primary reasons for the decrease in general and administrative expenses for the ~~nine months~~

six-months

ended ~~September~~June 30, ~~2017~~2020 as compared to the same period in ~~2016~~2019 is due to ~~recording of severance of $300,000, acceleration of~~a decrease in

non-cash ~~stock-based~~

stock compensation expense of ~~$578,000 related to the termination of the Company’s executive chairman in January 2016, a decrease in investor relations expenses of~~ approximately ~~$335,000,~~$101,000 and a decrease in legal expenses of ~~$248,000, and a decrease~~$264,000 partially offset by an increase in~~non-cash~~ ~~stock based compensation~~ insurance expense of ~~$403,000.~~

$138,000.

Liquidity and Capital Resources

Since our inception on July 10, 2000, we have financed our operations from proceeds of public and private offerings of debt and equity. As of ~~September~~June 30, ~~2017,~~2020, we raised a net total of ~~$132~~$197.4 million from these offerings. We have operated at a loss since our inception and have had no significant revenues. We anticipate that losses will continue for the foreseeable future. At ~~September~~June 30, ~~2017, we~~2020, the Company had ~~$7.0~~$40.8 million of unrestricted cash and cash equivalents available to fund future operations. ~~We believe that~~In December 2018, the Company announced the extension of its $10 million unsecured line of credit facility with stockholder and director, Richard E. Uihlein. The Company has not drawn under the ~~cash on hand at September 30, 2017,~~line of credit. The Company believes there is sufficient cash, including availability of the line of credit, to fund currently planned operations at least through ~~February 2018 which creates uncertainty about the Company’s ability to continue as a going concern. Our ability~~September 30, 2021. We will require more cash to fund our operations after ~~our current cash resources are exhausted depends on our ability~~September 30, 2021 and believe we will be able to obtain additional financing. The currently planned operations include costs related to a planned adaptively designed Phase 2b/3 clinical trial. The costs of the trial along with drug manufacturing and scientific support activities and general overhead during the first stage of the Phase 3 trial are currently estimated to be approximately $90 million. We will require additional funding in order to complete the trial. However, there can be no assurance that we will be successful in obtaining such new financing or, ~~achieve profitable operations, as~~if available, that such financing will be on terms favorable to which no assurances can be given. Accordingly, based on the forecasts and estimates underlying the Company’s current operating plan, substantial doubt exists about the ability for the Company to continue as a going concern. The financial statements do not currently include any adjustments that might be necessary if the Company is unable to continue as a going concern.

us.

Net cash used in operations increased by ~~$444,000~~$1,361,000 to ~~$11,988,000~~$6,975,000 for the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2020, as compared to ~~$11,544,000~~$5,614,000 for the ~~nine~~six months ended ~~September~~June 30, ~~2016.~~2019. Cash operating expenses increased principally ~~just~~ due to ~~timing of payments for research and development activities related to~~ our

NASH-RX

clinical trial ~~activity~~ with~~GR-MD-02.~~

belapectin.

Net cash provided by financing activities for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2020, of $263,000 represents proceeds of $219,000 from the exercise of common stock options and ~~2016, of $3,584,000 and $1,757,000, respectively, represents~~$44,000 in net proceeds from ~~the sale~~issuance of common shares under our ATM. Net cash provided by financing activities for the six months ended June 30, 2019, of $49,404,000 represents proceeds from the issuance of common stock from the stockholder rights offering of $44,889,000, from the ATM of $1,865,000 and ~~preferred~~$2,650,000 from the exercise of common stock options and warrants.

~~Other.~~

We have engaged outside vendors for certain services associated with our clinical trials. These services are generally available from several providers and, accordingly, our arrangements are typically cancellable on 30 days notice.

Off-Balance

Sheet Arrangements

We have not created, and are not a party to, any special-purpose or

off-balance

sheet entities for the purpose of raising capital, incurring debt or operating parts of our business that are not consolidated into our financial statements. We do not have any arrangements or relationships with entities that are not consolidated into our financial statements that are reasonably likely to materially affect our liquidity or the availability of capital resources.

Application of Critical Accounting Policies and Estimates

The preparation of condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to ~~intangible assets,~~ accrued expenses, stock-based compensation, contingencies and litigation. We base our estimates on historical experience, terms of existing contracts, our observance of trends in the industry, information available from other outside sources and on various other factors that we believe to be appropriate under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

Critical accounting policies are those policies that affect our more significant judgments and estimates used in preparation of our consolidated financial statements. We believe our critical accounting policies include our policies regarding stock-based compensation, accrued expenses and income taxes. For a more detailed discussion of our critical accounting policies, please refer to our ~~2016~~2019 Annual Report on Form

10-K.

23

~~Item 3.~~

~~Quantitative and Qualitative Disclosures about Market Risk~~

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Market risk represents the risk of loss that may impact our financial position, operating results or cash flows due to changes in the U.S. interest rates. The primary objective of our investment activities is to preserve cash until it is required to fund operations. To minimize risk, we maintain our portfolio of cash and cash equivalents in operating bank accounts and money market funds. Since our investments are short-term in duration, we believe that we are not subject to any material market risk exposure.

~~Item 4.~~

~~Controls and Procedures~~

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of the Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule

13a-15(e)

promulgated under the Securities Exchange Act of 1934) and concluded that, as of ~~September~~June 30, ~~2017,~~2020, our disclosure controls and procedures were ~~effective at a reasonable assurance level.~~ effective.

Changes in Internal Control over Financial Reporting

During the quarter ended ~~September~~June 30, ~~2017,~~2020, no change in our internal control over financial reporting has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

24

PART II — OTHER INFORMATION

~~Item 1.~~

~~Legal Proceedings~~

~~None except as discussed in Note 8 to our condensed consolidated financial statements included in this report.~~

Item 1. Legal Proceedings

None.

~~Item 1A.~~

~~Risk Factors~~

Item 1A. Risk Factors

The information set forth in this report should be read in conjunction with the risk factors set forth in Item 1A, “Risk Factors,” of Part I of our Annual Report on Form

10-K

for the year ended December 31, ~~2016,~~2019, which could materially impact our business, financial condition or future results.

The outbreak of the novel strain of coronavirus,

SARS-CoV-2,

which causes

COVID-19,

could adversely impact our business, including our preclinical studies and clinical trials.

Public health crises such as pandemics or similar outbreaks could adversely impact our business. In December 2019, a novel strain of coronavirus,

SARS-CoV-2,

which causes coronavirus disease 2019

(“COVID-19”),

surfaced in Wuhan, China. Since then,

COVID-19

has spread to multiple countries, including the United States. In response to the spread of

COVID-19,

we have closed our executive offices with our administrative employees continuing their work outside of our offices, restricted

on-site

staff to only those required to execute their job responsibilities and limited the number of staff in any given research and development laboratory.

As a result of the

COVID-19

outbreak, or similar pandemics, we have and may in the future experience disruptions that could severely impact our business and our anticipated rollout and/or continuation of our Phase 2b/3

NASH-RX

trial, including:

delays or difficulties in enrolling patients in our clinical trials;

delays or disruptions in

non-clinical

experiments due to unforeseen circumstances at contract research organizations and vendors along their supply chain;

increased rates of patients withdrawing from our clinical trials following enrollment as a result of contracting

COVID-19,

being forced to quarantine, or not accepting in office or home health visits;

diversion of healthcare resources away from the conduct of clinical trials, including the diversion of hospitals serving as sites for our

NASH-RX

trials and hospital staff supporting the conduct of such trials;

interruption of key clinical trial activities, such as clinical trial site data monitoring, due to limitations on travel imposed or recommended by federal or state governments, employers and others or interruption of clinical trial subject visits and study procedures (particularly any procedures that may be deemed

non-essential),

which may impact the integrity of subject data and clinical study endpoints;

interruption or delays in the operations of the FDA and comparable foreign regulatory agencies, which may impact review and approval timelines;

interruption of, or delays in receiving, supplies of our product candidates from our contract manufacturing organizations due to staffing shortages, production slowdowns or stoppages and disruptions in delivery systems; and

limitations on employee resources that would otherwise be focused on the conduct of our preclinical studies and clinical trials, including because of sickness of employees or their families, the desire of employees to avoid contact with large groups of people, an increased reliance on working from home or mass transit disruptions.

These and other factors arising from the

COVID-19

pandemic could worsen in countries that are already afflicted with

COVID-19,

could continue to spread to additional countries, or could return to countries where the pandemic has been partially contained, each of which could further adversely impact our ability to conduct clinical trials and our business generally, and could have a material adverse impact on our operations and financial condition and results.

In addition, the trading prices for our common stock and other biopharmaceutical companies have been highly volatile as a result of the

COVID-19

epidemic. As a result, we may face difficulties raising capital through sales of our common stock or such sales may be on unfavorable terms. The

COVID-19

outbreak continues to rapidly evolve. The extent to which the outbreak may impact our business, preclinical studies and clinical trials will depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as the ultimate geographic spread of the disease, the duration of the outbreak, travel restrictions and actions to contain the outbreak or treat its impact, such as social distancing and quarantines or lock-downs in the United States and other countries, business closures or business disruptions and the effectiveness of actions taken in the United States and other countries to contain and treat the disease.

25

~~Item 2.~~

~~Unregistered Sales of Equity Securities and Use of Proceeds~~

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None

~~Item 3.~~

~~Defaults Upon Senior Securities~~

Item 3. Defaults Upon Senior Securities

None

~~Item 4.~~

~~Mine Safety Disclosures~~

Item 4. Mine Safety Disclosures

Not Applicable

~~Item 5.~~

~~Other Information~~

Item 5. Other Information

Not Applicable

Item 6. Exhibits

~~Item 6.~~

~~Exhibits~~


Exhibit Number	Description of Document	Note Reference

31.1*	Certification Pursuant to Rule13a-14(a) of the Securities Exchange Act of 1934

31.2*	Certification Pursuant to Rule13a-14(a) of the Securities Exchange Act of 1934

32.1**	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of theSarbanes-Oxley Act of 2002

32.2**	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of theSarbanes-Oxley Act of 2002

~~101.INS~~101.INS*	XBRL Instance Document*Document the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

~~101.SCH~~101.SCH*	XBRL Taxonomy Extension Schema Document*Document

~~101.CAL~~101.CAL*	XBRL Taxonomy Calculation Linkbase Document*Document

~~101.DEF~~101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document*Document

~~101.LAB~~101.LAB*	XBRL Taxonomy Label Linkbase Document*Document

~~101.PRE~~101.PRE*	XBRL Taxonomy Presentation Linkbase Document*Document

104*	Cover Page Interactive Data File (the cover page XBRL tags are embedded in the Inline XBRL document and included in Exhibit 101)

*	Filed herewith.

**	Furnished herewith and not “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

26

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on ~~November 7, 2017.~~

August 10, 2020.


GALECTIN THERAPEUTICS INC.

By:		/s/ ~~Peter G. Traber~~Harold H. Shlevin
Name:		~~Peter G. Traber, M.D.~~Harold H. Shlevin, Ph.D.
Title:		Chief Executive Officer and President (principal executive officer)

By:		/s/ Jack W. Callicutt
Name:		Jack W. Callicutt
Title:		Chief Financial Officer (principal financial and accounting officer)

23

27


	September 30, 2017			December 31, 2016
	(in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	6,958		$	15,362
Prepaid expenses and other current assets		53			432

Total current assets		7,011			15,794

Intangible assets, net		—			1

Total assets	$	7,011		$	15,795


LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	166		$	910
Accrued expenses		4,175			2,802
Accrued dividends payable		—			68

Total current liabilities		4,341			3,780

Total liabilities		4,341			3,780


Commitments and contingencies (Note 8)

Series C super dividend convertible preferred stock; 1,000 shares authorized, 176 shares issued and outstanding at September 30, 2017 and December 31, 2016, redemption value: $7,130,000, liquidation value: $1,760,000 at September 30, 2017		1,723			1,723

Stockholders’ equity:
Undesignated stock, $0.01 par value; 20,000,000 shares authorized, 20,000,000 and 14,001,000 designated at September 30, 2017 and December 31, 2016, respectively		—			—
Series A 12% convertible preferred stock; 1,742,500 shares authorized, 1,377,500 issued and outstanding at September 30, 2017 and December 31, 2016, liquidation value $1,377,500 at September 30, 2017		557			557
SeriesB-1 12% convertible preferred stock; 900,000 shares authorized, issued and outstanding at September 30, 2017 and December 31, 2016, liquidation value $1,800,000 at September 30, 2017		1,761			1,761
SeriesB-2 12% convertible preferred stock; 2,100,000 shares authorized, issued and outstanding at September 30, 2017 and December 31, 2016, liquidation value $4,200,000 at September 30, 2017		3,697			3,697
SeriesB-3 8% convertible preferred stock; 2,508,000 shares authorized, 2,508,000 issued and outstanding at September 30, 2017 and December 31, 2016, liquidation value $2,508,000 at September 30, 2017		1,224			1,224
Common stock, $0.001 par value; 50,000,000 shares authorized at September 30, 2017 and December 31, 2016, 35,638,698 and 32,912,942 issued and outstanding at September 30, 2017 and December 31, 2016, respectively		36			33
Additionalpaid-in capital		172,053			166,721
Retained deficit		(178,381	)		(163,701	)

Total stockholders’ equity		947			10,292

Total liabilities, redeemable convertible preferred stock and stockholders’ equity	$	7,011		$	15,795


	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
	(in thousands, except per share data)						(in thousands, except per share data)
Operating expenses:
Research and development	$	3,503		$	3,289		$	10,719		$	11,892
General and administrative		911			1,248			3,155			4,990

Total operating expenses		4,414			4,537			13,874			16,882

Total operating loss		(4,414	)		(4,537	)		(13,874	)		(16,882	)


Other income (expense):
Interest income		6			11			21			37

Total other income (expense)		6			11			21			37

Net loss	$	(4,408	)	$	(4,526	)	$	(13,853	)	$	(16,845	)

Preferred stock dividends		(254	)		(63	)		(827	)		(466	)
Preferred stock accretion		—			(56	)		—			(173	)

Net loss applicable to common stockholders	$	(4,662	)	$	(4,645	)	$	(14,680	)	$	(17,484	)

Net loss per common share — basic and diluted	$	(0.13	)	$	(0.16	)	$	(0.42	)	$	(0.60	)
Weighted average common shares outstanding — basic and diluted		35,165			29,282			34,600			29,045


	Shares		Weighted Average Exercise Price
Outstanding, December 31, 2016		4,656,888	$	4.30
Granted		—		—
Exercised		—		—
Options forfeited/cancelled		—		—

Outstanding, September 30, 2017		4,656,888	$	4.30


	September 30, 2017 (shares)		September 30, 2016 (shares)
Warrants to purchase shares of common stock		12,249,590		10,452,844
Options to purchase shares of common stock		4,656,888		3,499,638
Shares of common stock issuable upon conversion of preferred stock		4,312,282		3,415,285
Unvested shares of restricted common stock		—		337,935

		21,218,760		17,705,702


	Three Months Ended September 30,				Nine Months Ended September 30,				2017 as Compared to 2016
	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months					Nine Months
	2017		2016		2017		2016		$ Change		% Change			$ Change			% Change
	(In thousands, except %)
Research and development	$	3,503	$	3,289	$	10,719	$	11,892	$	214		7	%	$	(1,173	)		(10	%)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2017		2016		2017		2016
	(in thousands)
Direct external expenses:
Clinical programs	$	2,945	$	2,499	$	8,973	$	9,272
Pre-clinical activities		39		213		105		787
All other research and development expenses		519		577		1,641		1,833

	$	3,503	$	3,289	$	10,719	$	11,892

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