UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, ~~2020~~2021

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Lantern Pharma Inc.

(Exact name of registrant as specified in its charter)

Delaware		001-39318		46-3973463
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

1920 McKinney Avenue, 7th Floor Dallas, Texas		75201
(Address of Principal Executive Offices)		(Zip Code)

(972) 277-1136

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: Common Stock

Title of each class		Trading Symbol		Name of each exchange on which registered
Common Stock, $0.0001 par value		LTRN		The Nasdaq Stock Market

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 þ ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ☑ No ¨☐

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

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	þ☑	Smaller reporting company	þ☑
Emerging growth company	þ☑

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 þ☑

As of July ~~29, 2020,~~22, 2021, the registrant had ~~6,217,577~~11,184,039 shares of common stock, $0.0001 par value per share outstanding.

Table of Contents

		Page

	Forward Looking Statements	ii

PART I – FINANCIAL INFORMATION

Item 1.	~~Forward Looking Statements~~Financial Statements.	ii1
~~Item 1.~~	~~Financial Statements.~~	1
	Condensed Consolidated Balance Sheets as of June 30, ~~2020~~2021 (unaudited) and December 31, ~~2019~~2020	1
	Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2021 and 2020 ~~and 2019~~ (unaudited)	2
	Condensed Consolidated Statements of Comprehensive Loss for the three and six months ended June 30, 2021 and 2020 (unaudited)	3
	Condensed Consolidated Statements of Changes in Stockholders’ Equity for ~~the~~ three and the six months ended June 30, 2021 and 2020 ~~and 2019~~ (unaudited)	34
	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2021 and 2020 ~~and 2019~~ (unaudited)	45
	Notes to Condensed Consolidated Financial Statements (unaudited)	56
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	1319
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	2228
Item 4.	Controls and Procedures.	2228

PART II – OTHER INFORMATION
~~Item 1.~~		~~Legal Proceedings.~~	23
Item 1A.	Risk Factors.	2329
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	2329
Item 3.5.	~~Defaults Upon Senior Securities.~~Other Information.	2329
Item 4.6.	~~Mine Safety Disclosures.~~Exhibits.	23
~~Item 5.~~	~~Other Information.~~	23
~~Item 6.~~	~~Exhibits.~~	2430
Signatures			2531

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements that involve substantial risks and uncertainties. We make such forward-looking statements pursuant to the safe harbor provisions of the U.S. Private Securities Litigation Reform Act, Section 21E of the Securities Exchange Act of 1934, as amended, and other federal securities laws. All statements, other than statements of historical fact, contained in this Quarterly Report on Form 10-Q, including statements regarding our strategy, future preclinical studies and clinical trials, future financial position, projected costs, prospects, plans and objectives of management, are forward-looking statements. The words “anticipate,” “believe,” “contemplate,” “could,” “estimate,” “expect,” “intend,” “seek,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “target,” “aim,” “should,” ‘will” “would,” or the negative of these words or other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these words. Forward-looking statements reflect our current views with respect to future events and are based on assumptions and subject to risks and uncertainties.

The forward-looking statements in this Quarterly Report on Form 10-Q include, among other things, statements relating to:

●

the potential advantages of our RADR^® platform in identifying drug candidates and patient populations that are likely to respond to a drug candidate;

●

our strategic plans to advance the development of any of our drug candidates;

●

our strategic plans to expand the number of data points that our RADR^® platform can access and analyze;

●

our research and development efforts of our internal drug discovery programs and the utilization of our RADR^® platform to streamline the drug development process;

●

the initiation, timing, progress, and results of our preclinical studies or clinical trials on any of our drug candidates;

●

our intention to leverage artificial intelligence, machine learning and genomic data to streamline the drug development process and to identify patient populations that would likely respond to a drug candidate;

●

our plans to discover and develop drug candidates and to maximize their commercial potential by advancing such drug candidates ourselves or in collaboration with others;

●

our expectations regarding our ability to fund our operating expenses and capital expenditure requirements with our existing cash and cash ~~equivalents, and the proceeds of this offering;~~equivalents;

●

our ability to secure sufficient funding and alternative ~~source~~sources of funding to support our existing and proposed preclinical studies and clinical trials;

●

our estimates regarding the potential market opportunity for our drug candidates we or any of our collaborators may in the future develop;

●

our anticipated growth strategies and our ability to manage the expansion of our business operations effectively;

●

our expectations related to the use of proceeds from ~~this offering;~~our initial public offering, which closed on June 15, 2020, and the use of proceeds from our follow-on public offering, which closed on January 20, 2021;

●

our ability to keep up with rapidly changing technologies and evolving industry standards, including our ability to achieve technological advances;

●

the potential impact of the ~~recent outbreak of~~ COVID-19 pandemic may have on our business plans;

●

our ability to source our needs for skilled labor in the fields of artificial intelligence, genomics, biology, oncology and drug development; and

●

the impact of government laws and regulations on the development and commercialization of our drug candidates.

We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions, and expectations disclosed in the forward-looking statements we make. We have included important factors in the cautionary statements included in this Quarterly Report on Form 10-Q and in the Risk Factors section of our Annual Report on Form 10-K (“2020 Form 10-K”), for the ~~final prospectus, dated June 10,~~year ended December 31, 2020 ~~for our initial public offering, on file~~filed with the Securities and Exchange Commission, or the SEC, on March 10, 2021, and have identified other factors such as the impact of the COVID-19 pandemic, the results of our clinical trials, and the impact of competition, that we believe could cause actual results or events to differ materially from the forward-statements that we make. Furthermore, we operate in a competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report on Form 10-Q.

You should read this Quarterly Report on Form 10-Q and the documents that we file with ~~the Securities and Exchange Commission, or~~ the SEC with the understanding that our actual future results may be materially different from what we expect. These forward-looking statements are based on management’s current expectations. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed elsewhere in this Quarterly Report on Form 10-Q and those listed under the Risk Factors section of ~~the final prospectus, dated June 10,~~our 2020 ~~for our initial public offering, on file with the Securities and Exchange Commission.~~Form 10-K. You may access our ~~June 10,~~ 2020 ~~final prospectus~~Form 10-K under the investor SEC filings tab of our website at www.lanternpharma.com or on the SEC’s website at www.sec.gov. Given these uncertainties, you should not rely on these forward-looking statements as predictions of future events. The forward-looking statements contained in this Quarterly Report on Form 10-Q are made as of the date of this Quarterly Report, and we do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

Unless the context requires otherwise, references to the “Company,” “Lantern,” “we,” “us,” and “our” in this Quarterly Report on Form 10-Q refer to Lantern Pharma Inc., a Delaware corporation, and, where appropriate, its wholly-owned subsidiary.

iii

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

Lantern Pharma Inc. and Subsidiary

Condensed Consolidated Balance Sheets

June 30, December 31,
2020 2019
(Unaudited)
CURRENT ASSETS
Cash $ 23,798,343 $ 1,232,030
Other current asset 1,728,539 -
Prepaid expense 70,775 788
Total current assets 25,597,657 1,232,818

Property and equipment, net 15,377 8,758
Deferred offering costs - 191,000

TOTAL ASSETS $ 25,613,034 $ 1,432,576

CURRENT LIABILITIES
Accounts payable and accrued expenses $ 467,988 $ 489,292
Insurance payable 1,705,846 -
Note payable 102,831 -

Total current liabilities 2,276,665 489,292

Loan payable 108,500 -

TOTAL LIABILITIES 2,385,165 489,292

COMMITMENTS AND CONTINGENCIES (NOTE 4)

STOCKHOLDERS’ EQUITY
Preferred Stock - Par Value (1,000,000 authorized at June 30, 2020; 3,480,000 authorized at December 31, 2019; $.0001 par value) (Zero shares issued and outstanding at June 30, 2020; 2,438,866 shares issued and outstanding at December 31, 2019) - 244
Common Stock – Par Value (25,000,000 authorized at June 30, 2020; 12,180,000 authorized at December 31, 2019; $.0001 par value) (6,217,577 shares issued and outstanding at June 30, 2020; 1,978,269 shares issued and outstanding at December 31, 2019) 622 198
Additional paid-in capital 31,289,650 7,694,547
Accumulated deficit (8,062,403 ) (6,751,705 )

Total stockholders’ equity 23,227,869 943,284

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 25,613,034 $ 1,432,576
June 30, December 31,
2021 2020
(Unaudited)
CURRENT ASSETS
Cash and cash equivalents $ 61,354,117 $ 19,229,232
Marketable securities 18,234,540 -
Prepaid expenses and other current assets 2,542,426 1,007,690
Total current assets 82,131,083 20,236,922

Property and equipment, net 30,598 21,507
Deferred offering costs - 101,205
Operating lease right-of-use assets 252,503 -
Other assets 17,889 -

TOTAL ASSETS $ 82,432,073 $ 20,359,634

CURRENT LIABILITIES
Accounts payable and accrued expenses $ 1,093,787 $ 552,339
Insurance payable 1,448,419 -
Operating lease liabilities, current 145,898 -
Total current liabilities 2,688,104 552,339

Operating lease liabilities, net of current portion 130,705 -
PPP loan payable - 108,500

TOTAL LIABILITIES 2,818,809 660,839

COMMITMENTS AND CONTINGENCIES (NOTE 4)

STOCKHOLDERS’ EQUITY
Preferred Stock - Par Value (1,000,000 authorized at June 30, 2021 and December 31, 2020; $.0001 par value) (Zero shares issued and outstanding at June 30, 2021 and December 31, 2020) - -
Common Stock – Par Value (25,000,000 authorized at June 30, 2021 and December 31, 2020; $.0001 par value) (11,184,039 shares issued and outstanding at June 30, 2021; 6,220,927 shares issued and outstanding at December 31, 2020) 1,118 622
Additional paid-in capital 97,088,382 32,358,068
Accumulated deficit (17,428,671 ) (12,659,895 )
Accumulated other comprehensive loss (47,565 ) -

Total stockholders’ equity 79,613,264 19,698,795

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 82,432,073 $ 20,359,634
See accompanying Notes to Condensed Consolidated Financial Statements

Lantern Pharma Inc. and Subsidiary
Condensed Consolidated Statements of Operations (Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2021 2020 2021 2020
Operating expenses:
General and administrative 1,314,201 676,399 2,487,459 1,016,571
Research and development 1,164,892 157,023 2,443,929 294,127
Total operating expenses 2,479,093 833,422 4,931,388 1,310,698
Loss from operations (2,479,093 ) (833,422 ) (4,931,388 ) (1,310,698 )
Interest income 47,889 - 47,889 -
Other income, net 114,723 - 114,723 -

NET LOSS $ (2,316,481 ) $ (833,422 ) $ (4,768,776 ) $ (1,310,698 )

Net loss per share of common shares, basic and diluted $ (0.21 ) $ (0.31 ) $ (0.45 ) $ (0.55 )
Weighted-average number of common shares
outstanding, basic and diluted 11,181,504 2,719,198 10,631,121 2,370,082
Three Months Ended
June 30, Six Months Ended
June 30,
2020 2019 2020 2019
Operating expenses:
General and administrative 676,399 268,120 1,016,571 536,049
Research and development 157,023 361,273 294,127 547,317
Total operating expenses 833,422 629,393 1,310,698 1,083,366

NET LOSS $ (833,422 ) $ (629,393 ) $ (1,310,698 ) $ (1,083,366 )

Net loss per share of common shares, basic and diluted $ (0.31 ) $ (0.32 ) $ (0.55 ) $ (0.55 )

Weighted-average number of common shares outstanding, basic and diluted 2,719,198 1,978,269 2,370,082 1,978,269
See accompanying Notes to Condensed Consolidated Financial Statements

Lantern Pharma Inc. and Subsidiary
Condensed Consolidated Statements of Comprehensive Loss (Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2021 2020 2021 2020

NET LOSS $ (2,316,481 ) $ (833,422 ) $ (4,768,776 ) $ (1,310,698 )

Other comprehensive loss, net of tax
Unrealized loss on available-for-sale securities, net of tax (47,565 ) - (47,565 ) -
Other comprehensive loss, net of tax (47,565 ) - (47,565 ) -
Comprehensive loss $ (2,364,046 ) $ (833,422 ) $ (4,816,341 ) $ (1,310,698 )
See accompanying Notes to Condensed Consolidated Financial Statements

Lantern Pharma Inc. and Subsidiary
Condensed Consolidated Statements of Stockholders’ Equity (Deficit) (Unaudited)

Preferred
Stock
Number of
Shares Preferred
Stock
Amount Common
Stock
Number
of Shares Common
Stock
Amount Additional
Paid-in
Capital Accumulated
Deficit Total
Stockholders’
Equity (Deficit)

Three and Six Months Ended June 30, 2019

Balance, December 31, 2018 1,292,952 $ 129 1,978,269 $ 198 $ 4,121,395 $ (4,323,520 ) $ (201,798 )

Preferred stock and warrants issued 804,153 81 - - 2,384,919 - 2,385,000
Stock-based compensation - - - - 15,531 - 15,531
Net Loss - - - - - (453,973 ) (453,973 )

Balance, March 31, 2019 2,097,105 $ 210 1,978,269 $ 198 $ 6,521,845 $ (4,777,493 ) $ 1,744,760

Stock-based compensation - - - - 6,029 - 6,029
Net Loss - - - - - (629,393 ) (629,393 )

Balance, June 30, 2019 2,097,105 $ 210 1,978,269 $ 198 $ 6,527,874 $ (5,406,886 ) $ 1,121,396

Three and Six Months Ended June 30, 2020

Balance, December 31, 2019 2,438,866 $ 244 1,978,269 $ 198 $ 7,694,547 $ (6,751,705 ) $ 943,284

Common stock issued - - 50,460 5 51,995 - 52,000
Stock-based compensation - - - - 18,460 - 18,460
Net Loss - - - - - (477,276 ) (477,276 )

Balance, March 31, 2020 2,438,866 $ 244 2,028,729 $ 203 $ 7,765,002 $ (7,228,981 ) $ 536,468

Common stock issued, net of issuance costs - - 1,750,000 175 23,419,546 - 23,419,721
Preferred stock conversion to common stock and fractional shares adjustments from stock split and conversion (2,438,866 ) (244 ) 2,438,848 244 (261 ) - (261 )
Stock-based compensation - - - - 105,363 - 105,363
Net Loss - - - - - (833,422 ) (833,422 )

Balance, June 30, 2020 - $ - 6,217,577 $ 622 $ 31,289,650 $ (8,062,403 ) $ 23,227,869
Preferred Stock Number of Shares Preferred Stock Amount Common Stock Number of Shares Common Stock Amount Additional Paid-in-Capital Accumulated Other Comprehensive Income Accumulated Deficit Total Stockholders’ Equity (Deficit)
Three and Six Months Ended June 30, 2020
Balance, December 31, 2019 2,438,866 $ 244 1,978,269 $ 198 $ 7,694,547 $ - $ (6,751,705 ) $ 943,284

Common stock issued - - 50,460 5 51,995 - - 52,000
Stock-based compensation - - - - 18,460 - - 18,460
Net loss - - - - - - (477,276 ) (477,276 )

Balance, March 31, 2020 2,438,866 $ 244 2,028,729 $ 203 $ 7,765,002 $ - $ (7,228,981 ) $ 536,468

Common stock issued, net of issuance costs - - 1,750,000 175 23,419,546 - - 23,419,721
Preferred stock conversion to common stock and fractional shares adjustments from stock split and conversion (2,438,866 ) (244 ) 2,438,848 244 (261 ) - - (261 )
Stock-based compensation - - - - 105,363 - - 105,363
Net loss - - - - - - (833,422 ) (833,422 )

Balance, June 30, 2020 - $ - 6,217,577 $ 622 $ 31,289,650 $ - $ (8,062,403 ) $ 23,227,869

Three and Six Months Ended June 30, 2021

Balance, December 31, 2020 - $ - 6,220,927 $ 622 $ 32,358,068 $ - $ (12,659,895 ) $ 19,698,795

Common stock issued in equity financing, net of issuance costs - - 4,928,571 493 64,166,361 - - 64,166,854
Common stock issued from warrant and option exercises - - 31,949 3 72,750 - - 72,753
Stock-based compensation - - - - 245,519 - - 245,519
Net Loss - - - - - - (2,452,295 ) (2,452,295 )

Balance, March 31, 2021 - $ - 11,181,447 $ 1,118 $ 96,842,698 $ - $ (15,112,190 ) $ 81,731,626

Common stock issued from warrant exercise - - 2,592 - - - - -
Stock-based compensation - - - - 245,684 - - 245,684
Net loss - - - - - - (2,316,481 ) (2,316,481 )
Other comprehensive loss - - - - - (47,565 ) - (47,565 )

Balance, June 30, 2021 - $ - 11,184,039 $ 1,118 $ 97,088,382 $ (47,565 ) $ (17,428,671 ) $ 79,613,264
See accompanying Notes to Condensed Consolidated Financial Statements

Lantern Pharma Inc. and Subsidiary
Condensed Consolidated Statements of Cash Flows (Unaudited)

Six Months Ended
June 30,
2021 2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (4,768,776 ) $ (1,310,698 )
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization 2,923 1,202
Non-cash lease expense 24,100 -
Stock based compensation 491,203 123,823
Gain on loan forgiveness (109,223 ) -
Changes in assets and liabilities:
Prepaid expenses and other current assets (169,880 ) (69,987 )
Accounts payable and accrued expenses 677,615 61,742
Other assets (17,889 ) -
Net cash flows used in operating activities (3,869,927 ) (1,193,918 )

INVESTING ACTIVITIES
Purchase of property and equipment (12,014 ) (7,821 )
Purchase of marketable securities (18,282,105 ) -
Net cash flows used in investing activities (18,294,119 ) (7,821 )

FINANCING ACTIVITIES
Proceeds from issuance of common and preferred stock 68,999,994 26,250,000
Issuance costs (4,783,816 ) (2,745,279 )
Proceeds from stock option and warrant exercises 72,753 52,000
Borrowings from notes payable - 169,049
Payments on notes payable - (66,218 )
Borrowings on loan payable - 108,500
Net cash flows provided by financing activities 64,288,931 23,768,052

CHANGE IN CASH AND CASH EQUIVALENTS FOR THE PERIOD 42,124,885 22,566,313

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 19,229,232 1,232,030

CASH AND CASH EQUIVALENTS, END OF PERIOD $ 61,354,117 $ 23,798,343

Non-cash investing and financing activities
Application of deferred offering costs to public offering proceeds $ (49,324 ) $ (456,437 )
Amounts owed related to fractional shares adjustment, included in accounts payable and accrued expenses - (261 )
Unrealized losses on debt securities (47,565 ) -
Six Months Ended
June 30,
2020 2019
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (1,310,698 ) $ (1,083,366 )
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization 1,202 629
Stock based compensation 123,823 21,560
Changes in assets and liabilities:
Prepaid expenses (69,987 ) (32,363 )
Accounts payable and accrued expenses 61,742 224,418
Net cash flows used in operating activities (1,193,918 ) (869,122 )

INVESTING ACTIVITIES
Purchase of property and equipment (7,821 ) -
Net cash flows used in investing activities (7,821 ) -

FINANCING ACTIVITIES
Proceeds from issuance of common and preferred stock 26,250,000 1,850,003
Issuance costs (2,745,279 ) -
Proceeds from stock option exercise 52,000 -
Borrowings from notes payable 169,049 -
Payments on notes payable (66,218 ) -
Borrowings on loan payable 108,500 -
Net cash flows provided by financing activities 23,768,052 1,850,003

CHANGE IN CASH FOR THE PERIOD 22,566,313 980,881

CASH, BEGINNING OF PERIOD 1,232,030 445,163

CASH, END OF PERIOD $ 23,798,343 $ 1,426,044

Non-cash financing activities
Conversion of SAFE agreements to Series A preferred stock $ - $ 535,000
Application of deferred offering costs to initial public offering proceeds $ (456,437 ) $ -
Amounts owed related to fractional shares adjustment, included in accounts payable and accrued expenses $ (261 ) $ -
See accompanying Notes to Condensed Consolidated Financial Statements

NOTES TO FINANCIAL STATEMENTS
Note 1. Organization, Principal Activities, and Basis of Presentation
Lantern Pharma Inc., and Subsidiary (the “Company”) is a clinical stage ~~biotechnology~~biopharmaceutical company, focused on leveraging artificial intelligence (“A.I.”), machine learning and genomic data to streamline the drug development process and to identify the patients that will benefit from its targeted oncology therapies. The Company’s portfolio of therapies consists of small molecule drug candidates that others have tried, but failed, to develop into an approved commercialized drug, as well as new compounds that it is developing with the assistance of its A.I. platform and its biomarker driven approach. The Company’s A.I. platform, known as ~~RADR®~~RADR^®, uses big data analytics (combining molecular data, drug efficacy data, data from historical studies, data from scientific literature, phenotypic data from trials and publications, and mechanistic pathway data) and machine learning. The Company’s data-driven, genomically-targeted and biomarker-driven approach allows it to pursue a transformational drug development strategy that identifies, rescues or develops, and advances potential small molecule drug candidates.
Lantern Pharma Inc. was incorporated under the laws of the state of Texas on November 7, 2013, and thereafter reincorporated in the state of Delaware on January 15, 2020. The Company’s principal operations are located in Texas. The Company formed a wholly owned subsidiary, Lantern Pharma Limited, in the United Kingdom in July 2017. ~~All intercompany balances and transactions have been eliminated in consolidation.~~
Since inception, the Company has devoted substantially all its activity to advancing research and development, including efforts in connection with preclinical studies, clinical trials and development of its RADR platform. This now includes ~~research and development for three~~four drug candidates ~~in development in targeted areas identified with the assistance of the RADR platform:~~and an ADC program directed towards seven disclosed therapeutic targets:
● LP-100 (irofulven), ~~out-licensed to Oncology Venture,~~ in a phase II trial for the treatment of prostate cancer;
● LP-300 (Tavocept) in ~~planning stages for~~preparation to launch a phase II trial for the treatment of non-small cell lung cancer; ~~and~~
● LP-184 in preclinical studies for treatment of solid tumors including pancreatic, prostate, ~~ovarian,~~ and liver ~~cancers.~~cancers and glioblastoma;
● LP-284, the stereoisomer (enantiomer) of LP-184, that has shown promising in-vitro anticancer activity in a range of indications that are distinct from LP-184; and
In connection with the Company’s reincorporation in the state of Delaware on January 15, 2020, the par value of the Company’s Common Stock and Series A Preferred Stock was changed from $0.01 per share to $0.0001 per share. The change in the par value has been retroactively reflected in the accompanying condensed consolidated financial statements. Additional funds have been reclassified from Common Stock and Series A Preferred Stock to additional paid-in capital to reflect the change in par value associated with the reincorporation.
● An Antibody Drug Conjugate (ADC) program that was initiated in early 2021.
The Company’s fiscal year ends on December 31 of each calendar year. The accompanying interim condensed consolidated financial statements are unaudited and have been prepared on substantially the same basis as the Company’s annual consolidated financial statements for the fiscal year ended December 31, ~~2019.~~2020. In the opinion of the Company’s management, these interim condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of the Company’s financial position, results of operations and cash flows for the periods presented. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of expenses during the reporting periods. Actual results could differ from these estimates.
The December 31, ~~2019~~2020 year-end condensed consolidated balance sheet data in the accompanying interim condensed consolidated financial statements was derived from audited consolidated financial statements. These condensed consolidated financial statements and notes do not include all disclosures required by U.S. generally accepted accounting principles and should be read in conjunction with the Company’s audited consolidated financial statements as of and for the year ended December 31, ~~2019~~2020 and the notes thereto included in the Company’s ~~final prospectus,~~Annual Report on Form 10-K, dated ~~June~~March 10, ~~2020, for the Company’s initial public offering,~~2021, on file with the Securities and Exchange Commission.

The results of operations and cash flows for the interim periods included in these condensed consolidated financial statements are not necessarily indicative of the results to be expected for any future period or the entire fiscal year.
Any reference in these notes to applicable guidance refers to Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”). To date, the Company has operated its business as one segment. The Company’s condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Lantern Pharma Limited. All intercompany balances and transactions have been eliminated in consolidation.
Effective June 11, 2020, in connection with the Company’s initial public offering (“IPO”), the Company completed a forward stock split of its common stock at a ratio of 1.74 for 1 shares. In addition, all of the Company’s preferred stock converted into common stock effective June 15, 2020 in connection with the IPO. All data on common stock and equivalents in the accompanying condensed consolidated financial statements and in these notes are shown herein reflective of this stock split and the conversion of the preferred stock. In addition, the number of shares of preferred stock in the accompanying condensed consolidated financial statements and in these notes is presented to reflect the number of shares into which the preferred stock would convert as a result of the forward stock split.
Note 2. Liquidity
The Company incurred a net loss of ~~$1,310,698~~approximately $4,769,000 and ~~$1,083,366~~$1,311,000 during the six months ended June 30, ~~2020~~2021 and ~~June 30, 2019,~~2020, respectively. As of June 30, ~~2020,~~2021, the Company had working capital of ~~$23,320,992, primarily as a result of the net proceeds raised in the IPO of~~ approximately ~~$23,420,000 (see Note 5). The Company had working capital of $743,526 as of December 31, 2019.~~$79,443,000. The Company has received funding in the form of periodic capital raises and also plans to apply for grant funding in the future to assist in supporting its capital needs. We may also explore the possibility of entering into commercial credit facilities as an additional source of liquidity. ~~As of December 31, 2019, there was substantial doubt about the Company’s ability to continue as a going concern in the absence of additional funding.~~ We believe that our existing cash ~~and cash equivalents~~ as of June 30, ~~2020, resulting from the proceeds raised in the IPO,~~2021, and our anticipated expenditures and capital commitments, ~~for the calendar year 2020 and the first half of calendar year 2021,~~ will enable us to fund our operating expenses and capital expenditure requirements for at least 12 months from the date of this quarterly report.
Note 3. Summary of Significant Accounting Policies
Use of Estimates and Assumptions
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The significant areas of estimation include determining ~~deferred tax asset valuation allowance~~research and development accruals and the inputs in determining the fair value of equity-based awards and warrants issued. Actual results could differ from those estimates.
Risks and Uncertainties
The Company operates in an industry that is subject to intense competition, government regulation and rapid technological change. Operations are subject to significant risk and uncertainties including financial, operational, technological, regulatory, and other risks, including the potential risk of business failure.
The extent of the impact and effects ~~of the recent outbreak~~ of the coronavirus (COVID-19) on the operation and financial performance of the Company’s business will depend on future developments, including the duration and spread of the outbreak and varying virus mutations, related travel advisories and restrictions, the recovery time of disrupted research services, the consequential staff shortages, and research and development delays, or the uncertainty with respect to the accessibility of additional liquidity or capital markets, all of which are highly uncertain and cannot be predicted. If the Company’s operations are impacted by ~~this~~the outbreak for an extended period, the Company’s results of operations or liquidity may be materially adversely affected.

Deferred Offering Costs
In conjunction with the Company’s ~~IPO,~~public offerings, costs incurred related to the ~~IPO~~public offerings were capitalized as deferred equity issuance costs in other non-current assets until the time of completion of the ~~IPO.~~public offerings. Upon completion of the ~~IPO,~~public offerings, these costs have been offset against proceeds received. Offering costs include direct and incremental costs related to the offering such as legal fees and related costs associated with the ~~IPO.~~public offerings.
During the six months ended June 30, 2020, the Company classified deferred offering costs of $456,437 as a reduction to additional paid-in capital upon completion of the Company’s IPO on June 15, 2020. As of December 31, ~~2019,~~2020, the Company recorded deferred offering costs of ~~$191,000~~approximately $101,000 and as of June 30, ~~2020,~~2021, there were no deferred offering costs recorded on the Company’s condensed consolidated balance ~~sheets.~~sheets (see Note 6).

Research and Development
Research and development costs are expensed as incurred. These expenses primarily consist of payroll, contractor expenses, research study expenses, costs for manufacturing and supplies, and technical infrastructure on the cloud for the purposes of developing the Company’s RADR platform and identifying, developing, and testing drug candidates. Development costs incurred by third parties are expensed as the work is performed. Costs to acquire technologies, including licenses, that are utilized in research and development and that have no alternative future use are expensed when incurred.
Cash and Cash Equivalents
~~Prepaid Expense~~
~~Prepaid expense as~~The Company considers money market funds with a short-term maturity of less than one year to be cash equivalents. Cash equivalents at June 30, 2021 and December 31, 2020 ~~totaled~~were approximately ~~$71,000~~$1,670,000 and 0, respectively, and are included ~~approximately $9,000 of upfront contractor fees, $55,000 of licensing and other fees to AF Chemicals, LLC, and approximately $7,000 of annual insurance fees.~~
~~Loan Pursuant to Paycheck Protection Program~~
~~The Company received $108,500 in aggregate loan proceeds (the “PPP Loan”) from JPMorgan Chase Bank (the “Lender”) pursuant to the Paycheck Protection Program~~along with cash under the ~~Coronavirus Aid, Relief,~~caption cash and Economic Security (CARES) Act. The PPP Loan is evidenced by a loan application and payment agreement (the “PPP Loan Agreement”) by and between the Company and the Lender. This amount is recorded as a loan payablecash equivalents on the Company’s condensed consolidated balance ~~sheet at~~sheets.
Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets as of June 30, ~~2020.~~2021 totaled approximately $2,542,000 and included approximately $602,000 of upfront payments for contractor fees, academic research studies and services, and subscriptions, approximately $489,000 of intellectual property related licensing and other fees, approximately $1,375,000 of prepaid annual insurance fees, and approximately $76,000 of interest receivable.
Leases
The Company determines whether an arrangement contains a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, current portion of operating lease liabilities, and net of current portion of operating lease liabilities on our consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent an obligation to make lease payments arising from the lease. Lease ROU assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. As the Company’s leases do not provide an implicit rate, an incremental borrowing rate is used based on the information available at the commencement date in determining the present value of lease payments. The Company does not include options to extend or terminate the lease term unless it is reasonably certain that the Company will exercise any such options. Rent expense is recognized under the operating leases on a straight-line basis. The Company does not recognize right-of-use assets or lease liabilities for short-term leases, which have a lease term of twelve months or less, and instead will recognize lease payments as expense on a straight-line basis over the lease term.
Marketable Securities
The Company’s marketable securities consist of government and agency securities, corporate bonds, and mutual funds. We classify our marketable securities as available-for-sale at the time of purchase and reevaluate such classification as of each balance sheet date. We may sell these securities at any time for use in current operations even if they have not yet reached maturity. As a result, we classify our investments, including securities with maturities beyond twelve months as current assets in the accompanying consolidated balance sheets. Available-for-sale debt securities are recorded at fair value each reporting period. Unrealized gains and losses are excluded from earnings and recorded as a separate component within “Accumulated other comprehensive income” on the consolidated balance sheets until realized. Interest is reported within “Interest income” and dividend income is reported within “Other income, net” on the consolidated statements of operations. We evaluate our investments to assess whether the amortized cost basis is in excess of estimated fair value and determine what amount of that difference, if any, is caused by expected credit losses. Allowance for credit losses are recognized as a charge in “Other (expense) income, net” on the consolidated statements of operations, and any remaining unrealized losses are included in “Accumulated other comprehensive income” on the consolidated balance sheets. There were no credit losses recorded for the three and six months ended June 30, 2021. There was no impairment charge for any unrealized losses for the three and six months ended June 30, 2021. We determine realized gains and losses on the sale of marketable securities based on the specific identification method and record such gains and losses in “Other (expense) income, net” on the consolidated statements of operations. The Company purchased all marketable securities during the three months ended June 30, 2021 and as a result, there was no impact on prior periods.

New Accounting Pronouncements, Not Yet Adopted
Current Expected Credit Loss
In June 2016 the FASB issued Accounting Standard Update (ASU) 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326). This introduces new methodology for recognition of credit losses - the current expected credit loss (“CECL”) method. The CECL method requires the recognition of all losses expected over the life of a financial instrument upon origination or purchase of the instrument, unless the company elects to recognize such instruments at fair value with changes in profit and loss. CECL is effective for the Company on January 1, 2023. The Company does not anticipate a material impact from the adoption of this new standard on its financial statements.
Note 4:4. Commitments and Contingencies
General.
The Company has entered into, and expects to enter into from time to time in the future, license agreements, strategic alliance agreements, assignment agreements, research service agreements, and similar agreements related to the advancement of its product candidates and research and development efforts. Significant agreements are described in detail below (collectively, the “License, Strategic Alliance, and Research Agreements”). During the three and six months ended June 30, 2021, the Company expensed a total of approximately $465,000 and $1,123,000, respectively, and during the three and six months ended June 30, 2020, the Company expensed a total of approximately $28,000 and $56,000, respectively, under the License, Strategic Alliance, and Research Agreements described below. These expense amounts are included under research and development expenses in the accompanying condensed consolidated statements of operations.
During the three and six months ended June 30, 2021, the Company made payments of approximately $556,000 and $1,589,000, respectively, and during the three and six months ended June 30, 2020, the Company made payments of approximately $12,000 and $99,000, respectively, under the License, Strategic Alliance, and Research Agreements.
Approximately $512,000 and $120,000 are accrued and payable under the License, Strategic Alliance, and Research Agreements at June 30, 2021 and December 31, 2020, respectively, which amounts are included in the accompanying condensed consolidated balance sheets.
Approximately $965,000 and $97,000 are included in prepaid expenses and other current assets under the License, Strategic Alliance, and Research Agreements at June 30, 2021 and December 31, 2020, respectively, which amounts are included in the accompanying condensed consolidated balance sheets.
BioNumerik ~~Pharmaceuticals.~~Pharmaceuticals
In January 2018, the Company entered into an Assignment Agreement (the “Assignment Agreement”) with BioNumerik Pharmaceuticals, Inc. (“BioNumerik”), pursuant to which the Company acquired rights to domestic and international patents, trademarks and related technology and data relating to LP-300 (Tavocept) for human therapeutic treatment indications. The Assignment Agreement replaced a License Agreement that was entered into between the Company and BioNumerik in May 2016. The Company made upfront payments totaling $25,000 in connection with entry into the Assignment Agreement.

In the event the Company develops and commercializes LP-300 internally, the Company is required to pay to the BioNumerik-related payment recipients designated in the Assignment Agreement a percentage royalty in the low double digits on cumulative net revenue up to $100 million, with incremental increases in the percentage royalty for net cumulative revenue between $100 million and $250 million, $250 million and $500 million, and $500 million and $1 billion, with a percentage royalty payment that could exceed $200 million for net cumulative revenue in excess of $1 billion. The Company has the right to first recover certain designated portions of patent costs and development and regulatory costs before the payment of royalties described above.
If the Company enters into a third party transaction for LP-300, the Company is required to pay the BioNumerik-related payment recipients a specified percentage of any upfront, milestone, and royalty amounts received by the Company from the transaction, after first recovering specified direct costs incurred by the Company for the development of LP-300 that are not otherwise reimbursed from such third party transaction.
In addition, the Assignment Agreement provides that the Company will use commercially diligent efforts to develop LP-300 and make specified regulatory filings and pay specified development and regulatory costs related to LP-300. The Assignment Agreement also provides that the Company will provide TriviumVet DAC (“TriviumVet”) with (i) specified data and information generated by the Company with respect to LP-300, and (ii) an exclusive license to use specified LP-300-related patent rights, trademark rights and related intellectual property to support LP-300 development in non-human (animal) treatment indications.
The Company is also required to pay all patent costs on covered patents related to LP-300. These patent costs are included in general and administrative expenses in the accompanying condensed consolidated statements of operations. These patent costs are fully recoverable at the time of any net revenue from LP-300, with up to 50% of net revenue amounts to be applied towards repayment of patent costs until such costs are fully recovered.
In addition to the recovery of patent costs, the Company has the right to recover the $25,000 upfront payments made in connection with entry into the Assignment Agreement, which payments are recoverable prior to making any royalty or third party transaction sharing payments. The Company also has the right to recover previously incurred LP-300 development and regulatory costs, with up to a mid-single digit percentage of net revenue amounts to be applied towards repayment of development and regulatory costs until such costs are fully recovered.
~~There is approximately $11,000 payable to BioNumerik as of June 30, 2020 and December 31, 2019.~~

AF ~~Chemicals.~~Chemicals
In January 2015, the Company entered into a Technology License Agreement to exclusively license domestic and international patent rights from AF Chemicals, LLC (“AF Chemicals”) for the treatment of cancer in humans for the compounds LP-100 (Irofulven) and LP-184. In February 2016, the Company and AF Chemicals entered into an Addendum (the “Addendum”) providing for additions and amendments to the Technology License Agreement. In December 2020, the Company and AF Chemicals entered into a Second Addendum (the “Second Addendum”) providing for further additions and amendments to the Technology License Agreement. The Technology License Agreement, Addendum and Second Addendum are collectively referred to as the “AFC License Agreement”.
Pursuant to the Second Addendum, the Company made specified payments to AF Chemicals within 10 days after signing and prior to March 31, 2021. The Second Addendum also provides that, from December 30, 2020 until January 15, 2025, the Company will have no obligation to pay annual licensing fees, development diligence extension payments, or patent maintenance fee payments to AFC under the AFC License Agreement.
As part of the Second Addendum, the Company has agreed to apply for specified orphan drug designations for LP-184 in the US and EU. The Second Addendum also amends and clarifies other provisions of the Technology License Agreement, and ~~Addendum (collectively, the “AFC License Agreement”)~~provides the Company ~~is obligated~~with the ability to ~~make~~recover a portion of initial payments made under the Second Addendum from sublicense fees or royalty payments that may be made to AFC by the Company or third parties prior to January 15, 2025.

Pursuant to the AFC License Agreement the Company made annual licensing fee payments to AF Chemicals ~~in the amount of $30,000 per year relating to LP-184. The Company paid $0 and $30,000 to AF Chemicals relating to the LP-184 annual fee~~ during the ~~three and~~ six months ended June 30, 2020 ~~$7,500 and $15,000 of which was expensed during the three and six months ended June 30, 2020, respectively. The Company paid $0 and $30,000 to AF Chemicals~~ relating to ~~the LP-184 annual fee during the three and six months ended June 30, 2019, $7,500 and $15,000 of which was expensed during the three and six months ended June 30, 2019, respectively.~~LP-184. Such amounts are included in research and development expenses in the accompanying condensed consolidated statements of operations. In addition, the Company is obligated to make milestone payments to AF Chemicals at the time of an Investigational New Drug Application (“IND”) filing relating to LP-184 and also upon reaching additional specified milestones in connection with the development and potential marketing approval of LP-184 in the United States, specified countries in Europe, and other countries.
In the event of a sublicense of the LP-184 rights, the Company is obligated to pay AF Chemicals (a) a low double digit percentage of the gross income and fees received by the Company with respect to the United States in connection with such sublicense, and (b) a lower double digit percentage of the gross income and fees received by the Company with respect to Europe and Japan in connection with such sublicense.
The AFC License Agreement also provides that the Company will pay AF Chemicals a royalty of at least a very small single digit percentage of specified net sales of LP-184 and other analogs. In addition, the AFC License Agreement contains specified time requirements for the Company to file an IND, enroll patients in clinical trials, and file a potential NDA with respect to LP-184, with the ability for the Company to pay AF Chemicals additional amounts ranging ~~from $25,000~~up to ~~$50,000~~an amount in the low hundreds of thousands of dollars for each one, two, three and ~~three~~four year extension to such development time requirements, with additional extensions beyond ~~three~~four years to be negotiated by the Company and AF Chemicals. ~~During~~
Pursuant to the ~~three and six months ended June 30, 2020,~~Second Addendum, no additional payments of annual licensing fees or development diligence extension payments are required to be made by the Company ~~paid AF Chemicals $25,000 and $50,000, respectively, relating to the IND filing milestone extension fee for LP-184, $12,500 and $25,000 of~~until January 15, 2025, at which were expensed during the three and six months ended June 30, 2020, respectively, and included under research and development expenses in the accompanying condensed consolidated statements of operations.time these obligations will resume. The Company paid AF Chemicals $37,500 during the year ended December 31, 2019 in connection with extension of the IND filing milestone for LP-184, none of which was paid during the three and six months ended June 30, 2019. Amounts of $9,375 and $18,750 were expensed during the three and six months ended June 30, 2019, respectively, related to this extension payment, and included under research and development expenses in the accompanying condensed consolidated statements of operations. The Company iswill also be obligated to make annual licensing fee payments to AF Chemicals relating to LP-100 beginning January 15, 2025, as described below under ~~“Oncology Venture.”~~Allarity Therapeutics.
~~Nothing was accrued or payable~~In the event of a sublicense of the LP-184 rights, the Company is obligated to pay AF Chemicals (a) a low double digit percentage of the gross income and fees received by the Company with respect to the United States in connection with such sublicense, and (b) a lower double digit percentage of the gross income and fees received by the Company with respect to Europe and Japan in connection with such sublicense.
Allarity Therapeutics (formerly known as ~~of June 30, 2020 and December 31, 2019.~~Oncology Venture)
~~Oncology Venture.~~
In May 2015, the Company licensed various rights to LP-100 to Oncology Venture (now known as Allarity Therapeutics) pursuant to a Drug License and Development Agreement. In February 2016, the Company and ~~Oncology Venture~~Allarity Therapeutics entered into an addendum and an amendment providing for additions and amendments to the Drug License and Development Agreement. In connection with the Drug License and Development Agreement, as amended (collectively, the ~~“OV~~“Allarity License and Development Agreement”), ~~Oncology Venture~~Allarity Therapeutics agreed to directly pay to AF Chemicals on behalf of the Company certain amounts ~~owed~~to satisfy the Company’s milestone obligations to AF Chemicals with respect to LP-100 under the AFC License Agreement. Amounts paid by ~~Oncology Venture~~Allarity Therapeutics to AF Chemicals on behalf of the Company are then deducted from amounts owed by ~~Oncology Venture~~Allarity Therapeutics to the Company. On July 23, 2021, the Company entered into an Asset Purchase Agreement to reacquire global development and commercialization rights for Irofulven (LP-100) from Allarity (See Note 11).
The amounts ~~owed~~to be paid to AF Chemicals with respect to LP-100 under the AFC License Agreement are in many ways similar to the amounts ~~owed~~to be paid with respect to LP-184 as described above under “AF Chemicals”.
In addition, the ~~event any such amounts relating~~AFC License Agreement contains specified time requirements for the Company to ~~LP-100 are not~~enroll patients in clinical trials, and file a potential NDA with respect to LP-100. Extension fees may be paid by the Company to AF Chemicals from time to time related to these requirements. Pursuant to the Second Addendum with AF Chemicals, no additional payments of annual licensing fees or development diligence extension payments are required to be made by ~~Oncology Venture,~~ the Company with respect to LP-100 until January 15, 2025, at which time these obligations will resume.
Califia Pharma
In December 2020, the Company entered into an Evaluation and Limited Use Agreement (the “Evaluation Agreement”) with Califia Pharma, Inc. (“Califia”). The Evaluation Agreement provides for the Company and Califia to collaborate on the in vitro and in vivo testing and evaluation of novel Califia payloads conjugated to a Lantern targeting entity. The Evaluation Agreement also provides the Company with the right to negotiate with Califia for exclusive license rights to use LP-184 and related analogs as the payload with an affinity drug conjugate or small molecule drug conjugate targeting entity supplied by the Company. The Company also has the right under the Evaluation Agreement to negotiate for non-exclusive license rights to use a targeting entity from the Company with a payload and linker combination selected from novel specified Califia payloads and linkers.

Patheon API Services
The Company has entered into agreements with Patheon API Services, Inc. (“Patheon”) for the manufacture and supply of cGMP material to support the Company’s planned Phase II clinical trial for its product candidate LP-300. In addition to producing LP-300 API (active pharmaceutical ingredient) under cGMP (current Good Manufacturing Practices) conditions, Patheon is ~~obligated~~transferring previously validated manufacturing processes and analytical methods for LP-300 and is producing non-GMP material that can be used to support non-clinical studies for LP-300. The agreements provide for payments in stages as specified process and manufacturing milestones are achieved. Patheon, a part of Thermo Fisher Scientific, has previously developed and/or manufactured more than 700 pharmaceuticals for biopharma clients and has more than 55 locations around the world, providing access to a fully integrated global network of facilities. The Company expects to pay ~~such unpaid amounts.~~ additional amounts to Patheon in future periods in accordance with specified process and manufacturing milestones under the Patheon agreements.
Southwest Research Institute
As part of the Company’s research and development activities, the Company has engaged Southwest Research Institute (“SwRI”) from time to time to assist with compound synthesis and manufacturing related activities for the Company’s product candidates. The Company has entered into agreements with SwRI for the non-GMP synthesis of LP-184 material and related analytical development to assist with preclinical studies. The Company expects to pay additional amounts to SwRI in future periods as synthesis and analytical work is conducted by SwRI under the agreements.
The Research Institute of Fox Chase Cancer Center
In September 2020, the Company entered into a research agreement with the Research Institute of Fox Chase Cancer Center (“FCCC”) as part of the Company’s research and development activities, with a focus on advancing the targeted use of LP-184 in molecularly-defined sub-types of pancreatic cancer. The Company expects to pay additional amounts to FCCC in future periods in accordance with the payment schedule specified under the FCCC agreement.
Piramal Pharma Solutions
In January 2021, the Company entered into an agreement with Piramal Pharma Solutions (“Piramal”) for the fill and finish manufacture of LP-300 drug product at Piramal’s Lexington, Kentucky site in support of future Phase II clinical testing. Piramal will complete activities to support the cGMP manufacturing of LP-300, conduct a transfer project, manufacture a cGMP clinical batch, and perform stability studies on the cGMP batch of LP-300 drug product. The Company expects to pay additional amounts to Piramal in future periods in accordance with the payment schedule specified under the Piramal agreement.
Other Research and Service Provider Agreements
In addition to the ~~payments to be made by Oncology Venture,~~agreements described above, the Company ~~is obligated to make annual licensing fee payments to AF Chemicals in~~has entered into other research and service provider agreements for the ~~amount~~advancement of ~~$30,000 per year relating to LP-100. The Company paid $0~~its product candidates and $30,000 to AF Chemicals relating to the LP-100 annual fee during the three and six months ended June 30, 2020, respectively, $7,500 and $15,000 of which was expensed during the three and six months ended June 30, 2020, respectively. The Company paid $0 and $30,000 to AF Chemicals relating to the LP-100 annual fee during the three and six months ended June 30, 2019, respectively, $7,500 and $15,000 of which was expensed during the three and six months ended June 30, 2019, respectively. Such amounts are included in research and development ~~expenses~~efforts. The Company expects to pay additional amounts in ~~the accompanying condensed consolidated statements of operations. There is nothing accrued or payable related to the OV License~~future periods in connection with existing and ~~Development Agreement as of June 30, 2020~~future research and ~~December 31, 2019.~~service provider agreements.
EU Grant
In September 2018, Lantern Pharma Limited, a wholly owned subsidiary of Lantern Pharma Inc., was awarded a grant by the UK government in the form of state aid under the Commission Regulations (EU) No. 651/2014 of 17 June 2014 (the “General Block Exemption”), Article 25 Aid for research and development projects, state aid notification no. SA.40154. The grant was awarded to conduct research and development activities for the prostate cancer biomarker analysis of the LP-184 drug candidate. Following the Company’s research and development activities in Northern Ireland, the grant will reimburse the Company 50% of its research and development expenses not exceeding GBP 24,215 of vouched and approved expenditures within specific categories. The grant contains some reporting and consent requirements. The grant will remain in force for a period of five years. No payments to the Company have been made under the grant as of June 30, ~~2020~~2021 and December 31, ~~2019.~~2020. No revenue has been recognized from this grant through June 30, ~~2020.~~2021.

Actuate Therapeutics
In May 2021, the Company entered into a Collaboration Agreement with Actuate Therapeutics, Inc. (“Actuate”), a clinical stage private biopharmaceutical company focused on the development of compounds for use in the treatment of cancer, and inflammatory diseases leading to fibrosis. Pursuant to the agreement, the Company and Actuate will collaborate on utilization of the Company’s RADR® platform to develop novel biomarker derived signatures for use with one of Actuate’s product candidates. As part of the collaboration, the Company received 25,000 restricted shares of Actuate stock, subject to meeting certain conditions of the collaboration, as well as the potential to receive additional Actuate stock if results from the collaboration are utilized in future development efforts. The Company’s director Mr. Kreis is also a director of Actuate. Affiliates of Mr. Kreis hold substantial beneficial ownership interests in both the Company and Actuate. Through June 30, 2021, no revenues or costs have been recognized from third parties under the Agreement.

The restricted shares of Actuate stock had a nominal value when acquired and, therefore, were recorded at a cost of $0. These shares do not have a readily determinable fair value, but will be adjusted for observable price changes, if any, in future periods. There were no adjustments to the carrying amount through June 30, 2021.
Note 5. Leases
The operating lease cost recognized in general and administrative expenses in our consolidated statements of operations was approximately $27,000 and $29,000 for the three and six months ended June 30, 2021, and approximately $12,000 and $24,000 during the three and six months ended June 30, 2020.
The following provides balance sheet information related to leases as of June 30, 2021 and December 31, 2020:
June 30, 2021
December 31,
2020

Assets
Operating lease, right-of-use asset, net $ 252,503 $ -
Liabilities
Current portion of operating lease liabilities $ 145,898 $ -
Operating lease liabilities, net of current portion 130,705 -
Total operating lease liabilities $ 276,603 $ -
At June 30, 2021, the future estimated minimum lease payments under non-cancelable operating leases are as follows:
2021 (remaining 6 months) $ 77,396
2022 158,403
2023 53,403
Total minimum lease payments 289,202
Less amount representing interest 12,599
Present value of future minimum lease payments 276,603
Less current portion of operating lease liabilities 145,898
Operating lease liabilities, net of current portion $ 130,705

~~Operating Lease~~

In April 2021, we entered into two operating leases for office space that commenced in May 2021. The leases expire in April 2023 and automatically renew month-to-month unless we provide three-months written notice to the landlord prior to initial expiration. The exercise of lease renewal options is at our sole discretion and is assessed as to whether to include any renewals in the lease term at inception. The following table provides a reconciliation for our right of use assets and lease liabilities:
Right-of-Use Asset Operating Lease Liability
Balance at March 31, 2021 $ - $ -
Additions 274,472 276,603
Amortizations and Reductions (21,969 ) -
Balance at June 30, 2021 $ 252,503 $ 276,603
Other supplemental information related to operating leases is as follows:
As of June 30,
2021 2020
Weighted average remaining term of operating leases (in years) 1.83 -
Weighted average discount rate of operating leases 4.65 % - %
The Company also leased office space in Dallas, Texas under month-to-month lease arrangements during the three and six months ended June 30, ~~2020 and the year ended December 31, 2019.~~
2021. In August 2019, the Company entered into a leasing agreement for office space in New Jersey. Monthly rent ~~is $2,106,~~was approximately $2,000, plus electrical ~~utilities and the~~utilities. The lease ~~expires~~expired on July 31, ~~2020.~~
~~Public Company Director~~2020 and ~~Officer Liability Insurance~~
~~In connection with becoming a public company,~~was not renewed. Under these short-term leases, the Company ~~obtained director~~elected the short-term lease measurement and officer liability insurance at a premium cost of approximately $1,810,000, with approximately $104,000 of such insurance premiums expensed during the six months ended June 30, 2020, all of which is accruedrecognition exemption under ASC 842 and recorded rent expense as of June 30, 2020. The remaining balance of approximately $1,706,000 was included under other current asset and insurance payable on the Company’s condensed consolidated balance sheet at June 30, 2020.incurred.
~~Note 5. Shareholders’ Equity~~
~~Preferred Stock~~
In March 2019, the Company sold 590,643 shares of Series A preferred stock for aggregate proceeds of approximately $1,850,000. The Company also issued 213,510 shares of Series A preferred stock in March 2019, in connection with the conversion of the Simple Agreement for Future Equity (SAFE) agreements. See Note 6. In connection with the sale and issuance of the Series A preferred stock in March 2019, the Company issued warrants to purchase an aggregate of 96,499 shares of Series A preferred stock at an initial exercise price of $3.13 per share.Stockholders’ Equity
As of December 31, 2019, the Company had 3,480,000 authorized shares of preferred stock, of which 2,438,866 shares designated as Series A Preferred Stock were issued and outstanding. The holders of Series A Preferred Stock were entitled to receive dividends when, as and if declared by the Company’s Board of Directors, payable in preference and priority to any declaration or payment of dividends on Common Stock.
Effective January 15, 2020, as a result of the reincorporation in the state of Delaware, the par value of the Company’s preferred stock was changed from $0.01 to $0.0001 per share, and all data on preferred stock was retroactively adjusted to be shown herein as reflective of this change
Upon the Company’s IPO, all shares of the Company’s Series A preferred stock were converted into 2,438,851 shares of common stock effective June 15, 2020, with fractional share adjustments made in connection with the conversion as discussed below. As of June 30, 2020, the Company had 1,000,000 authorized share of preferred stock, with zero shares of preferred stock issued and outstanding.
Common Stock
On June 15, 2020, the Company received net proceeds of $23,419,721 in its IPO, after deducting underwriting discounts and commissions of $1,968,750 and other offering expenses of $861,529 borne by the Company. The Company issued and sold 1,750,000 shares of common stock in its IPO at a price of $15.00 per share. In connection with the IPO, all shares of the Company’s Series A Preferred Stock were converted into 2,438,851 shares of common ~~stock, after giving effect to the 1.74 for 1 forward stock split of the common stock and net of the fractional shares adjustments that occurred in connection with the IPO.~~stock.

The Company ~~is to make~~made payments of approximately $261 in the aggregate in connection with fractional shares resulting from the stock split and the conversion of the preferred stock that took place in connection with the IPO.
During the three and six months ended June 30, 2020, the Company issued ~~zero~~0 and 50,460 shares of common stock relating to the exercise of stock options. The shares were issued at a purchase price of $1.03 for total proceeds of $52,000.
On January 20, 2021, the Company closed a public offering of 4,928,571 shares of its common stock at a public offering price of $14.00 per share, which amount included 642,856 shares sold upon full exercise of the underwriter’s over-allotment option. Total gross proceeds from the offering were approximately $69,000,000, and net proceeds from the offering were approximately $64,167,000, after deducting underwriting discounts and commissions of approximately $4,554,000 and other offering expenses of approximately $279,000, including $101,000 of deferring offering costs previously recorded.
During the three and six months ended June 30, 2021, the Company issued 0 and 11,782 shares of common stock, respectively, relating to the exercise of stock options. The shares were issued at a purchase price of $1.03 per share for total proceeds of approximately $12,000.
During the three and six months ended June 30, 2021, the Company issued 0 and 19,367 shares of common stock relating to the cash exercise of warrants for total proceeds of approximately $61,000. During the three and six months ended June 30, 2021 the Company also issued 2,592 and 3,392 shares of common stock relating to the cashless exercise of warrants to purchase 3,258 and 4,215 shares, respectively. All of such warrants were exercisable at an exercise price of $3.13 per share of common stock.
As of June 30, 2021 and December 31, 2020, the Company had 25,000,000 authorized shares of Common Stock, of which ~~6,217,577~~11,184,039 and 6,220,927 shares were issued and ~~outstanding. As of December 31, 2019, the Company had 12,180,000 authorized shares of Common Stock, of which 1,978,269 shares were issued and outstanding.~~outstanding, respectively.

Warrants
The Company had warrants to purchase ~~332,014~~302,036 shares of common stock outstanding and exercisable as of June 30, 2021 at a weighted average exercise price of $6.75 per share, and with expiration dates ranging from December 31, 2021 to June 10, 2025. The Company had warrants to purchase 325,618 shares of common stock outstanding and exercisable as of December 31, 2020 at a weighted average exercise price of $6.42 per share. The Company had warrants to purchase 232,885 shares of Series A Preferred Stock outstanding and exercisable as of June 30, 2019 at a weighted average exercise price of $3.13 per share.
In connection with the IPO and the conversion of the Series A Preferred Stock into common stock, all outstanding warrants to purchase Series A Preferred Stock converted into warrants to purchase common stock.
~~In connection with the IPO, the Company granted the underwriters warrants (the “Underwriters’ Warrants”) to purchase an aggregate of 70,000 shares of common stock at an exercise price of $18.75~~$6.49 per share, ~~which is 125% of the initial public offering price. The Underwriters’ Warrants have a five-year term~~ and ~~are not exercisable prior~~with expiration dates ranging from December 31, 2021 to ~~December 7, 2020. All of the Underwriters’ Warrants were outstanding at~~ June ~~30, 2020.~~10, 2025.
Options
In connection with the Series A Preferred Stock financing transactions discussed above, during the six months ended June 30, 2019, the Company issued warrants to purchase an aggregate of 96,498 shares of Series A Preferred Stock.
~~Options~~
The Company recorded stock-based compensation of approximately ~~$124,000~~$246,000 and ~~$22,000~~$491,000 related to stock options during the three and six months ended June 30, 2021, and $105,000 and $124,000 related to stock options during the three and six months ended June 30, 2020, ~~and 2019, respectively, and approximately $105,000 and $6,000 during the three months ended June 30, 2020 and 2019,~~ respectively. These amounts are ~~included in~~allocated between general and administrative and research and development expenses in the accompanying condensed consolidated statements of operations. The Company recorded approximately $87,000 in additional stock-based compensation during the three months ended June 30, 2020, resulting from the acceleration of the vesting conditions of stock options upon the closing of the IPO.

A summary of stock option activity under the Lantern Pharma Inc. 2018 Equity Incentive Plan, as amended and restated (the “Plan”) during the six months ended June 30, ~~2020~~2021 is presented below:
Options Outstanding
Number of
Shares Weighted-Average
Exercise Price Per Share
Outstanding December 31, 2019 607,491 $ 1.03
Granted 306,743 15.00
Exercised (50,460 ) 1.03
Cancelled or expired (43,166 ) 1.03
Outstanding June 30, 2020 820,608 $ 6.25
Options Outstanding
Number of
Shares Weighted-
Average
Exercise Price Per Share
Outstanding December 31, 2020 835,608 $ 6.41
Granted - -
Exercised (11,782 ) 1.03
Cancelled or expired - -
Outstanding June 30, 2021 823,826 $ 6.49
Options were exercisable for ~~508,966~~643,404 shares of Common Stock at June 30, ~~2020.~~2021.
During the six months ended June 30, ~~2019,~~2020, options to purchase ~~1,342~~306,743 shares of ~~Common Stock~~common stock were granted, no options were exercised to purchase 50,460 shares of common stock, and no options relating to 43,166 shares of common stock expired or were canceled.
Note 7. Marketable Securities
At June 30, 2021, marketable securities consisted of the following:
Amortized Cost Unrealized Gains Unrealized Losses Aggregate Fair Value
Government & Agency Securities 2,514,869 - (7,954 ) 2,506,915
Corporate Bonds 9,741,378 - (42,453 ) 9,698,925
Mutual Funds – Fixed Income 4,002,704 6,942 (4,100 ) 4,005,546
Mutual Funds – Alternative Investments 2,023,154 - - 2,023,154
Marketable Securities $ 18,282,105 $ 6,942 $ (54,507 ) $ 18,234,540
The contractual maturities of the investments classified as Government & Agency Securities and Corporate Bonds are as follows:
As of
June 30,
2021
Due within one year $ 612,762
Due in one to two years 4,779,661
Due in three to five years 6,813,417
$ 12,205,840

The following table presents gross unrealized losses and fair values for those marketable securities that were in an unrealized loss position as of June 30, 2021, aggregated by investment category and the length of time that individual securities have been in a continuous loss position:
As of June 30, 2021
Less than 12 months
Fair Value Unrealized Loss
Government & Agency Securities $ 2,506,915 $ (7,954 )
Corporate Bonds 9,698,925 (42,453 )
Mutual Funds – Fixed Income 1,992,600 (4,100 )
$ 14,198,440 $ (54,507 )
We do not believe the unrealized losses represent credit losses based on our evaluation of available evidence as of June 30, 2021, which includes an assessment of whether it is more likely than not we will be required to sell the investment before recovery of the investment’s amortized cost basis.
Note ~~6. SAFE Agreements~~8. Fair Value Measurements
~~In December 2018,~~We determine the ~~Company entered into SAFE agreements (the “SAFE Financing”) with five investors pursuant~~fair values of our financial instruments based on the fair value hierarchy, which requires an entity to ~~which~~maximize the ~~Company~~use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Fair value is defined as the price that would be received ~~funding~~to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value assumes that the transaction to sell the asset or transfer the liability occurs in the principal or most advantageous market for the asset or liability and establishes that the fair value of ~~$535,000~~an asset or liability shall be determined based on the assumptions that market participants would use in ~~exchange for agreement to issue~~pricing the ~~investors shares of preferred stock upon occurrence~~asset or liability. The classification of a ~~subsequent financing~~financial asset or liability within the hierarchy is based upon the lowest level input that is significant to the fair value measurement. The fair value hierarchy prioritizes the inputs into three levels that may be used to measure fair value:
Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities.
Level 2 - Inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of ~~preferred stock.~~the financial instrument.
~~The number of shares to be received by the SAFE agreement investors was~~Level 3 - Inputs are unobservable inputs based on ~~80%~~our assumptions.
Financial Assets
When available, our marketable securities are valued using quoted prices for identical instruments in active markets. If we are unable to value our marketable securities using quoted prices for identical instruments in active markets, we value our investments using broker reports that utilize quoted market prices for comparable instruments. As of June 30, 2021 our available-for-sale debt securities were valued through use of quoted prices for comparable instruments in active markets and are classified as Level 2, and our mutual funds – alternative investments were valued using NAV, net asset value per share, under the ~~pricing~~practical expedient methodology.
Based on our valuation of our marketable securities, we concluded that they are classified in either Level 2 or NAV, and we have no financial assets measured using Level 1 or 3 inputs. The following table presents information about our assets that are measured at fair value on a recurring basis using the triggering equity financing. In a liquidity or dissolution event, the investors’ right to receive cash out was junior to payment of outstanding indebtedness and creditor claims, on par for other SAFEs and preferred stock, and senior to common stock. The SAFE agreements had no interest rate or maturity date, and the SAFE investors had no voting right prior to conversion.above input categories.
Fair Value Measurements as of June 30, 2021
Description Total Level 1 Level 2 Level 3 NAV*
Government & Agency Securities 2,506,915 - 2,506,915 - -
Corporate Bonds 9,698,925 - 9,698,925 - -
Mutual Funds – Fixed Income 4,005,546 - 4,005,546 - -
Mutual Funds – Alternative Investments 2,023,154 - - - 2,023,154
$ 18,234,540 $ - $ 16,211,386 $ - $ 2,023,154
* Certain marketable securities investments are measured at fair value using net asset value per share under the practical expedient methodology.

~~The SAFE agreements were converted to equity in March 2019 and the Company issued 213,510 shares of Series A Preferred Stock in full satisfaction of these agreements.~~
Note 7.9. Notes and Loan Payable
In January 2020, the Company entered into a financing arrangement for commercial insurance with First Insurance Funding. The total amount financed was approximately $66,000 with an annual interest rate of 6.64%, to be paid over a period of ten months. In June 2020, the insurance policy was canceled, and the remaining loan balance was ~~satisfied. As of June 30, 2020, there is no remaining loan balance on the Company’s condensed consolidated balance sheet related to the First Insurance financing arrangement.~~repaid.
On May 1, 2020 (the “Origination Date”), the Company received $108,500 in aggregate loan proceeds (the “PPP Loan”) from JPMorgan Chase Bank (the “Lender”) pursuant to the Paycheck Protection Program under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The PPP Loan iswas evidenced by a loan application and payment agreement (the “PPP Loan Agreement”) by and between the Company and the Lender. Subject to the terms of the PPP Loan Agreement, the PPP Loan ~~bears~~bore interest at a fixed rate of one percent (1.0%) per annum. Payments of principal and interest ~~are~~were deferred for the first six months following the Origination Date, and the PPP Loan ~~will~~provided that it would mature two years after the Origination Date. ~~Following~~The guidance under the ~~deferral period, unless the loan is forgiven, the Company will be required to make~~Paycheck Protection Program was later updated so that payments of principal ~~plus~~and interest ~~accrued under~~were extended past the current fiscal year and maturity was extended past two years. The Company applied for forgiveness of the loan, and in April 2021 the Company received notice that the Small Business Administration (SBA) had authorized full forgiveness of the PPP Loan. A gain on loan forgiveness attributed to the PPP Loan to the Lender in monthly installments based upon an amortization schedule to be determined by the Lender based on the principal balance of the PPP Loan outstanding following the deferral period and taking into consideration any portion of the PPP Loan that may be forgiven prior to that time. The PPP Loan is unsecured and guaranteed by the U.S. Small Business Administration.
During the three months ended June 30, 2020, the Company received approximately $103,000 in funding resulting from a loan that was funded incorrectly. The Company’s return of the funds was hindered due to the lending institution’s reduced staffing and delayed responsiveness as a result of the coronavirus (COVID-19) pandemic. All of the funds from the loan were returned by the Company in July 2020, and no loan funds were expended prior to the return.
~~Note 8. Related Party Transactions~~
~~The Company has from time to time obtained preclinical services from Biological Mimetics, Inc., which is also a stockholder in the Company. The Company recorded expenses~~ of approximately ~~$10,000~~$110,000 of principal and ~~$12,000 related to Biological Mimetics, Inc.~~interest forgiven was recognized during the three and six months ended June 30, ~~2019, all of which is~~2021 and included in research and development. No expenses related to Biological Mimetics, Inc. were recorded during the three and six months ended June 30, 2020. Approximately $2,000 was owed to Biological Mimetics, Inc. at December 31, 2019, all of which is included in accounts payable and accrued expensesOther income, net in the accompanying condensed consolidated ~~balance sheet. Nothing was owed to Biological Mimetics at June 30, 2020.~~
~~The Company has previously engaged Intuition Systems (“Intuition”) to provide services relating to development~~statements of the Company’s technology infrastructure and artificial intelligence platform, cloud computing, and computational biology. The chief executive officer of Intuition is the brother of Arun Asaithambi, the Company’s former Chief Executive Officer, President and Director. No expenses were recorded related to Intuition Systems during the three and six months ended June 30, 2020 or during the three and six months ended June 30, 2019. At both June 30, 2020 and December 31, 2019, approximately $9,000 remained unpaid relating to Intuition and is included in accounts payable and accrued expenses in the accompanying condensed consolidated balance sheet.
In January 2018, the Company entered into an Assignment Agreement (the “Assignment Agreement”) with BioNumerik Pharmaceuticals, Inc. (“BioNumerik”), pursuant to which the Company acquired rights to domestic and international patents, trademarks and related technology and data relating to LP-300 for human therapeutic treatment indications. Mr. Margrave, the Company’s Chief Financial Officer and Secretary, formerly served as the President, Chief Administrative Officer, General Counsel and Secretary of BioNumerik and has a minority ownership interest in BioNumerik. The Company recorded no expense related to BioNumerik during the three and six months ended June 30, 2020 and June 30, 2019. Amounts payable to BioNumerik as of both June 30, 2020 and December 31, 2019 totaled approximately $11,000.
operations.

Note 9.10. Loss Per Share of Common Shares
Basic loss per share is derived by dividing net loss applicable to common stockholders by the weighted average number of shares of common stock outstanding during each period. Diluted loss per share includes the effect, if any, from the potential exercise or conversion of securities, such as warrants and stock options, which would result in the issuance of incremental shares of common stock unless such effect is anti-dilutive. In calculating the basic and diluted net loss per share applicable to common stockholders, the weighted average number of shares remained the same for both calculations due to the fact that when a net loss exists, dilutive shares are not included in the calculation. Potentially dilutive securities outstanding that have been excluded from diluted loss per share due to being anti-dilutive include the following:
Outstanding at June 30,
2020 2019
Warrants to purchase Common Stock 332,014 -
Warrants to purchase Series A Preferred stock - 232,885
Stock options 820,608 630,402
Series A preferred stock - 2,097,105
1,152,622 2,960,392
Outstanding at June 30,
2021 2020
Warrants to purchase Common Stock 302,036 332,014
Stock options 823,826 820,608
1,125,862 1,152,622
Note ~~10.~~11. Subsequent Events
InOn July 2020, the Company returned approximately $103,000 in funding resulting from a loan that was funded incorrectly. All of the funds from the loan were returned by the Company and no loan funds were expended prior to the return.
~~In July 2020,~~23, 2021, the Company entered into an ~~agreement with Patheon API Services, Inc.~~Asset Purchase Agreement to reacquire global development and commercialization rights for Irofulven (LP-100) from Allarity Therapeutics A/S (“~~Patheon”~~Allarity”), formerly known as Oncology Venture. The transaction includes global rights to the clinical stage drug candidate Irofulven (LP-100), as well as the developed clinical protocol for an intended study in bladder and prostate cancer patients who have a mutation in the ~~manufacture~~ERCC2/3 genes. The Company also received an exclusive license to use Allarity’s companion diagnostic in future development and ~~supply~~commercialization of ~~cGMP material~~LP-100. As a result of this transaction, the Company will have full authority to ~~support~~manage and guide future clinical development and commercialization of LP-100.
Under the ~~Company’s planned Phase II clinical~~terms of the Asset Purchase Agreement, the Company paid an initial upfront amount of US $1.0 million to Allarity, and future escrow payments that have the potential to deliver an additional US $1.0 million to Allarity based on drug manufacturing and trial ~~for its product candidate LP-300. In addition~~enrollment milestones within the next 24 months. Allarity is also eligible to ~~producing LP-300 API (active pharmaceutical ingredient) under cGMP (current Good Manufacturing Practices) conditions, Patheon will transfer previously validated manufacturing processes~~receive up to US $16.0 million in additional milestone payments over the life of the program based on IP license milestones and ~~analytical methods for LP-300~~regulatory filings and ~~will produce non-GMP material that can be used~~approvals in the US and EU, and low- to support non-clinical studies for LP-300. The agreement provides for payments in stages as specified process and manufacturing milestones are achieved. Patheon, a part of Thermo Fisher Scientific, has previously developed and/or manufactured more than 700 pharmaceuticals for biopharma clients and has more than 55 locations around the world, providing access to a fully integrated global network of facilities.mid-single-digit royalties on future commercial net sales.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
You should read the following discussion and analysis of our financial condition and plan of operations together with our condensed consolidated financial statements and the related notes appearing elsewhere in this Quarterly Report. In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from ~~those discussed~~the plans, intentions, expectations and other forward-looking statements included in the discussion below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below, and those factors discussed in the Risk Factors section of ~~the final prospectus, dated June 10,~~our 2020 ~~for our initial public offering,~~Form 10-K on file with the ~~Securities and Exchange Commission.~~SEC.
Overview
We are a clinical stage biotechnology company, focused on leveraging artificial intelligence (“A.I.”), machine learning and genomic data to streamline the drug development process and to identify the patients that will benefit from our targeted oncology therapies. Our portfolio of therapies consists of small molecules that others have tried, but failed, to develop into an approved commercialized drug, as well as new compounds that we are developing with the assistance of our proprietary A.I. platform and our biomarker driven approach. Our A.I. platform, known as RADR^®, currently includes more than ~~450 million~~4.6 billion data points, and uses big data analytics (combining molecular data, drug efficacy data, data from historical studies, data from scientific literature, phenotypic data from trials and publications, and mechanistic pathway data) and machine learning to rapidly uncover biologically relevant genomic signatures correlated to drug response, and then identify the cancer patients that we believe may benefit most from our compounds. This data-driven, genomically-targeted and biomarker-driven approach allows us to pursue a transformational drug development strategy that identifies, rescues or develops, and advances potential small molecule drug candidates at what we believe is a fraction of the time and cost associated with traditional cancer drug development.
Our strategy is to both develop new drug candidates using our RADR^® platform, and other machine learning driven methodologies, and to pursue the development of drug candidates that have undergone previous clinical trial testing or that may have been halted in development or deprioritized because of insufficient clinical trial efficacy (i.e., a meaningful treatment benefit relevant for the disease or condition under study as measured against the comparator treatment used in the relevant clinical testing) or for strategic reasons by the owner or development team responsible for the compound. Importantly, these historical drug candidates appear to have been well-tolerated in many instances, and often have considerable data from previous toxicity, tolerability and ADME (absorption, distribution, metabolism, and excretion) studies that have been completed. Additionally, these drug candidates may also have a body of existing data supporting the potential mechanism(s) by which they achieve their intended biologic effect, but often require more targeted trials in a stratified group of patients to demonstrate statistically meaningful results. Our dual approach to both develop de-novo, biomarker-guided drug candidates and “rescue” historical drug-candidates by leveraging A.I., recent advances in genomics, computational biology and cloud computing is emblematic of a new era in drug development that is being driven by data-intensive approaches meant to de-risk development and accelerate the clinical trial process. In this context, we intend to create a diverse portfolio of oncology drug candidates for further development towards regulatory and marketing approval with the objective of establishing a leading A.I.-driven, methodology for treating the right patient with the right oncology therapy.

A key component of our strategy is to target specific cancer patient populations and treatment indications identified by leveraging our RADR^®platform, a proprietary A.I. enabled engine created and owned by us. We believe the combination of our therapeutic area expertise, our A.I. expertise, and our ability to identify and develop promising drug candidates through our collaborative relationships with research institutions in selected areas of oncology gives us a significant competitive advantage. Our RADR^® platform was developed and refined over the last four years and integrates ~~millions~~billions of data points immediately relevant for oncology drug development and patient response prediction using artificial intelligence and proprietary machine learning algorithms. By identifying clinical candidates, together with relevant genomic and phenotypic data, we believe our approach will help us design more efficient pre-clinical studies, and more targeted clinical trials, thereby accelerating our drug candidates’ time to approval and eventually to market. Although we have not yet applied for or received regulatory or marketing approval for any of our drug candidates, we believe our RADR^® platform has the ability to reduce the cost and time to bring drug candidates to specifically targeted patient groups. We believe we have developed a sustainable and scalable biopharma business model by combining a unique, oncology-focused big-data platform that leverages artificial intelligence along with active clinical and preclinical programs that are being advanced in targeted cancer therapeutic areas to address today’s treatment needs.

Our current portfolio consists of ~~three active~~four compounds ~~in development:~~and an Antibody Drug Conjugate (ADC) program: two drug candidates in clinical phases, ~~and,~~ one in preclinical ~~studies.~~studies and one candidate and our recently initiated ADC program in research optimization. One of the two drug candidates in clinical development, LP-100, was previously out-licensed by us to Allarity Therapeutics A/S. In July 2021, we entered into an Asset Purchase Agreement to reacquire global development and commercialization rights for LP-100 from Allarity. All of these drug candidates and our ADC program are leveraging precision oncology, A.I. and genomic driven approaches to accelerate and direct development efforts. We currently have two drug candidates in clinical development, LP-100 and LP-300, where we are leveraging data from prior preclinical studies and clinical trials, along with insights generated from our A.I. platform, to target the types of tumors and patient groups that would be most responsive to the drug. Both LP-100 and LP-300 showed promise in ~~prior clinical testing,~~important patient subgroups, but failed pivotal Phase III trials ~~where~~when the overall results did not meet the ~~required~~predefined clinical ~~endpoints~~endpoints. We believe that this was due to ~~what we believe was~~ a lack of biomarker-driven patient ~~stratification driven~~stratification. LP-300 has been studied in multiple randomized, controlled, multi-center non-small cell lung cancer, or NSCLC, trials that included administration of either paclitaxel and cisplatin and/or docetaxel and cisplatin, and we are currently preparing LP-300 for the launch of a targeted phase II trial, in non or never smoking patients with NSCLC in combination with chemotherapy, under an existing investigational new drug application. LP-100 is in a Phase II clinical trial in metastatic, castration-resistant, prostate cancer that was previously managed by ~~an inability~~Allarity Therapeutics. As a result of the Asset Purchase Agreement we entered into with Allarity in July 2021, we will have full authority to ~~develop biomarker-driven, precision oncology trials.~~ manage and guide future clinical development and commercialization of LP-100.
Additionally, we have one new drug candidate, LP-184, in preclinical development for ~~two~~multiple potentially distinct indications where we are leveraging machine learning and genomic data to streamline the drug development process and to identify the patients and cancer subtypes that will best benefit from the drug, if approved. Our drug candidate, LP-284, the stereoisomer (enantiomer) of LP-184, has shown promising in-vitro anticancer activity in a range of indications that are distinct from LP-184. Our antibody drug conjugate (ADC) program commenced in early 2021 is aimed at identifying targeted or therapeutic antibodies, utilizing a unique library of linkers to conjugate with LP-184 and other compounds.
Our development strategy is to pursue an increasing number of oncology focused, molecularly targeted therapies where artificial intelligence and genomic data can help us provide biological insights, reduce the risk associated with development efforts and help clarify potential patient response. We plan on strategically evaluating these on a program-by-program basis as they advance into clinical development, either to be done entirely by us, or with ~~out-licensing~~licensing partners, to maximize the commercial opportunity and reduce the time it takes to bring the right drug to the right ~~patient~~patient.

To date, except for a prior research grant, we have not generated any revenue, we have incurred net losses and our operations have been financed primarily by sales of our equity securities. Our net losses were ~~$833,422~~approximately $2,317,000 and ~~$629,393~~$4,769,000 for the three and six months ended June 30, ~~2020~~2021 and ~~June 30, 2019, respectively. Our net losses~~$833,000 and $1,311,000 for the three and six months ended June 30, 2020, ~~and June 30, 2019 were $1,310,698 and $1,083,366,~~ respectively.
Our net losses have primarily resulted from costs incurred in licensing and developing the drug candidates in our pipeline, planning, preparing and conducting preclinical studies, early stage clinical testing and general and administrative activities associated with our operations. We expect to continue to incur significant expenses and corresponding increased operating losses for the foreseeable future as we continue to develop our pipeline. Our costs may further increase as we conduct preclinical studies and clinical trials and potentially seek regulatory clearance for and prepare to commercialize our drug candidates. We expect to incur significant expenses to continue to build the infrastructure necessary to support our expanded operations, preclinical studies, clinical trials, commercialization, including manufacturing, marketing, sales and distribution functions. We have experienced and will ~~also~~continue to experience increased costs associated with operating as a public company.
Our operations, including the development of our drug candidates, could be disrupted and materially adversely affected in the future by a pandemic, epidemic or outbreak of an infectious disease like the recent outbreak of COVID-19. For example, as a result of measures imposed by the governments in regions affected by COVID-19 businesses and schools have been suspended due to quarantines or “stay at home” orders intended to contain this outbreak. The spread of COVID-19 from China to other countries has resulted in the Director GeneralAs of the ~~World Health Organization declaring the outbreak~~date of COVID-19 as a Public Health Emergency of International Concern (PHEIC), based on the advice of the Emergency Committee under the International Health Regulations (2005), and on March 12, 2020, the President of the United States imposed international travel restrictions between the U.S. and Europe to supplement the existing international travel restrictions between the US and certain Asian countries and on March 13, 2020, declared a national emergency in response to the likely spread of COVID-19. COVID-19 continues to spread globally and, as of June 30 2020, has spread to over 150 countries, including the United States. U.S. and international stock markets continue to experience fluctuations and to be impacted from time to time by uncertainty associated withthis report, we believe we have effectively managed the impact of ~~COVID-19 on~~ the U.S., Chinese, European and other economies and the reduced levels of international travel experienced since early 2020. The Dow Industrial Average and other domestic and international stock indices have experienced substantial fluctuations during the first half of 2020 largely attributed to assessments and expectations regarding the adverse effects of theCOVID-19 pandemic on ~~the world’s economies. We are continuing to assess~~ our business plans and the impact COVID-19 may have on our operations and plans, including the ability to advance the development of our drug candidates, but no assurances can be given that this analysis will enable us to avoid part or all of any impact from the spread of COVID-19 or its consequences, including downturns in business sentiment generally or in our sector in particular. The extent to which COVID-19 impacts our operations and plans will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration of the outbreak, new information which may emerge concerning the severity and treatment of COVID-19, and preventative or protective actions that governments, businesses, and organizations performing research and clinical trials may take in respect of COVID-19, among others. The existence and spread of an infectious disease, including COVID-19, may also result in the inability of our suppliers to deliver components or raw materials on a timely basis or materially and adversely affect our collaborators and out-license partner’s ability to perform and advance preclinical and nonclinical studies and clinical trials. For example, Oncology Venture has informed us that continuing enrollment in the Phase II clinical trial for LP-100 (Irofulven) has slowed during the pandemic.operations. The timing of non-clinical research studies for our drug candidates by collaborators and service providers ~~also~~ slowed during ~~the second quarter of~~ 2020 in connection with the pandemic.
In addition, Allarity Therapeutics informed us that enrollment in the Phase II clinical trial for LP-100 slowed during the pandemic. While we believe we have been able to manage the disruption caused by the COVID-19 pandemic to date, there can be no assurance that our operations, including the development of our drug candidates, will not be disrupted and materially adversely affected in the future by the COVID-19 pandemic, or an epidemic or outbreak of an infectious disease like the outbreak of COVID-19.

Components of Our Results of Operations
Revenues
We did not recognize revenues for any of the three or six month periods ended June 30, ~~2020~~2021 and ~~2019.~~June 30, 2020.
General and Administrative
General and administrative expenses consist of our operating expenses that are not included in the direct costs of production or cost of goods sold which include:
● corporate office overhead expenses such as salaries of administrative staff and corporate officers;
● legal expenses;
● ~~legal~~accounting expenses; and
●
● ~~accounting expenses; and~~
● ~~insurance,~~ rent, utilities, insurance, information systems, and supplies.
Research and Development
Research and development expenses consist primarily of costs incurred for the research and development of our preclinical and clinical candidates, which include:
● expenses incurred ~~towards~~for employees, consultants, research studies, laboratories and investigators ~~that~~for the conduct of our preclinical or clinical research activities; and
●
● the cost of acquiring and developing preclinical study materials and lab supplies.
We expense research and development costs to operations as incurred.

Our research and development costs by project category for the three and six months ended June 30, ~~2020~~2021 are as follows:
Three Months Ended June 30,
2020
LP-300 $ 21,417
LP-184 60,205
RADR^®Platform 45,499
Other 29,902
Total research and development expenses $ 157,023
Three Months
Ended
June 30,
2021 Six Months Ended
June 30,
2021
LP-300 $ 275,620 $ 810,205
LP-184 591,851 1,055,801
RADR^®Platform 152,159 293,737
Other 145,262 284,186
Total research and development expenses $ 1,164,892 $ 2,443,929
~~As a private company, we~~We did not track our research and development costs by project ~~category primarily because research~~prior to our initial public offering (“IPO”) in June 2020. We have tracked and ~~development salary expenses were not further~~ allocated ~~to each project. As a result,~~ our ~~tracking of~~ research and development costs by project category ~~commenced during~~since the second quarter of calendar 2020.
The category designated as “Other” in the above table includes expenses for the three and six months ended June 30, ~~2020~~2021 associated with our ADC program, which commenced in ~~connection with the Company’s IPO.~~early 2021, and expenses related to our compound known as LP-284.
We expect that our research and development expenses will continue to increase as we ~~plan for and commence~~progress toward our commencement of clinical trials of LP-300 and LP-184, advance clinical development of LP-100, and ~~LP-300.~~advance our other programs and drug candidates. We expect this increase to include additional expenses associated with research and service provider agreements for the advancement of our drug candidates and research and development efforts.

Because of the numerous risks and uncertainties associated with product development, we cannot determine with certainty the duration and completion costs of these or other current or future clinical trials of LP-300, LP-184, ~~and LP-300~~LP-100 or our other ~~therapeutic~~drug candidates. We may never succeed in achieving regulatory approval for LP-300, LP-184, ~~and LP-300~~LP-100 or any of our other drug candidates. The duration, costs and timing of clinical trials and development of our ~~therapeutic~~drug candidates will depend on a variety of factors, including the uncertainties of future clinical and preclinical studies, uncertainties in clinical trial enrollment rate and significant and changing government regulation. In addition, the probability of success for each drug candidate will depend on numerous factors, including competition, manufacturing capability and commercial viability.
General and Administrative
General and administrative expenses consist primarily of salaries and related costs for employees in executive, finance and administration, corporate development and administrative support functions, including stock-based compensation expenses and benefits. Other significant general and administrative expenses include accounting and legal services, ~~insurance,~~ the cost of various consultants, occupancy costs and information systems costs.
We expect that our general and administrative expenses will increase ~~now that~~as we ~~are operating~~continue to operate as a public company. We expect increased administrative costs resulting from our anticipated clinical trials and the potential commercialization of our drug candidates. We believe that these increases ~~in our general and administrative expenses~~ will likely include increased costs for director and officer liability insurance, hiring additional personnel to support future market research and future product commercialization efforts and increased fees for outside consultants, attorneys and accountants. We also expect to continue to incur increased costs to comply with corporate governance, internal controls, investor relations and disclosures and similar requirements applicable to a public company.

Summary Results of Operations for the Three ~~Months~~ and Six Months Ended June 30, 2021 and June 30, 2020 ~~and 2019~~ (unaudited)
Three Months Ended
June 30, Six Months Ended
June 30,
2020 2019 2020 2019

Operating expenses
General and administrative $ 676,399 $ 268,120 $ 1,016,571 $ 536,049
Research and development 157,023 361,273 294,127 547,317
Total expenses 833,422 629,393 1,310,698 1,083,366
Net loss $ (833,422 ) $ (629,393 ) $ (1,310,698 ) $ (1,083,366 )
Three Months Ended Six Months Ended
June 30, June 30,
2021 2020 2021 2020
Operating expenses:
General and administrative $ 1,314,201 $ 676,399 $ 2,487,459 $ 1,016,571
Research and development 1,164,892 157,023 2,443,929 294,127
Total operating expenses 2,479,093 833,422 4,931,388 1,310,698
Loss from operations (2,479,093 ) (833,422 ) (4,931,388 ) (1,310,698 )
Interest income 47,889 - 47,889 -
Other income, net 114,723 - 114,723 -
NET LOSS $ (2,316,481 ) $ (833,422 ) $ (4,768,776 ) $ (1,310,698 )
Comparison of the Three Months Ended June 30, ~~2020~~2021 and ~~2019~~June 30, 2020
Revenues
To date, except for a prior research grant, we have not generated any revenue since our inception.

General and Administrative Expenses
General and administrative expenses increased ~~$408,279~~approximately $638,000, or ~~152%~~94%, from ~~$268,120~~approximately $676,000 for the three months ended June 30, ~~2019~~2020 to ~~$676,399~~approximately $1,314,000 for the three months ended June 30, ~~2020.~~2021. The increase was primarily attributable to increases ~~in:~~in labor expense of approximately ~~$86,000,~~$25,000, increases in ~~Nasdaq~~business and ~~other filing~~corporate development expense of approximately $158,000, increases in legal and patent related fees of approximately ~~$44,000, professional fees~~$114,000, increases in general and administrative related stock option expense of approximately ~~$79,000,~~$25,000, corporate insurance expense increases of approximately ~~$139,000,~~$296,000, and ~~stock option compensation expense increases~~a net increase in other expenses of approximately ~~$99,000. This was partially offset by a decrease in travel and relocation of approximately $48,000.~~$20,000.
Research and Development Expenses
Research and development expenses ~~decreased $204,250,~~increased approximately $1,008,000, or ~~57%~~642%, from ~~$361,273~~approximately $157,000 for the three months ended June 30, ~~2019~~2020 to ~~$157,023~~approximately $1,165,000 for the three months ended June 30, ~~2020.~~2021. The ~~decrease~~increase was primarily attributable to ~~reductions~~increases in product candidate manufacturing related expenses of approximately $151,000 reflecting completion of process development and scale-up studies conducted in the prior year period, reductions in preclinical and clinical research studies expenses of approximately $72,000, and a reduction$320,000, increases in research and development employee associated expenses of approximately ~~$20,000,~~$279,000, increases in research study expenses of approximately $280,000, increases in licensing fees of approximately $39,000, and increases in research and development related stock option expense of approximately $116,000. This was partially offset ~~in part~~ by ~~an increase~~a decrease in ~~non-manufacturing related~~ consulting expenses of approximately ~~$35,000. Expenses for annual licensing fees~~$26,000.
Interest and ~~development milestone extension payments did not change substantially~~Other Income
Interest income increased approximately $48,000 from zero for the three months ended June 30, 2020 ~~as compared~~ to approximately $48,000 for the three months ended June 30, ~~2019.~~2021. This increase was attributable to investment in marketable securities entered into during the three months ended June 30, 2021. Other income, net increased approximately $115,000 from zero for the three months ended June 30, 2020 to approximately $115,000 for the three months ended June 30, 2021. This increase was primarily attributable to a gain on loan forgiveness attributable to the PPP Loan of approximately $110,000 and dividend income of approximately $5,000.
Comparison of the Six Months Ended June 30, ~~2020~~2021 and ~~2019~~June 30, 2020
Revenues
To date, except for a prior research grant, we have not generated any revenue since our inception.

General and Administrative Expenses
General and administrative expenses increased ~~$480,522~~approximately $1,471,000, or ~~90%~~145%, from ~~$536,049~~approximately $1,017,000 for the six months ended June 30, ~~2019~~2020 to ~~$1,016,571~~approximately $2,488,000 for the six months ended June 30, ~~2020.~~2021. The increase was primarily attributable to increases in labor expense of approximately ~~$153,000,~~$77,000, increases in ~~Nasdaq~~business and ~~other filing~~corporate development expense of approximately $271,000, increases in legal and patent related fees of approximately ~~$51,000,~~$205,000, increases in other professional fees ~~increase~~ of approximately ~~$42,000,~~$30,000, increases in general and administrative related stock option expense of $136,000, corporate insurance expense increases of approximately ~~$164,000,~~$737,000, and ~~stock option compensation expense increases~~a net increase in other expenses of approximately ~~$102,000. This was partially offset by a decrease in travel and relocation of approximately $58,000.~~$15,000.
Research and Development Expenses
Research and development expenses ~~decreased $253,190,~~increased approximately $2,150,000, or ~~46%~~731%, from ~~$547,317~~approximately $294,000 for the six months ended June 30, ~~2019~~2020 to ~~$294,127~~approximately $2,444,000 for the six months ended June 30, ~~2020.~~2021. The ~~decrease~~increase was primarily attributable to ~~reductions~~increases in product candidate manufacturing related expenses of approximately $210,000 reflecting completion of process development and scale-up studies conducted in the prior year period, reductions in preclinical and clinical research studies expenses of approximately $64,000, and a reduction$872,000, increases in research and development employee associated expenses of approximately ~~$47,000, offset in part by~~$568,000, increases in ~~non-manufacturing~~research study expenses of approximately $460,000, increases in licensing fees of approximately $74,000, and increases in research and development related stock option expense of approximately $231,000. This was partially offset by a decrease in consulting expenses of approximately ~~$61,000. Expenses for annual licensing fees~~$55,000.
Interest and ~~development milestone extension payments did not change substantially~~Other Income
Interest income, net increased approximately $48,000 from zero for the six months ended June 30, 2020 ~~as compared~~ to approximately $48,000 for the ~~three~~six months ended June 30, ~~2019.~~
~~On September 3, 2018 Lantern Pharma Limited, our wholly owned subsidiary,~~2021. This increase was ~~awarded a grant by~~attributable to investment in marketable securities entered into during the UK government in the form of state aid under the Commission Regulations (EU) No. 651/2014 of 17 June 2014 (the “General Block Exemption”), Article 25 Aid for research and development projects, state aid notification no. SA.40154. The grant was awarded to conduct research and development activities for the prostate cancer biomarker analysis of our LP-184 drug candidate. Following our research and development activities in Northern Ireland, the grant will reimburse 50% of our research and development expenses not exceeding GBP 24,215 of vouched and approved expenditures within specific categories and will remain in force for a period of five years. No revenue has been recognized from this grant throughsix months ended June 30, ~~2020.~~

~~Liquidity and Capital Resources~~
~~We incurred~~2021. Other income, net ~~losses of $1,310,698 and $1,083,366~~increased approximately $115,000 from zero for the six months ended June 30, 2020 ~~and~~to approximately $115,000 for the six months ended June 30, ~~2019,~~2021. This increase was primarily attributable to a gain on loan forgiveness attributable to the PPP Loan of approximately $110,000 and dividend income of approximately $5,000.
Liquidity and Capital Resources
We incurred net losses of approximately $2,317,000 and $4,769,000 for the three and six months ended June 30, 2021 and net losses of approximately $833,000 and $1,311,000 for the three and six months ended June 30, 2020, respectively. As of June 30, 2021, we had working capital of approximately $79,443,000 and as of December 31, 2020 we had working capital of approximately ~~$23,321,000 and as~~$19,685,000.
On January 20, 2021, we closed a public offering of ~~December 31, 2019 we had working capital of approximately $744,000.~~
On June 10, 2020, our registration statement on Form S-1 relating to our IPO was declared effective by the Securities and Exchange Commission (“SEC”). The IPO closed on June 15, 2020, and we issued and sold 1,750,0004,928,571 shares of common stock at a public offering price of ~~$15.00~~$14.00 per ~~share. Gross~~share, which amount included 642,856 shares sold upon full exercise of the underwriter’s over-allotment option. Total gross proceeds ~~totaled $26,250,000~~from the offering were approximately $69,000,000, and net proceeds ~~totaled $23,419,721 after deducting underwriting discounts and commissions of $1,968,750 and other offering expenses of $861,529.~~
On May 1, 2020 (the “Origination Date”), we received $108,500 in aggregate loan proceeds (the “PPP Loan”) from JPMorgan Chase Bank (the “Lender”) pursuant to the Paycheck Protection Program under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. As of June 30, 2020, we expect to meet the requirements of loan forgiveness under the stipulations of the program. In the event we do not meet the requirements of loan forgiveness, the PPP Loan bears interest at a fixed rate of 1.0% per annum. Payments of principal and interest are deferred for the first six months following the Origination Date, and the PPP Loan will mature two years after the Origination Date. Following the deferral period, we will be required to make payments of principal plus interest accrued under the PPP Loan to the Lender in monthly installments based upon an amortization schedule to be determined by the Lender based on the principal balance of the PPP Loan outstanding following the deferral period and taking into consideration any portion of the PPP Loan that may be forgiven prior to that time.
During the three months ended June 30, 2020, we received approximately $103,000 in funding resulting from a loan that was funded incorrectly. Our return of the funds was hindered due to the lending institution’s reduced staffing and delayed responsiveness as a result of the coronavirus (COVID-19) pandemic. All of the funds from the ~~loan~~offering were ~~returned by us in July 2020 and no loan funds were expended prior to the return.~~approximately $64,167,000.
We have not yet generated any revenues from operations, other than revenues from a research grant, and we have not yet achieved profitability. We expect that general and administrative expenses and our research and development expenses will continue to increase and, as a result, we will need to generate significant product revenues to achieve profitability. We may never achieve profitability.
Sources of Liquidity
Since our inception, our operations have been financed primarily through the sale of equity securities, and, to a much lesser extent, funds received by us from the PPP Loan and a 2017 grant from the Massachusetts Life Sciences Center. We plan to apply for grant funding in the future to assist in supporting our capital needs. We may also explore the possibility of entering into commercial credit facilities as an additional source of liquidity.
As of June 30, ~~2020~~2021 and December 31, ~~2019,~~2020, we had cash and cash equivalents of approximately ~~$23,798,000~~$61,354,000 and ~~$1,232,000,~~$19,229,000, respectively. WeBased on our anticipated expenditures and capital commitments as of the date of this report, we believe that our existing cash and cash equivalents as of June 30, ~~2020, and our anticipated expenditures and capital commitments for the calendar year 2020 and the first half or the calendar year~~ 2021 will enable us to fund our operating expenses and capital expenditure requirements for at least 12 months from the date of this Quarterly Report.

Cash Flows
The following table summarizes our cash flow for the periods indicated:

For the Six Months Ended
June 30,
2020 2019
(Unaudited)
Net cash flows used in operating activities $ (1,193,918 ) $ (869,122 )
Net cash flows used in investing activities (7,821 ) —
Net cash flows provided by financing activities 23,768,052 1,850,003
Net increase in cash and cash equivalents $ 22,566,313 $ 980,881

For the Six Months ended
June 30,

2021 2020
(Unaudited)
Net cash flows used in operating activities $ (3,869,927 ) $ (1,193,918 )
Net cash flows used in investing activities (18,294,119 ) (7,821 )
Net cash flows provided by financing activities 64,288,931 23,768,052
Net increase in cash and cash equivalents $ 42,124,885 $ 22,566,313
Operating Activities
For the six months ended June 30, ~~2020,~~2021, net cash used in operating activities was ~~$1,193,918~~$3,869,927 compared to ~~$869,122~~$1,193,918 for the six months ended June 30, ~~2019.~~2020. The increase in net cash used in operating activities was primarily the result of the increase in the net loss ~~together with increases in prepaid expenses.~~for the six months ended June 30, 2021.
Investing Activities
For the six months ended June 30, ~~2020,~~2021, net cash used in investing activities was ~~$7,821. No~~$18,294,119 compared to $7,821 for the six months ended June 30, 2020. The increase in net cash ~~was~~ used in ~~or provided by~~ investing activities was primarily due to investments in marketable securities during the six months ended June 30, ~~2019.~~2021.
Financing Activities
Net cash provided by financing activities was ~~$23,768,052~~$64,288,931 during the six months ended June 30, ~~2020,~~2021, attributable primarily to net proceeds from our ~~initial public offering.~~equity financing in January 2021. Net cash provided by financing activities during the six months ended June 30, ~~2019~~2020 was ~~$1,850,003.~~$23,768,052, attributable primarily to net proceeds from our initial public offering.
Operating Capital and Capital Expenditure Requirements
We expect to continue to incur significant and increasing operating losses at least for the next several years as we commence our clinical trials of LP-184 and LP-300, advance clinical development of LP-100, pursue development of our other drug candidates, and seek potential future marketing approval for our drug candidates which could be several years in the future, if at all. We do not expect to generate revenue, other than possible license revenue, unless and until we successfully complete development and obtain regulatory approval for our therapeutic candidates. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our planned clinical trials and our expenditures on other research and development activities.
We have based our projections of operating capital requirements on assumptions that may prove to be incorrect and we may use all of our available capital resources sooner than we expect. Because of the numerous risks and uncertainties associated with research, development and commercialization of pharmaceutical products, we are unable to estimate the exact amount of our operating capital requirements. We anticipate that our expenses will increase substantially as we:
● continue the development of our drug candidates;
●
● initiate preclinical studies and clinical trials for any additional indications for our current drug candidates and any future drug candidates that we may pursue;

●
● continue to build our portfolio of drug candidates through the acquisition or in-license of additional drug candidates or technologies;
●
● continue to develop, maintain, expand and protect our intellectual property portfolio;
●
● ~~continue to develop, maintain, and expand our RADR~~^® ~~platform;~~
● pursue regulatory approvals for those of our current and future drug candidates that successfully complete clinical trials;
●
● ultimately establish a sales, marketing, distribution and other commercial infrastructure to commercialize any drug candidate for which we may obtain marketing approval;

● hire additional clinical, regulatory, scientific and accounting personnel; ~~and~~
●
● incur additional legal, accounting and other expenses in operating as a public ~~company.~~company; and
● continue to develop, maintain, and expand our RADR^® platform.
We expect that we will need to obtain substantial additional funding in order to complete our clinical trials. To the extent that we raise additional capital through the sale of common stock, convertible securities or other equity securities, the ownership interests of our existing stockholders may be materially diluted and the terms of these securities could include liquidation or other preferences that could adversely affect the rights of our existing stockholders. In addition, debt financing, if available, would result in increased fixed payment obligations and may involve agreements that include restrictive covenants that limit our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends, that could adversely impact our ability to conduct our business. If we are unable to raise capital when needed or on attractive terms, we could be forced to significantly delay, scale back or discontinue the development or commercialization of LP-184, ~~and~~ LP-300, LP-100 and/or other drug candidates and programs, seek collaborators at an earlier stage than otherwise would be desirable or on terms that are less favorable than might otherwise be available, and relinquish or license, potentially on unfavorable terms, our rights to LP-184, ~~and~~ LP-300, LP-100 and/or other drug candidates and programs that we otherwise would seek to develop or commercialize ourselves.
~~Contractual Obligations~~
Off-Balance Sheet Arrangements
We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements as defined under SEC rules.
Critical Accounting Policies and Estimates
~~We prepare our consolidated financial statements in accordance with generally accepted accounting standards in the United States of America. Our significant accounting policies are described in Note 3~~There have been no changes to our ~~condensed consolidated financial statements appearing elsewhere in this Quarterly Report. We believe the following~~ critical accounting policies ~~involve the most significant judgments and estimates used in the preparation of the condensed consolidated financial statements.~~
~~Use of Estimates~~
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant areas of estimation include determining the deferred tax asset valuation allowance and the inputs in determining the fair value of equity-based awards and warrants issued. Actual results could differ from these estimates.
~~Research and Development~~
Research and development expenses are expensed as incurred. Costs to acquire technologies, including licenses, that are utilized in research and development and that have no alternative future use are expensed when incurred.
~~Stock-based Compensation~~
We have granted stock options to our employees under the Lantern Pharma Inc. 2018 Equity Incentive Plan, as amended (the “Plan”). Stock-based compensation expense from awards granted under the Plan is allocated over the required service period over which those stock option awards vest.
The stock option awards are valued at fair value on the date of grant and that fair value is recognized over the requisite service period. The estimated fair value of stock option awards was determined using the Black Scholes option pricing model on the date of grant. Significant judgment and estimates were used to estimate the fair value of these awards, as they occurred when our stock was not publicly traded.

Our estimation of fair value of the awards made prior to the time we became a public company considered our recent transactions, relevant industry and comparable public company data. Since, at the time of the grants, we were a non-public entity, the majority of the inputs used to estimate the fair value of the common stock option awards are considered level 3 due to their unobservable nature. Each option award is subject to specified vesting schedules and requirements. Compensation expense is charged to us over the required service period to earn the award which is expected to be up to four years, subject to the achievement of time and event-based vesting requirements. For the three months ended June 30, ~~2020~~2021. Critical accounting policies and ~~June 30, 2019, we incurred share-based compensation expense related to equity awards totaling $105,363 and $6,029, respectively. For~~ the six months ended June 30, 2020 and June 30, 2019, we incurred share-based compensation expense related to equity awards totaling $123,823 and $21,560, respectively. We have recorded these charges as general and administrative expensesignificant accounting estimates made in accordance with such policies are regularly discussed with the Audit Committee of the Company’s board of directors. Those policies are discussed under “Critical Accounting Policies” in our ~~statement~~“Management’s Discussion and Analysis of ~~operations.~~Financial Condition and Results of Operations” included in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2020, as well as in our consolidated financial statements and the footnotes thereto, included in the Annual Report on Form 10-K.
Accounting Pronouncements
The Company considered the applicability and impact of recent accounting pronouncements and determined them to be either not applicable or expected to have minimal impact on our condensed consolidated balance sheets or statements of operations.
Recent Accounting Pronouncements
See Note 3 of the Notes to the Condensed Consolidated Financial Statements.
Quantitative and Qualitative Disclosure About Market Risk
Our primary exposure to market risk is interest expense sensitivity, which is affected by changes in the general level of U.S. interest rates. Fixed rate securities may have their market value adversely affected due to a rise in interest rates. Accordingly, our future investment income may fluctuate as a result of changes in interest rates, or we may suffer losses in principal if we are forced to sell securities that decline in market value as a result of changes in interest rates.
Historically, we have raised capital through the issuance of equity securities. We had no long-term debt outstanding as of June 30, 2021, and as of December 31, 2020 we had no long-term debt outstanding, other than our PPP Loan Agreement entered into in May 2020. In April 2021 we received notice that the Small Business Administration (SBA) had authorized full forgiveness of the PPP Loan.

We do not believe that our cash ~~has~~and cash equivalents have significant risk of default or illiquidity. Our cash and cash equivalents consist primarily of cash and money market funds. Our exposure to market risk for changes in interest rates is limited because our cash and cash equivalents have a short-term maturity and are used primarily for working capital purposes. While we believe our cash, ~~does~~cash equivalents and marketable securities do not contain excessive risk, we cannot provide absolute assurance that in the future our investments will not be subject to adverse changes in market value. In addition, we maintain significant amounts of cash at one or more financial institutions that are in excess of federally insured limits.
We do not participate in any foreign currency hedging activities and we do not have any other derivative financial instruments. ~~We did not recognize any significant exchange rate losses during the six months ended June 30, 2020 and 2019, respectively.~~
Inflation generally affects us by increasing our cost of labor and clinical trial costs. We do not believe that inflation has had a material effect on our results of operations during the periods presented.

~~JOBS Act~~
On April 5, 2012, the Jumpstart Our Business Startups Act of 2012, or the JOBS Act, was enacted. Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended, or the Securities Act, for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.
We are in the process of evaluating the benefits of relying on other exemptions and reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, as an “emerging growth company,” we intend to rely on certain of these exemptions, including without limitation, (i) providing an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act and (ii) complying with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements, known as the auditor discussion and analysis. We will remain an “emerging growth company” until the earliest of (i) the last day of the fiscal year in which we have total annual gross revenues of $1.07 billion or more; (ii) the last day of our fiscal year following the fifth anniversary of the date of the completion of this offering; (iii) the date on which we have issued more than $1 billion in nonconvertible debt during the previous three years; or (iv) the date on which we are deemed to be a large accelerated filer under the rules of the SEC.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.
~~Our balance sheet as~~As a Smaller Reporting Company we are exempt from the requirements of June 30, 2020 includes cash and cash equivalents of approximately $23,798,000. Our primary exposure to market risk is interest expense sensitivity, which is affected by changes in the general level of U.S. interest rates. Historically, we have raised capital through the issuance of equity securities.Item 3.
We do not believe that our cash has significant risk of default or illiquidity. While we believe our cash does not contain excessive risk, we cannot provide absolute assurance that in the future our investments will not be subject to adverse changes in market value. In addition, we maintain significant amounts of cash at one or more financial institutions that are in excess of federally insured limits.
~~We do not participate in any foreign currency hedging activities and we do not have any other derivative financial instruments.~~
Inflation generally affects us by increasing our cost of labor and clinical trial costs. We do not believe that inflation has had a material effect on our results of operations during the periods presented.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer (our principal executive officer and principal financial officer, respectively), evaluated the effectiveness of our disclosure controls and procedures as of June 30, ~~2020.~~2021. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
The closing of our initial public offering occurred on June 15, 2020. Consequently, as a newly reporting company under the Exchange Act, we are not required to evaluate the effectiveness of our internal controls over financial reporting until the end of the fiscal year after we file our first annual report on Form 10-K, which will occur on December 31, 2021. However, in connection with the audit of our financial statements for the years ended December 31, 2019 and 2018, prior to our initial public offering, we observed material weaknesses in our internal controls over financial reporting during those periods because we did not have a formal process for period end financial closing and reporting, and also because we historically had insufficient resources to conduct an effective monitoring and oversight function independent from our operations. We believe we are addressing these weaknesses through measures including implementation of additional internal control processes and procedures regarding the financial close and reporting process, the recruitment of a full time Chief Financial Officer, and the allocation of additional personnel and resources to support our finance function, including, but not limited to, enhanced scrutiny of accounting entries in the areas where we have observed material weaknesses in our internal controls over financial reporting. Our management intends to monitor these weaknesses and evaluate whether the remedial actions taken by the Company have remediated these weaknesses when it completes its first evaluation of the Company’s internal controls over financial reporting for the fiscal year ended December 31, 2021.
Based on the evaluation of our disclosure controls and procedures as of June 30, ~~2020,~~2021, our Chief Executive Officer and Chief Financial Officer have concluded that, as of such date, our disclosure controls and procedures, as defined above, are effective.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during the three-month period ended June 30, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION
~~Item 1. Legal Proceedings.~~
From time to time in the future, we may become involved in litigation or other legal proceedings that arise in the ordinary course of business. We are not currently party to any legal proceedings, and we are not aware of any pending or threatened litigation against us that we believe could have a material adverse effect on our business, operating results or financial condition. In the event we are subject to a legal proceeding, it could have a material adverse impact on us because of litigation costs and diversion of management resources.
Item 1A. Risk Factors.
As a Smaller Reporting Company we are exempted from the requirements of Item 1A.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Unregistered Sales of Equity Securities.
~~Effective~~Exercise of Warrants
In June ~~15, 2020, all of our outstanding shares of Series A Preferred Stock were converted into 2,438,851~~2021, a warrant holder acquired 2,592 shares of common stock inpursuant to the ~~aggregate after giving effect~~cashless exercise of a warrant to ~~a 1.74 for 1 forward stock split that occurred in connection with our initial public offering.~~purchase 3,258 shares. The ~~conversion~~warrant was exercisable at an exercise price of ~~the Series A preferred stock into shares~~$3.13 per share of common ~~stock~~ stock. The issuance of common shares was exempt from registration pursuant to Section ~~3(a)(9)~~4(a)(2) of the Securities ~~Act~~Act. The recipient of ~~1933, as amended (the “Securities Act”).~~the shares represented their intention to acquire the securities for investment only and not with a view to or for sale in connection with any distribution thereof, and appropriate legends were placed regarding the stock issued in this transaction. The sale of these securities was made without any general solicitation or advertising.
Use of Proceeds.
~~On June 10, 2020, our registration statement on Form S-1, as amended (File No.~~ ~~333-237714)~~ ~~was declared effective by the SEC in connection with~~Use of proceeds from our initial public offering of common stock ~~pursuant to which we issued and sold, on~~
On June 15, 2020, we closed our IPO of 1,750,000 shares of common stock, at a public offering price of $15.00 per share, ~~for total gross proceeds of $26,250,000. On~~pursuant to our registration statement on Form S-1, as amended (File No. 333-237714), declared effective by the SEC on June 15, 2020 we received net proceeds of $23,419,721, after deducting underwriting discounts and commissions of $1,968,750 and other offering expenses of $861,529 borne by us. None of the expenses incurred by us were direct or indirect payments to any of (i) our directors or officers or their associates, (ii) persons owning 10, ~~percent or more of our common stock, or (iii) our affiliates.~~ ThinkEquity, a division of Fordham Financial Management, Inc. acted as sole book-running manager for the offering. Colliers Securities LLC and Paulson Investment Company, LLC acted as co-managers for the offering. 2020. There ~~was~~has been no material change in ~~the~~our use of ~~IPO~~the net proceeds from ~~that~~the IPO as described in ~~the~~our final prospectus ~~dated June 10, 2020, related to the offering, as~~ filed with the ~~SEC.~~SEC on June 12, 2020.
~~Item 3. Defaults Upon Senior Securities.~~
~~None.~~
~~Item 4. Mine Safety Disclosures.~~
~~Not applicable.~~
Item 5. Other Information.
~~None.~~
On July 23, 2021, we entered into an Asset Purchase Agreement to reacquire global development and commercialization rights for Irofulven (LP-100) from Allarity Therapeutics A/S (“Allarity”), formerly known as Oncology Venture. The transaction includes global rights to the clinical stage drug candidate Irofulven (LP-100), as well as the developed clinical protocol for an intended study in bladder and prostate cancer patients who have a mutation in the ERCC2/3 genes. We also received an exclusive license to use Allarity’s companion diagnostic in future development and commercialization of LP-100. As a result of this transaction, we will have full authority to manage and guide future clinical development and commercialization of LP-100.

Under the terms of the Asset Purchase Agreement, we paid an initial upfront amount of US $1.0 million to Allarity, and future escrow payments that have the potential to deliver an additional US $1.0 million to Allarity based on drug manufacturing and trial enrollment milestones within the next 24 months. Allarity is also eligible to receive up to US $16.0 million in additional milestone payments over the life of the program based on IP license milestones and regulatory filings and approvals in the US and EU, and low- to mid-single-digit royalties on future commercial net sales.

Item 6. Exhibits.
Exhibit No. Exhibit Description Method of Filing
3.1
~~3.1(iv)~~ ~~Amendment to Certificate of Incorporation (incorporated by reference to exhibit 3.1(iv) to Registrant’s Form 8-K filed June 17, 2020).~~
~~3.1(v)~~ Amended and Restated Certificate of Incorporation ~~(incorporated~~ Incorporated by reference ~~to exhibit 3.1(v) to~~from the Registrant’s Current Report on Form 8-K filed June 17, ~~2020).~~2020
~~10.3~~3.2 ~~Amendment to Employment Agreement dated May 18, 2020 with Panna Sharma (incorporated~~By-Laws Incorporated by reference ~~to exhibit 10.3 to~~from the Registrant’s Registration Statement on Form ~~S-1/A~~S-1 filed ~~June 8, 2020).~~April 16, 2020
~~10.4~~31.1 ~~Employment Agreement dated May 18, 2020 with David Margrave (incorporated by reference to exhibit 10.4 to Registrant’s Form S-1/A filed May 19, 2020).~~
~~10.16~~ ~~Employment Agreement dated May 18, 2020 with Kishor G Bhatia (incorporated by reference to exhibit 10.16 to Registrant’s Form S-1/A filed May 19, 2020).~~
31.1* Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed electronically herewith
31.2* Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed electronically herewith
32.1** Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Furnished electronically herewith
32.2** Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Furnished electronically herewith
101.INS XBRL Instance Document Filed electronically herewith
101.SCH XBRL Taxonomy Extension Schema Filed electronically herewith
101.CAL XBRL Taxonomy Extension Calculation Linkbase Filed electronically herewith
101.DEF XBRL Taxonomy Extension Definition Linkbase Filed electronically herewith
101.LAB XBRL Taxonomy Extension Label Linkbase Filed electronically herewith
101.PRE XBRL Taxonomy Extension Presentation Linkbase Filed electronically herewith

101.INS* ~~XBRL Instance Document~~

101.SCH*104 ~~XBRL Taxonomy Extension Schema~~

101.CAL*Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) ~~XBRL Taxonomy Extension Calculation Linkbase~~
101.DEF* ~~XBRL Taxonomy Extension Definition Linkbase~~
101.LAB* ~~XBRL Taxonomy Extension Label Linkbase~~
101.PRE* ~~XBRL Taxonomy Extension Presentation Linkbase~~Filed electronically herewith

* Filed herewith
**Furnished with this report
SIGNATURES

~~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.
Lantern Pharma Inc.,
A Delaware Corporation
Dated: July ~~30, 2020~~29, 2021 By: /s/ Panna Sharma
Panna Sharma, Chief Executive Officer
Dated: July ~~30, 2020~~29, 2021 By: /s/ David R. Margrave
David R. Margrave, Chief Financial Officer
25
31

iso4217:USD xbrli:shares

	June 30,			December 31,
	2020			2019
	(Unaudited)
CURRENT ASSETS
Cash	$	23,798,343		$	1,232,030
Other current asset		1,728,539			-
Prepaid expense		70,775			788
Total current assets		25,597,657			1,232,818

Property and equipment, net		15,377			8,758
Deferred offering costs		-			191,000

TOTAL ASSETS	$	25,613,034		$	1,432,576

CURRENT LIABILITIES
Accounts payable and accrued expenses	$	467,988		$	489,292
Insurance payable		1,705,846			-
Note payable		102,831			-

Total current liabilities		2,276,665			489,292

Loan payable		108,500			-

TOTAL LIABILITIES		2,385,165			489,292

COMMITMENTS AND CONTINGENCIES (NOTE 4)

STOCKHOLDERS’ EQUITY
Preferred Stock - Par Value (1,000,000 authorized at June 30, 2020; 3,480,000 authorized at December 31, 2019; $.0001 par value) (Zero shares issued and outstanding at June 30, 2020; 2,438,866 shares issued and outstanding at December 31, 2019)		-			244
Common Stock – Par Value (25,000,000 authorized at June 30, 2020; 12,180,000 authorized at December 31, 2019; $.0001 par value) (6,217,577 shares issued and outstanding at June 30, 2020; 1,978,269 shares issued and outstanding at December 31, 2019)		622			198
Additional paid-in capital		31,289,650			7,694,547
Accumulated deficit		(8,062,403	)		(6,751,705	)

Total stockholders’ equity		23,227,869			943,284

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	25,613,034		$	1,432,576

	June 30,			December 31,
	2021			2020
	(Unaudited)
CURRENT ASSETS
Cash and cash equivalents	$	61,354,117		$	19,229,232
Marketable securities		18,234,540			-
Prepaid expenses and other current assets		2,542,426			1,007,690
Total current assets		82,131,083			20,236,922

Property and equipment, net		30,598			21,507
Deferred offering costs		-			101,205
Operating lease right-of-use assets		252,503			-
Other assets		17,889			-

TOTAL ASSETS	$	82,432,073		$	20,359,634

CURRENT LIABILITIES
Accounts payable and accrued expenses	$	1,093,787		$	552,339
Insurance payable		1,448,419			-
Operating lease liabilities, current		145,898			-
Total current liabilities		2,688,104			552,339

Operating lease liabilities, net of current portion		130,705			-
PPP loan payable		-			108,500

TOTAL LIABILITIES		2,818,809			660,839

COMMITMENTS AND CONTINGENCIES (NOTE 4)

STOCKHOLDERS’ EQUITY
Preferred Stock - Par Value (1,000,000 authorized at June 30, 2021 and December 31, 2020; $.0001 par value) (Zero shares issued and outstanding at June 30, 2021 and December 31, 2020)		-			-
Common Stock – Par Value (25,000,000 authorized at June 30, 2021 and December 31, 2020; $.0001 par value) (11,184,039 shares issued and outstanding at June 30, 2021; 6,220,927 shares issued and outstanding at December 31, 2020)		1,118			622
Additional paid-in capital		97,088,382			32,358,068
Accumulated deficit		(17,428,671	)		(12,659,895	)
Accumulated other comprehensive loss		(47,565	)		-

Total stockholders’ equity		79,613,264			19,698,795

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	82,432,073		$	20,359,634

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2021			2020			2021			2020
Operating expenses:
General and administrative		1,314,201			676,399			2,487,459			1,016,571
Research and development		1,164,892			157,023			2,443,929			294,127
Total operating expenses		2,479,093			833,422			4,931,388			1,310,698
Loss from operations		(2,479,093	)		(833,422	)		(4,931,388	)		(1,310,698	)
Interest income		47,889			-			47,889			-
Other income, net		114,723			-			114,723			-

NET LOSS	$	(2,316,481	)	$	(833,422	)	$	(4,768,776	)	$	(1,310,698	)

Net loss per share of common shares, basic and diluted	$	(0.21	)	$	(0.31	)	$	(0.45	)	$	(0.55	)
Weighted-average number of common shares outstanding, basic and diluted		11,181,504			2,719,198			10,631,121			2,370,082

	Three Months Ended June 30,						Six Months Ended June 30,
	2020			2019			2020			2019
Operating expenses:
General and administrative		676,399			268,120			1,016,571			536,049
Research and development		157,023			361,273			294,127			547,317
Total operating expenses		833,422			629,393			1,310,698			1,083,366

NET LOSS	$	(833,422	)	$	(629,393	)	$	(1,310,698	)	$	(1,083,366	)

Net loss per share of common shares, basic and diluted	$	(0.31	)	$	(0.32	)	$	(0.55	)	$	(0.55	)

Weighted-average number of common shares outstanding, basic and diluted		2,719,198			1,978,269			2,370,082			1,978,269

	Preferred Stock Number of Shares			Preferred Stock Amount			Common Stock Number of Shares		Common Stock Amount		Additional Paid-in Capital			Accumulated Deficit			Total Stockholders’ Equity (Deficit)

	Three and Six Months Ended June 30, 2019

Balance, December 31, 2018		1,292,952		$	129			1,978,269	$	198	$	4,121,395		$	(4,323,520	)	$	(201,798	)

Preferred stock and warrants issued		804,153			81			-		-		2,384,919			-			2,385,000
Stock-based compensation		-			-			-		-		15,531			-			15,531
Net Loss		-			-			-		-		-			(453,973	)		(453,973	)

Balance, March 31, 2019		2,097,105		$	210			1,978,269	$	198	$	6,521,845		$	(4,777,493	)	$	1,744,760

Stock-based compensation		-			-			-		-		6,029			-			6,029
Net Loss		-			-			-		-		-			(629,393	)		(629,393	)

Balance, June 30, 2019		2,097,105		$	210			1,978,269	$	198	$	6,527,874		$	(5,406,886	)	$	1,121,396

		Three and Six Months Ended June 30, 2020

Balance, December 31, 2019		2,438,866		$	244			1,978,269	$	198	$	7,694,547		$	(6,751,705	)	$	943,284

Common stock issued		-			-			50,460		5		51,995			-			52,000
Stock-based compensation		-			-			-		-		18,460			-			18,460
Net Loss		-			-			-		-		-			(477,276	)		(477,276	)

Balance, March 31, 2020		2,438,866		$	244			2,028,729	$	203	$	7,765,002		$	(7,228,981	)	$	536,468

Common stock issued, net of issuance costs		-			-			1,750,000		175		23,419,546			-			23,419,721
Preferred stock conversion to common stock and fractional shares adjustments from stock split and conversion		(2,438,866	)		(244	)		2,438,848		244		(261	)		-			(261	)
Stock-based compensation		-			-			-		-		105,363			-			105,363
Net Loss		-			-			-		-		-			(833,422	)		(833,422	)

Balance, June 30, 2020		-		$	-			6,217,577	$	622	$	31,289,650		$	(8,062,403	)	$	23,227,869

	Preferred Stock Number of Shares			Preferred Stock Amount			Common Stock Number of Shares		Common Stock Amount			Additional Paid-in-Capital			Accumulated Other Comprehensive Income			Accumulated Deficit			Total Stockholders’ Equity (Deficit)
Three and Six Months Ended June 30, 2020
Balance, December 31, 2019		2,438,866		$	244			1,978,269	$	198		$	7,694,547		$	-		$	(6,751,705	)	$	943,284

Common stock issued		-			-			50,460		5			51,995			-			-			52,000
Stock-based compensation		-			-			-		-			18,460			-			-			18,460
Net loss		-			-			-		-			-			-			(477,276	)		(477,276	)

Balance, March 31, 2020		2,438,866		$	244			2,028,729	$	203		$	7,765,002		$	-		$	(7,228,981	)	$	536,468

Common stock issued, net of issuance costs		-			-			1,750,000		175			23,419,546			-			-			23,419,721
Preferred stock conversion to common stock and fractional shares adjustments from stock split and conversion		(2,438,866	)		(244	)		2,438,848		244			(261	)		-			-			(261	)
Stock-based compensation		-			-			-		-			105,363			-			-			105,363
Net loss		-			-			-		-			-			-			(833,422	)		(833,422	)

Balance, June 30, 2020		-		$	-			6,217,577	$	622	$		31,289,650		$	-		$	(8,062,403	)	$	23,227,869

Three and Six Months Ended June 30, 2021

Balance, December 31, 2020		-		$	-			6,220,927	$	622		$	32,358,068		$	-		$	(12,659,895	)	$	19,698,795

Common stock issued in equity financing, net of issuance costs		-			-			4,928,571		493			64,166,361			-			-			64,166,854
Common stock issued from warrant and option exercises		-			-			31,949		3			72,750			-			-			72,753
Stock-based compensation		-			-			-		-			245,519			-			-			245,519
Net Loss		-			-			-		-			-			-			(2,452,295	)		(2,452,295	)

Balance, March 31, 2021		-		$	-			11,181,447	$	1,118		$	96,842,698		$	-		$	(15,112,190	)	$	81,731,626

Common stock issued from warrant exercise		-			-			2,592		-			-			-			-			-
Stock-based compensation		-			-			-		-			245,684			-			-			245,684
Net loss		-			-			-		-			-			-			(2,316,481	)		(2,316,481	)
Other comprehensive loss		-			-			-		-			-			(47,565	)		-			(47,565	)

Balance, June 30, 2021		-		$	-			11,184,039	$	1,118		$	97,088,382		$	(47,565	)	$	(17,428,671	)	$	79,613,264

	Six Months Ended June 30,
	2021			2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(4,768,776	)	$	(1,310,698	)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization		2,923			1,202
Non-cash lease expense		24,100			-
Stock based compensation		491,203			123,823
Gain on loan forgiveness		(109,223	)		-
Changes in assets and liabilities:
Prepaid expenses and other current assets		(169,880	)		(69,987	)
Accounts payable and accrued expenses		677,615			61,742
Other assets		(17,889	)		-
Net cash flows used in operating activities		(3,869,927	)		(1,193,918	)

INVESTING ACTIVITIES
Purchase of property and equipment		(12,014	)		(7,821	)
Purchase of marketable securities		(18,282,105	)		-
Net cash flows used in investing activities		(18,294,119	)		(7,821	)

FINANCING ACTIVITIES
Proceeds from issuance of common and preferred stock		68,999,994			26,250,000
Issuance costs		(4,783,816	)		(2,745,279	)
Proceeds from stock option and warrant exercises		72,753			52,000
Borrowings from notes payable		-			169,049
Payments on notes payable		-			(66,218	)
Borrowings on loan payable		-			108,500
Net cash flows provided by financing activities		64,288,931			23,768,052

CHANGE IN CASH AND CASH EQUIVALENTS FOR THE PERIOD		42,124,885			22,566,313

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		19,229,232			1,232,030

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	61,354,117		$	23,798,343

Non-cash investing and financing activities
Application of deferred offering costs to public offering proceeds	$	(49,324	)	$	(456,437	)
Amounts owed related to fractional shares adjustment, included in accounts payable and accrued expenses		-			(261	)
Unrealized losses on debt securities		(47,565	)		-

	June 30, 2021		December 31, 2020
Assets
Operating lease, right-of-use asset, net	$	252,503	$	-
Liabilities
Current portion of operating lease liabilities	$	145,898	$	-
Operating lease liabilities, net of current portion		130,705		-
Total operating lease liabilities	$	276,603	$	-

2021 (remaining 6 months)	$	77,396
2022		158,403
2023		53,403
Total minimum lease payments		289,202
Less amount representing interest		12,599
Present value of future minimum lease payments		276,603
Less current portion of operating lease liabilities		145,898
Operating lease liabilities, net of current portion	$	130,705

	Right-of-Use Asset			Operating Lease Liability
Balance at March 31, 2021	$	-		$	-
Additions		274,472			276,603
Amortizations and Reductions		(21,969	)		-
Balance at June 30, 2021	$	252,503		$	276,603

	As of June 30,
	2021			2020
Weighted average remaining term of operating leases (in years)		1.83			-
Weighted average discount rate of operating leases		4.65	%		-	%

	Options Outstanding
	Number of Shares			Weighted-Average Exercise Price Per Share
Outstanding December 31, 2019	607,491		$	1.03
Granted	306,743			15.00
Exercised	(50,460	)		1.03
Cancelled or expired	(43,166	)		1.03
Outstanding June 30, 2020	820,608		$	6.25

	Options Outstanding
	Number of Shares			Weighted- Average Exercise Price Per Share
Outstanding December 31, 2020		835,608		$	6.41
Granted		-			-
Exercised		(11,782	)		1.03
Cancelled or expired		-			-
Outstanding June 30, 2021		823,826		$	6.49

	Amortized Cost		Unrealized Gains		Unrealized Losses			Aggregate Fair Value
Government & Agency Securities		2,514,869		-		(7,954	)		2,506,915
Corporate Bonds		9,741,378		-		(42,453	)		9,698,925
Mutual Funds – Fixed Income		4,002,704		6,942		(4,100	)		4,005,546
Mutual Funds – Alternative Investments		2,023,154		-		-			2,023,154
Marketable Securities	$	18,282,105	$	6,942	$	(54,507	)	$	18,234,540

	As of June 30, 2021
Due within one year	$	612,762
Due in one to two years		4,779,661
Due in three to five years		6,813,417
	$	12,205,840

	As of June 30, 2021
	Less than 12 months
	Fair Value		Unrealized Loss
Government & Agency Securities	$	2,506,915	$	(7,954	)
Corporate Bonds		9,698,925		(42,453	)
Mutual Funds – Fixed Income		1,992,600		(4,100	)
	$	14,198,440	$	(54,507	)

	Fair Value Measurements as of June 30, 2021
Description	Total		Level 1		Level 2		Level 3		NAV*
Government & Agency Securities		2,506,915		-		2,506,915		-		-
Corporate Bonds		9,698,925		-		9,698,925		-		-
Mutual Funds – Fixed Income		4,005,546		-		4,005,546		-		-
Mutual Funds – Alternative Investments		2,023,154		-		-		-		2,023,154
	$	18,234,540	$	-	$	16,211,386	$	-	$	2,023,154

	Outstanding at June 30,
	2020		2019
Warrants to purchase Common Stock		332,014		-
Warrants to purchase Series A Preferred stock		-		232,885
Stock options		820,608		630,402
Series A preferred stock		-		2,097,105
		1,152,622		2,960,392

	Three Months Ended June 30, 2020
LP-300	$	21,417
LP-184		60,205
RADR^®Platform		45,499
Other		29,902
Total research and development expenses	$	157,023

	Three Months Ended June 30, 2021		Six Months Ended June 30, 2021
LP-300	$	275,620	$	810,205
LP-184		591,851		1,055,801
RADR^®Platform		152,159		293,737
Other		145,262		284,186
Total research and development expenses	$	1,164,892	$	2,443,929

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2021			2020			2021			2020
Operating expenses:
General and administrative	$	1,314,201		$	676,399		$	2,487,459		$	1,016,571
Research and development		1,164,892			157,023			2,443,929			294,127
Total operating expenses		2,479,093			833,422			4,931,388			1,310,698
Loss from operations		(2,479,093	)		(833,422	)		(4,931,388	)		(1,310,698	)
Interest income		47,889			-			47,889			-
Other income, net		114,723			-			114,723			-
NET LOSS	$	(2,316,481	)	$	(833,422	)	$	(4,768,776	)	$	(1,310,698	)

	For the Six Months Ended June 30,
	2020			2019
	(Unaudited)
Net cash flows used in operating activities	$	(1,193,918	)	$	(869,122	)
Net cash flows used in investing activities		(7,821	)		—
Net cash flows provided by financing activities		23,768,052			1,850,003
Net increase in cash and cash equivalents	$	22,566,313		$	980,881

	●	continue to build our portfolio of drug candidates through the acquisition or in-license of additional drug candidates or technologies;

	●	continue to develop, maintain, expand and protect our intellectual property portfolio;

	●	pursue regulatory approvals for those of our current and future drug candidates that successfully complete clinical trials;

	●	ultimately establish a sales, marketing, distribution and other commercial infrastructure to commercialize any drug candidate for which we may obtain marketing approval;

	●	hire additional clinical, regulatory, scientific and accounting personnel; ~~and~~

	●	incur additional legal, accounting and other expenses in operating as a public ~~company.~~company; and

Exhibit No.		Exhibit Description		Method of Filing
3.1
~~3.1(iv)~~	~~Amendment to Certificate of Incorporation (incorporated by reference to exhibit 3.1(iv) to Registrant’s Form 8-K filed June 17, 2020).~~

~~3.1(v)~~	Amended and Restated Certificate of Incorporation ~~(incorporated~~		Incorporated by reference ~~to exhibit 3.1(v) to~~from the Registrant’s Current Report on Form 8-K filed June 17, ~~2020).~~2020

~~10.3~~3.2		~~Amendment to Employment Agreement dated May 18, 2020 with Panna Sharma (incorporated~~By-Laws		Incorporated by reference ~~to exhibit 10.3 to~~from the Registrant’s Registration Statement on Form ~~S-1/A~~S-1 filed ~~June 8, 2020).~~April 16, 2020

~~10.4~~31.1	~~Employment Agreement dated May 18, 2020 with David Margrave (incorporated by reference to exhibit 10.4 to Registrant’s Form S-1/A filed May 19, 2020).~~

~~10.16~~	~~Employment Agreement dated May 18, 2020 with Kishor G Bhatia (incorporated by reference to exhibit 10.16 to Registrant’s Form S-1/A filed May 19, 2020).~~

31.1*	Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.		Filed electronically herewith

31.2*		Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.		Filed electronically herewith

32.1**		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.		Furnished electronically herewith

32.2**		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.		Furnished electronically herewith

101.INS		XBRL Instance Document		Filed electronically herewith

101.SCH		XBRL Taxonomy Extension Schema		Filed electronically herewith

101.CAL		XBRL Taxonomy Extension Calculation Linkbase		Filed electronically herewith

101.DEF		XBRL Taxonomy Extension Definition Linkbase		Filed electronically herewith

101.LAB		XBRL Taxonomy Extension Label Linkbase		Filed electronically herewith

101.PRE		XBRL Taxonomy Extension Presentation Linkbase		Filed electronically herewith

101.INS*	~~XBRL Instance Document~~

101.SCH*104	~~XBRL Taxonomy Extension Schema~~

101.CAL*Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)	~~XBRL Taxonomy Extension Calculation Linkbase~~

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

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

101.PRE*	~~XBRL Taxonomy Extension Presentation Linkbase~~Filed electronically herewith

	Lantern Pharma Inc.,

	A Delaware Corporation

Dated: July ~~30, 2020~~29, 2021	By:	/s/ Panna Sharma
		Panna Sharma, Chief Executive Officer

Dated: July ~~30, 2020~~29, 2021	By:	/s/ David R. Margrave
		David R. Margrave, Chief Financial Officer