Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2023 | Apr. 28, 2023 | |
Cover [Abstract] | ||
Entity Registrant Name | MONOPAR THERAPEUTICS INC. | |
Entity Central Index Key | 0001645469 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | true | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Mar. 31, 2023 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2023 | |
Entity Ex Transition Period | true | |
Entity Common Stock Shares Outstanding | 13,222,056 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-39070 | |
Entity Incorporation State Country Code | DE | |
Entity Tax Identification Number | 32-0463781 | |
Entity Interactive Data Current | Yes | |
Entity Address Address Line 1 | 1000 Skokie Blvd. | |
Entity Address Address Line 2 | Suite 350 | |
Entity Address City Or Town | Wilmette | |
Entity Address State Or Province | IL | |
Entity Address Postal Zip Code | 60091 | |
City Area Code | 847 | |
Local Phone Number | 388-0349 | |
Security 12b Title | Common Stock, $0.001 par value | |
Trading Symbol | MNPR | |
Security Exchange Name | NASDAQ |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 5,725,593 | $ 8,186,194 |
Investments | 5,950,638 | 4,933,550 |
Other current assets | 106,819 | 45,982 |
Total current assets | 11,783,050 | 13,165,726 |
Operating lease right-of-use asset | 49,376 | 61,228 |
Total assets | 11,832,426 | 13,226,954 |
Current liabilities: | ||
Accounts payable, accrued expenses and other current liabilities | 2,887,765 | 3,128,894 |
Total current liabilities | 2,887,765 | 3,128,894 |
Non-current operating lease liability | 0 | 8,408 |
Total liabilities | 2,887,765 | 3,137,302 |
Stockholders' equity | ||
Common stock, par value of $0.001 per share, 40,000,000 shares authorized, 13,222,056 and 12,946,573 shares issued and outstanding at March 31, 2023, and December 31, 2022, respectively | 13,222 | 12,947 |
Additional paid-in capital | 63,138,229 | 61,871,784 |
Accumulated other comprehensive income | 31,787 | 8,942 |
Accumulated deficit | (54,238,577) | (51,804,021) |
Total stockholders' equity | 8,944,661 | 10,089,652 |
Total liabilities and stockholders' equity | $ 11,832,426 | $ 13,226,954 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2023 | Dec. 31, 2022 |
Condensed Consolidated Balance Sheets | ||
Common Stock, Par Value | $ 0.001 | $ 0.001 |
Common Stock, Authorized | 40,000,000 | 40,000,000 |
Common Stock, Issued | 13,222,056 | 12,946,573 |
Common Stock, Outstanding | 13,222,056 | 12,946,573 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Operating expenses: | ||
Research and development | $ 1,653,369 | $ 1,677,932 |
General and administrative | 871,675 | 779,254 |
Total operating expenses | 2,525,044 | 2,457,186 |
Loss from operations | (2,525,044) | (2,457,186) |
Interest income | 90,488 | 464 |
Net loss | (2,434,556) | (2,456,722) |
Other comprehensive income | ||
Foreign currency translation loss | (10,800) | (584) |
Unrealized gain on investments | 33,645 | 0 |
Comprehensive loss | $ (2,411,711) | $ (2,457,306) |
Net loss per share: | ||
Basic and diluted | $ (0.19) | $ (0.19) |
Weighted average shares outstanding: | ||
Basic and diluted | 13,105,831 | 12,604,443 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders Equity (Unaudited) - USD ($) | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit |
Balance, shares at Dec. 31, 2021 | 12,598,125 | ||||
Balance, amount at Dec. 31, 2021 | $ 18,941,071 | $ 12,598 | $ 60,220,016 | $ (3,160) | $ (41,288,383) |
Issuance of common stock to non-employee directors pursuant to vested restricted stock units, shares | 11,436 | ||||
Issuance of common stock to non-employee directors pursuant to vested restricted stock units, amount | 0 | $ 12 | (12) | 0 | 0 |
Issuance of common stock to employees pursuant to vested restricted stock units, net of taxes, shares | 11,031 | ||||
Issuance of common stock to employees pursuant to vested restricted stock units, net of taxes, amount | (16,666) | $ 11 | (16,677) | 0 | 0 |
Stock-based compensation (non-cash) | 499,812 | 0 | 499,812 | 0 | 0 |
Net Income (Loss) Attributable to Parent | (2,456,722) | 0 | 0 | 0 | (2,456,722) |
Other comprehensive loss | (584) | $ 0 | 0 | (584) | 0 |
Balance, shares at Mar. 31, 2022 | 12,620,592 | ||||
Balance, amount at Mar. 31, 2022 | 16,966,911 | $ 12,621 | 60,703,139 | (3,744) | (43,745,105) |
Balance, shares at Dec. 31, 2022 | 12,946,573 | ||||
Balance, amount at Dec. 31, 2022 | 10,089,652 | $ 12,947 | 61,871,784 | 8,942 | (51,804,021) |
Issuance of common stock to non-employee directors pursuant to vested restricted stock units, shares | 10,132 | ||||
Issuance of common stock to non-employee directors pursuant to vested restricted stock units, amount | 0 | $ 10 | (10) | 0 | 0 |
Issuance of common stock to employees pursuant to vested restricted stock units, net of taxes, shares | 20,959 | ||||
Issuance of common stock to employees pursuant to vested restricted stock units, net of taxes, amount | (16,827) | $ 21 | (16,848) | 0 | 0 |
Stock-based compensation (non-cash) | 476,209 | 0 | 476,209 | 0 | 0 |
Net Income (Loss) Attributable to Parent | (2,434,556) | $ 0 | 0 | 0 | (2,434,556) |
Issuance of common stock under a Capital on DemandTM Sales Agreement with JonesTrading Institutional Services, LLC, net of commissions, fees and offering costs of $37,661, shares | 244,392 | ||||
Issuance of common stock under a Capital on DemandTM Sales Agreement with JonesTrading Institutional Services, LLC, net of commissions, fees and offering costs of $37,661, amount | 807,338 | $ 244 | 807,094 | 0 | 0 |
Other comprehensive income, net | 22,845 | $ 0 | 0 | 22,845 | 0 |
Balance, shares at Mar. 31, 2023 | 13,222,056 | ||||
Balance, amount at Mar. 31, 2023 | $ 8,944,661 | $ 13,222 | $ 63,138,229 | $ 31,787 | $ (54,238,577) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash flows from operating activities: | ||
Net loss | $ (2,434,556) | $ (2,456,722) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock-based compensation expense (non-cash) | 476,209 | 499,812 |
Changes in operating assets and liabilities, net | ||
Other current assets | (60,842) | 24,110 |
Accounts payable, accrued expenses and other current liabilities | (251,924) | (532,321) |
Operating lease right-of-use assets and liabilities, net | 0 | (2,379) |
Net cash used in operating activities | (2,271,113) | (2,467,500) |
Cash flows from investing activities: | ||
Purchase of investments | (2,958,776) | 0 |
Maturities of short-term investments | 1,975,333 | 0 |
Net cash used in investing activities | (983,443) | 0 |
Cash flows from financing activities: | ||
Cash proceeds from the sales of common stock under a Capital on DemandTM Sales Agreement | 821,625 | 0 |
Taxes paid related to net share settlement of vested restricted stock units | (16,827) | (16,666) |
Net cash provided by (used in) financing activities | 804,798 | (16,666) |
Effect of exchange rates | (10,843) | (659) |
Net decrease in cash and cash equivalents | (2,460,601) | (2,484,825) |
Cash and cash equivalents at beginning of period | 8,186,194 | 20,303,869 |
Cash and cash equivalents at end of period | $ 5,725,593 | $ 17,819,044 |
Nature of Business and Liquidit
Nature of Business and Liquidity | 3 Months Ended |
Mar. 31, 2023 | |
Nature of Business and Liquidity | |
Nature Of Business And Liquidity | Note 1 – Nature of Business and Liquidity Nature of Business Monopar Therapeutics Inc. (“Monopar” or the ”Company”) is a clinical-stage biopharmaceutical company focused on developing proprietary therapeutics designed to extend life or improve quality of life for cancer patients. Monopar currently has three compounds in development: 1) camsirubicin (generic name for MNPR-201, GPX-150; 5-imino-13-deoxydoxorubicin), a Phase 1b clinical stage novel analog of doxorubicin engineered specifically to retain anticancer activity while minimizing toxic effects on the heart; 2) MNPR-101 RIT and MNPR-101-Zr, a preclinical stage uPAR-targeted antibody being developed as a radioimmunotherapeutic and companion diagnostic for advanced cancers; and 3) an early stage camsirubicin analog, MNPR-202, for various cancers. On March 27, 2023, the Company discontinued its Validive Phase 2b/3 VOICE trial based upon its Data Safety Monitoring Board’s determination that the trial did not meet the pre-defined threshold for efficacy of a 15% absolute difference in severe oral mucositis prevention between Validive and placebo. Other than clinical site close-out related expense to be incurred in Q2 2023, the Company will not incur any license or royalty obligations or incur any significant expenses beyond Q2 2023 related to Validive. Liquidity The Company has incurred an accumulated deficit of approximately $54.2 million as of March 31, 2023. To date, the Company has primarily funded its operations with the net proceeds from the Company’s initial public offering of its common stock on Nasdaq, sales of its common stock in the public market through at-the-market sales agreements, private placements of convertible preferred stock and of common stock and cash provided in the camsirubicin asset purchase transaction. Management estimates that currently available cash will provide sufficient funds to enable the Company to meet its obligations at least through June 2024. The Company’s ability to fund its future operations, including the continued clinical development of camsirubicin and continued development of its radiopharmaceutical program, is dependent upon its ability to execute its business strategy, to obtain additional funding and/or to execute collaborative research agreements. There can be no certainty that future financing or collaborative research agreements will occur in the amounts required or at a time needed to maintain operations, if at all. Market variables over which the Company has no control, such as inflation of product costs, higher capital costs, labor rates and fuel, freight and energy costs, as well as geopolitical events could cause the Company to suffer significant increases in its operating and administrative expenses. The Russia-Ukraine war, and resulting sanctions against Russia and Russian entities or allies, have increased fuel costs and may cause shipping delays. The broader economic, trade and financial market consequences are uncertain at this time, which may increase the cost of supplies for the Company’s clinical materials, may delay the manufacture of its clinical materials, may increase costs of other goods and services, or make it more difficult or costly to raise additional financing, any of which could cause an adverse effect on the Company’s clinical and development program and on the Company’s financial condition. The coronavirus disease (“COVID-19”) continues to affect economies and business around the world. Due to many uncertainties, the Company is unable to estimate COVID-19’s financial impact or duration in light of global vaccine rollouts, treatment options and potential surges of new cases from current or future COVID-19 variants or its potential impact on the Company’s current clinical trial and development programs, including COVID-19’s effect on drug candidate manufacturing, shipping, patient recruitment at clinical sites and regulatory agencies around the globe. |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Significant Accounting Policies | |
Significant Accounting Policies | Note 2 – Significant Accounting Policies Basis of Presentation These condensed consolidated financial statements include the financial results of Monopar Therapeutics Inc., its wholly-owned French subsidiary, Monopar Therapeutics, SARL, and its wholly-owned Australian subsidiary, Monopar Therapeutics Australia Pty Ltd, and have been prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”) and include all disclosures required by GAAP for financial reporting. All intercompany accounts have been eliminated. The principal accounting policies applied in the preparation of these condensed consolidated financial statements are set out below and have been consistently applied in all periods presented. The Company has been primarily involved in performing research activities, developing product candidates, and raising capital to support and expand these activities. The accompanying interim unaudited condensed consolidated financial statements contain all normal, recurring adjustments necessary to present fairly the Company’s condensed consolidated financial position as of March 31, 2023, and the Company’s condensed consolidated results of operations and comprehensive loss for the three months ended March 31, 2023, and 2022, and the Company’s condensed consolidated cash flows for the three months ended March 31, 2023, and 2022. The interim condensed consolidated results of operations and comprehensive loss and condensed consolidated cash flows for the periods presented are not necessarily indicative of the condensed consolidated results of operations or cash flows which may be reported for the remainder of 2023 or for any future period. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2022, included in the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 23, 2023. Functional Currency The Company’s consolidated functional currency is the U.S. Dollar. The Company’s Australian subsidiary and French subsidiary use the Australian Dollar and European Euro, respectively, as their functional currency. At each quarter-end, each foreign subsidiary’s balance sheets are translated into U.S. Dollars based upon the quarter-end exchange rate, while their statements of operations and comprehensive loss and statements of cash flows are translated into U.S. Dollars based upon an average exchange rate during the period. Comprehensive Loss Comprehensive loss represents net loss plus any income or losses not reported in the condensed consolidated statements of operations and comprehensive loss, such as foreign currency translations gains and losses and unrealized gains and losses on debt security investments that are reflected on the Company’s condensed consolidated statements of stockholders’ equity. Use of Estimates 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, disclosure of contingent assets and liabilities, and reported amounts of expenses in the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Going Concern Assessment The Company applies Accounting Standards Codification 205-40 (“ASC 205-40”), Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern Cash Equivalents The Company considers all highly liquid investments purchased with a maturity of 90 days or less on the date of purchase to be cash equivalents. Cash equivalents as of March 31, 2023, and December 31 2022, consisted of two money market accounts and U.S. Treasury Bills. Investments The Company considers all of its investments in debt securities (U.S. Government or Agencies), with maturities at the date of purchase from three months to one year to be available-for-sale securities. These investments are recorded at fair value with the unrealized gains and losses reflected in accumulated other comprehensive income (loss) on the Company’s condensed consolidated balance sheets. Realized gains and losses from the sale of investments, if any are determined, are recorded net in the condensed consolidated statements of operations and comprehensive loss. The investments selected by the Company have a low level of inherent credit risk given they are issued by the U.S. government and any changes in their fair value are primarily attributable to changes in interest rates and market liquidity. Investments as of March 31, 2023, and December 31, 2022, consisted of U.S. Treasury Bills with maturities of 91 days to one year. Prepaid Expenses Prepayments are expenditures for goods or services before the goods are used or the services are received and are charged to operations as the benefits are realized. Prepaid expenses may include payments to development collaborators in excess of actual expenses incurred by the collaborator measured at the end of each reporting period. Prepayments also include insurance premiums, dues and subscriptions and software costs of $10,000 or more per year that are expensed monthly over the life of the contract, which is typically one year. Prepaid expenses are reflected on the Company’s condensed consolidated balance sheets as other current assets. Leases Lease agreements are evaluated to determine whether an arrangement is or contains a lease in accordance with ASC 842, Leases Concentration of Credit Risk Financial instruments that potentially subject the Company to concentration of credit risk consist of cash and cash equivalents. The Company maintains cash and cash equivalents at two reputable financial institutions. As of March 31, 2023, the balance at one financial institution was in excess of the $250,000 Federal Deposit Insurance Corporation (“FDIC”) insurable limit. The Company has not experienced any losses on its deposits since inception and management believes the Company is not exposed to significant risks with respect to these financial institutions. Fair Value of Financial Instruments For financial instruments consisting of cash and cash equivalents, investments, accounts payable, accrued expenses, and other current liabilities, the carrying amounts are reasonable estimates of fair value due to their relatively short maturities. The Company adopted ASC 820, Fair Value Measurements and Disclosures, The standard establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources. Unobservable inputs reflect a reporting entity’s pricing an asset or liability developed based on the best information available under the circumstances. The fair value hierarchy consists of the following three levels: Level 1 Level 2 Level 3 Determining which category an asset or liability falls within the hierarchy requires significant judgment. The Company evaluates its hierarchy disclosures each reporting period. There were no transfers between Level 1, 2 or 3 of the fair value hierarchy during the three months ended March 31, 2023, and 2022. The following table presents the assets and liabilities that are reported at fair value on our condensed consolidated balance sheets on a recurring basis. No values were recorded in Level 2 or Level 3 at March 31, 2023, and December 31, 2022. Assets and Liabilities Measured at Fair Value on a Recurring Basis March 31, 2023 Level 1 Total Assets: Cash equivalents (1) $ 4,472,806 $ 4,472,806 Investments (2) 5,950,638 5,950,638 Total $ 10,423,444 $ 10,423,444 December 31 2022 Level 1 Total Assets: Cash equivalents (1) $ 7,248,946 $ 7,248,946 Investments (2) 4,933,550 4,933,550 Total $ 12,182,496 $ 12,182,496 (1) Cash equivalents as of March 31, 2023, and December 31, 2022, represent the fair value of the Company’s investment in two money market accounts and U.S. Treasury Bills with maturities at the date of purchase of less than 90 days. (2) Investments represents the fair value of the Company’s investment in U.S. Treasury Bills with maturities at the date of purchase from 91 days to one year. Net Loss per Share Net loss per share for the three months ended March 31, 2023, and 2022, is calculated by dividing net loss by the weighted-average shares of common stock outstanding during the periods. Diluted net loss per share for the three months ended March 31, 2023, and 2022, is calculated by dividing net loss by the weighted-average shares of the sum of a) weighted average common stock outstanding (13,105,831 and 12,604,443 shares for the three months ended March 31, 2023 and 2022, respectively) and b) potentially dilutive shares of common stock (such as stock options and restricted stock units) outstanding during the period. As of March 31, 2023, and 2022, potentially dilutive securities included stock-based awards to purchase up to 2,745,916 and 2,548,155 shares of the Company’s common stock, respectively. For the three months ended March 31, 2023, and 2022, potentially dilutive securities are excluded from the computation of fully diluted net loss per share as their effect is anti-dilutive. Research and Development Expenses Research and development (“R&D”) costs are expensed as incurred. Major components of R&D expenses include salaries and benefits paid to the Company’s R&D staff, compensation expenses of G&A personnel performing R&D, fees paid to consultants and to the entities that conduct certain R&D activities on the Company’s behalf and materials and supplies which were used in R&D activities during the reporting period. Clinical Trials Accruals The Company accrues and expenses the costs for clinical trial activities performed by third parties based upon estimates of the percentage of work completed over the life of the individual study in accordance with agreements established with contract research organizations, service providers, and clinical trial sites. The Company estimates the amounts to accrue based upon discussions with internal clinical personnel and external service providers as to progress or stage of completion of trials or services and the agreed upon fees to be paid for such services. Costs of setting up clinical trial sites for participation in the trials are expensed immediately as R&D expenses. Clinical trial site costs related to patient screening and enrollment are accrued as patients are screened/entered into the trial. Collaborative Agreements The Company and its collaborative partners are active participants in collaborative agreements and all parties would be exposed to significant risks and rewards depending on the technical and commercial success of the activities. Contractual payments to the other parties in collaboration agreements and costs incurred by the Company when the Company is deemed to be the principal participant for a given transaction are recognized on a gross basis in R&D expenses. Royalties and license payments are recorded as earned. During the three months ended March 31, 2023, and 2022, no milestones were met, and no royalties were earned, therefore, the Company did not pay or accrue/expense any license or royalty payments. Licensing Agreements The Company has various agreements licensing technology utilized in the development of its product or technology programs. The licenses contain success milestone obligations and royalties on future sales. During the three months ended March 31, 2023, and 2022, no milestones were met, and no royalties were earned, therefore, the Company did not pay or accrue/expense any license or royalty payments under any of its license agreements. Patent Costs The Company expenses costs relating to issued patents and patent applications, including costs relating to legal, renewal and application fees, as a component of general and administrative expenses in its condensed consolidated statements of operations and comprehensive loss. Income Taxes The Company uses an asset and liability approach for accounting for deferred income taxes, which requires recognition of deferred income tax assets and liabilities for the expected future tax consequences of events that have been recognized in its financial statements but have not been reflected in its taxable income. Estimates and judgments are required in the calculation of certain tax liabilities and in the determination of the recoverability of certain deferred income tax assets, which arise from temporary differences and carryforwards. Deferred income tax assets and liabilities are measured using the currently enacted tax rates that apply to taxable income in effect for the years in which those tax assets and liabilities are expected to be realized or settled. The Company regularly assesses the likelihood that its deferred income tax assets will be realized from recoverable income taxes or recovered from future taxable income. To the extent that the Company believes any amounts are not “more likely than not” to be realized, the Company records a valuation allowance to reduce the deferred income tax assets. In the event the Company determines that all or part of the net deferred tax assets are not realizable in the future, an adjustment to the valuation allowance would be charged to earnings in the period such determination is made. Similarly, if the Company subsequently determines deferred income tax assets that were previously determined to be unrealizable are now realizable, the respective valuation allowance would be reversed, resulting in an adjustment to earnings in the period such determination is made. Internal Revenue Code Sections 382 and 383 (“Sections 382 and 383”) limit the use of net operating loss (“NOL”) carryforwards and R&D credits, after an ownership change. To date, the Company has not conducted a Section 382 or 383 study, however, because the Company will continue to raise significant amounts of equity in the coming years, the Company expects that Sections 382 and 383 will limit the Company’s usage of NOLs and R&D credits in the future. ASC 740, Income Taxes The Company is subject to U.S. Federal, Illinois and California state income taxes. In addition, the Company is subject to local tax laws of France and Australia. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. Monopar was originally formed as an LLC in December 2014, then incorporated on December 16, 2015. The Company is subject to U.S. Federal, state and local tax examinations by tax authorities for the tax years 2015 through 2021. The Company does not anticipate significant changes to its current uncertain tax positions through March 31, 2024. The Company plans on filing its U.S. Federal and state tax returns for the year ended December 31, 2022, prior to the extended filing deadlines in all jurisdictions. Stock-Based Compensation The Company accounts for stock-based compensation arrangements with employees, non-employee directors and consultants using a fair value method, which requires the recognition of compensation expense for costs related to all stock-based awards, including stock option and restricted stock unit (“RSU”) grants. The fair value method requires the Company to estimate the fair value of stock-based payment awards on the date of grant using an option pricing model or the closing stock price on the date of grant in the case of RSUs. Stock-based compensation expense for awards granted to employees, non-employee directors and consultants are based on the fair value of the underlying instrument calculated using the Black-Scholes option-pricing model on the date of grant for stock options and using the closing stock price on the date of grant for RSUs and recognized as expense on a straight-line basis over the requisite service period, which is the vesting period. Determining the appropriate fair value model and related assumptions requires judgment, including estimating the future stock price volatility and expected terms. The expected volatility rates are estimated based on the Company’s historical actual volatility over the two-year period from its initial public offering on December 18, 2019 through December 31, 2021 for stock-based awards granted in 2022. For awards granted during the three months ended March 31, 2023, the expected volatility rates were estimated based on the Company’s historical actual volatility over the three-year period from its initial public offering on December 18, 2019, through December 31, 2022. The expected term for options granted to date is estimated using the simplified method. Forfeitures only include known forfeitures to-date as the Company accounts for forfeitures as they occur due to a limited history of forfeitures. The Company has not paid dividends and does not anticipate paying a cash dividend in the future vesting period and, accordingly, uses an expected dividend yield of zero. The risk-free interest rate is based on the rate of U.S. Treasury securities with maturities consistent with the estimated expected term of the awards. |
Investments
Investments | 3 Months Ended |
Mar. 31, 2023 | |
Investments | |
Investments | Note 3 - Investments As of March 31, 2023, the Company had two money market accounts and available-for-sale investments with contractual maturities of one year or less as follows: As of March 31, 2023 Cost Basis Unrealized Gains Aggregate Fair Value U.S. Treasury Bills $ 6,895,576 $ 48,684 $ 6,944,260 Money Market Accounts 3,479,184 - 3,479,184 Total $ 10,374,760 $ 48,684 $ 10,423,444 As of March 31, 2023, there were no available-for-sale securities in an unrealized-loss position. U.S. Treasury Bills classified as Investments on the condensed consolidated balance sheet as of March 31, 2023 were $6.0 million. As of December 31, 2022 the Company had two money market accounts and available-for-sale investments with contractual maturities of one year or less as follows: As of December 31, 2022 Cost Basis Unrealized Gains Aggregate Fair Value U.S. Treasury Bills $ 6,905,171 $ 15,039 $ 6,920,210 Money Market Accounts 5,262,286 - 5,262,286 Total $ 12,167,457 $ 15,039 $ 12,182,496 As of December 31, 2022, there were no available-for-sale securities in an unrealized-loss position and there were no sales of available-for-sale securities made during 2022. U.S. Treasury Bills classified as Investments on the condensed consolidated balance sheet as of December 31, 2022 were $4.9 million. See Note 2 for additional discussion regarding the Company’s fair value measurements. |
Capital Stock
Capital Stock | 3 Months Ended |
Mar. 31, 2023 | |
Capital Stock | |
Capital Stock | Note 4 - Capital Stock Holders of the common stock are entitled to receive such dividends as may be declared by the Board of Directors out of funds legally available therefor. To date no dividends have been declared. Upon dissolution and liquidation of the Company, holders of the common stock are entitled to a ratable share of the net assets of the Company remaining after payments to creditors of the Company. The holders of shares of common stock are entitled to one vote per share for the election of each director nominated to the Board and one vote per share on all other matters submitted to a vote of stockholders. The Company’s amended and restated certificate of incorporation authorizes the Company to issue 40,000,000 shares of common stock with a par value of $0.001 per share. Sales of Common Stock On April 20, 2022, the Company entered into a Capital on Demand™ Sales Agreement with JonesTrading Institutional Services LLC (“JonesTrading”), pursuant to which Monopar may offer and sell, from time to time, through or to JonesTrading, as sales agent or principal, shares of Monopar’s common stock. On April 20, 2022, the Company filed a prospectus supplement with the U.S. Securities and Exchange Commission relating to the offer and sale of its common stock from time to time pursuant to the agreement up to an aggregate amount of $4,870,000. In addition, the Company filed a new Form S-3, which included therein a prospectus to increase the aggregate amount under this agreement to $6,505,642. The Form S-3 was declared effective by the Securities and Exchange Commission on January 4, 2023, at which time the prospectus included therein replaced the prior prospectus supplement. Expenses related to these financing activities were recorded as offering costs (a reduction of additional paid in capital) on the Company’s condensed consolidated statement of stockholders’ equity for the period. During the three months ended March 31, 2023, the Company sold 244,392 shares of its common stock at an average gross price per share of $3.46 for net proceeds of $823,855, after fees and commissions of $21,144. In addition, the Company incurred legal, accounting and other fees totaling $16,517 for net proceeds after fees, commissions and expenses of $807,338. During the three months ended March 31, 2022, the Company did not sell any shares of common stock. As of March 31, 2023, the Company had 13,222,056 shares of common stock issued and outstanding. |
Stock Incentive Plan
Stock Incentive Plan | 3 Months Ended |
Mar. 31, 2023 | |
Stock Incentive Plan | |
Stock Incentive Plan | Note 5 - Stock Incentive Plan In April 2016, the Company’s Board of Directors and stockholders representing a majority of the Company’s outstanding stock at that time, approved the Monopar Therapeutics Inc. 2016 Stock Incentive Plan, as amended (the “Plan”), allowing the Company to grant up to an aggregate 700,000 shares of stock-based awards in the form of stock options, restricted stock units, stock appreciation rights and other stock-based awards to employees, non-employee directors and consultants. In October 2017, the Company’s Board of Directors voted to increase the stock award pool to 1,600,000 shares of common stock, which subsequently was approved by the Company’s stockholders. In April 2020, the Company’s Board of Directors voted to increase the stock award pool to 3,100,000 (an increase of 1,500,000 shares of common stock), which was approved by the Company’s stockholders in June 2020. In April 2021, the Company’s Board of Directors voted to approve an amendment to the 2016 Stock Incentive Plan to remove certain individual award limits and other provisions related to I.R.C. Section 162(m) and to update the limit on Incentive Stock Options to no more that 100% of the maximum aggregate number of shares which may be granted under the plan, which was approved by the Company’s stockholders in June 2021. In March 2022, the Company’s Board of Directors voted to increase the stock award pool to 5,100,000 (an increase of 2,000,000 shares of common stock), which was approved by the Company’s stockholders in June 2022. During the three months ended March 31, 2023, the Company’s Plan Administrator Committee (with regards to non-officer employees and consultants) and the Company’s Compensation Committee, as ratified by the Board of Directors (in case of executive officers and non-employee directors), granted to executive officers, non-officer employees, non-employee directors and consultants aggregate stock options for the purchase of 508,902 shares of the Company’s common stock with exercise prices ranging from $2.37 to $3.16 per share which vest over 1 to 4 years. All stock option grants have a 10-year term. Under the Plan, the per share exercise price for the shares to be issued upon exercise of an option shall be determined by the Plan Administrator, except that the per share exercise price shall be no less than 100% of the fair market value per share on the grant date. Fair market value is the Company’s closing price on the grant date on Nasdaq. Stock options generally expire after 10 years. Stock option activity under the Plan was as follows: Options Outstanding Number of Shares Subject to Options Weighted-Average Exercise Price Balances at December 31, 2022 1,642,950 4.28 Granted (1) 508,902 3.14 Forfeited (2) (5,729 ) 2.44 Balances at March 31, 2023 2,146,123 4.01 Unvested options outstanding expected to vest (3) 901,308 3.45 (1) 508,902 options vest as follows: options to purchase 443,182 shares of the Company’s common stock vest 6/48ths on the six-month anniversary of grant date and 1/48th per month thereafter; options to purchase 55,720 shares of the Company’s common stock vest quarterly over one year; and options to purchase 10,000 shares of the Company’s common stock vest monthly over one year. (2) Forfeited options represent unvested shares and vested, unexercised shares related to employee terminations. (3) Forfeitures only include known forfeitures to-date as the Company accounts for forfeitures as they occur due to a limited history of forfeitures. Exercise Prices Number of Shares Subject to Options Outstanding Weighted-Average Remaining Contractual Term in Years Number of Shares Subject to Options Fully Vested and Exercisable Weighted-Average Remaining Contractual Term in Years $0.001-$5.00 1,397,112 7.73 600,616 5.38 $5.01-$10.00 629,216 6.14 528,988 5.78 $10.01-$15.00 113,670 6.81 109,086 6.80 $15.01-$20.00 6,125 6.84 6,125 6.84 2,146,123 7.21 1,244,815 5.68 Restricted stock unit activity under the Plan was as follows: Restricted Stock Units (#) Weighted- Average Grant Date Fair Value per Unit ($) Unvested balance at December 31, 2022 272,650 4.00 Granted 368,345 3.16 Vested (41,202 ) 5.35 Unvested Balance at March 31, 2023 599,793 3.39 During the three months ended March 31, 2023, and 2022, the Company recognized $244,337 and $204,474 of employee, non-employee director and consultant stock-based compensation expense as general and administrative expenses, respectively, and $231,872 and $295,338 as research and development expenses, respectively. The stock-based compensation expense is allocated on a departmental basis, based on the classification of the stock-based award holder. No income tax benefits have been recognized in the condensed consolidated statements of operations and comprehensive loss for stock-based compensation arrangements. The fair value of options granted for the three months ended March 31, 2023, was based on the Black-Scholes option-pricing model assuming the following factors: 5.3 to 6.1 years expected term, 90% volatility, 3.5% to 4.0% risk free interest rate and zero dividends. The expected term for options granted to date was estimated using the simplified method. Stock option grants and fair values under the Plan were as follows: Three Months Ended March 31, 2023 2022 Stock options granted 508,902 553,064 Weighted-average grant date fair value per share $ 2.38 2.11 Fair value of shares vested $ 223,273 292,328 At March 31, 2023, the aggregate intrinsic value of outstanding vested stock options was approximately $0.5 million (there were no unvested stock options that had intrinsic value) and the weighted-average exercise price in aggregate was $4.01 which includes $4.42 for fully vested stock options and $3.45 for stock options expected to vest. At March 31, 2023, unamortized unvested balance of stock-based compensation was $4.1 million, to be amortized over the following 3.0 years. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2023 | |
Related Party Transactions | |
Related Party Transactions | Note 6 - Related Party Transactions As of March 31, 2023, Tactic Pharma, LLC (“Tactic Pharma”), the Company’s initial investor, beneficially owned 32.4% of Monopar’s common stock and during the three months ended March 31, 2023, there were no transactions between Tactic Pharma and Monopar. None of the related parties discussed in this paragraph received compensation other than market-based salary, market-based stock-based compensation and benefits and performance-based incentive bonus or in the case of non-employee directors, market-rate Board fees and market-rate stock-based compensation. The Company considers the following individuals as related parties: Two of the Company’s board members were also Managing Members of Tactic Pharma as of March 31, 2023. Chandler D. Robinson is a Company Co-Founder, Chief Executive Officer, common stockholder, Managing Member of Tactic Pharma, former Manager of the predecessor LLC, Manager of CDR Pharma, LLC and Board member of Monopar as a C Corporation. Michael Brown is a Managing Member of Tactic Pharma (as of February 1, 2019, with no voting power as it relates to Monopar), a previous managing member of Monopar as an LLC, common stockholder and Board member of Monopar as a C Corporation. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and contingencies (Note 8) | |
Commitments And Contingencies | Note 7 – Commitments and Contingencies License, Development and Collaboration Agreements Onxeo S.A. In June 2016, the Company executed an option and license agreement with Onxeo S.A. (“Onxeo”), a public French company, which gave Monopar the exclusive option to license (on a world-wide exclusive basis) Validive to pursue treating severe oral mucositis in patients undergoing chemoradiation treatment for head and neck cancers. The pre-negotiated Onxeo license agreement for Validive as part of the option agreement includes clinical, regulatory, developmental and sales milestones and escalating royalties on net sales . On September 8, 2017, the Company exercised the license option, and therefore paid Onxeo the $1 million fee under the option and license agreement. On March 27, 2023, Monopar announced the discontinuation of its Validive Phase 2b/3 VOICE trial based upon the Data Safety Monitoring Board (“DSMB”) determination that the trial did not meet the pre-defined threshold for efficacy of a 15% absolute difference in severe oral mucositis prevention between Validive and placebo. The Company does not anticipate further development under the Onxeo license agreement or any future license or royalty obligations. Grupo Español de Investigación en Sarcomas (“GEIS”) In June 2019, the Company executed a clinical collaboration agreement with GEIS for the development of camsirubicin in patients with advanced soft tissue sarcoma (“ASTS”). Following completion of the Company’s Phase 1b clinical trial in the U.S. that Monopar initiated in the third quarter of 2021 with the first patient dosed in October 2021, the Company continues to expect that GEIS will sponsor and lead a multi-country, randomized, open-label Phase 2 clinical trial to evaluate camsirubicin head-to-head against doxorubicin, the current first-line treatment for ASTS. The Company will provide study drug and supplemental financial support for the clinical trial. During the three months ended March 31, 2023 and March 31, 2022, no expenses were incurred under the GEIS agreement. The Company can terminate the agreement by providing GEIS with advance notice, and without affecting the Company’s rights and ownership to any related intellectual property or clinical data. In the second quarter of 2021, due to regulatory delays in Spain, Monopar decided to conduct an open-label Phase 1b clinical trial of camsirubicin in the U.S., therefore no expenses were incurred related to the GEIS collaboration beyond March 31, 2021. XOMA Ltd. The intellectual property rights contributed by Tactic Pharma to the Company included the non-exclusive license agreement with XOMA Ltd. for the humanization technology used in the development of MNPR-101. Pursuant to such license agreement, the Company is obligated to pay XOMA Ltd. clinical, regulatory and sales milestones for MNPR-101 that could reach up to $14.925 million if the Company achieves all milestones. The agreement does not require the payment of sales royalties. There can be no assurance that the Company will reach any milestones under the XOMA agreement. As of March 31, 2023, the Company had not reached any milestones and has not been required to pay XOMA Ltd. any funds under this license agreement. Legal Contingencies The Company may be subject to claims and assessments from time to time in the ordinary course of business. No claims have been asserted to date. Indemnification In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties and provide for general indemnification. The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the future, but that have not yet been made. To date, the Company has not paid any claims nor been required to defend any action related to its indemnification obligations. However, the Company may record charges in the future as a result of future claims against these indemnification obligations. In accordance with its second amended and restated certificate of incorporation, amended and restated bylaws and the indemnification agreements entered into with each officer and non-employee director, the Company has indemnification obligations to its officers and non-employee directors for certain events or occurrences, subject to certain limits, while they are serving at the Company’s request in such capacities. There have been no indemnification claims to date. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Significant Accounting Policies | |
Basis Of Presentation | These condensed consolidated financial statements include the financial results of Monopar Therapeutics Inc., its wholly-owned French subsidiary, Monopar Therapeutics, SARL, and its wholly-owned Australian subsidiary, Monopar Therapeutics Australia Pty Ltd, and have been prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”) and include all disclosures required by GAAP for financial reporting. All intercompany accounts have been eliminated. The principal accounting policies applied in the preparation of these condensed consolidated financial statements are set out below and have been consistently applied in all periods presented. The Company has been primarily involved in performing research activities, developing product candidates, and raising capital to support and expand these activities. The accompanying interim unaudited condensed consolidated financial statements contain all normal, recurring adjustments necessary to present fairly the Company’s condensed consolidated financial position as of March 31, 2023, and the Company’s condensed consolidated results of operations and comprehensive loss for the three months ended March 31, 2023, and 2022, and the Company’s condensed consolidated cash flows for the three months ended March 31, 2023, and 2022. The interim condensed consolidated results of operations and comprehensive loss and condensed consolidated cash flows for the periods presented are not necessarily indicative of the condensed consolidated results of operations or cash flows which may be reported for the remainder of 2023 or for any future period. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2022, included in the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 23, 2023. |
Functional Currency | The Company’s consolidated functional currency is the U.S. Dollar. The Company’s Australian subsidiary and French subsidiary use the Australian Dollar and European Euro, respectively, as their functional currency. At each quarter-end, each foreign subsidiary’s balance sheets are translated into U.S. Dollars based upon the quarter-end exchange rate, while their statements of operations and comprehensive loss and statements of cash flows are translated into U.S. Dollars based upon an average exchange rate during the period. |
Comprehensive Loss | Comprehensive loss represents net loss plus any income or losses not reported in the condensed consolidated statements of operations and comprehensive loss, such as foreign currency translations gains and losses and unrealized gains and losses on debt security investments that are reflected on the Company’s condensed consolidated statements of stockholders’ equity. |
Use Of Estimates | 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, disclosure of contingent assets and liabilities, and reported amounts of expenses in the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. |
Going Concern Assessment | The Company applies Accounting Standards Codification 205-40 (“ASC 205-40”), Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern |
Cash Equivalents | The Company considers all highly liquid investments purchased with a maturity of 90 days or less on the date of purchase to be cash equivalents. Cash equivalents as of March 31, 2023, and December 31 2022, consisted of two money market accounts and U.S. Treasury Bills. |
Investments | The Company considers all of its investments in debt securities (U.S. Government or Agencies), with maturities at the date of purchase from three months to one year to be available-for-sale securities. These investments are recorded at fair value with the unrealized gains and losses reflected in accumulated other comprehensive income (loss) on the Company’s condensed consolidated balance sheets. Realized gains and losses from the sale of investments, if any are determined, are recorded net in the condensed consolidated statements of operations and comprehensive loss. The investments selected by the Company have a low level of inherent credit risk given they are issued by the U.S. government and any changes in their fair value are primarily attributable to changes in interest rates and market liquidity. Investments as of March 31, 2023, and December 31, 2022, consisted of U.S. Treasury Bills with maturities of 91 days to one year. |
Prepaid Expenses | Prepayments are expenditures for goods or services before the goods are used or the services are received and are charged to operations as the benefits are realized. Prepaid expenses may include payments to development collaborators in excess of actual expenses incurred by the collaborator measured at the end of each reporting period. Prepayments also include insurance premiums, dues and subscriptions and software costs of $10,000 or more per year that are expensed monthly over the life of the contract, which is typically one year. Prepaid expenses are reflected on the Company’s condensed consolidated balance sheets as other current assets. |
Leases | Lease agreements are evaluated to determine whether an arrangement is or contains a lease in accordance with ASC 842, Leases |
Concentration Of Credit Risk | Financial instruments that potentially subject the Company to concentration of credit risk consist of cash and cash equivalents. The Company maintains cash and cash equivalents at two reputable financial institutions. As of March 31, 2023, the balance at one financial institution was in excess of the $250,000 Federal Deposit Insurance Corporation (“FDIC”) insurable limit. The Company has not experienced any losses on its deposits since inception and management believes the Company is not exposed to significant risks with respect to these financial institutions. |
Fair Value Of Financial Instruments | For financial instruments consisting of cash and cash equivalents, investments, accounts payable, accrued expenses, and other current liabilities, the carrying amounts are reasonable estimates of fair value due to their relatively short maturities. The Company adopted ASC 820, Fair Value Measurements and Disclosures, The standard establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources. Unobservable inputs reflect a reporting entity’s pricing an asset or liability developed based on the best information available under the circumstances. The fair value hierarchy consists of the following three levels: Level 1 Level 2 Level 3 Determining which category an asset or liability falls within the hierarchy requires significant judgment. The Company evaluates its hierarchy disclosures each reporting period. There were no transfers between Level 1, 2 or 3 of the fair value hierarchy during the three months ended March 31, 2023, and 2022. The following table presents the assets and liabilities that are reported at fair value on our condensed consolidated balance sheets on a recurring basis. No values were recorded in Level 2 or Level 3 at March 31, 2023, and December 31, 2022. Assets and Liabilities Measured at Fair Value on a Recurring Basis March 31, 2023 Level 1 Total Assets: Cash equivalents (1) $ 4,472,806 $ 4,472,806 Investments (2) 5,950,638 5,950,638 Total $ 10,423,444 $ 10,423,444 December 31 2022 Level 1 Total Assets: Cash equivalents (1) $ 7,248,946 $ 7,248,946 Investments (2) 4,933,550 4,933,550 Total $ 12,182,496 $ 12,182,496 (1) Cash equivalents as of March 31, 2023, and December 31, 2022, represent the fair value of the Company’s investment in two money market accounts and U.S. Treasury Bills with maturities at the date of purchase of less than 90 days. (2) Investments represents the fair value of the Company’s investment in U.S. Treasury Bills with maturities at the date of purchase from 91 days to one year. |
Net Loss Per Share | Net loss per share for the three months ended March 31, 2023, and 2022, is calculated by dividing net loss by the weighted-average shares of common stock outstanding during the periods. Diluted net loss per share for the three months ended March 31, 2023, and 2022, is calculated by dividing net loss by the weighted-average shares of the sum of a) weighted average common stock outstanding (13,105,831 and 12,604,443 shares for the three months ended March 31, 2023 and 2022, respectively) and b) potentially dilutive shares of common stock (such as stock options and restricted stock units) outstanding during the period. As of March 31, 2023, and 2022, potentially dilutive securities included stock-based awards to purchase up to 2,745,916 and 2,548,155 shares of the Company’s common stock, respectively. For the three months ended March 31, 2023, and 2022, potentially dilutive securities are excluded from the computation of fully diluted net loss per share as their effect is anti-dilutive. |
Research And Development Expenses | Research and development (“R&D”) costs are expensed as incurred. Major components of R&D expenses include salaries and benefits paid to the Company’s R&D staff, compensation expenses of G&A personnel performing R&D, fees paid to consultants and to the entities that conduct certain R&D activities on the Company’s behalf and materials and supplies which were used in R&D activities during the reporting period. |
Clinical Trials Accruals | The Company accrues and expenses the costs for clinical trial activities performed by third parties based upon estimates of the percentage of work completed over the life of the individual study in accordance with agreements established with contract research organizations, service providers, and clinical trial sites. The Company estimates the amounts to accrue based upon discussions with internal clinical personnel and external service providers as to progress or stage of completion of trials or services and the agreed upon fees to be paid for such services. Costs of setting up clinical trial sites for participation in the trials are expensed immediately as R&D expenses. Clinical trial site costs related to patient screening and enrollment are accrued as patients are screened/entered into the trial. |
Collaborative Agreements | The Company and its collaborative partners are active participants in collaborative agreements and all parties would be exposed to significant risks and rewards depending on the technical and commercial success of the activities. Contractual payments to the other parties in collaboration agreements and costs incurred by the Company when the Company is deemed to be the principal participant for a given transaction are recognized on a gross basis in R&D expenses. Royalties and license payments are recorded as earned. During the three months ended March 31, 2023, and 2022, no milestones were met, and no royalties were earned, therefore, the Company did not pay or accrue/expense any license or royalty payments. |
Licensing Agreements | The Company has various agreements licensing technology utilized in the development of its product or technology programs. The licenses contain success milestone obligations and royalties on future sales. During the three months ended March 31, 2023, and 2022, no milestones were met, and no royalties were earned, therefore, the Company did not pay or accrue/expense any license or royalty payments under any of its license agreements. |
Patent Costs | The Company expenses costs relating to issued patents and patent applications, including costs relating to legal, renewal and application fees, as a component of general and administrative expenses in its condensed consolidated statements of operations and comprehensive loss. |
Income Taxes | The Company uses an asset and liability approach for accounting for deferred income taxes, which requires recognition of deferred income tax assets and liabilities for the expected future tax consequences of events that have been recognized in its financial statements but have not been reflected in its taxable income. Estimates and judgments are required in the calculation of certain tax liabilities and in the determination of the recoverability of certain deferred income tax assets, which arise from temporary differences and carryforwards. Deferred income tax assets and liabilities are measured using the currently enacted tax rates that apply to taxable income in effect for the years in which those tax assets and liabilities are expected to be realized or settled. The Company regularly assesses the likelihood that its deferred income tax assets will be realized from recoverable income taxes or recovered from future taxable income. To the extent that the Company believes any amounts are not “more likely than not” to be realized, the Company records a valuation allowance to reduce the deferred income tax assets. In the event the Company determines that all or part of the net deferred tax assets are not realizable in the future, an adjustment to the valuation allowance would be charged to earnings in the period such determination is made. Similarly, if the Company subsequently determines deferred income tax assets that were previously determined to be unrealizable are now realizable, the respective valuation allowance would be reversed, resulting in an adjustment to earnings in the period such determination is made. Internal Revenue Code Sections 382 and 383 (“Sections 382 and 383”) limit the use of net operating loss (“NOL”) carryforwards and R&D credits, after an ownership change. To date, the Company has not conducted a Section 382 or 383 study, however, because the Company will continue to raise significant amounts of equity in the coming years, the Company expects that Sections 382 and 383 will limit the Company’s usage of NOLs and R&D credits in the future. ASC 740, Income Taxes The Company is subject to U.S. Federal, Illinois and California state income taxes. In addition, the Company is subject to local tax laws of France and Australia. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. Monopar was originally formed as an LLC in December 2014, then incorporated on December 16, 2015. The Company is subject to U.S. Federal, state and local tax examinations by tax authorities for the tax years 2015 through 2021. The Company does not anticipate significant changes to its current uncertain tax positions through March 31, 2024. The Company plans on filing its U.S. Federal and state tax returns for the year ended December 31, 2022, prior to the extended filing deadlines in all jurisdictions. |
Stock-based Compensation | The Company accounts for stock-based compensation arrangements with employees, non-employee directors and consultants using a fair value method, which requires the recognition of compensation expense for costs related to all stock-based awards, including stock option and restricted stock unit (“RSU”) grants. The fair value method requires the Company to estimate the fair value of stock-based payment awards on the date of grant using an option pricing model or the closing stock price on the date of grant in the case of RSUs. Stock-based compensation expense for awards granted to employees, non-employee directors and consultants are based on the fair value of the underlying instrument calculated using the Black-Scholes option-pricing model on the date of grant for stock options and using the closing stock price on the date of grant for RSUs and recognized as expense on a straight-line basis over the requisite service period, which is the vesting period. Determining the appropriate fair value model and related assumptions requires judgment, including estimating the future stock price volatility and expected terms. The expected volatility rates are estimated based on the Company’s historical actual volatility over the two-year period from its initial public offering on December 18, 2019 through December 31, 2021 for stock-based awards granted in 2022. For awards granted during the three months ended March 31, 2023, the expected volatility rates were estimated based on the Company’s historical actual volatility over the three-year period from its initial public offering on December 18, 2019, through December 31, 2022. The expected term for options granted to date is estimated using the simplified method. Forfeitures only include known forfeitures to-date as the Company accounts for forfeitures as they occur due to a limited history of forfeitures. The Company has not paid dividends and does not anticipate paying a cash dividend in the future vesting period and, accordingly, uses an expected dividend yield of zero. The risk-free interest rate is based on the rate of U.S. Treasury securities with maturities consistent with the estimated expected term of the awards. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Significant Accounting Policies | |
Assets And Liabilities Measured At Fair Value On A Recurring Basis | March 31, 2023 Level 1 Total Assets: Cash equivalents (1) $ 4,472,806 $ 4,472,806 Investments (2) 5,950,638 5,950,638 Total $ 10,423,444 $ 10,423,444 December 31 2022 Level 1 Total Assets: Cash equivalents (1) $ 7,248,946 $ 7,248,946 Investments (2) 4,933,550 4,933,550 Total $ 12,182,496 $ 12,182,496 |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Investments | |
summary of sale investments with contractual maturities | As of March 31, 2023 Cost Basis Unrealized Gains Aggregate Fair Value U.S. Treasury Bills $ 6,895,576 $ 48,684 $ 6,944,260 Money Market Accounts 3,479,184 - 3,479,184 Total $ 10,374,760 $ 48,684 $ 10,423,444 As of December 31, 2022 Cost Basis Unrealized Gains Aggregate Fair Value U.S. Treasury Bills $ 6,905,171 $ 15,039 $ 6,920,210 Money Market Accounts 5,262,286 - 5,262,286 Total $ 12,167,457 $ 15,039 $ 12,182,496 |
Stock Incentive Plan (Tables)
Stock Incentive Plan (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Stock Incentive Plan | |
Stock Option Activity | Options Outstanding Number of Shares Subject to Options Weighted-Average Exercise Price Balances at December 31, 2022 1,642,950 4.28 Granted (1) 508,902 3.14 Forfeited (2) (5,729 ) 2.44 Balances at March 31, 2023 2,146,123 4.01 Unvested options outstanding expected to vest (3) 901,308 3.45 |
Options Outstanding | Exercise Prices Number of Shares Subject to Options Outstanding Weighted-Average Remaining Contractual Term in Years Number of Shares Subject to Options Fully Vested and Exercisable Weighted-Average Remaining Contractual Term in Years $0.001-$5.00 1,397,112 7.73 600,616 5.38 $5.01-$10.00 629,216 6.14 528,988 5.78 $10.01-$15.00 113,670 6.81 109,086 6.80 $15.01-$20.00 6,125 6.84 6,125 6.84 2,146,123 7.21 1,244,815 5.68 |
Restricted Stock Unit Activity | Restricted Stock Units (#) Weighted- Average Grant Date Fair Value per Unit ($) Unvested balance at December 31, 2022 272,650 4.00 Granted 368,345 3.16 Vested (41,202 ) 5.35 Unvested Balance at March 31, 2023 599,793 3.39 |
Schedule Of Stock Option Grants And Fair Values | Three Months Ended March 31, 2023 2022 Stock options granted 508,902 553,064 Weighted-average grant date fair value per share $ 2.38 2.11 Fair value of shares vested $ 223,273 292,328 |
Nature of Business and Liquid_2
Nature of Business and Liquidity (Details Narrative) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Retained Earnings (Accumulated Deficit) | $ (54,238,577) | $ (51,804,021) |
Liquidity [Member] | ||
Retained Earnings (Accumulated Deficit) | $ 5,420,000 |
Significant Accounting Polici_4
Significant Accounting Policies (Details) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Assets | ||
Cash equivalents | $ 4,472,806 | $ 7,248,946 |
Investments | 5,950,638 | 4,933,550 |
Total | 10,423,444 | 12,182,496 |
Level 1 | ||
Assets | ||
Cash equivalents | 4,472,806 | 7,248,946 |
Investments | 5,950,638 | 4,933,550 |
Total | $ 10,423,444 | $ 12,182,496 |
Significant Accounting Polici_5
Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Significant Accounting Policies | ||
Weighted Average Number of Shares Outstanding, Basic and Diluted | 13,105,831 | 12,604,443 |
Insurance premiums, dues, subscription, and software cost paid in advance | $ 10,000 | |
FDIC insurable limit | $ 250,000 | |
Potentially dilutive securities | 2,745,916 | 2,548,155 |
Investments (Details)
Investments (Details) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Aggregate Cost Basis | $ 10,374,760 | $ 12,167,457 |
Unrealized Gains | 48,684 | 15,039 |
Aggregate Fair Value | 10,423,444 | 12,182,496 |
U.S. Treasury Bills | ||
Available For Sale Debt Securities Amortized Cost Basis | 6,895,576 | 6,905,171 |
Available-for-sale debt securities accumulated gross unrealized gain | 48,684 | 15,039 |
Available for sale debt securities aggregate fair value | 6,944,260 | 6,920,210 |
Money Market Funds [Member] | ||
Money market amortized cost basis | 3,479,184 | 5,262,286 |
Unrealized Gains | 0 | 0 |
Aggregate Fair Value | $ 3,479,184 | $ 5,262,286 |
Investments (Details Narrative)
Investments (Details Narrative) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Investments | ||
Available For Sale Debt Securities | $ 600 | $ 490 |
Capital Stock (Details Narrativ
Capital Stock (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2023 | Dec. 31, 2022 | Apr. 20, 2022 | |
Capital Stock | |||
Fees and commissions | $ 21,144 | ||
Proceeds from sale of stock | $ 823,855 | ||
Average gross price per share | $ 3.46 | ||
Sale of common stock shares | 244,392 | ||
Common stock, par value | $ 0.001 | $ 0.001 | |
Pursuant aggregate amount | $ 4,870,000 | ||
Common stock, authorized | 40,000,000 | 40,000,000 | |
Legal, accounting and other fees | $ 16,517 | ||
Net proceeds after fees, commissions and expenses | $ 807,338 | ||
Common Stock, Issued and Outstanding | 13,222,056 | ||
Aggregate amount increased | $ 6,505,642 | ||
Common stock, outstanding | 13,222,056 | 12,946,573 |
Stock Incentive Plan (Details)
Stock Incentive Plan (Details) | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Stock Incentive Plan | |
Stock options outstanding, beginning | shares | 1,642,950 |
Stock options, granted | shares | 508,902 |
Stock options, forfeited | shares | (5,729) |
Stock options outstanding, ending | shares | 2,146,123 |
Unvested options outstanding expected to vest | shares | 901,308 |
Weighted-Average Exercise Price, beginning | $ / shares | $ 4.28 |
Weighted average exercise price, granted | $ / shares | 3.14 |
Weighted average exercise price, forfeited | $ / shares | 2.44 |
Weighted average exercise price outstanding, ending | $ / shares | 4.01 |
Weighted-Average Exercise Price unvested options outstanding expected to vest | $ / shares | $ 3.45 |
Stock Incentive Plan (Details 1
Stock Incentive Plan (Details 1) | 3 Months Ended |
Mar. 31, 2023 shares | |
Number of Shares Subject to Options Outstanding | 2,146,123 |
Options outstanding Contractual Term in Years | 7 years 2 months 15 days |
Number of shares fully vested and exercisable | 1,244,815 |
Options fully vested and exercisable Contractual Term in Years | 5 years 8 months 4 days |
Option 1 | |
Number of Shares Subject to Options Outstanding | 1,397,112 |
Options outstanding Contractual Term in Years | 7 years 8 months 23 days |
Number of shares fully vested and exercisable | 600,616 |
Options fully vested and exercisable Contractual Term in Years | 5 years 4 months 17 days |
Exercise price | 0.001-$5.00 |
Option 2 | |
Number of Shares Subject to Options Outstanding | 629,216 |
Options outstanding Contractual Term in Years | 6 years 1 month 20 days |
Number of shares fully vested and exercisable | 528,988 |
Options fully vested and exercisable Contractual Term in Years | 5 years 9 months 10 days |
Exercise price | 5.01-$10.00 |
Option 3 | |
Number of Shares Subject to Options Outstanding | 113,670 |
Options outstanding Contractual Term in Years | 6 years 9 months 21 days |
Number of shares fully vested and exercisable | 109,086 |
Options fully vested and exercisable Contractual Term in Years | 6 years 9 months 18 days |
Exercise price | 10.01-$15.00 |
Option 4 | |
Number of Shares Subject to Options Outstanding | 6,125 |
Options outstanding Contractual Term in Years | 6 years 10 months 2 days |
Number of shares fully vested and exercisable | 6,125 |
Options fully vested and exercisable Contractual Term in Years | 6 years 10 months 2 days |
Exercise price | 15.01-$20.00 |
Stock Incentive Plan (Details 2
Stock Incentive Plan (Details 2) - Restricted Stock Units - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested | 599,793 | 272,650 |
Unvested restricted stock units, granted | 368,345 | |
Unvested Restricted Stock Units, Vested | (41,202) | |
Weighted-average grant date fair value per unit, granted | $ 3.16 | |
Weighted-average grant date fair value per unit, vested | 5.35 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ 3.39 | $ 4 |
Stock Incentive Plan (Details 3
Stock Incentive Plan (Details 3) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Stock Incentive Plan | ||
Stock options granted | 508,902 | 553,064 |
Weighted-average grant date fair value per share | $ 2.38 | $ 2.11 |
Fair value of shares vested | $ 223,273 | $ 292,328 |
Stock Incentive Plan (Details N
Stock Incentive Plan (Details Narrative) - USD ($) | 3 Months Ended | |||
Mar. 31, 2023 | Mar. 31, 2022 | Oct. 31, 2017 | Apr. 30, 2016 | |
Stock Option Grants Term Period | 10 years | |||
Aggregate intrinsic value of outstanding vested stock options | $ 500,000 | |||
Weighted-average exercise price | $ 4.01 | |||
Unamortized unvested balance of stock base compensation | $ 410,000 | |||
Unamortized unvested balance of stock base compensation, period | 3 years | |||
Weighted Average Stock Options Expected To Vest | $ 3.45 | |||
Description of exercise price | exercise prices ranging from $2.37 to $3.16 per share which vest over 1 to 4 years. All stock option grants have a 10-year term. | |||
Weighted average vested exercise price | $ 4.42 | |||
Stock Option Granted | 508,902 | |||
Stock-based compensation expense (non-cash) | $ 476,209 | $ 499,812 | ||
Minimum Member | ||||
Risk free interest rate | 3.50% | |||
Expected term | 5 years 3 months 18 days | |||
Volatility | 90% | |||
Maximum Member | ||||
Risk free interest rate | 4% | |||
Expected term | 6 years 1 month 6 days | |||
Stock award pool [Member] | ||||
Share based compensation arrangement by share based payment award number of additional shares authorized | 1,500,000 | |||
2016 Stock Incentive Plan | ||||
Share based compensation arrangement by share based payment award number of shares authorized | 700,000 | |||
October 2017 | Board of Directors | ||||
Share based compensation arrangement by share based payment award number of shares authorized | 1,600,000 | |||
April 2020 | Board of Directors | ||||
Share based compensation arrangement by share based payment award number of shares authorized | 3,100,000 | |||
Vested 6/48ths on 6 month anniversary of grant date and 1/48th per month thereafter | ||||
Option to purchase shares | 443,182 | |||
Vested quarterly over one year | ||||
Option to purchase shares | 55,720 | |||
Vested monthly over one year | ||||
Option to purchase shares | 10,000 | |||
Options [Member] | ||||
Aggregate Stock Option Purchase Of Shares | 508,902 | |||
Research and Development Expenses | ||||
Stock-based compensation expense (non-cash) | $ 231,872 | 295,338 | ||
Research and Development Expense [Member] | ||||
Stock-based compensation expense (non-cash) | $ 244,337 | $ 204,474 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) | 3 Months Ended |
Mar. 31, 2023 | |
Tactic Pharma LLC | |
Beneficial ownership | 32.40% |
Commitments and Contingencies (
Commitments and Contingencies (Details) | 3 Months Ended |
Mar. 31, 2023 | |
XOMA Ltd [Member] | |
Option And License Agreement Description | clinical, regulatory and sales milestones for MNPR-101 that could reach up to $14.925 million if the Company achieves all milestones |