MIRA Pharmaceuticals reported financial results for the second quarter ended June 30, 2024. As is typical for a preclinical-stage company, revenue was $0, on par with our estimates. GAAP EPS of $(0.11) missed our earnings expectations of $(0.08), mainly due to higher-than-forecast general and administrative expenses. Common shares outstanding remained unchanged at 14,780,885.
MIRA’s cash position decreased from $4.6 million on December 31, 2023 to $2.9 million on June 30, 2024, causing the company’s current ratio to deteriorate from 8.7x to 3.7x. We note that while current cash is expected to support operations through year-end 2024, MIRA expects to generate losses for the foreseeable future and will need to secure significant external funding in the near-term to continue the development of its two preclinical assets.
We update our FY 2024 earnings estimate to $(0.52) to account for higher than previously modeled G&A costs. We also lower our year-end 2025 price target to $7.50, in light of the pressure MIRA is experiencing to secure additional funding by year-end, the associated likely dilution of existing shareholders, and the uncertainty around MIRA’s ability to continue as a going concern.
We further note that MIRA’s CEO, Erez Aminov, was named Chairman of the Board and CEO of Telomir Pharmaceuticals, following the passing of Telomir’s previous CEO, Christopher Chapman, Jr., MD. Telomir Pharmaceuticals is a preclinical-stage pharmaceutical company focused on the development and commercialization of Telomir-1 for the treatment of age-related conditions. Having Mr. Aminov dividing his time and attention between two preclinical-stage companies further increases the risk profiles of both.
Notwithstanding MIRA’s financial pressures, we remain optimistic about the prospects of the company’s preclinical assets.
MIRA recently revealed that Nor-Ketamir-2, the principal metabolite of its lead asset, Ketamir-2, demonstrated superior selectivity and bioavailability, as well as extended therapeutic efficacy.
A new formulation brings Nor-Ketamir-2’s bioavailability close to 100%, a significant improvement over traditional ketamine’s bioavailability of less than 30%. Taken together with Ketamir-2’s ability to passthrough the blood-brain barrier, this may allow for higher efficacy at lower doses or dosing frequencies.
The extended half-life and elevated levels of Nor-Ketamir-2 imply prolonged therapeutic effects, and the higher receptor binding site specificity of Ketamir-2 and Nor-Ketamir-2 suggest a reduced risk of adverse effects such as dissociation and hallucinations, enhancing the drug’s safety profile.
If validated in clinical trials, Ketamir-2 has the potential to offer effective treatment for neurological and neuropsychiatric disorders such as depression, treatment-resistant depression, and post-traumatic stress disorder, with a more convenient oral administration route than current marketed therapies.
In pursuit of its goal to file an Investigational New Drug (IND) application by year-end, MIRA has begun IND-enabling regulatory safety studies and is progressing with Good Manufacturing Practice (GMP)-compliant drug scale-up, devising a manufacturing process that allows large-scale, low-variability synthesis. The company is also completing Chemistry, Manufacturing, and Controls (CMC)documentation for Ketamir-2.
We will revisit and potentially revise our financial forecast during the fourth quarter of 2024, once additional information is available regarding the size and scale of MIRA’s upcoming financing round.