Jaguar Health, Inc. [JAGX] Filings

10-Q 1 jagx-20230630x10q.htm 10-Q

Table of Contents

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, 2023

☐

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

For the transition period from to

Commission file number 001-36714

JAGUAR HEALTH, INC.

(Exact name of registrant as specified in its charter)

Delaware		46-2956775
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

200 Pine Street, Suite 400

San Francisco, California 94104

(Address of principal executive offices, zip code)

(415) 371-8300

(Registrant’s telephone number, including area code)

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

Indicate by check mark whether the registrant has submitted electronically 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 ⌧ 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 ⌧	Smaller reporting company ☒
			Emerging growth company ☐

If an emerging growth company, indicate by a 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 ⌧

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


Title of each class:	Trading Symbol(s)	Name of each exchange on which registered:
Common stock, Par Value $0.0001 Per Share	JAGX	The NASDAQ Capital Market

As of August 14, 2023, there were (i) 19,117,219 shares of voting common stock, par value $0.0001 per share, outstanding, and (ii) 9 shares of non-voting common stock, par value $0.0001 per share, outstanding (convertible into nine shares of voting common stock).

Table of Contents


	Page No.
PART I. — FINANCIAL INFORMATION	1
Item 1. Condensed Consolidated Financial Statements	1
Condensed Consolidated Balance Sheets	1
Condensed Consolidated Statements of Comprehensive Losses	2
Condensed Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders’ Equity	4
Condensed Consolidated Statements of Cash Flows	8
Notes to Condensed Consolidated Financial Statements	10
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	48
Item 3. Quantitative and Qualitative Disclosures About Market Risk	63
Item 4. Controls and Procedures	63
PART II. — OTHER INFORMATION	65
Item 1. Legal Proceedings	65
Item 1A. Risk Factors	65
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	65
Item 3. Defaults Upon Senior Securities	65
Item 4. Mine Safety Disclosures	65
Item 5. Other Information	65
Item 6. Exhibits	66
SIGNATURE	67

Table of Contents

PART I. — FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

JAGUAR HEALTH, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS


	June 30,		December 31,
(In thousands, except share and per share data)	2023		2022
	(unaudited)
Assets
Current assets:
Cash	$	8,627	$	5,469
Accounts receivable		1,397		1,879
Other receivable		161		588
Inventory		8,264		7,024
Prepaid expenses and other current assets		9,778		7,361
Total current assets		28,227		22,321
Property and equipment, net		526		557
Operating lease - right-of-use asset		945		1,140
Intangible assets, net		21,463		22,439
Other assets		1,011		995
Total assets	$	52,172	$	47,452

Liabilities and Stockholders' equity (deficit)
Current liabilities:
Accounts payable	$	4,663	$	5,808
Accrued liabilities		10,018		8,165
Operating lease liability, current		515		483
Notes payable, current		13,807		15,883
Total current liabilities		29,003		30,339
Operating lease liability, net of current portion		495		725
Notes payable, net of discount, net of current portion (includes hybrid instrument designated at Fair Value Option amounting to $9.0 million as of June 30, 2023 and $7.8 million December 31, 2022, respectively)		16,846		17,744
Total liabilities		46,344		48,808

Commitments and contingencies (See Note 6)

Stockholders' equity (deficit)
Series B-2 convertible preferred stock: 10,165 shares designated from 4,475,074 preferred stock authorized at June 30, 2023 and December 31, 2022; zero shares issued and outstanding at June 30, 2023 and December 31, 2022		—		—
Series C perpetual preferred stock: 1,011,000 shares designated from 4,475,074 preferred stock authorized at June 30, 2023 and December 31, 2022; zero shares issued and outstanding at June 30, 2023 and December 31, 2022		—		—
Series E perpetual preferred stock: 10 shares designated from 4,475,074 preferred stock authorized at June 30, 2023 and December 31, 2022; zero shares issued and outstanding at June 30, 2023 and December 31, 2022		—		—
Series G convertible preferred stock: $0.0001 par value; 137 and zero shares designated from 4,475,074 preferred stock authorized at June 30, 2023 and December 31, 2022; 137 and zero shares issued and outstanding at June 30, 2023 and December 31, 2022		—		—
Series H convertible preferred stock: $0.0001 par value; 105 and zero shares designated from 4,475,074 preferred stock authorized at June 30, 2023 and December 31, 2022; 105 and zero shares issued and outstanding at June 30, 2023 and December 31, 2022		—		—
Common stock - voting: $0.0001 par value, 298,000,000 shares authorized at June 30, 2023 and December 31, 2022; 19,117,218 and 2,182,084 issued and outstanding at June 30, 2023 and December 31, 2022		1		—
Common stock - non-voting: $0.0001 par value, 50,000,000 shares authorized at June 30, 2023 and December 31, 2022; 9 shares issued and outstanding at June 30, 2023 and December 31, 2022		—		—
Additional paid-in capital		297,659		266,971
Noncontrolling interest		191		(699)
Accumulated deficit		(291,300)		(266,948)
Accumulated other comprehensive loss		(723)		(680)
Total Stockholders' equity (deficit)		5,828		(1,356)
Total liabilities and Stockholders' equity (deficit)	$	52,172	$	47,452

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

JAGUAR HEALTH, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSSES

(Unaudited)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands, except share and per share data)	2023		2022		2023		2022
Product revenue	$	2,676	$	2,921	$	4,648	$	5,546
Operating expenses
Cost of product revenue		491		456		836		911
Research and development		4,277		2,451		9,052		7,396
Sales and marketing		1,573		2,144		3,457		4,979
General and administrative		4,437		4,349		9,250		10,493
Total operating expenses		10,778		9,400		22,595		23,779
Loss from operations		(8,102)		(6,479)		(17,947)		(18,233)
Interest expense		(3,453)		(2,536)		(5,634)		(7,358)
Loss on extinguishment of debt		—		—		—		(2,187)
Change in fair value of financial instruments and hybrid instrument designated at Fair Value Option		(762)		709		(1,121)		477
Other income (expense)		26		(1,084)		14		(253)
Loss before income tax		(12,291)		(9,390)		(24,688)		(27,554)
Income tax expense		—		—		—		—
Net loss		(12,291)		(9,390)	$	(24,688)	$	(27,554)
Net loss attributable to noncontrolling interest		(141)		(23)	$	(336)	$	(201)
Net loss attributable to common stockholders	$	(12,150)	$	(9,367)	$	(24,352)	$	(27,353)
Net loss per share, basic	$	(0.69)	$	(8.77)	$	(2.14)	$	(29.51)
Net loss per share, diluted	$	(0.42)		(8.77)	$	(1.42)		(29.51)
Weighted-average common stock outstanding, basic		17,631,514		1,068,267		11,405,153		927,040
Weighted-average common stock outstanding, diluted		29,109,440		1,068,267		17,175,861		927,040

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

JAGUAR HEALTH, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSSES

(Unaudited)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands, except share and per share data)	2023		2022		2023		2022
Net loss	$	(12,291)	$	(9,390)	$	(24,688)	$	(27,554)
Other comprehensive income (loss)		183		—		(49)		—
Net comprehensive loss	$	(12,108)	$	(9,390)	$	(24,737)	$	(27,554)
Common stockholders:
Net loss attributable to common stockholders	$	(12,150)	$	(9,367)	$	(24,352)	$	(27,353)
Other comprehensive loss attributable to common stockholders
Translation adjustments		161		—		(43)		—
Net income (loss) and comprehensive loss attributable to common stockholders	$	(11,989)	$	(9,367)	$	(24,395)	$	(27,353)
Non-controlling interests:
Net loss attributable to non-controlling interests	$	(141)	$	(23)	$	(336)	$	(201)
Other comprehensive income (loss) attributable to non-controlling interests
Translation adjustments		22		—		(6)		—
Net loss and comprehensive loss attributable to non-controlling interests		(119)		(23)	$	(342)	$	(201)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

JAGUAR HEALTH, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES

IN CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY

(Unaudited)


	Series G Convertible preferred stock			Series H Convertible preferred stock			Common Stock - voting			Common Stock - non-voting			Additional		Noncontrolling		Accumulated		Accumulated other comprehensive		Total Stockholders'
(In thousands, except share data)	Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount		paid-in capital		interest		deficit		loss		Equity
Balances as of March 31, 2023	—	$	—	—	$	—	14,175,741	$	1	9	$	—	$	287,383	$	310	$	(279,150)	$	(884)	$	7,660
Preferred stock issued in PIPE financing, net of issuance and offering costs of $12	137		—	—		—	—		—	—		—		611		—		—		—		611
Preferred stock issued to Streeterville in exchange of notes payable and accrued interest	—		—	73		—	—		—	—		—		1,730		—		—		—		1,730
Preferred stock issued to Irving in exchange of notes payable and accrued interest	—		—	32		—	—		—	—		—		758		—		—		—		758
Common stock issued in At the Market offering, net of issuance and offering costs of $147	—		—	—		—	3,019,477		—	—		—		1,553		—		—		—		1,553
Common stock issued to Irving in exchange of notes payable and accrued interest	—		—	—		—	1,908,651		—	—		—		1,393		—		—		—		1,393
Common stock issued upon exercise of restricted stock units	—		—	—		—	13,149		—	—		—		9		—		—		—		9
Common stock issued to third party for services	—		—	—		—	200		—	—		—		—		—		—		—		—
Warrants issued in PIPE financing	—		—	—		—	—		—	—		—		1,235		—		—		—		1,235
Warrants issued to Irving in exchange of Standstill	—		—	—		—	—		—	—		—		1,934		—		—		—		1,934
Warrants issued to Iliad in exchange of Standstill	—		—	—		—	—		—	—		—		535		—		—		—		535
Stock-based compensation	—		—	—		—	—		—	—		—		518		—		—		—		518
Net loss	—		—	—		—	—		—	—		—		—		(141)		(12,150)		—		(12,291)
Translation loss	—		—	—		—	—		—	—		—		—		22		—		161		183
Balances as of June 30, 2023	137	$	—	105	$	—	19,117,218	$	1	9	$	—	$	297,659	$	191	$	(291,300)	$	(723)	$	5,828

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

JAGUAR HEALTH, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES

IN CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY

(Unaudited)


	Series G Convertible preferred stock			Series H Convertible preferred stock			Common Stock - voting			Common Stock - non-voting			Additional		Noncontrolling		Accumulated		Accumulated other comprehensive		Total Stockholders'
(In thousands, except share data)	Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount		paid-in capital		interest		deficit		loss		Equity
Balances as of March 31, 2022	—	$	—	—	$	—	1,027,652	$	—	9	$	—	$	245,526	$	64	$	(237,480)	$	—	$	8,110
Common stock issued in At the Market offering, net of issuance and offering costs of $17	—		—	—		—	90,244		—	—		—		2,453		—		—		—		2,453
Common stock issued to Iliad in exchange of notes payable and accrued interest	—		—	—		—	15,249		—	—		—		467		—		—		—		467
Common stock issued upon exercise of restricted stock units	—		—	—		—	2,323		—	—		—		95		—		—		—		95
Common stock issued to third party for services	—		—	—		—	133		—	—		—		5		—		—		—		5
Stock-based compensation	—		—	—		—	—		—	—		—		1,017		—		—		—		1,017
Net loss	—		—	—		—	—		—	—		—		—		(23)		(9,367)		—		(9,390)
Balances as of June 30, 2022	—	$	—	—	$	—	1,135,601	$	—	9	$	—	$	249,563	$	41	$	(246,847)	$	—	$	2,757

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

JAGUAR HEALTH, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES

IN CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY

(Unaudited)

Series G
Convertible
preferred stock

Series H
Convertible
preferred stock

Common
Stock - voting

Common
Stock - non-voting

Additional

Noncontrolling

Accumulated

Accumulated
other comprehensive

Total
Stockholders'

(In thousands, except share data)

Shares

Amount

Shares

Amount

Shares

Amount

Shares

Amount

paid-in capital

interest

deficit

loss

Equity

Balances as of January 1, 2023

—

2,182,084

—

266,971

(699)

(266,948)

(680)

(1,356)

Preferred stock issued in PIPE financing, net of issuance and offering costs of $12

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