Entero Therapeutics, Inc. Reports Financial Results for the Quarter Ended March 31, 2025

Overview

Forte Biosciences, Inc. is a clinical-stage biopharmaceutical company focused on the research and development of targeted, non-systemic therapies for the treatment of gastrointestinal (GI) diseases. The company’s key product candidates include:

• Adrulipase: A recombinant lipase enzyme designed to enable the digestion of fats and other nutrients in cystic fibrosis and chronic pancreatitis patients with exocrine pancreatic insufficiency.
• Latiglutenase: A targeted oral biotherapeutic for celiac disease designed to break down gluten into non-immunogenic peptides.
• Capeserod: A selective 5-HT4 receptor partial agonist that was being developed as a gastroparesis therapeutic.
• Niclosamide: An oral small molecule with anti-inflammatory properties for patients with inflammatory bowel diseases.

In March 2024, Forte Biosciences acquired ImmunogenX, Inc. (IMGX), a private clinical-stage company developing Latiglutenase and CypCel for celiac disease. However, in March 2025, Forte announced a rescission agreement to unwind the IMGX acquisition.

Forte has discontinued the development of Latiglutenase, Capeserod and Niclosamide programs to focus on advancing Adrulipase. The company received a notice from Nasdaq in September 2024 regarding non-compliance with the minimum bid price requirement, and was granted an extension until September 2025 to regain compliance.

Financial Performance

• Forte has not generated any revenue to date, as its product candidates are still in development.
• Research and development expenses decreased by $0.5 million (97%) in Q1 2025 compared to Q1 2024, as the company scaled back development activities.
• General and administrative expenses decreased by $7.7 million (91%) in Q1 2025 compared to Q1 2024, primarily due to reductions in non-cash expenses, legal fees, share-based compensation, and public company costs.
• Net loss decreased by $6.8 million (122%) in Q1 2025 compared to Q1 2024, driven by the reduction in operating expenses.
• As of March 31, 2025, Forte had $66,000 in cash and cash equivalents, and had secured a $2 million revolving loan facility to fund operations.

Liquidity and Capital Resources

• Forte has funded its operations to date primarily through debt, convertible debt, preferred stock, and public/private equity offerings.
• The company expects to continue incurring substantial expenses for the development of Adrulipase and will require additional financing to advance its pipeline.
• Forte’s current financial condition raises substantial doubt about its ability to continue as a going concern. The company will need to raise additional capital through equity/debt financings, collaborations or other sources to fund its operations.
• Forte’s ability to issue securities is subject to market conditions, and each issuance will require a new prospectus filing.

Debt Obligations

• In January 2025, Forte entered into a $2 million revolving loan agreement, with an initial draw of $700,000.
• Through the IMGX acquisition, Forte assumed various debt obligations including a revolving line of credit, promissory notes, and an EIDL loan. These liabilities were reclassified as part of the disposal group held for sale.

Outlook

Forte is primarily focused on advancing the development of its Adrulipase program for exocrine pancreatic insufficiency. The company plans to move this program forward in 2025 after the Phase 2b monotherapy bridging study demonstrated safety and tolerability.

However, Forte’s overall financial condition raises substantial doubt about its ability to continue as a going concern. The company will need to secure additional financing through equity/debt raises, collaborations or other sources to fund its operations and pipeline development. Forte’s ability to maintain its Nasdaq listing is also uncertain, as it must regain compliance with the minimum bid price requirement by September 2025.