Exhibit 99.1
InflaRx N.V.
Unaudited Condensed Consolidated
Financial Statements – June 30, 2023
These unaudited condensed financial statements are consolidated financial statements for the group consisting of InflaRx N.V. and its wholly-owned subsidiaries InflaRx GmbH, Jena, Germany, and InflaRx Pharmaceuticals Inc., Ann Arbor, Michigan, United States (together, the “Group”). The financial statements are presented in euros (€).
InflaRx N.V. is a company limited by shares, incorporated and domiciled in Amsterdam, The Netherlands.
Its registered office and principal place of business is in Germany, Jena, Winzerlaer Str. 2.
Index to Unaudited Condensed Consolidated Financial Statements
for the three and six months ended June 30, 2023
InflaRx N.V. and subsidiaries
Unaudited
Condensed Consolidated Statements of Operations and Comprehensive Loss
for the three and six months ended June 30, 2023 and 2022
For
the three months | For
the six months | |||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||||
| Note | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||||
| (in €, except for share data) | ||||||||||||||||||
| Research and development expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| General and administrative expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Sales and marketing expenses | ( | ) | ( | ) | ||||||||||||||
| Other income | 2 | |||||||||||||||||
| Other expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Operating Result | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Finance income | 3 | |||||||||||||||||
| Finance expenses | 3 | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||
| Foreign exchange result | 3 | ( | ) | |||||||||||||||
| Other financial result | 3 | ( | ) | ( | ) | |||||||||||||
| Income Taxes | ||||||||||||||||||
| Income (Loss) for the Period | ( | ) | ( | ) | ( | ) | ||||||||||||
| Share Information | ||||||||||||||||||
| Weighted average number of shares outstanding | ||||||||||||||||||
| ( | ) | ( | ) | ( | ) | |||||||||||||
| Other comprehensive income (loss) that may be reclassified to profit or loss in subsequent periods: | ||||||||||||||||||
| Exchange differences on translation of foreign currency | ( | ) | ( | ) | ||||||||||||||
| Total Comprehensive Income (Loss) | ( | ) | ( | ) | ( | ) | ||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
F-3
InflaRx N.V. and subsidiaries
Unaudited
Condensed Consolidated Statements of Financial Position
as of June 30, 2023 and December 31, 2022
| June 30, | ||||||||||
| 2023 | December 31, | |||||||||
| Note | (unaudited) | 2022 | ||||||||
| (in €) | ||||||||||
| ASSETS | ||||||||||
| Non-current assets | ||||||||||
| Property and equipment | ||||||||||
| Right-of-use assets | ||||||||||
| Intangible assets | ||||||||||
| Other assets | 5 | |||||||||
| Financial assets | 6 | |||||||||
| Total non-current assets | ||||||||||
| Current assets | ||||||||||
| Inventories | 4 | |||||||||
| Current other assets | 5 | |||||||||
| Current tax assets | ||||||||||
| Financial assets from government grants | 6 | |||||||||
| Other financial assets | 6 | |||||||||
| Cash and cash equivalents | 7 | |||||||||
| Total current assets | ||||||||||
| TOTAL ASSETS | ||||||||||
| EQUITY AND LIABILITIES | ||||||||||
| Equity | ||||||||||
| Issued capital | 8 | |||||||||
| Share premium | 8 | |||||||||
| Other capital reserves | ||||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||||
| Other components of equity | ||||||||||
| Total equity | ||||||||||
| Non-current liabilities | ||||||||||
| Lease liabilities | 6 | |||||||||
| Other liabilities | ||||||||||
| Total non-current liabilities | ||||||||||
| Current liabilities | ||||||||||
| Trade and other payables | 6 | |||||||||
| Liabilities from government grants | 6 | |||||||||
| Lease liabilities | 6 | |||||||||
| Employee benefits | ||||||||||
| Other liabilities | ||||||||||
| Total current liabilities | ||||||||||
| Total Liabilities | ||||||||||
| TOTAL EQUITY AND LIABILITIES | ||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
F-4
InflaRx N.V. and subsidiaries
Unaudited
Condensed Consolidated Statements of Changes in Shareholders’ Equity
for the six months ended June 30, 2023 and 2022
| (in €, except for share data) | Note | Shares outstanding | Issued capital | Share premium | Other capital reserves | Accumulated deficit | Other components of equity | Total equity | ||||||||||||||||||||||
| Balance as of January 1, 2023 | ( | ) | ||||||||||||||||||||||||||||
| Loss for the period | — | ( | ) | ( | ) | |||||||||||||||||||||||||
| Exchange differences on translation of foreign currency | — | ( | ) | ( | ) | |||||||||||||||||||||||||
| Total comprehensive loss | — | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||
| Issuance of common shares | 8 | |||||||||||||||||||||||||||||
| Transaction costs | 8 | — | ( | ) | ( | ) | ||||||||||||||||||||||||
| Equity-settled share-based payments | 9 | — | ||||||||||||||||||||||||||||
| Share options exercised | 9 | |||||||||||||||||||||||||||||
| Balance as of June 30, 2023* | ( | ) | ||||||||||||||||||||||||||||
| Balance as of January 1, 2022 | ( | ) | ||||||||||||||||||||||||||||
| Loss for the period | — | ( | ) | ( | ) | |||||||||||||||||||||||||
| Exchange differences on translation of foreign currency | — | |||||||||||||||||||||||||||||
| Total comprehensive loss | — | ( | ) | ( | ) | |||||||||||||||||||||||||
| Equity-settled share-based payments | 9 | — | ||||||||||||||||||||||||||||
| Balance as of June 30, 2022* | ( | ) | ||||||||||||||||||||||||||||
| * |
The accompanying notes are an integral part of these condensed consolidated financial statements.
F-5
InflaRx N.V. and subsidiaries
Unaudited
Condensed Consolidated Statements of Cash Flows
for the six months ended June 30, 2023 and 2022
| For the six months ended June 30, | ||||||||||
| 2023 | 2022 | |||||||||
| Note | (unaudited) | (unaudited) | ||||||||
| Operating activities | (in €) | |||||||||
| Loss for the period | ( | ) | ( | ) | ||||||
| Adjustments for: | ||||||||||
| Depreciation & amortization of property and equipment, right-of-use assets and intangible assets | ||||||||||
| Net finance income | 3 | ( | ) | ( | ) | |||||
| Share-based payment expense | 9 | |||||||||
| Net foreign exchange differences | 3 | ( | ) | |||||||
| Changes in: | ||||||||||
| Financial assets from government grants | 6 | ( | ) | ( | ) | |||||
| Other assets | ||||||||||
| Employee benefits | ( | ) | ( | ) | ||||||
| Other liabilities | ( | ) | ||||||||
| Liabilities from government grants received | 6 | ( | ) | ( | ) | |||||
| Trade and other payables | ( | ) | ||||||||
| Inventories | 4 | ( | ) | |||||||
| Interest received | 3 | |||||||||
| Interest paid | 3 | ( | ) | ( | ) | |||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||||
| Investing activities | ||||||||||
| Purchase of intangible assets, property and equipment | ( | ) | ( | ) | ||||||
| Purchase of current financial assets | ( | ) | ( | ) | ||||||
| Proceeds from the maturity of financial assets | ||||||||||
| Net cash from/(used in) investing activities | ( | ) | ||||||||
| Financing activities | ||||||||||
| Proceeds from issuance of common shares | 8 | |||||||||
| Transaction costs from issuance of common shares | 8 | ( | ) | |||||||
| Proceeds from exercise of share options | 9 | |||||||||
| Repayment of lease liabilities | ( | ) | ( | ) | ||||||
| Net cash from/(used in) financing activities | ( | ) | ||||||||
| Net increase/(decrease) in cash and cash equivalents | ( | ) | ||||||||
| Effect of exchange rate changes on cash and cash equivalents | ( | ) | ||||||||
| Cash and cash equivalents at beginning of period | ||||||||||
| Cash and cash equivalents at end of period | 7 | |||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
F-6
InflaRx N.V. and subsidiaries
Notes to the Unaudited Condensed Consolidated Financial Statements
| 1. | Summary of significant accounting policies and other disclosures |
| a) | Reporting entity and the Group’s structure |
InflaRx N.V. (the “Company” or “InflaRx”) is a Dutch public company with limited liability (naamloze vennootschap) with its corporate seat in Amsterdam, the Netherlands, and is registered in the Commercial Register of the Netherlands Chamber of Commerce Business Register under CCI number 68904312. The Company’s registered office is at Winzerlaer Straße 2 in 07745 Jena, Germany. Since November 10, 2017, InflaRx N.V.’s ordinary shares have been listed on the Nasdaq Global Select Market under the symbol IFRX.
InflaRx is a biopharmaceutical company focused on applying its proprietary anti-C5a and C5aR technologies to discover, develop and commercialize first-in-class, potent and specific inhibitors of the complement activation factor known as C5a. On April 4, 2023, the US Food and Drug Administration (FDA) issued an Emergency Use Authorization (EUA) for the emergency use of the Company’s monoclonal anti-C5a antibody vilobelimab, under the brand name Gohibic, for the treatment of COVID-19 in hospitalized adults. These consolidated financial statements of InflaRx comprise the Company and its wholly-owned subsidiaries, InflaRx GmbH, Jena, Germany, and InflaRx Pharmaceuticals Inc., Ann Arbor, Michigan, United States (together referred to as the “Group”).
| b) | Basis of preparation |
These interim condensed consolidated financial statements for the three- and six-month reporting periods ended June 30, 2023, and 2022 have been prepared in accordance with IAS 34 Interim Financial Reporting. These condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements. Accordingly, this report is to be read in conjunction with the financial statements in our annual report for the year ended December 31, 2022 on form 20-F.
The interim condensed consolidated financial statements were authorized for issue by the board of directors of the Company (the “Board of Directors”) on August 9, 2023.
The financial statements are presented in euros (€). The euro is the functional currency of InflaRx N.V. and InflaRx GmbH. The functional currency of InflaRx Pharmaceuticals Inc. is the U.S. dollar. Effective January 1, 2023, the functional currency of InflaRx N.V. changed from the U.S. dollar to the euro due to a change in the Company’s operational function and, in turn, a change in the primary currency of its underlying transactions. This change in functional currency has been accounted for prospectively.
All financial information presented in euros have been rounded. Accordingly, numerical figures shown as totals in some tables may not be an arithmetic aggregation of the figures that precede them or may deviate from other tables.
The accounting policies adopted are consistent with those followed in the preparation of the Group’s annual consolidated financial statements for the year ended December 31, 2022, except for the adoption of new standards effective as of January 1, 2023, as set out below. The Group has not adopted any other standard, interpretation or amendment that has been issued but is not yet effective early.
The following IFRS standards have been applied starting in Q2 2023 for the first time ever, as no transactions in the scope of these IFRS standards had been previously recognized and are not expected to have a significant impact on the Company’s consolidated financial statements in future periods.
| ● | IAS 2 Inventories |
According to IAS 2, inventories are stated at the lower amount of cost or their net realizable value. Cost comprises direct materials and, where applicable, direct labor costs and those overheads that have been incurred in bringing the inventories to their present location and condition. Cost is calculated using the weighted average cost method. Net realizable value represents the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.
| ● | IFRS 15 Revenue from contracts with customers |
Revenue will be recognized when a performance obligation has been satisfied through the transfer of a promised good or service to a customer. An asset is transferred when the customer obtains control of that asset. Revenue will be recognized at the point in time that the control of the products is transferred to the customer and measured considering return liabilities. As of June 30, 2023, no revenue has been recognized.
F-7
The following amendments were adopted effective January 1, 2023, and do not have a material impact on the consolidated financial statements of the Group:
| ● | IFRS 17 Insurance Contracts |
| ● | Amendments to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors: Definition of Accounting Estimates |
| ● | Amendments to IAS 12 Deferred Tax related to Assets and Liabilities arising from a Single Transaction |
| ● | Amendments to IAS 1 and IFRS Practice Statement 2 - Disclosure of Accounting Policies - |
The following standards issued will be adopted in a future period, and the potential impact, if any, they will have on the Group’s consolidated financial statements is being assessed:
| ● | Amendments to IFRS 16 Leases: Leases on Sale and Leaseback |
| ● | Amendments to IAS 1 Presentation of Financial Statements: Classification of Liabilities as Current or Non-current and Non-current Liabilities with Covenants |
| 2. |
| For the three months ended June 30, | For the six months ended June 30 | |||||||||||||||
| 2023 (unaudited) | 2022 (unaudited) | 2023 (unaudited) | 2022 (unaudited) | |||||||||||||
| (in €) | ||||||||||||||||
| Other income | ||||||||||||||||
| Income from government grants | ||||||||||||||||
| Other | ||||||||||||||||
| Total | ||||||||||||||||
Other
income for the three months ended June 30, 2023 amounted to €
F-8
| 3. | Net financial result |
| For the three months ended June 30, | For the six months ended June 30 | |||||||||||||||
| 2023 (unaudited) | 2022 (unaudited) | 2023 (unaudited) | 2022 (unaudited) | |||||||||||||
| (in €) | ||||||||||||||||
| Financial income | ||||||||||||||||
| Interest income | ||||||||||||||||
| Financial expenses | ||||||||||||||||
| Interest expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Interest on lease liabilities | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Total | ||||||||||||||||
| For the three months ended June 30, | For the six months ended June 30 | |||||||||||||||
| 2023 (unaudited) | 2022 (unaudited) | 2023 (unaudited) | 2022 (unaudited) | |||||||||||||
| (in €) | ||||||||||||||||
| Foreign exchange result | ||||||||||||||||
| Foreign exchange income | ||||||||||||||||
| Foreign exchange expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Total | ( | ) | ||||||||||||||
| For the three months ended June 30, | For the six months ended June 30 | |||||||||||||||
| 2023 (unaudited) | 2022 (unaudited) | 2023 (unaudited) | 2022 (unaudited) | |||||||||||||
| (in €) | ||||||||||||||||
| Other financial result | ( | ) | ( | ) | ||||||||||||
Other
financial result is attributable to the expected credit loss allowance, which is deducted from the Company’s current and non-current
financial assets.
F-9
| 4. |
| As of June 30, 2023 (unaudited) | As of December 31, 2022 | |||||||
| (in €) | ||||||||
| Raw materials and supplies | ||||||||
| Unfinished goods | ||||||||
| Finished goods | ||||||||
| Total | ||||||||
The Company valued inventories at manufacturing cost in its consolidated statements of financial position as of June 30, 2023. Inventories do not include costs relating to production of products before the granting of the EUA for Gohibic (vilobelimab), since those were expensed in previous reporting periods as research and development expenses in the period incurred.
During
the three and the six months ended June 30, 2023, there were
| 5. |
| As of June 30, 2023 (unaudited) | As of December 31, 2022 | |||||||
| (in €) | ||||||||
| Non-current other assets | ||||||||
| Prepaid expenses | ||||||||
| Total | ||||||||
| Current other assets | ||||||||
| Prepayments on research & development projects | ||||||||
| Prepaid expense | ||||||||
| Others | ||||||||
| Total | ||||||||
| Total other assets | ||||||||
As
of June 30, 2023, prepayments on research & development projects amounted to €
Prepaid expenses mainly consist of prepaid insurance expense.
The reduction of the amounts in the category “others” primarily relate to credit notes issued to the Company by CROs, which were still outstanding as of December 31, 2022 and were paid in 2023.
F-10
| 6. | Financial assets and financial liabilities |
| As of June 30, 2023 (unaudited) | As of December 31, 2022 | |||||||
| (in €) | ||||||||
| Financial assets at amortized cost | ||||||||
| Non-current financial assets | ||||||||
| Financial assets from government grants | ||||||||
| Other current financial assets | ||||||||
| Financial liabilities at amortized cost | ||||||||
| Liabilities from government grants | ||||||||
| Trade and other payables | ||||||||
As
of June 30, 2023, the fair value of current and non-current financial assets (primarily quoted debt securities) amounted to €
As
of June 30, 2023, liabilities from government grants amounted to €
| 7. | Cash and cash equivalents |
| As of June 30, 2023 (unaudited) | As of December 31, 2022 | |||||||
| (in €) | ||||||||
| Short-term deposits | ||||||||
| Deposits held in U.S. dollars | ||||||||
| Deposits held in euros | ||||||||
| Total | ||||||||
| Cash at banks | ||||||||
| Cash held in U.S. dollars | ||||||||
| Cash held in euros | ||||||||
| Total | ||||||||
| Total cash and cash equivalents | ||||||||
| 8. | Equity |
In
April 2023, the Company issued
Through
an underwritten public offering in April 2023, the Company sold and issued an aggregate of
| 9. | Share-based payments |
| a) | Equity settled share-based payment arrangements |
| Number of share options | 2023 | 2022 | ||||||
| Outstanding as of January 1, | ||||||||
| Exercised during the six months ended June 30 | ||||||||
| Outstanding as of June 30, | ||||||||
| thereof vested | ||||||||
F-11
Under the terms and conditions of the share option plan 2016, InflaRx GmbH granted rights to subscribe for InflaRx GmbH’s ordinary shares to directors, senior management, and key employees. Those InflaRx GmbH options were converted into options for ordinary shares of InflaRx N.V. at the time of its IPO in November 2017:
| Number of share options | 2023 | 2022 | ||||||
| Outstanding as of January 1, | ||||||||
| Exercised during the six months ended June 30 | — | |||||||
| Outstanding as of June 30, | ||||||||
| thereof vested | ||||||||
InflaRx
also granted share options under the 2017 LTIP subsequently to its IPO in November 2017.
| Number of share options | 2023 | 2022 | ||||||
| Total number of options outstanding as of January 1, | ||||||||
| Granted during the six months ended June 30, | ||||||||
| Exercised during the six months ended June 30, | — | |||||||
| Forfeited during the six months ended June 30, | — | ( | ) | |||||
| Outstanding as of June 30, | ||||||||
| thereof vested | ||||||||
Share options granted 2023 | Number | Fair value per option | FX rate as of grant date | Fair value per option | Share price at grant date / Exercise price | Expected volatility | Expected life (midpoint based) | Risk-free rate (interpolated, U.S. sovereign strips curve) | ||||||||||||||||||||||||
| January 24 | $ | € | $ | % | ||||||||||||||||||||||||||||
| January 24 | $ | € | $ | % | ||||||||||||||||||||||||||||
| May 31 | $ | € | $ | % | ||||||||||||||||||||||||||||
Of the
Expected dividends are nil for all share options listed above.
| b) | Share-based payment expense recognized |
For
the six months ended June 30, 2023, the Company has recognized €
None of the share-based payment awards were dilutive in determining earnings per share due to the Group’s loss position.
F-12
| c) | Share options exercised |
During
the six months ended June 30, 2023,
| 10. | Protective foundation |
According
to the Articles of Association of the Company, up to
In
order to deter acquisition bids, the Company`s shareholders approved the right of an independent foundation under Dutch law, or protective
foundation, to exercise a call option on preferred shares. Pursuant to the call option agreement, the Company shall issue an amount of
preferred shares to the protective foundation, amounting to up to
These preferred shares will have both a liquidation and dividend preference over the Company`s ordinary shares and will accrue cash dividends at a pre-determined rate. The protective foundation would be expected to require us to cancel its preferred shares once the perceived threat to the Company and its stakeholders has been removed or sufficiently mitigated or neutralized. We believe that the call option does not represent a significant fair value based on a Level 3 valuation, since the preference shares are restricted in use and can be canceled by us.
During
the six months ended June 30, 2023, the Company expensed €
| 11. | Subsequent events |
Effective July 1, 2023, Dr. Camilla Chong was appointed the Company’s Chief Medical Officer.
F-13