Quarterly Report for Quarter Ending June 30, 2024 (Form 10-Q)

10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 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, 2024

OR

☐	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: 001-39603

REVELATION BIOSCIENCES, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware	84-3898466
( State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
4660 La Jolla Village Drive, Suite 100, San Diego, CA	92122
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code: (650) 800-3717

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 $0.001 per share		REVB		The NasdaqStock Market LLC
Redeemable warrants, each exercisable for a 1/1,050thshare of common stock at an exercise price of $12,075.00 per share		REVBW		The Nasdaq Stock Market LLC

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, 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 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 ☒

As of August 5, 2024, the registrant had 1,643,395shares of common stock, $0.001 par value per share, outstanding.

Table of Contents

		Page
PART I	FINANCIAL INFORMATION	1
Item 1.	Condensed Consolidated Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations	2
	Condensed Consolidated Statements of Changes in Stockholders' Equity (Deficit)	3
	Condensed Consolidated Statements of Cash Flows	4
	Notes to the Condensed Consolidated Financial Statements	5
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	28
Item 4.	Controls and Procedures	28
PART II.	OTHER INFORMATION	28
Item 1.	Legal Proceedings	28
Item 1A.	Risk Factors	28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29
Item 3.	Defaults Upon Senior Securities	29
Item 4.	Mine Safety Disclosures	29
Item 5.	Other Information	29
Item 6.	Exhibits	29
Signatures		30

PART I-FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements (Unaudited)

REVELATION BIOSCIENCES, INC.

Condensed Consolidated Balance Sheets

(Unaudited)

		June 30, 2024			December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents		$	12,073,058			$	11,991,701
Deferred offering costs			-				71,133
Prepaid expenses and other current assets			125,743				84,691
Total current assets			12,198,801				12,147,525
Property and equipment, net			70,774				65,084
Total assets		$	12,269,575			$	12,212,609
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable		$	1,281,323			$	1,359,898
Accrued expenses			8,454,139				1,152,460
Deferred underwriting commissions			1,382,848				2,911,260
Warrant liability			10,844				141,276
Total current liabilities			11,129,154				5,564,894
Total liabilities			11,129,154				5,564,894
Commitments and Contingencies(Note 4)
Stockholders' equity:
Common Stock, $0.001par value; 500,000,000shares authorized at June 30, 2024 and December 31, 2023 and 1,643,395and 264,537issued and outstanding at June 30, 2024 and December 31, 2023, respectively			1,643				265
Additional paid-in-capital			37,677,132				32,114,552
Accumulated deficit			(36,538,354	)			(25,467,102	)
Total stockholders' equity			1,140,421				6,647,715
Total liabilities and stockholders' equity		$	12,269,575			$	12,212,609

See accompanying notes to the condensed consolidated financial statements.

REVELATION BIOSCIENCES, INC.

CondensedConsolidated Statements of Operations

(Unaudited)

		Three Months Ended June 30,			Six Months Ended June 30,
		2024			2023			2024			2023
Operating expenses:
Research and development		$	1,394,929			$	909,278			$	2,112,511			$	1,434,551
General and administrative			1,127,468				1,023,752				2,312,024				2,118,326
Total operating expenses			2,522,397				1,933,030				4,424,535				3,552,877
Loss from operations			(2,522,397	)			(1,933,030	)			(4,424,535	)			(3,552,877	)
Other (expense) income:
Change in fair value of warrant liability			4,416				423,239				72,843				8,168,174
Other (expense) income, net			(5,871,838	)			61,621				(6,719,560	)			95,728
Total other (expense) income, net			(5,867,422	)			484,860				(6,646,717	)			8,263,902
Net (loss) earnings		$	(8,389,819	)		$	(1,448,170	)		$	(11,071,252	)		$	4,711,025
Net (loss) earnings per share, basic		$	(5.13	)		$	(5.83	)		$	(8.13	)		$	24.52
Weighted-average shares used to compute net (loss) earnings per share, basic			1,635,234				248,369				1,362,534				192,149
Net (loss) earnings per share, diluted		$	(5.13	)		$	(5.83	)		$	(8.13	)		$	23.89
Weighted-average shares used to compute net (loss) earnings per share, diluted			1,635,234				248,369				1,362,534				197,167

See accompanying notes to the condensed consolidated financial statements.

REVELATION BIOSCIENCES, INC.

Condensed Consolidated Statements of Changes in Stockholders' Equity (Deficit)

(Unaudited)

		Series A Preferred Stock			Common Stock			Additional Paid-in			Accumulated			Total Stockholders'
		Shares			Amount			Shares			Amount			Capital			Deficit			Equity
Balance at December 31, 2022			1			$	-				77,375			$	77			$	26,399,224			$	(25,346,848	)		$	1,052,453
Redemption of Series A Preferred Stock			(1	)			-				-				-				-				-				-
Issuance of common stock from the February 2023 Public Offering			-				-				96,287				96				33,378				-				33,474
Class C Pre-Funded Warrants exercise			-				-				6,434				7				12				-				19
Alternative cashless exercise of Class C Common Stock Warrants			-				-				32,190				32				2,740,378				-				2,740,410
Stock-based compensation expense			-				-				-				-				32,095				-				32,095
Net income			-				-				-				-				-				6,159,195				6,159,195
Balance as of March 31, 2023			-			$	-				212,286			$	212			$	29,205,087			$	(19,187,653	)		$	10,017,646
Class C Pre-Funded Warrants exercise			-				-				4,780				5				10				-				15
Alternative cashless exercise of Class C Common Stock Warrants			-				-				47,331				47				2,785,830				-				2,785,877
RSU awards issued			-				-				140				1				(1	)			-				-
Stock-based compensation expense			-				-				-				-				59,435				-				59,435
Net loss			-				-				-				-				-				(1,448,170	)			(1,448,170	)
Balance as of June 30, 2023			-			$	-				264,537			$	265			$	32,050,361			$	(20,635,823	)		$	11,414,803
Balance at December 31, 2023			-			$	-				264,537			$	265			$	32,114,552			$	(25,467,102	)		$	6,647,715
Issuance of common stock from the February 2024 Public Offering			-				-				128,470				128				5,416,925				-				5,417,053
Class D Pre-Funded Warrants exercise			-				-				1,236,530				1,237				(1,110	)			-				127
Alternative cashless exercise of Class C Common Stock Warrants			-				-				3,398				3				57,586				-				57,589
Stock-based compensation expense			-				-				-				-				32,094				-				32,094
Net loss			-				-				-				-				-				(2,681,433	)			(2,681,433	)
Balance as of March 31, 2024			-			$	-				1,632,935			$	1,633			$	37,620,047			$	(28,148,535	)		$	9,473,145
Common stock issued for services			-				-				10,460				10				24,990				-				25,000
Stock-based compensation expense			-				-				-				-				32,095				-				32,095
Net loss			-				-				-				-				-				(8,389,819	)			(8,389,819	)
Balance as of June 30, 2024			-			$	-				1,643,395			$	1,643			$	37,677,132			$	(36,538,354	)		$	1,140,421

See accompanying notes to the condensed consolidated financial statements.

REVELATION BIOSCIENCES, INC.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

		Six Months Ended June 30,
		2024			2023
Cash flows from operating activities:
Net (loss) income		$	(11,071,252	)			4,711,025
Adjustments to reconcile net (loss) income to net cash used in operating activities:
Stock-based compensation expense			64,189				91,530
Issuance of common stock for services			25,000				-
Depreciation expense			13,482				12,525
Change in fair value of warrant liability			(72,843	)			(8,168,174	)
Changes in operating assets and liabilities:
Prepaid expenses and other current assets			(41,052	)			(176,880	)
Deferred offering costs			71,133				61,154
Accounts payable			(78,575	)			377,578
Accrued expenses			5,773,267				(475,527	)
Net cash used in operating activities			(5,316,651	)			(3,566,769	)
Cash flows from investing activities:
Purchase of property and equipment			(19,172	)			-
Net cash used in investing activities			(19,172	)			-
Cash flows from financing activities:
Proceeds from the February 2024 Public Offering, net			5,417,053				-
Proceeds from Class D Pre-Funded Warrants exercise			127				-
Redemption of Series A Preferred Stock			-				(5,000	)
Proceeds from the February 2023 Public Offering, net			-				14,029,974
Proceeds from Class C Pre-Funded Warrants exercise			-				34
Net cash provided by financing activities			5,417,180				14,025,008
Net increase in cash and cash equivalents			81,357				10,458,239
Cash and cash equivalents at beginning of period			11,991,701				5,252,979
Cash and cash equivalents at end of period		$	12,073,058			$	15,711,218
Supplemental disclosure of non-cash investing and financing activities:
Issuance of Class D Common Stock Warrants in connection with the February 2024 Public Offering		$	6,269,684			$	-
Fair Value of Class C Common Stock Warrants in connection with the February 2023 Public Offering		$	-			$	13,996,500
Alternative cashless exercise of Class C Common Stock Warrants		$	57,589			$	5,526,287

See accompanying notes to the condensed consolidated financial statements.

REVELATION BIOSCIENCES, INC.

Notes to the Condensed Consolidated Financial Statements

7. Preferred Stock

9. Stock-Based Compensation

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

You should read the following discussion of our financial condition and results of operations in conjunction with our unaudited financial statements and the notes included elsewhere in this Form 10-Q. The following discussion contains forward-looking statements that involve certain risks and uncertainties. Our actual results could differ materially from those discussed in these statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this form 10-Q or our Annual Report Form 10-K for the year ended December 31, 2023, particularly under the "Risk Factors" and "Cautionary Note Regarding Forward-Looking Statements and Risk Factors Summary" sections.

Overview

Revelation is a clinical-stage biopharmaceutical company focused on harnessing the power of trained immunity for the prevention and treatment of disease by developing and commercializing therapeutics that modulate the innate immune system. We are developing a pipeline of potential high-value products based on Gemini. Gemini is our proprietary formulation of PHAD an established TLR4 agonist that can stimulate the human body's innate immune response to prevent and treat disease. Our current Gemini based programs consist of: GEM-AKI, which is being developed as a potential therapy for the prevention and treatment of acute kidney injury as a result of cardiac surgery; GEM-CKD, which is being developed as a potential therapy for the prevention and treatment of chronic kidney disease; and GEM-PSI, which is being developed for the prevention and treatment of post surgical infection.

Since our inception, we have devoted substantially all of our resources to organizing and staffing our Company, business planning, raising capital, and research and development of GEM-AKI, GEM-CKD and GEM-PSI, our product candidates.

We have funded our operations since our inception to June 30, 2024 through the issuance and sale of our capital stock, from which we have raised net proceeds of $49.3 million. Our current cash and cash equivalents balance will not be sufficient to complete all necessary product development or future commercialization efforts. We anticipate that our current cash and cash equivalents balance will not be sufficient to sustain operations within one-year after the date that our unaudited financial statements for June 30, 2024 were issued, which raises substantial doubt about our ability to continue as a going concern.

We plan to seek additional funding through public or private equity or debt financings. We may not be able to obtain financing on acceptable terms, or at all. The terms of any financing may adversely affect the holdings or the rights of our stockholders. If we are unable to obtain funding we could be required to delay, reduce or eliminate research and development programs, product portfolio expansion or future commercialization efforts, which could adversely affect our business operations.

We have incurred recurring losses since our inception, including a net loss of $11.1 million for the six months ended June 30, 2024 and $4.7 million for the six months ended June 30, 2023, respectively. As of June 30, 2024 we had an accumulated deficit of $36.5 million. We expect to continue to generate operating losses and negative operating cash flows for the foreseeable future if and as we:

Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our clinical studies and our expenditures on other research and development activities.

We have never generated revenue and do not expect to generate revenue from product sales unless and until we successfully complete development and obtain regulatory approval for GEM-AKI, GEM-CKD, GEM-PSI or other product candidates, which we expect will not be for at least several years, if ever. Accordingly, until such time as we can generate significant revenue from sales of GEM-AKI, GEM-CKD, GEM-PSI or other product candidates, if ever, we expect to finance our cash needs through a combination of public or private equity offerings, debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements. However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. Our failure to raise capital or enter into such other arrangements when needed would have a negative impact on our financial condition and could force us to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

Recent Developments

2024 Reverse Stock Split

On January 25, 2024, the Company effected a 1-for-30 reverse stock split of our outstanding shares of common stock, which had been approved at a special meeting of stockholders.

Research and Development

Research and development expenses consist primarily of costs incurred for the development of our product candidates GEM-AKI, GEM-CKD and GEM-PSI. Our research and development expenses consist primarily of external costs related to clinical development, costs related to contract research organizations, costs related to consultants, costs related to acquiring and manufacturing clinical study materials, costs related to contract manufacturing organizations and other vendors, costs related to the preparation of regulatory submissions, costs related to laboratory supplies and services, and personnel costs. Personnel and related costs consist of salaries, employee benefits and stock-based compensation for personnel involved in research and development efforts.

We expense all research and development expenses in the periods in which they are incurred. We accrue for costs incurred as the services are being provided by monitoring the status of specific activities and the invoices received from our external service providers. We adjust our accrual as actual costs become known.

We expect our research and development expenses to increase substantially for the foreseeable future as we continue the development of GEM-AKI, GEM-CKD and GEM-PSI and continue to invest in research and development activities. The process of conducting the necessary clinical research and product development to obtain regulatory approval is costly and time consuming, and the successful development of GEM-AKI, GEM-CKD and GEM-PSI and any future product candidates is highly uncertain. To the extent that our product candidates continue to advance into larger and later stage clinical studies, our expenses will increase substantially and may become more variable.

The actual probability of success for GEM-AKI, GEM-CKD and GEM-PSI or any future product candidate may be affected by a variety of factors, including the safety and efficacy of our product candidates, investment in our clinical programs, manufacturing capability and competition with other products. As a result, we are unable to determine the timing of initiation, duration and completion costs of our research and development efforts or when and to what extent we will generate revenue from the commercialization and sale of GEM-AKI, GEM-CKD and GEM-PSI or any future product candidate.

General and Administrative

Our general and administrative expenses consist primarily of personnel costs, expenses for outside professional services, including financial advisory, legal, human resource, audit and accounting services and consulting costs. Personnel and related costs consist of salaries, employee benefits and stock-based compensation for personnel involved in executive, finance and other administrative functions. We expect our general and administrative expenses to increase for the foreseeable future as we increase the size of our administrative function to support the growth of our business and support our continued research and development activities. We also anticipate increased expenses as we continue to operate as a public company, including increased expenses related to financial advisory services, audit, legal, regulatory, investor relations costs, director and officer insurance premiums associated with maintaining compliance with exchange listing and SEC requirements.

Other (Expense) Income, Net

Other (expense) income, net primarily consists of the change in fair value of warrant liability, clinical trial related expenses, foreign currency transaction gains and losses, interest expense and interest income from our cash balances in savings accounts.

Results of Operations

The following table summarizes our results of operations for the periods presented:

		Three Months Ended June 30,			Six Months Ended June 30,
		2024			2023			Change			2024			2023			Change
Operating expenses:
Research and development		$	1,394,929			$	909,278			$	485,651			$	2,112,511			$	1,434,551			$	677,960
General and administrative			1,127,468				1,023,752				103,716				2,312,024				2,118,326				193,698
Total operating expenses			2,522,397				1,933,030				589,367				4,424,535				3,552,877				871,658
Loss from operations			(2,522,397	)			(1,933,030	)			(589,367	)			(4,424,535	)			(3,552,877	)			(871,658	)
Total other (expense) income, net			(5,867,422	)			484,860				(6,352,282	)			(6,646,717	)			8,263,902				(14,910,619	)
Net (loss) earnings		$	(8,389,819	)		$	(1,448,170	)		$	(6,941,649	)		$	(11,071,252	)		$	4,711,025			$	(15,782,277	)

Research and Development Expenses

The following table summarizes our research and development expenses for the periods presented:

		Three Months Ended June 30,			Six Months Ended June 30,
		2024			2023			Change			2024			2023			Change
GEM-PSI and GEM-AKI clinical study expenses		$	949,125			$	-			$	949,125			$	1,264,634			$	-			$	1,264,634
Manufacturing expenses			18,452				219,238				(200,786	)			36,168				510,506				(474,338	)
Other program expenses			50,304				477,019				(426,715	)			101,468				542,739				(441,271	)
Other expenses			61,876				61,591				285				99,727				120,539				(20,812	)
Personnel expenses (including stock-based compensation)			315,172				151,430				163,742				610,514				260,767				349,747
Total research and development expenses		$	1,394,929			$	909,278			$	485,651			$	2,112,511			$	1,434,551			$	677,960

Research and development expenses increased by $0.5 million, from $0.9 million for the three months ended June 30, 2023 to $1.4 million for the three months ended June 30, 2024. The increase was primarily due to increases of $0.9 million in clinical study expenses related to GEM-AKI and GEM-PSI and $0.2 million in personnel expenses, offset by decreases of $0.4 in other program expenses and $0.2 million in manufacturing expenses. Other program expenses include pre-clinical costs and clinical preparation costs primarily for programs GEM-AKI and GEM-PSI.

Research and development expenses increased by $0.7 million, from $1.4 million for the six months ended June 30, 2023 to $2.1 million for the six months ended June 30, 2024. The increase was primarily due to increases of $1.3 million in clinical study expenses related to GEM-AKI and GEM-PSI and $0.3 million in personnel expenses, offset by decreases of $0.5 million in manufacturing expenses and $0.4 in other program expenses. Other program expenses include pre-clinical costs and clinical preparation costs primarily for programs GEM-AKI and GEM-PSI.

General and Administrative Expenses

The following table summarizes our general and administrative expenses for the periods presented:

		Three Months Ended June 30,			Six Months Ended June 30,
		2024			2023			Change			2024			2023			Change
Personnel expenses (including employee stock-based compensation)		$	696,571			$	546,654			$	149,917			$	1,410,890			$	1,006,438			$	404,452
Legal and professional fees (including non-employee stock-based compensation)			341,821				388,474				(46,653	)			694,196				932,935				(238,739	)
Other expenses			89,076				88,624				452				206,938				178,953				27,985
Total general and administrative expenses		$	1,127,468			$	1,023,752			$	103,716			$	2,312,024			$	2,118,326			$	193,698

General and administrative expenses increased by $0.1 million, from $1.0 million for the three months ended June 30, 2023 to $1.1 million for the three months ended June 30, 2024. The increase was primarily due to an increase of $0.1 million in personnel expenses.

General and administrative expenses increased by $0.2 million, from $2.1 million for the six months ended June 30, 2023 to $2.3 million for the six months ended June 30, 2024. The increase was primarily due to increases of $0.4 million in personnel expenses, offset by a decrease of $0.2 million in legal and professional fees.

Other (Expense) Income, Net

Other (expense) income, net was ($484,860) for the three months ended June 30, 2023, related to the change in fair value of the warrant liability, foreign currency transaction gains and losses, and interest income from our cash balances in savings accounts. Other income (expense), net was ($5,867,422) for the three months ended June 30, 2024, primarily related to the LifeSci judgment expense and reimbursement of costs, offset by interest income from our cash balances in savings accounts.

Other (expense) income, net was $8,263,902 for the six months ended June 30, 2023, related to the change in fair value of the warrant liability, foreign currency transaction gains and losses, and interest income from our cash balances in savings accounts. Other (expense) income, net was ($6,646,717) for the six months ended June 30, 2024, primarily related to the LifeSci judgment expense, reimbursement of costs and clinical trial related settlement expenses with A-IR (defined below), offset by interest income from our cash balances in savings accounts.

Liquidity and Capital Resources

Since our inception to June 30, 2024, we have funded our operations from the issuance and sale of our common stock, preferred stock and warrants, from which we have raised net proceeds of $49.3 million, of which $5.4 million was received during the six months ended June 30, 2024. As of June 30, 2024, we had available cash and cash equivalents of $12.1 million and an accumulated deficit of $36.5 million.

Our use of cash is to fund operating expenses, which consist primarily of research and development expenditures related to our therapeutic product candidates, GEM-AKI, GEM-CKD and GEM-PSI. We plan to increase our research and development expenses substantially for the foreseeable future as we continue the clinical development of our current and future product candidates. At this time, due to the inherently unpredictable nature of product development, we cannot reasonably estimate the costs we will incur and the timelines that will be required to complete development, obtain marketing approval, and commercialize our current product candidate or any future product candidates. For the same reasons, we are also unable to predict when, if ever, we will generate revenue from product sales or any future license agreements which we may enter into or whether, or when, if ever, we may achieve profitability. Clinical and preclinical development timelines, the probability of success, and development costs can differ materially from expectations. In addition, we cannot forecast the timing and amounts of milestone, royalty and other revenue from licensing activities, which future product candidates may be subject to future collaborations, when such arrangements will be secured, if at all, and to what degree such arrangements would affect our development plans and capital requirements.

We expect to continue to generate substantial operating losses for the foreseeable future as we expand our research and development activities. We will continue to fund our operations primarily through utilization of our current financial resources and through additional raises of capital.

To the extent that we raise additional capital through partnerships or licensing arrangements with third parties, we may have to relinquish valuable rights to our product candidates, future revenue streams or research programs or to grant licenses on terms that may not be favorable to us. If we raise additional capital through public or private equity offerings, the ownership interest of our then-existing stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect our stockholders' rights. If we raise additional capital through debt financing, we may be subject to covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we are unable to obtain adequate financing when needed, we may have to delay, reduce the scope of or suspend one or more of our clinical studies or preclinical studies, research and development programs or commercialization efforts or grant rights to develop and market our product candidates even if we would otherwise prefer to develop and market such product candidates ourselves.

Going Concern

We have incurred recurring losses since our inception, including a net loss of $11.1 million for the six months ended June 30, 2024. As of June 30, 2024 we had an accumulated deficit of $36.5 million, a stockholders' equity of $1.1 million and available cash and cash equivalents of $12.1 million. We expect to continue to incur significant operating and net losses, as well as negative cash flows from operations, for the foreseeable future as we continue to complete all necessary product development or future commercialization efforts. We have never generated revenue and do not expect to generate revenue from product sales unless and until we successfully complete development and obtain regulatory approval for GEM-AKI, GEM-CKD, GEM-PSI or other product candidates, which we expect will not be for at least several years, if ever. We do not anticipate that our current cash and cash equivalents balance will be sufficient to sustain operations within one-year after the date that our unaudited financial statements for June 30, 2024 were issued, which raises substantial doubt about our ability to continue as a going concern.

To continue as a going concern, we will need, among other things, to raise additional capital resources. We plan to seek additional funding through public or private equity or debt financings. We may not be able to obtain financing on acceptable terms, or at all. The terms of any financing may adversely affect the holdings or the rights of our stockholders. If we are unable to obtain funding we could be required to delay, reduce or eliminate research and development programs, product portfolio expansion or future commercialization efforts, which could adversely affect our business operations.

The unaudited condensed consolidated financial statements for June 30, 2024, have been prepared on the basis that we will continue as a going concern, and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability for us to continue as a going concern.

Cash Flows

The following table summarizes our cash flows for the periods presented:

		Six Months Ended June 30,
		2024			2023
Net cash used in operating activities		$	(5,316,651	)		$	(3,566,769	)
Net cash used in investing activities			(19,172	)			-
Net cash provided by financing activities			5,417,180				14,025,008
Net increase in cash and cash equivalents		$	81,357			$	10,458,239

Net Cash Used in Operating Activities

During the six months ended June 30, 2024, net cash used in operating activities was $5.3 million, which consisted of a net loss of $11.1 million and a net change of $5.7 million in our net operating assets and liabilities.

During the six months ended June 30, 2023, net cash used in operating activities was $3.6 million, which consisted of a net income of $4.7 million, offset by a net change of $8.1 million comprised of the change in fair value of the warrant liability, stock-based compensation expense and depreciation expense.

Net Cash Used in Investing Activities

During the six months ended June 30, 2024, net cash used in investing activities consisted of a purchase of lab equipment.

During the six months ended June 30, 2023, there was no cash used in investing activities.

Net Cash Provided by Financing Activities

During the six months ended June 30, 2024, net cash provided by financing activities was $5.4 million, from the February 2024 Public Offering.

During the six months ended June 30, 2023, net cash provided by financing activities was $14.0 million, from the February 2023 Public Offering.

Contractual Obligations and Other Commitments

The following table summarizes our contractual obligations as of June 30, 2024 and the effects of such obligations are expected to have on our liquidity and cash flow in future periods:

		Less than 1 year			1 to 3 years			3 to 5 years			More than 5 years			Total
Operating lease obligations		$	26,750			$	-			$	-			$	-			$	26,750
Total contractual obligations		$	26,750			$	-			$	-			$	-			$	26,750

We have entered into an operating lease for laboratory space in San Diego, California. The table above includes future minimum lease payments under the non-cancelable lease arrangement.

We enter into contracts in the normal course of business with third party service providers and vendors. These contracts generally provide for termination on notice and, therefore, are cancellable contracts and not considered contractual obligations and commitments. We believe that our non-cancelable obligations under these agreements are not material.

Off-Balance Sheet Arrangements

As of June 30, 2024, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K.

Quantitative and Qualitative Disclosure about Market Risk

We are exposed to market risks in the ordinary course of our business.

Interest Rate Risk

Our cash and cash equivalents consist primarily of highly liquid investments in money market funds and cash on hand and have an original maturity date of 90 days or less. The fair value of our cash and cash equivalents would not be significantly affected by either an increase or decrease in interest rates due mainly to the short-term nature of these instruments.

Foreign Currency Risk

Our expenses are generally denominated in the currencies in which our operations are located, which is primarily in the United States, England and Australia. We make payments to vendors for research and development services with payments denominated in foreign currencies including Australian Dollars and British Pounds. We are subject to foreign currency transaction gains or losses on our payments denominated in foreign currencies. To date, foreign currency transaction gains and losses have not been material and we have not had a formal hedging program with respect to foreign currency; however, we may consider doing so in the future. A 10% increase or decrease in currency exchange rates would not have a material effect on our financial results.

Critical Accounting Policies and Significant Judgments and Estimates

Our management's discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with the U.S. generally accepted accounting principles ("GAAP"). The preparation of the condensed consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions about future events that affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenue and expenses. These estimates and assumptions are based on management's best estimates and judgment. Management regularly evaluates its estimates and assumptions using industry experience and other factors; however, actual results could differ materially from these estimates and could have an adverse effect on our condensed consolidated financial statements. While our significant accounting policies are more fully described in the notes to our condensed consolidated financial statements, we believe that the accounting policies discussed below are most critical to understanding and evaluating our historical and future performance.

Research and Development Expenditures

We record accrued expenses for estimated preclinical and clinical study and research expenses related to the services performed but not yet invoiced pursuant to contracts with research institutions, contract research organizations and clinical manufacturing organizations that conduct and manage preclinical studies, and clinical studies, and research services on our behalf. Payments for these services are based on the terms of individual agreements and payment timing may differ significantly from the period in which the services were performed. Our estimates are based on factors such as the work completed, including the level of patient enrollment. We monitor patient enrollment levels and related activity to the extent reasonably possible and make judgments and estimates in determining the accrued balance in each reporting period. Our estimates of accrued expenses are based on the facts and circumstances known at the time. If we underestimate or overestimate the level of services performed or the costs of these services, our actual expenses could differ from our estimates. As actual costs become known, we adjust our accrued expenses. To date, we have not experienced significant changes in our estimates of clinical study accruals.

Stock-based Compensation

We recognize the compensation expense related to stock options, third-party warrants, and RSU awards granted, based on the estimated fair value of the awards on the date of grant. The fair value of employee stock options and third-party warrants are generally determined using the Black-Scholes option-pricing model using various inputs, including estimates of historic volatility, term, risk-free rate, and future dividends. The grant date fair value of the stock-based awards, which have graded vesting, is recognized using the straight-line method over the requisite service period of each stock-based award, which is generally the vesting period of the respective stock-based awards. The Company recognizes forfeitures as they occur.

As of June 30, 2024, there were 94 Rollover RSU awards unvested and unissued and 946 stock options outstanding.

Determination of the Fair Value of Common Stock

Prior to the Business Combination, given the absence of a public trading market for our shares of common stock, our board of directors exercised its judgment and considered a number of objective and subjective factors to determine the best estimate of the fair value of our shares of common stock, including timely valuations of our shares of common stock prepared by an unrelated third-party valuation firm, important developments in our operations, sales of common stock and convertible preferred shares, actual operating results and financial performance, the conditions in the biotechnology industry and the economy in general, the stock price performance and volatility of comparable public companies, and the lack of liquidity of our shares of common stock, among other factors. After the Business Combination, the fair value of each share of common stock is based on the closing price of our shares of common stock as reported on the date of grant.

Recent Accounting Pronouncements

See Note 2 to our unaudited condensed consolidated financial statements for more information about recent accounting pronouncements, the timing of their adoption, and our assessment, to the extent we have made one yet, of their potential impact on our financial condition of results of operations.

JOBS Act Accounting Election

We are an "emerging growth company," as defined in the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies.

We have elected to use this extended transition period to enable us to comply with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our financial statements and our interim condensed financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our principal executive officer and our principal financial officer, evaluated, as of the end of the period covered by this Quarterly Report on Form 10-Q, the effectiveness of our disclosure controls and procedures. Based on that evaluation of our disclosure controls and procedures as of June 30, 2024, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures as of such date are effective at the reasonable assurance level. The term "disclosure controls and procedures," as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act"), means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in the U.S. Securities and Exchange Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and our management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Changes in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting that occurred during our most recent quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II-OTHER INFORMATION

Item 1. Legal Proceedings.

On February 18, 2022, LifeSci filed an action against the Company in the U.S. District Court for the Southern District of New York seeking damages in the amount of approximately $5.3 million plus interest for unpaid banking and advisory fees. These fees arise under contracts which were entered into prior to the Business Combination and the Company asserted that LifeSci is not entitled to the fee because it violated its responsibilities by misrepresenting to Petra the funds that would be available following the Business Combination, absent which Petra would not have entered into the Business Combination Agreement. On December 1, 2023 a Magistrate Judge issued a report recommending summary judgment in favor of LifeSci. On December 15, 2023, the Company filed objections to the Magistrate's report asserting that the Magistrate Judge made factual determinations not appropriate for summary judgment and misapplied the law. The Magistrate's report was a recommendation to the trial judge who was responsible for reviewing the case de novo. On August 1, 2024 the District Court judge entered an order adopting the Magistrate Judge's report and granted the summary judgment and issued a judgment, including interest, totaling $7.3 million. Following the issuance of the judgment, LifeSci, filed a motion for reimbursement of costs in the amount of $0.2 million.

On September 27, 2022, A-IR Clinical Research Ltd. ("A-IR") filed a claim against the Company in the High Court of Justice, in the Business and Property Courts of England and Wales, seeking £1.6 million in unpaid invoices, plus interest and costs, relating to the Company's viral challenge study. The Company had disputed the claim because many of the invoices relate to work that was not performed and A-IR had misrepresented its qualifications to perform the contracted work. On April 26, 2024 the parties settled the claim and the proceedings were withdrawn with prejudice.

Item 1A. Risk Factors.

Our business is subject to various risks, including those described in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023. There have been no material changes from the risk factors disclosed in Item 1A of our Annual Report on Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Item 3. Defaults Upon Senior Securities.

Not applicable.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

Item 6. Exhibits, Financial Statement Schedules.

Furnish the exhibits required by Item 601 of Regulation S-K (§ 229.601 of this chapter).

EXHIBIT		DESCRIPTION
31.1*		Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a_14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*		Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a_14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1*		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2*		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*		XBRL Instance Document - the instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document.
101.SCH*		Inline XBRL Taxonomy Extension Scema Document
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104*		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

*	Filed herewith.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized.

		REVELATION BIOSCIENCES, INC.
Date: August 9, 2024		By:	/s/ James Rolke
			James Rolke
			Chief Executive Officer
			(principal executive officer)
Date: August 9, 2024		By:	/s/ Chester S. Zygmont, III
			Chester S. Zygmont, III
			Chief Financial Officer
			(principal financial and accounting officer)

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