Overview

Genelux is a late clinical-stage biopharmaceutical company focused on developing a pipeline of next-generation oncolytic viral immunotherapies for patients suffering from aggressive and/or difficult-to-treat solid tumor types. The company’s clinical and preclinical product candidates are intended to selectively kill tumor cells and induce a robust immune response against a patient’s tumor neoantigens. Genelux’s oncolytic immunotherapy product candidates are “off-the-shelf” personalized immunotherapies, where the same virus product is administered to different patients, but the cellular immune response generated is expected to be specific to the unique neoantigens in that patient.

Genelux’s lead product candidate, Olvi-Vec (olvimulogene nanivacirepvec), is a proprietary, modified strain of the vaccinia virus (VACV), a stable DNA virus with a large engineering capacity. The company has developed an extensive library of isolated and engineered oncolytic VACV immunotherapeutic product candidates using its proprietary selection technology and discovery and development platform (CHOICE).

Since inception, Genelux has incurred significant operating losses and does not have any approved products or generated any revenue from product sales. The company expects to continue incurring significant expenses and operating losses as it advances its current and future product candidates through preclinical and clinical development. Genelux will need substantial additional funding to support its operations and pursue its growth strategy.

Recent Developments

Underwritten Public Offering On March 26, 2025, Genelux completed an underwritten offering of 3,000,000 shares of its common stock at an offering price of $3.50 per share, raising $10.5 million in gross proceeds.

US-Based Phase 2 Trial in NSCLC In October 2024, Genelux announced the first patient had been dosed in a Phase 2 clinical trial evaluating the efficacy and safety of intravenously delivered Olvi-Vec oncolytic VACV for patients with recurrent non-small cell lung cancer (NSCLC) in the United States. Genelux’s partner in China, Newsoara BioPharma Co. Ltd., is obligated to fund the Phase 2 trial in its entirety.

Components of Results of Operations

Net Sales During 2023, Genelux recognized $0.2 million in revenue from supplying product to its partner Newsoara for use in clinical trials. In 2024, the company recognized $0.01 million in revenue from its license agreement with ELIAS Animal Health, LLC.

Operating Expenses Genelux’s operating expenses consist of research and development (R&D) expenses and general and administrative (G&A) expenses.

Research and Development Expenses R&D expenses include employee compensation, costs of funding research by third parties, manufacturing and laboratory expenses, clinical and regulatory expenses, and other R&D-related costs. R&D costs are expensed as incurred.

General and Administrative Expenses G&A expenses include salaries and other compensation for personnel in executive, finance, accounting, business development, and administrative roles, as well as professional service fees, insurance, travel, and facility costs.

Results of Operations

Comparison of the Years Ended December 31, 2024 and 2023

The following table summarizes Genelux’s results of operations for 2024 and 2023 (in thousands):

Research and Development Expenses R&D expenses increased by $6.2 million in 2024 compared to 2023, primarily due to:

• $1.2 million increase in employee compensation
• $1.2 million increase in stock-based compensation
• $4.5 million increase in clinical and regulatory expenses related to the Phase 3 and Phase 2 trials
• $0.9 million decrease in manufacturing and laboratory materials

General and Administrative Expenses G&A expenses increased by $1.1 million in 2024 compared to 2023, primarily due to:

• $0.2 million increase in employee compensation
• $0.8 million increase in stock-based compensation
• $0.4 million increase in consulting and contract labor expenses
• $0.5 million decrease in professional services

Other Income (Expenses), net Other income was $1.8 million in 2024 compared to $4.1 million in expenses in 2023. The 2024 income was primarily from $1.4 million in interest income and a $0.4 million gain on extinguishment of accounts payable. The 2023 expenses included $0.2 million in interest expense, $0.6 million in debt discount amortization, $0.4 million in debt extinguishment costs, and $3.2 million in financing costs.

Liquidity and Capital Resources

Genelux has experienced recurring losses and used $21.2 million in cash from operations in 2024, raising substantial doubt about its ability to continue as a going concern. As of December 31, 2024, the company had $30.9 million in cash and short-term investments, but no committed external funding sources.

Genelux expects its existing cash may not enable it to fund operations for at least the next 12 months. The company will need to raise additional capital through public/private equity offerings, debt financing, collaborations, or other arrangements to continue its operations and development activities.

In 2024, Genelux raised $27.7 million in net proceeds from a public offering of 7.5 million shares of common stock. In 2023, the company raised $39.6 million in net proceeds from its IPO and private placements.

Genelux’s future capital requirements will depend on the costs and progress of its R&D programs, manufacturing, regulatory approvals, and potential commercialization activities. Without additional funding, the company may be required to delay, reduce or terminate its product development efforts.

Critical Accounting Policies and Significant Judgments and Estimates

Genelux’s critical accounting policies include:

• Prepaid Research and Development Expenses: The company estimates accrued expenses for services performed by vendors in connection with R&D activities.
• Stock-Based Compensation: Genelux measures and recognizes compensation expense for stock-based awards granted to employees and directors.
• Commitments and Contingencies: The company evaluates the likelihood of unfavorable outcomes in legal or regulatory proceedings and records loss contingencies accordingly.