angn-20230331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_____________________________________________

FORM 10-Q

_____________________________________________


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

For the quarterly period ended March 31, 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 001-39990

ANGION BIOMEDICA CORP

(Exact name of registrant as specified in its charter)


Delaware									11-3430072
(State or other jurisdiction of incorporation or organization)									(I.R.S. Employer Identification No.)

7-57 Wells Avenue Newton, Massachusetts									02459
(Address of Principal Executive Offices)									(Zip Code)

(415) 655-4899

Registrant's telephone number, including area code

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 $0.01	ANGN	The Nasdaq Global Select Market

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 and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting 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 Act). Yes ☐ No ☒

The number of shares of the issuer’s common stock outstanding as of May 5, 2023 was 30,113,703.


TABLE OF CONTENTS

PART I FINANCIAL INFORMATION			Page
Item 1. Financial Statements			5
Condensed Consolidated Balance Sheets (unaudited)			5
Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited)			6
Condensed Consolidated Statements of Stockholders' Equity (unaudited)			7
Condensed Consolidated Statements of Cash Flows (unaudited)			9
Notes to Unaudited Interim Condensed Consolidated Financial Statements			10
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			23
Item 3. Quantitative and Qualitative Disclosures			30
Item 4. Controls and Procedures			30
PART II OTHER INFORMATION
Item 1. Legal Proceedings			32
Item 1A. Risk Factors			32
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			33
Item 3. Defaults Upon Senior Securities			33
Item 4. Mine Safety Disclosures			33
Item 5. Other Information			33
Item 6. Exhibits			34
Signatures			35

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Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Any statements contained in this Quarterly Report on Form 10-Q that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “aim,” “anticipate,” “assume,” “believe,” “contemplate,” “continue,” “could,” “due,” “estimate,” “expect,” “goal,” “intend,” “may,” “objective,” “plan,” “predict,” “potential,” “positioned,” “seek,” “should,” “target,” “will,” “would,” and other similar expressions that are predictions of or indicate future events and future trends, or the negative of these terms or other comparable terminology. These forward-looking statements include, but are not limited to, statements about:

•our expectations regarding the announced reverse merger transaction with Elicio Therapeutics, Inc.;

•the potential benefits, activity, effectiveness and safety of our product candidates;

•the scope, progress, expansion, and costs of developing and commercializing our product candidates;

•our dependence on existing and future collaborators for commercializing product candidates in the collaboration;

•our receipt and timing of any milestone payments or royalties under any existing or future research collaboration and license agreements or arrangements;

•the potential effects of the COVID-19 pandemic on our business and operations, results of operations and financial performance;

•the potential adverse effects of any regional armed conflicts on our business and operations, results of operations and financial performance;

•the size and growth of the potential markets for our product candidates and the ability to serve those markets;

•our expectations regarding our expenses, the sufficiency of our cash resources, and needs for additional financing;

•regulatory developments in the United States and other countries;

•the rate and degree of market acceptance of any future products;

•the implementation of our business model and strategic plans for our business and product candidates, including additional indications which we may pursue;

•our expectations regarding competition;

•our anticipated business strategies;

•the performance of third-party manufacturers;

•our ability to establish and maintain development partnerships;

•our expectations regarding federal, state, and foreign regulatory requirements;

•our ability to obtain and maintain intellectual property protection for our product candidates;

•the successful development for our sales and marketing capabilities;

•the hiring, retention, or separation of key scientific or management personnel; and

•the anticipated trends and challenges in our business and the market in which we operate.

We caution you that the foregoing list may not contain all of the forward-looking statements made in this Quarterly Report on Form 10-Q.

Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. We discuss these risks in greater detail in “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our management’s beliefs and assumptions only as of the date of this Quarterly Report on Form 10-Q. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this Quarterly Report on Form 10-Q. While we believe that information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into or review of, all relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely on these statements.

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This Quarterly Report on Form 10-Q also contains estimates, projections and other information concerning our industry, our business and the markets for certain drugs, including data regarding the estimated size of those markets, their projected growth rates and the incidence of certain medical conditions. Information that is based on estimates, forecasts, projections or similar methodologies is inherently subject to uncertainties, and actual events or circumstances may differ materially from events and circumstances reflected in this information. Unless otherwise expressly stated, we obtained this industry, business, market and other data from reports, research surveys, studies and similar data prepared by third parties, industry, medical and general publications, government data and similar sources. In some cases, we do not expressly refer to the sources from which this data is derived. In that regard, when we refer to one or more sources of this type of data in any paragraph, you should assume that other data of this type appearing in the same paragraph is derived from the same sources, unless otherwise expressly stated or the context otherwise requires.

Trademarks

This Quarterly Report on Form 10-Q includes trademarks, service marks and trade names owned by us or other companies. All trademarks, service marks and trade names included in this Quarterly Report on Form 10-Q are the property of their respective owners.

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Part I FINANCIAL INFORMATION

Item 1. Financial Statements

ANGION BIOMEDICA CORP.

Condensed Consolidated Balance Sheets

(in thousands, except share and per share amounts)

(unaudited)


	March 31, 2023		December 31, 2022
Assets
Current assets
Cash and cash equivalents	$	29,219	$	50,487

Prepaid expenses and other current assets	1,730		943
Notes receivable	9,678		—
Total current assets	40,627		51,430
Property and equipment, net	—		273
Operating lease right-of-use assets	126		152
Investments in related parties	150		874
Other assets	864		61
Total assets	$	41,767	$	52,790
Liabilities and stockholders’ equity
Current liabilities
Accounts payable	$	692	$	2,720
Accrued expenses	1,103		2,569
Operating lease liabilities, current	227		994
Financing obligation, current	—		67

Warrant liability	9		19
Total current liabilities	2,031		6,369
Operating lease liabilities, noncurrent	70		2,481
Financing obligation, noncurrent	—		168



Total liabilities	2,101		9,018
Commitments and contingencies - Note 10
Stockholders' equity


Common stock, $0.01 par value per share; 300,000,000 shares authorized; 30,114,190 and 30,113,946 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively	301		301

Additional paid-in capital	297,679		297,327
Accumulated other comprehensive income	165		86
Accumulated deficit	(258,479)		(253,942)
Total stockholders' equity	39,666		43,772
Total liabilities and stockholders' equity	$	41,767	$	52,790

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

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ANGION BIOMEDICA CORP.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(in thousands, except share and per share amounts)

(unaudited)


	Three Months Ended March 31,
		2023		2022
Revenue:
Contract revenue		$	—	$	1,648

Total revenue		—		1,648
Operating expenses:


Research and development		326		11,667
General and administrative		4,281		4,466

Total operating expenses		4,607		16,133
Loss from operations		(4,607)		(14,485)
Other income (expense)
Change in fair value of warrant liability		10		39
Change in fair value of notes receivable		(322)		—


Foreign exchange transaction gain (loss)		(87)		111
Earnings from equity method investment		—		9
Interest income, net		469		86
Total other income		70		245
Net loss		(4,537)		(14,240)
Other comprehensive income:
Foreign currency translation adjustment		79		(96)
Comprehensive loss		$	(4,458)	$	(14,336)
Net loss per common share, basic and diluted		$	(0.15)	$	(0.48)
Weighted average common shares outstanding, basic and diluted		30,114,113		29,959,251

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

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ANGION BIOMEDICA CORP.

Condensed Consolidated Statements of Stockholders' Equity

(in thousands, except share amounts)

(unaudited)


	Common Stock			Additional Paid-in Capital	Accumulated Other Comprehensive Income		Accumulated Deficit		Total Stockholders' Equity
	Shares	Amount
















Balance as of December 31, 2022	30,113,946	$	301		$	297,327	$	86	$	(253,942)	$	43,772
Issuance of common stock upon net settlement of restricted stock units and performance stock units	244	—			—		—		—		—
Stock-based compensation	—	—			352		—		—		352
Foreign currency translation adjustment	—	—			—		79		—		79
Net loss	—	—			—		—		(4,537)		(4,537)
Balance as of March 31, 2023	30,114,190	$	301		$	297,679	$	165	$	(258,479)	$	39,666

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	Common Stock			Treasury Stock			Additional Paid-in Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total Stockholders' Equity (Deficit)
	Shares	Amount		Shares	Amount
Balance as of December 31, 2021	29,959,060	$	300	—	$	—	$	296,445	$	(103)	$	(215,135)	$	81,507


Issuance of common stock upon net settlement of restricted stock units and performance stock units	365	—		—	—		—		—		—		—
Stock-based compensation	—	—		—	—		31				—		31
Foreign currency translation adjustment	—	—		—	—		—		(96)		—		(96)
Net loss	—	—		—	—		—		—		(14,240)		(14,240)
Balance as of March 31, 2022	29,959,425	$	300	—	$	—	$	296,476	$	(199)	$	(229,375)	$	67,202

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

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ANGION BIOMEDICA CORP.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)


	Three Months Ended March 31,
	2023		2022
Cash flows from operating activities:
Net loss	$	(4,537)	$	(14,240)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	22		32
Amortization of right-of-use assets	26		196

Stock-based compensation	352		31

Change in fair value of notes receivable	322		—

Change in fair value of warrant liability	(10)		(39)
Loss on disposal of property and equipment, net	251		—
Earnings from equity investment	—		(9)
Loss on termination of lease obligation	52		—
Loss on termination of financing obligation	23		—
Changes in operating assets and liabilities:
Grants receivable	—		806
Prepaid expenses and other current assets	(766)		(1,515)
Other assets	(851)		28
Accounts payable	(1,834)		(1,323)
Accrued expenses	(1,074)		2,023
Lease liabilities	(55)		(215)

Deferred revenue	—		(1,648)
Other liabilities, noncurrent	—		220
Net cash used in operating activities	(8,079)		(15,653)
Cash flows from investing activities:

Issuance of notes receivable	(10,000)		—
Net cash used in investing activities	(10,000)		—
Cash flows from financing activities:





Payment of financing obligation	(15)		(14)
Payment to terminate lease obligation	(3,025)		—
Payment to terminate financing obligation	(228)		—


Net cash used in financing activities	(3,268)		(14)
Effect of foreign currency on cash	79		(87)
Net decrease in cash and cash equivalents	(21,268)		(15,754)
Cash and cash equivalents at the beginning of the period	50,487		88,756
Cash and cash equivalents at the end of the period	$	29,219	$	73,002

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

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ANGION BIOMEDICA CORP.

Notes to Unaudited Interim Condensed Consolidated Financial Statements

Note 1—Description of the Business and Financial Condition

Angion Biomedica Corp. (“Angion” or the “Company”) had been a clinical-stage biopharmaceutical company focused on the discovery, development, and commercialization of novel small molecule therapeutics to address chronic and progressive fibrotic diseases, prior to its 2022 Strategic Realignment announced in July 2022 whereby the Company announced its process to explore strategic options for enhancing and preserving shareholder value (“2022 Strategic Realignment”)(See Note 11). The Company was incorporated in Delaware in 1998.

On January 17, 2023, the Company entered into a definitive merger agreement (the “Merger Agreement”) with Elicio Therapeutics, Inc. (“Elicio”) under which Elicio will merge with a wholly-owned subsidiary of Angion in an all-stock transaction (the “Merger”). Upon completion of the Merger, the combined company will focus on advancing Elicio’s proprietary lymph node AMP technology to develop immunotherapies, with a focus on ELI-002, a therapeutic cancer vaccine targeting mKRAS-driven tumors.

Angion has suspended clinical development activities in anticipation of completion of the announced Merger, and does not have any products approved for sale.

Liquidity and Capital Resources

Since inception, the Company has devoted substantially all of its efforts and financial resources to conducting research and development activities, including drug discovery and pre-clinical studies and clinical trials, establishing and maintaining its intellectual property portfolio, organizing and staffing the Company, business planning, raising capital and providing general and administrative support for these operations. The Company has incurred losses from operations and negative cash flows from operating activities since inception. As of March 31, 2023, the Company had $29.2 million in cash and cash equivalents and an accumulated deficit of $258.5 million.

The Company has evaluated and concluded there are no conditions or events, considered in the aggregate, that raise substantial doubt about its ability to continue as a going concern for a period of one year following the date these condensed consolidated financial statements are issued and believes its existing cash and cash equivalents will be sufficient to meet the projected operating requirements for at least 12 months following the issuance date of its condensed consolidated financial statements.

Note 2—Summary of Significant Accounting Policies

Basis of Presentation

The Company's condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of the Company, its wholly owned subsidiary, Angion Biomedica Europe Limited, which was dissolved on March 16, 2021, and its wholly owned subsidiary, Angion Pty Ltd., which was established on August 22, 2019. The Company established Angion Pty Ltd., an Australian subsidiary, for the purpose of qualifying for research credits for studies conducted in Australia. All significant intercompany balances and transactions have been eliminated in consolidation.

The Company’s significant accounting policies are described in Note 2 to its consolidated financial statements for the year ended December 31, 2022, included in its Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on March 17, 2023 (the “Annual Report on Form 10-K”). There have been no material changes to the Company’s significant accounting policies during the three months ended March 31, 2023.

Unaudited Interim Financial Information

The condensed consolidated financial statements of the Company included herein have been prepared, without audit, pursuant to the rules and regulations of the SEC. The interim unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements as of and for the year ended December 31, 2022 and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s consolidated financial position, results of operations and comprehensive loss, and cash flows. The condensed consolidated balance sheet

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ANGION BIOMEDICA CORP.

Notes to Unaudited Interim Condensed Consolidated Financial Statements (Continued)

as of December 31, 2022 was derived from the audited financial statements as of that date. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted from this Quarterly Report, as is permitted by such rules and regulations. Accordingly, these condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K. The results for any interim period are not necessarily indicative of results for any future period.

Segments

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker (“CODM”) in making decisions regarding resource allocation and assessing performance. The Company views its operations and manages its business as one operating segment.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. On an ongoing basis, management evaluates its estimates, including those related to the useful lives of long-lived assets, the measurement of stock-based compensation, accruals for research and development activities, the valuation of its notes receivable, income taxes and revenue recognition. The Company bases its estimates on historical experience and on other relevant assumptions that are reasonable under the circumstances. Actual results could materially differ from those estimates.

Concentrations of Credit Risk and Off-Balance Sheet Risk

Cash and cash equivalents are financial instruments that are potentially subject to concentrations of credit risk. The Company maintains its cash equivalents in securities and money market funds with original maturities less than three months. On March 10, 2023, Silicon Valley Bank (SVB), at which the Company maintained substantially all of its cash and cash equivalents in multiple accounts and in amounts exceeding federally insured limits, was closed by the California Department of Financial Protection and Innovation, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. The failure of SVB exposed the Company to liquidity and credit risk prior to the completion of the FDIC resolution of SVB in a manner that fully protects all depositors. At the end of March 2023, Angion transferred substantially all of its cash and cash equivalents from SVB to an asset manager. If the Company is unable to access its cash and cash equivalents as needed, its financial position and ability to operate its business will be adversely affected.

The Company has no financial instruments with off-balance sheet risk of loss.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. As of March 31, 2023 and December 31, 2022, the Company’s cash equivalents were held in institutions in the United States and include deposits in a money market fund which were unrestricted as to withdrawal or use.

Fair Value Measurement

Certain assets and liabilities are carried at fair value under GAAP. Fair value is determined using the principles of ASC 820, Fair Value Measurement. Fair value is described as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes and defines the inputs to valuation techniques as follows:

Level 1: Observable inputs such as quoted prices in active markets.

Level 2: Inputs are observable for the asset or liability either directly or through corroboration with observable market data.

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ANGION BIOMEDICA CORP.

Notes to Unaudited Interim Condensed Consolidated Financial Statements (Continued)

Level 3: Unobservable inputs.

The inputs used to measure the fair value of an asset or a liability are categorized within levels of the fair value hierarchy. The fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the measurement.

The Company's cash and cash equivalents, accounts payable and accrued expenses are carried at cost, which approximates fair value due to the short-term nature of these instruments.

Notes Receivable at Fair Value

As permitted under ASC 825, Financial Instruments ("ASC 825"), the Company has elected the fair value option for the notes receivable (“Notes”) issued to Elicio. In accordance with ASC 825, the Company recognizes these Notes at fair value with changes in fair value recognized in the condensed consolidated statement of operations. The fair value option may be applied instrument by instrument, but it is irrevocable. As a result of applying the fair value option, direct costs and fees related to the issuance of the Notes were recognized in the condensed consolidated statement of operations as incurred and not deferred. The estimated fair value of the Notes is determined by utilizing a scenario-based analysis considering possible outcomes available to the holders of the Notes. See Note 4. Accrued interest receivable for the Notes has been included in the change in fair value of the Notes in the condensed consolidated statement of operations.

Research and Development

Research and development costs include, but are not limited to, payroll and personnel expenses, laboratory supplies, preclinical studies, compound manufacturing costs, consulting costs and allocated overhead, including rent, equipment, depreciation and utilities. Research and development costs may be offset by research and development refundable tax rebates received by the Company’s wholly-owned Australian subsidiary.

The Company has agreements with various Contract Research Organizations (“CROs") and third-party vendors. Research and development accruals of amounts due to the CRO are estimated based on the level of services performed, progress of the studies, including the phase or completion of events, and contracted costs. The estimated costs of research and development provided, but not yet invoiced, are included in accrued expenses on the condensed consolidated balance sheet. Payments made to CROs under such arrangements in advance of the performance of the related services are recorded as prepaid expenses and other current assets until the services are rendered. The Company makes judgments and estimates in determining the accrued expenses balance in each reporting period. As actual costs become known, the Company adjusts its accrued expenses. For the three months ended March 31, 2023 and 2022, the Company has not experienced any material differences between accrued costs and actual costs incurred.

Net Loss Per Share

Basic net loss per share of common stock is computed by dividing net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding for the period. Diluted net loss per share excludes the potential impact of common stock options, warrants and unvested shares of restricted stock and restricted stock units because their effect would be anti-dilutive due to the Company's net loss. Since the Company had net losses for the three months ended March 31, 2023 and 2022, basic and diluted net loss per common share are the same.

Recently Issued Accounting Pronouncements

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326) Measurement of Credit Losses on Financial Instruments (ASU No. 2016-13), which requires an entity to utilize a new impairment model known as the current expected credit loss (“CECL”) model to estimate its lifetime “expected credit loss” and record an allowance that, when deducted from the amortized cost basis of the financial assets and certain other instruments, including but not limited to, available-for-sale debt securities. Credit losses relating to available-for-sale debt securities will be recorded through an allowance for credit losses rather than as a direct write-down to the security. The Company adopted ASU No. 2016-13 on January 1, 2023 and the adoption of the standard had no material impact on its condensed consolidated financial statements.

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ANGION BIOMEDICA CORP.

Notes to Unaudited Interim Condensed Consolidated Financial Statements (Continued)

Note 3—Revenue and Deferred Revenue

Contract Revenue

The Company’s contract revenue has been generated from payments received pursuant to a license agreement (the “Vifor License”) with Vifor International, Ltd. (“Vifor Pharma”), with headquarters located in Switzerland. The Company recognized revenue from upfront payments over the term of its estimated period of performance using a cost-based input method under Topic 606.

Vifor License Agreement

In November 2020, the Company granted Vifor Pharma, an exclusive, global (excluding Greater China), royalty-bearing license for the commercialization of ANG-3777 in all Renal Indications, beginning with delayed graft function (DGF) and AKI associated with cardiac surgery involving cardiopulmonary bypass (CSA-AKI). The Vifor License also grants Vifor Pharma exclusive rights, with a right to sublicense subject to Company’s consent for certain specified conditions, to develop and manufacture ANG-3777 for commercialization in Renal Indications worldwide (excluding Greater China) in cooperation with Angion or independently. The Company retains the right to develop and commercialize combination therapy products combining ANG-3777 with its other proprietary molecules, subject to Vifor Pharma's right of first negotiation with respect to global (excluding Greater China) rights to such combination therapy products in the Renal Indications.

Pursuant to the Vifor License and specifically based upon the clinical development plan for ANG-3777 set forth in the Vifor License, the Company was entitled to receive $80 million in upfront and near-term clinical milestone payments. The Company received $60.0 million in upfront and equity payments, including $30.0 million in up-front cash received in November 2020, and a $30.0 million equity investment, $5.0 million of which was a convertible note that subsequently converted into common stock with the IPO and $25.0 million of which was received in the Concurrent Private Placement with the Company’s IPO. The Company was also eligible to receive post-approval milestones of up to approximately $260.0 million and sales-related milestones of up to $1.585 billion, providing a total potential deal value of up to $1.925 billion (subject to certain specified reductions and offsets), plus tiered royalties on net sales of ANG-3777 at royalty rates of up to 40%. Under the Vifor License, the Company is responsible for executing a pre-specified clinical development plan designed to obtain regulatory approvals of ANG-3777 for DGF and CSA-AKI. For the three months ended March 31, 2022, the Company recognized $1.6 million contract revenue related to the Vifor License. The Company completed its performance obligations under the Vifor License agreement and recognized all deferred revenue in 2022.

On October 26, 2021, the Company announced that its Phase 3 trial of ANG-3777 in DGF did not achieve its primary endpoint and the data from the Phase 3 trial was not expected to provide sufficient evidence to support an indication in the studied DGF population. On December 14, 2021, the Company announced its Phase 2 trial of ANG-3777 in CSA-AKI did not achieve its primary endpoint. The Vifor License included additional milestone and royalty objectives related to the clinical development plan for ANG-3777 which had included a Phase 3 study for CSA-AKI and a Phase 4 confirmatory study in DGF. The Company does not expect to receive any clinical, post-approval, or sales milestones, or royalties, as it does not intend to continue to pursue the current clinical development plan for ANG-3777. The Company continues to discuss with Vifor Pharma the analyses of the results of the clinical trials announced in the fourth quarter of 2021 and the future of the collaboration with Vifor.

Note 4—Fair Value Measurements

The following tables present the Company's financial assets and liabilities measured at fair value on a recurring basis and their assigned levels within the fair value hierarchy (in thousands):

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ANGION BIOMEDICA CORP.

Notes to Unaudited Interim Condensed Consolidated Financial Statements (Continued)


	March 31, 2023
	Level 1		Level 2		Level 3		Total
Money market funds(1)	$	28,284	$	—	$	—	$	28,284
Notes receivable	—		—		9,678		9,678
Total assets	$	28,284	$	—	$	9,678	$	37,962
Warrant liabilities	$	—	$	—	$	9	$	9
Total liabilities	$	—	$	—	$	9	$	9


	December 31, 2022
	Level 1		Level 2		Level 3		Total
Money market funds(1)	$	9,860	$	—	$	—	$	9,860
Total assets	$	9,860	$	—	$	—	$	9,860
Warrant liabilities	$	—	$	—	$	19	$	19
Total liabilities	$

SEC Form 10-Q filed by Angion Biomedica Corp.