Business and Basis of Presentation

9 Months Ended

Sep. 30, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Business and Basis of Presentation

Note 1: Business and Basis of Presentation

AIM ImmunoTech Inc. and its subsidiaries (collectively, “AIM”, “Company”, “we” or “us”) are an immuno-pharma company headquartered in Ocala, Florida, and focused on the research and development of therapeutics to treat multiple types of cancers, viral diseases and immune-deficiency disorders. We have established a strong foundation of laboratory, pre-clinical and clinical data with respect to the development of nucleic acids and natural interferon to enhance the natural antiviral defense system of the human body, and to aid the development of therapeutic products for the treatment of certain cancers and chronic diseases.

AIM’s flagship products are Ampligen (rintatolimod), a first-in-class drug of large macromolecular RNA (ribonucleic acid) molecules, and Alferon N Injection (Interferon Alfa-N3). Ampligen has not been approved by the FDA or marketed in the United States. Ampligen is approved for commercial sale in the Argentine Republic for the treatment of severe Chronic Fatigue Syndrome (“CFS”).

The Company’s primary present business focus involves Ampligen. Ampligen is a double-stranded RNA (“dsRNA”) molecule being developed for globally important cancers, viral diseases and disorders of the immune system.

AIM currently is proceeding primarily in three areas:

● Ampligen plus Standard of Care (“SOC”) to treat pancreatic cancer patients, and in other cancers, as a potential therapeutic that modifies the tumor microenvironment with the goal of increasing anti-tumor responses to check point inhibitors and with SOC.

● Exploring Ampligen’s antiviral activities and potential use as a prophylactic or treatment for existing viruses, mutations thereof or new viruses.

● Ampligen as a treatment for myalgic encephalomyelitis/chronic fatigue syndrome (“ME/CFS”) and what we refer to as Post-COVID-19 Cognitive Dysfunction (“PCCD”).

Today, some two years after COVID-19 first appeared, the world has a number of vaccines and some promising therapeutics. AIM’s quest to prove the antiviral activities of Ampligen continues. If Ampligen has the broad-spectrum antiviral properties that the Company believes that it has, it could be a very valuable tool in treating variants of existing viral diseases, including COVID-19, or novel ones that arise in the future. Unlike most developing therapeutics which attack the virus, Ampligen works differently. AIM believes that it activates antiviral immune system pathways that fight not just a particular virus or viral variant, but other similar viruses as well.

Alferon N Injection is approved in Argentina for a category of sexually transmitted disease infections and patients that are not responsive or are intolerant to recombinant interferon. Alferon is the only natural-source, multi-species alpha interferon currently approved for sale in the United States for the intralesional treatment of refractory (i.e., resistant to other treatment) or recurring external condylomata acuminata/genital warts in patients 18 years of age or older. Certain types of human papilloma viruses cause genital warts. AIM also has approval from ANMAT for the treatment of refractory patients that failed or were intolerant to treatment with recombinant interferon in Argentina.

The Company owns and operates a 30,000 sq. ft. facility at 783 Jersey Ave, New Brunswick, N.J., where it conducts testing and has produced limited quantities of active pharmaceutical ingredients (“API”) for its products. AIM is in the planning stages of updating the manufacturing and laboratory suites with state-of-the-art, mobile-ready equipment that can be used either there or in future alternate space. While the Company believes it has sufficient API to meet its current needs, it is also continually exploring new opportunities to maximize its ability to fulfill future needs. AIM’s current and active production plan is to shift to the utilization of Contract Manufacturing Organizations (“CMO”), while maintaining on-site teams for QC, QA, R&D, bench and small-batch manufacturing.

On May 13, 2021, the Company exercised its option to re-purchase the New Brunswick facility, pursuant to the terms of the March 16, 2018, sale and lease-back agreement. Subsequently, the Company sold certain equipment and machinery that it determined to be obsolete and no longer needed for current or future manufacturing (See Note 13: Financing Obligation Arising from Sale Leaseback Transaction).

In the opinion of management, all adjustments necessary for a fair presentation of such consolidated financial statements have been included. Such adjustments consist of normal recurring items. Interim results are not necessarily indicative of results for a full year.

The interim consolidated financial statements and notes thereto are presented as permitted by the Securities and Exchange Commission (“SEC”), and do not contain certain information which will be included in the Company’s annual consolidated financial statements and notes thereto.

These consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements for the years ended December 31, 2020 and 2019, contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, filed on March 31, 2021.

Immaterial Revision of Previously Reported Amounts

Subsequent to the preparation of the consolidated financial statements as of and for the period ended December 31, 2020, Management noted an error in the Company’s previously issued Consolidated Financial Statements. The error related to the Company’s income taxes footnote disclosure that resulted in the reduction of approximately $37,900,000 of certain Federal NOL carryforward assets limited by Internal Revenue Code Section 382 and the corresponding valuation allowance as of and for the period ended December 31, 2020. The revised balances of the NOL carryforward assets and valuation allowance are $8,775,000 and $8,473,000, respectively, as of December 31, 2020. In evaluating whether the previously issued Consolidated Financial Statements were materially misstated, the Company applied the guidance in ASC 250, Accounting Changes and Error Corrections, SEC Staff Accounting Bulletin (“SAB”) Topic 1.M, Assessing Materiality and SAB Topic 1.N, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements and concluded that the effect of the error on prior period financial statements was immaterial. The adjustment had no effect on the consolidated balance sheet, statement of comprehensive loss, changes in stockholders’ equity or statement of cash flows for any annual or interim period.