Entero Therapeutics (now GridAI Technologies) delays 10-K over accounting review

The late annual report

Entero Therapeutics, Inc. told the Securities and Exchange Commission on April 1, 2025 that it could not file its annual report on Form 10-K for the year ended December 31, 2024 by the due date. The Form 12b-25 notice gives the reason in one sentence: "We are currently reviewing the accounting treatment of a significant transaction." The company says the complexity of that matter requires more time so the financial statements are accurately presented under the relevant accounting standards.

The notice does not name the transaction. It says the company expects to file within the grace period Rule 12b-25 allows, and that all other periodic reports for the preceding 12 months have been filed. It does not expect a significant change in results from the prior year. The notice gives no revenue, loss or cash figure, and it lists Anna Skowron as the contact person.

The ImmunogenX unwind

The business section of the annual report describes the ImmunogenX merger that the company announced as closed in March 2024. As consideration, Entero issued the former ImmunogenX shareholders 36,830 shares of common stock and 11,777.418 shares of Series G Preferred Stock. It also assumed ImmunogenX options for 200,652 shares, at an exercise price of $0.81, and warrants for 127,682 shares, at prices from $3.02 to $3.92.

As of December 31, 2024, the company classified ImmunogenX assets and liabilities as held for sale and reported the subsidiary's results as discontinued operations. The annual report says the disposal is a strategic shift with a major effect on the company's operations and financial statements.

In March 2025 the company announced a rescission agreement. Under its terms, the parties would rescind the common and preferred stock issued in the merger, convey the ImmunogenX membership interests back to the former shareholders, and cancel the assumed options and warrants. The company would keep up to approximately $695,000 of ImmunogenX accounts payable, and ImmunogenX would remain responsible for approximately $9,278,400 of secured debt. The company expects closing on or before June 30, 2025, subject to conditions including shareholder approval for the transfer of the membership interests.

The rest of the pipeline

The company says it is focused on adrulipase, an oral enzyme for exocrine pancreatic insufficiency in cystic fibrosis and chronic pancreatitis. Its Phase 2b monotherapy bridging study, announced in July 2023, did not achieve its primary efficacy endpoint. The company says the enhanced formulation was safe, well tolerated and an improvement over prior formulations, and it plans to move the program forward in 2025.

The prior programs are being discontinued. Latiglutenase, which was tied to the ImmunogenX merger, is among them, along with capeserod and niclosamide. On February 26, 2025 the company gave notice to end its Sanofi license for capeserod, with termination expected in April 2025 and no payments due. The company also described three transactions it does not expect to proceed: a reverse merger with Journey Therapeutics, announced as a binding term sheet in November 2024, a license of two technology suites from Data Vault Holdings, announced as a letter of intent in September 2024, and a sale of niclosamide, announced as a non-binding term sheet in December 2023.

Critical read

The notice does not explain the accounting question, and the annual report it delays is the document that would. Until that report is filed, investors cannot see the financial effect of the unwind, the ImmunogenX balances or the cost of the discontinued programs. The company's own filing says its remaining clinical program, adrulipase, did not achieve the primary efficacy endpoint in its last major study. The discontinued programs, the cancelled deals and the rescission together leave a company that depends on that one program.

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