Emmaus Life Sciences, Inc. reported significant financial challenges in its latest 10-Q filing for the quarter ending June 30, 2024. The company experienced a substantial decline in revenue, with net revenues for the three months ending June 30, 2024, at $5.4 million, a decrease of 50% from $10.8 million in the same period of 2023. For the six months ended June 30, 2024, revenues totaled $7.9 million, down 55% from $17.5 million year-over-year. This decline was primarily attributed to a shortage of finished goods inventory due to delays from the company's sole packager, which led to an order backlog of approximately $4.6 million.

Despite a decrease in total operating expenses from $6.9 million to $4.6 million for the three months ended June 30, 2024, the company reported a net loss of $2.2 million, compared to a loss of $1.6 million in the prior year. For the six-month period, the net loss widened to $6.5 million from $5.0 million in 2023. The gross profit also fell significantly, from $10.3 million in Q2 2023 to $5.1 million in Q2 2024.

Emmaus's total assets decreased to $25.9 million as of June 30, 2024, down from $35.2 million at the end of 2023. Current liabilities increased to $64.0 million, resulting in a widened stockholders’ deficit of $57.0 million. The company’s cash and cash equivalents also fell to $1.5 million, down from $2.5 million at the end of 2023, raising concerns about liquidity and the ability to sustain operations without additional funding.

Strategically, the company has faced challenges following the expiration of market exclusivity for its primary product, Endari®, on July 7, 2024. The introduction of a generic version by ANI Pharmaceuticals on July 15, 2024, is expected to further impact sales. Emmaus plans to restructure or refinance its existing debt and raise additional funds through loans and equity financing to address its financial difficulties.

The company has also reported material weaknesses in its internal controls over financial reporting, which have persisted despite remediation efforts. Management has indicated substantial doubt about the company's ability to continue as a going concern over the next 12 months, emphasizing the need for immediate financial restructuring and operational adjustments.