Company: INMB
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001213900-25-041072
Chunk: 7

Company: Inmune Bio, Inc.
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 1
Chunk 7
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 The Company operates in an environment of rapid change in technology and substantial
competition from other pharmaceutical and biotechnology companies.

The Company relies and expects to continue to
rely on a small number of vendors to manufacture supplies and materials for its use in the clinical trial programs. These programs could
be adversely affected by a significant interruption in these manufacturing services.

Use of Estimates

Preparing financial statements in conformity with
US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses.
Actual results and outcomes may differ from management’s estimates and assumptions.

Fair Value of Financial Instruments

The Company measures certain assets and liabilities
in accordance with authoritative guidance which requires fair value measurements to be classified and disclosed in one of the following
three categories:

Level 1: Quoted prices (unadjusted)
in active markets that are accessible at the measurement date for assets or liabilities.

Level 2: Observable prices that
are based on inputs not quoted on active markets but corroborated by market data.

Level 3: Unobservable inputs are
used when little or no market data is available.

Assets and liabilities are classified based on
the lowest level of input that is significant to the fair value measurements. The Company reviews the fair value hierarchy classification
on a quarterly basis. Changes in the ability to observe valuation inputs may result in a reclassification of levels for certain assets
or liabilities within the fair value hierarchy. The Company did not have any transfers of assets and liabilities between the levels of
the fair value measurement hierarchy during the years presented.

The carrying amounts of financial instruments
such as cash and cash equivalents, research and development tax credit receivable, other tax receivable, prepaid expenses, and accounts
payable and accrued liabilities approximate the related fair values due to the short-term maturities of these instruments. 

7

Cash and Cash Equivalents

The Company
considers all short-term, highly liquid investments with an original maturity at the date of purchase of three months or less to be cash
equivalents. The Company maintains cash balances that may be uninsured or in deposit accounts that exceed Federal Deposit Insurance Corporation
limits. The Company maintains its cash deposits with major financial institutions.

Research
and Development Tax Incentive Receivable

The Company, through its wholly owned subsidiary
in Australia (“AUS”), participates in the Australian research and development tax incentive program, such that a percentage
of our qualifying research and development expenditures are reimbursed by the Australian government, and such incentives are reflected