Hepion Pharmaceuticals, Inc. (HEPA): History, Ownership, Mission, How It Works & Makes Money

Hepion Pharmaceuticals, Inc. (HEPA) is a clinical-stage biopharmaceutical company that has fundamentally changed its business in 2025, but what does a pivot from a high-risk drug pipeline to diagnostics really mean for your investment thesis?

You're looking at a company that, as of Q3 2025, reported $0 million in revenue and a 9-month net loss of $7,620,965, all while dramatically cutting operating expenses by 80% to stabilize cash burn. This aggressive shift-from the failed rencofilstat drug to in-licensing diagnostic tests-is the core of the story, so we need to map out the new mission and how they plan to make money with only $2,321,078 in cash on the balance sheet.

Hepion Pharmaceuticals, Inc. (HEPA) History

You need a clear picture of how Hepion Pharmaceuticals, Inc. got to its current, pivotal state, and honestly, the journey is a classic biotech pivot story. It didn't start with its current name or focus; the company's history is marked by strategic shifts, a major drug development focus, and a dramatic pivot in 2025 after facing significant clinical and financial headwinds.

Given Company's Founding Timeline

Year established

The corporate entity was first established in May 2013, incorporated as ContraVir Pharmaceuticals, Inc.

Original location

The company was incorporated in Delaware, later establishing its principal executive offices in Edison, New Jersey.

Founding team members

Hepion Pharmaceuticals was formed through the merger of a private entity, ContraVir Pharmaceuticals, Inc., and the Hepatitis C assets of Synergy Pharmaceuticals Inc. Key leadership evolved post-inception, with figures like Robert T. Foster, PharmD, PhD, later guiding the strategic direction.

Initial capital/funding

Specific initial seed funding details pre-merger are not public, but the company's operations were subsequently fueled by funding through private placements and public offerings following its NASDAQ listing. Drug development is expensive; the company was often incurring R&D investments exceeding $5 million quarterly in 2024.

Given Company's Evolution Milestones

Given Company's Transformative Moments

The most recent period has been defintely the most transformative, shifting the company's entire business model. The core challenge was simple: the high-risk, high-cost nature of clinical-stage drug development ran out of runway. You can dig deeper into the financial fallout in Breaking Down Hepion Pharmaceuticals, Inc. (HEPA) Financial Health: Key Insights for Investors.

The company's board initiated a strategic restructuring in December 2023 to preserve capital, which led to the wind-down of the key ASCEND-NASH trial in April 2024. This was a clear signal that the NASH drug development focus was ending due to financial constraints.

The pivot in 2025 was stark, moving from a clinical-stage biopharma company to a developer and distributor of diagnostic tests.

• Failed Merger: A proposed merger with Pharma Two B Ltd., an Israeli company focused on Parkinson's Disease, was announced in July 2024 but mutually terminated in December 2024. This left the company without a clear path forward.
• Shift to Diagnostics: In May 2025, Hepion Pharmaceuticals executed a binding letter of intent with New Day Diagnostics to commercialize diagnostic tests for conditions like Celiac Disease and respiratory illnesses. This was a complete strategic pivot away from the legacy drug pipeline.
• Cost Reduction and Cash Burn: The strategic retreat was financially aggressive. For the first nine months of the 2025 fiscal year (9M 2025), total operating expenses were slashed by $14.6 million, an 80% reduction, with Research and Development (R&D) plunging 97% to just $0.4 million. This cut the operating cash burn sharply from $17.1 million in 9M 2024 to $2.9 million in 9M 2025.
• Diagnostics Acquisition Impairment: The new strategy immediately hit a snag. The $0.8 million acquisition of assets from New Day Diagnostics in May 2025 resulted in an immediate $0.4 million impairment loss, a 50% write-down, as management concluded the projected cash flow would not cover the cost.

Here's the quick math on liquidity: As of September 30, 2025, the company held only $2.3 million in cash, which is less than the $2.9 million used in operations during the preceding nine months. This precarious position is why the company is subject to a "going concern" warning. The story is now about executing a high-risk commercial pivot with minimal cash. That's the reality you're looking at.

Hepion Pharmaceuticals, Inc. (HEPA) Ownership Structure

Hepion Pharmaceuticals, Inc. operates as a publicly traded entity, but its ownership structure shows a high concentration of shares in the hands of the general public and a very small insider stake, which can lead to significant stock price volatility.

Given Company's Current Status

The company is currently a public entity trading on the OTCQB Venture Market (OTCQB:HEPA), having been delisted from the Nasdaq Stock Market in May 2025 due to non-compliance with listing requirements, including the minimum bid price rule. This transition to the over-the-counter market is a critical risk factor for investors.

Following a shift in strategy, the company pivoted from developing drug therapies for chronic liver diseases to focusing on medical diagnostics, which led to the wind-down of its main clinical trial due to insufficient funding. For the three months ended September 30, 2025, the company reported a net loss of $(472,506), contributing to a nine-month net loss of $(7,620,965), and its cash balance was only $2,321,078 as of September 30, 2025. Here's the quick math: that cash position raises substantial doubt about the company's ability to continue as a going concern without securing new capital.

For a deeper dive into the company's financial standing, you should review Breaking Down Hepion Pharmaceuticals, Inc. (HEPA) Financial Health: Key Insights for Investors.

Given Company's Ownership Breakdown

The ownership structure of Hepion Pharmaceuticals is heavily skewed toward retail investors, with institutional holders maintaining a relatively small position. This means the stock price is defintely more susceptible to retail trading sentiment and rapid changes.

Given Company's Leadership

The company's leadership has undergone a significant change in 2025, reflecting its strategic pivot and financial challenges. Dr. Kaouthar Lbiati now holds the top two executive positions on an interim basis, bringing a background in global pharmaceutical leadership to the company's new focus on diagnostics.

• Dr. Kaouthar Lbiati: Interim Chief Executive Officer (CEO) and Interim Chief Financial Officer (CFO), effective June 2025.
• John P. Brancaccio: Former CEO and CFO, who resigned from both executive and board positions in June 2025.
• Key Directors: The board includes individuals like Dr. Timothy M. Block, Ph.D., and Michael Purcell, a retired Deloitte & Touche LLP Audit Partner, who provide oversight.

The board's average tenure is around 2.7 years, which suggests a relatively new board. This lack of deep, long-term continuity among directors is a factor to consider when evaluating the stability of the new diagnostics-focused strategy.

Hepion Pharmaceuticals, Inc. (HEPA) Mission and Values

Hepion Pharmaceuticals, Inc. is undergoing a significant strategic shift in 2025, moving its core purpose from AI-driven drug development for liver disease to precision diagnostics for various conditions, aiming for near-term revenue. This pivot means their mission and values are now grounded in a patient-centric, scientifically rigorous, but also commercially urgent, path.

Honestly, the immediate financial reality is tough, with the company reporting annual revenue of $0 and a market capitalization around $782,628 as of May 2025, so the mission shift is a clear action to address a less-than-one-year cash runway.

Hepion Pharmaceuticals, Inc.'s Core Purpose

The company's core purpose is evolving from a long-term therapeutic play to a more immediate diagnostic focus, which is a massive change for a biopharma company. The sale of their lead drug candidate, Rencofilstat, in May 2025 for a nominal amount plus a contingent value right (CVR) signaled this strategic re-alignment.

Official mission statement

The mission statement reflects the dual focus of their history and their new strategic direction, which centers on addressing significant unmet medical needs through scientific innovation.

• Develop and commercialize AI-driven therapeutics (the historical focus) to address chronic liver diseases.
• Advance innovative drug candidates through rigorous clinical trials, providing effective treatment options for debilitating liver conditions.
• Crucially, the 2025 repositioning: Develop and commercialize precision diagnostic tests for conditions like celiac disease, respiratory multiplex (COVID/Influenza A/B and RSV), H. pylori, and hepatocellular carcinoma (HCC).

Vision statement

Hepion's vision is to establish itself as a leader in innovative solutions for improved patient health, now explicitly including the precision diagnostics space to create a viable business model.

• Become a leader in the treatment of chronic liver diseases.
• Focus on innovative solutions for improved liver health, leveraging their AI-POWR™ platform.
• Commit to scientific excellence and a patient-centric approach to bring life-changing therapies to patients.

Hepion Pharmaceuticals, Inc. Core Values

While a formal, bulleted list of core values isn't always published, their corporate governance and culture point to a clear set of operational principles. These values are what drive their decision-making, even the defintely high-stakes one to pivot the entire business model.

• Scientific Excellence: Maintain a commitment to rigorous research and a targeted, multi-targeted approach to complex diseases.
• Ethical Conduct: Achieve the highest possible standards of ethics and behavior in corporate governance, promoting a trustworthy and honest work environment.
• Patient-Centricity: Prioritize the needs of patients suffering from debilitating conditions in all development and commercialization efforts.
• Collaboration & Teamwork: Foster a collaborative culture where diverse perspectives and open communication drive research forward.

Hepion Pharmaceuticals, Inc. slogan/tagline

The company's marketing reflects their historical focus on the massive unmet need in liver health, even as the business model shifts to diagnostics for a broader set of diseases.

• TACKLING CHRONIC LIVER DISEASE
• BROAD SPECTRUM LIVER THERAPY

You can find more detail on the company's foundational principles here: Mission Statement, Vision, & Core Values of Hepion Pharmaceuticals, Inc. (HEPA).

Hepion Pharmaceuticals, Inc. (HEPA) How It Works

Hepion Pharmaceuticals, Inc. has fundamentally shifted its business model in 2025, moving from a high-risk clinical-stage drug developer to a commercial-stage medical diagnostics company. The company now generates value by licensing and commercializing in-vitro diagnostic (IVD) tests, primarily focusing on near-term revenue generation in the European and UK markets.

Given Company's Product/Service Portfolio

Following the May 2025 licensing of assets from New Day Diagnostics, the company's portfolio is centered on commercializing four key diagnostic tests, all of which hold the CE mark for sale in the European Union and the UK.

Given Company's Operational Framework

The operational framework is now a lean commercialization and cost-management engine, a sharp pivot from its previous R&D focus. The company's core activity is the sales and distribution of licensed diagnostic tests in key international markets.

• Commercialization Focus: Prioritize near-term revenue generation by selling the CE-marked diagnostic tests in the EU and UK, where regulatory approval is already secured.
• R&D Cessation: Research and development (R&D) activities have been drastically reduced, dropping 97% from 9M 2024 to just $0.4 million in the nine months ended September 30, 2025. This move defintely cut the burn rate.
• Financial Restructuring: Total operating expenses were slashed by $14.6 million, or 80%, to stabilize the operating cash burn at $2.9 million for the first nine months of 2025.
• US Regulatory Pursuit: Simultaneously, the company is preparing for US regulatory submissions for the diagnostic tests to open up the domestic market.

To be fair, the initial diagnostic pivot has been rocky; the company recorded an immediate $0.4 million impairment loss on the $0.8 million in assets acquired from New Day Diagnostics, suggesting execution risk is high.

Given Company's Strategic Advantages

The company's strategic advantage is no longer its drug pipeline but a combination of financial engineering and market access for its new diagnostic portfolio.

• Contingent Value Right (CVR): The sale of the Rencofilstat drug assets to Panetta Partners Limited in May 2025 included a CVR for Hepion's stockholders. This provides a no-cost, non-dilutive upside, including a potential payment of $3,000,000 if Rencofilstat's net sales surpass $750,000,000.
• Immediate Market Access: The licensed diagnostic tests already possess the CE mark, which allows for immediate commercial sales in Europe and the UK without a lengthy, capital-intensive clinical trial process like the one its former drug candidate required.
• Targeting High-Value Diagnostics: The portfolio focuses on large, growing, and underserved diagnostic markets, such as the mSEPT9 assay for HCC, which targets an $8.7 billion market.
• Lean Operating Model: The aggressive cost-cutting measures have extended the cash runway, which is crucial since the company reported $0 million in revenue and a cash balance of only $2.3 million as of September 30, 2025. This low overhead model is a necessity, not a choice.

You can find more detail on the company's new direction here: Mission Statement, Vision, & Core Values of Hepion Pharmaceuticals, Inc. (HEPA).

Hepion Pharmaceuticals, Inc. (HEPA) How It Makes Money

Hepion Pharmaceuticals, Inc. currently makes its money almost exclusively through capital raises, not product sales, as it is a company in a deep business transition. For the nine months ended September 30, 2025, the company reported $0 million in revenue, meaning its operations are entirely funded by investor capital and debt management while it attempts to commercialize a new line of diagnostic tests.

You need to understand that a clinical-stage biopharma company's financial health is measured by its cash runway, not its revenue, until a product is approved and launched. Hepion Pharmaceuticals' strategy pivoted in 2025 from developing the liver drug rencofilstat to in-licensing medical diagnostics, which means their future revenue model is now based on selling diagnostic tests, primarily in markets outside the US for now.

Hepion Pharmaceuticals' Revenue Breakdown

The revenue breakdown reflects the reality of a company in a critical pivot phase, where the former drug pipeline has been sold and the new diagnostic products are yet to be commercialized. The numbers are stark, but they clarify the immediate financial challenge.

Business Economics

The core economic engine for Hepion Pharmaceuticals right now is capital preservation and the successful launch of its new diagnostic assets. The old model, which relied on massive research and development (R&D) spending to reach a blockbuster drug approval, is over. The new model is lower-cost and aims for near-term revenue.

The company sold its rencofilstat assets in May 2025 for a nominal amount, retaining Contingent Value Rights (CVRs)-a type of security that pays out if specific future milestones, like FDA approval or sales targets, are met. This is a potential, non-guaranteed revenue stream, but no contingent amounts were recognized in Q3 2025.

The new strategy, centered on diagnostic tests for conditions like celiac disease and respiratory multiplex (Covid/Flu/RSV), involves a licensing fee of $525,000 cash and $270,629 in stock paid to New Day Diagnostics LLC, plus up to $17.15 million in potential milestones. The pricing strategy for these tests will target European Union and other CE-mark markets first, where they are eligible for sale, but the US market is not yet open. This is a much faster path to revenue than drug development, but the market size is different. Mission Statement, Vision, & Core Values of Hepion Pharmaceuticals, Inc. (HEPA).

Hepion Pharmaceuticals' Financial Performance

The Q3 2025 financial report, filed in November 2025, shows a company aggressively cutting costs to survive and fund the pivot. This is a distressed financial situation, but the cost control is defintely notable.

• Net Loss: The net loss for Q3 2025 was $(472,506), a sharp drop from the prior year, but the nine-month net loss was still substantial at $(7,620,965).
• Cash Position: Cash on hand as of September 30, 2025, was $2,321,078. This is a critical metric, as it indicates a very short cash runway given the ongoing losses.
• Operating Expenses: Research and Development (R&D) expense for Q3 2025 was reduced to $0, reflecting the pause in drug development. General and Administrative (G&A) expense was $527,902 for the quarter.
• Financing: The company raised approximately $9.0 million in gross proceeds from a public offering in January 2025, which was vital for its operations and debt repayment.
• Going Concern Risk: The company's management has explicitly stated there is substantial doubt about its ability to continue as a going concern without securing additional capital. This is the single biggest risk factor you face as an investor.

Here's the quick math: with quarterly operating expenses around $527,902 (Q3 G&A) and cash at $2.32 million, the current cash position provides a very limited runway, not even a full year, before needing new financing-and that's assuming R&D remains at zero. What this estimate hides is the cash needed for the new diagnostic commercialization efforts.

Your next step must be to monitor Q4 2025 filings for any revenue recognition from the new diagnostic products and any new capital raises. Owner: You (Investor/Analyst).

Hepion Pharmaceuticals, Inc. (HEPA) Market Position & Future Outlook

Hepion Pharmaceuticals has executed a dramatic pivot, shifting from a high-risk clinical-stage biopharmaceutical company focused on Non-Alcoholic Steatohepatitis (NASH) to a commercial-stage medical diagnostics firm. This strategic retreat, driven by a lack of funding for its drug pipeline, positions the company for near-term revenue generation in the European Union (EU) diagnostics market while facing severe financial and operational headwinds.

Competitive Landscape

The company's competitive landscape has fundamentally changed. After winding down its drug development program and selling its lead asset, rencofilstat, Hepion now competes in the crowded, low-margin diagnostics market, specifically in the niche of CE-marked tests for celiac disease, respiratory multiplex, H. pylori, and hepatocellular carcinoma (HCC) in the EU and other non-US markets. It is not a direct competitor to large-cap NASH drug developers like Gilead or Novo Nordisk anymore. Given the recent pivot in May 2025, a precise market share percentage is not available for its new diagnostics portfolio, so we must be defintely realistic.

Opportunities & Challenges

The company's future hinges entirely on its ability to commercialize its newly licensed diagnostic tests and secure additional capital, especially since its cash balance of $2,321,078 as of September 30, 2025, is insufficient to cover its prior operating burn. Here's the quick math: the nine-month 2025 operating cash burn was $2.9 million, so the current cash runway is extremely short.

Industry Position

Hepion Pharmaceuticals now holds a precarious position, having moved from the high-risk, high-reward biopharma sector to the low-margin diagnostics distribution space. The company is now a small-cap entity trading on the OTCQB Venture Market, a significant step down from its former Nasdaq listing.

The core of its strategic initiative is to generate revenue from the licensed diagnostic tests, which are currently only eligible for sale in the EU and other markets that accept the CE mark, excluding the United States. This shift means the company has effectively exited the drug development industry, with research and development (R&D) expenses plunging 97% to just $0.4 million for the nine months ended September 30, 2025. That's a near-total cessation of R&D. Still, the immediate 50% impairment on the new assets is a major red flag for the commercial viability of the new strategy. You can find more detail on the financial situation here: Breaking Down Hepion Pharmaceuticals, Inc. (HEPA) Financial Health: Key Insights for Investors.

• Liquidity Crisis: Cash of $2.3 million (Q3 2025) is insufficient to cover the 9-month operating burn, necessitating highly dilutive financing.
• Governance Risk: Management has identified material weaknesses in internal financial controls.
• New Focus: The company's future depends on successfully commercializing CE-marked diagnostic tests for celiac disease, respiratory multiplex, H. pylori, and HCC.

Action: Finance/Operations must immediately present a 13-week cash flow forecast for the new diagnostics business by the end of the week.