What changed in this filing

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Item 2. Management’s Discussion and Analysis

2022-05-12 compared with 2021-11-09 · 81 added, 106 removed, 77 unchanged (71% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read together with our consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and our consolidated financial statements and related notes for the year ended December 31, 2020 included in our Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission on February 25, 2021.

The following discussion and analysis of our financial condition and results of operations should be read together with our consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and our consolidated financial statements and related notes for the year ended December 31, 2021 included in our Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission on March 15, 2022.

This Quarterly Report on Form 10-Q contains forward-looking statements that involve substantial risks and uncertainties.

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is a clinical stage biopharmaceutical company focused on developing treatments for obesity and liver diseases.

Our pipeline includes proprietary intranasal vaccines and next generation peptide therapeutics for obesity, NASH ( pemvidutide, proposed INN, formerly known as ALT-801 ) and chronic hepatitis B (HepTcell).

In June 2021, we announced the discontinuation of further development of our COVID-19 vaccine candidate, AdCOVID following our review of findings from the Phase 1 clinical trial, and in view of the highly competitive COVID-19 landscape.

In the study, AdCOVID was generally well tolerated, but the immunogenicity data demonstrated lower than expected immune responses for each of the immune parameters tested.

Our lead product candidate, pemvidutide (proposed INN, formerly known as ALT-801), is a dual GLP-1/glucagon receptor agonist that is being developed for the treatment of obesity and non-alcoholic steatohepatitis (“NASH”).

In addition, we are developing HepTcell, an immunotherapeutic agent designed to achieve a functional cure for chronic hepatitis B.

Impact of COVID-19

We are closely monitoring how the spread of COVID-19, including any resurgences or the emergence of new variants, is affecting our employees, business, preclinical studies and clinical trials.

We have reopened our executive office to allow certain employees to return to the office based on a phased approach that is intended to comply with federal and state guidelines, with a focus on employee safety and optimal work environment.

We have reopened our executive office to allow employees to return to the office based on an approach that is intended to comply with federal and state guidelines, with a focus on employee safety and optimal work environment.

We are continuing our regular interactions with the FDA and other regulatory agencies and, based on current information, we do not anticipate COVID-19 to materially affect our regulatory timelines for our ongoing clinical trials.

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While the vaccination mandate remains subject to the interpretation of various government agencies and other entities, and questions remain regarding the specific application of the vaccination mandate, we are continuing to develop and implement health, safety, employment and operational protocols in order to timely comply with the vaccination mandate.

As of and for the three and nine months ended September 30, 2021, the vaccination mandate has not had a material impact on our employees or operations.

Although operations have not been materially affected by the COVID-19 pandemic as of and for the three and nine months ended September 30, 2021, at this time, however, there is significant uncertainty relating to the trajectory of the pandemic and the impact of related responses, and disruptions caused by the COVID-19 pandemic may result in difficulties or delays in initiating, enrolling, conducting or completing our planned and ongoing trials and the incurrence of unforeseen costs as a result of disruptions in clinical supply or preclinical study or clinical trial delays.

As of and for the three months ended March 31, 2022, the vaccination mandate has not had a material impact on our employees or operations.

Although operations have not been materially affected by the COVID-19 pandemic as of and for the three months ended March 31, 2022, at this time, however, there is uncertainty relating to the trajectory of the pandemic and the impact

of related responses, and disruptions caused by the COVID-19 pandemic may result in difficulties or delays in initiating, enrolling, conducting or completing our planned and ongoing trials and the incurrence of unforeseen costs as a result of disruptions in clinical supply or preclinical study or clinical trial delays.

The impact of COVID-19 on our future results will largely depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as the ultimate geographic spread of the disease, the duration of the pandemic, travel restrictions and social distancing in the United States and other countries, business closures or business disruptions, the ultimate impact on financial markets and the global economy, and the effectiveness of actions taken in the United States and other countries to contain and treat the disease.

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Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2021.

Recent Global Events

Russia and Ukraine Conflict

The military conflict in Russia and Ukraine that began in February 2022 continues as of the date of this quarterly report.

As the conflict continues to evolve, we are closely monitoring the impact on our business.

The conflict, and the sanctions and counter-sanctions imposed in response to it, have created increased economic uncertainty and operational complexity globally.

While we have no direct exposure to Russia and Ukraine, and do not at the moment believe the situation will have a material impact on our operating results, we are monitoring any broader economic impact from the situation.

Should the conflict continue or escalate, it could have a significant negative effect on the global economy or on our operations, including continued inflationary pressures on raw materials, supply chain and logistics disruptions, volatility in foreign exchange rates and interest rates and heightened cybersecurity threats.

Government Contracts and Grants

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The competitive award was granted by USAMRDC in collaboration with the Medical Technology Enterprise Consortium (“MTEC”), a 501(c)(3) biomedical technology consortium working in partnership with the Department of Defense (“DoD”).

Under the contract, MTEC pays us a firm fixed fee based upon the achievement of certain milestones for conduct and completion of a Phase 1/2 study and research and development work on the replication-deficient adenovirus 5 (“RD-Ad5”) vector vaccine platform.

For the nine months ended September 30, 2021, we have recognized approximately $0.5 million of grant revenue under the contract.

For the three and nine months ended September 30, 2020, we have recognized approximately $2.3 million of grant revenue under the contract.

Under the contract, MTEC paid us a firm fixed fee based upon the achievement of certain milestones for conduct and completion of a Phase 1/2 study and research and development work on the replication-deficient adenovirus 5 (“RD-Ad5”) vector vaccine platform.

For the three months ended March 31, 2021, we recognized approximately $0.5 million of grant revenue under the contract, which completed the full recognition of this award.

No revenue was recognized for this contract for the three months ended March 31, 2022.

In July 2016, we signed a five-year contract with Biomedical Advanced Research and Development Authority (“BARDA”).

The contract, as amended, has a total value of up to $136.8 million and is used to fund clinical development of NasoShield.

Under the contract, BARDA pays us a fixed fee and reimburses certain costs for the research and development of an Ad5-vectored, protective antigen-based intranasal anthrax vaccine through cGMP manufacture and conduct of a Phase 1 clinical trial dose ranging assessment of safety and immunogenicity.

The contract consists of an initial base performance period providing approximately $30.9 million in funding for the period July 2016 through December 2021.

BARDA has seven options to extend the contract to fund certain continued development and manufacturing activities for the anthrax vaccine, including Phase 2 clinical trials.

Each option, if exercised by BARDA, would provide additional funding ranging from approximately $1.1 million to $34.4 million for a three-year period beginning in 2021.

For the three and nine months ended September 30, 2021, we have recognized approximately $0.1 million and $0.4 million, respectively, of grant revenue under the current BARDA contract.

For the three and nine months ended September 30, 2020, we recognized approximately $0.6 million and $2.7 million, respectively, of grant revenue under the current BARDA contract.

The contract, as amended, had a total value of up to $136.8 million to be used to fund clinical development of NasoShield.

Under the contract, BARDA paid us a fixed fee and reimbursed certain costs for the research and development of an Ad5-vectored, protective antigen-based intranasal anthrax vaccine through cGMP manufacture and conduct of a Phase 1 clinical trial dose ranging assessment of safety and immunogenicity.

The contract consisted of an initial base performance period providing approximately $30.9 million in funding for the period July 2016 through December 2021.

BARDA had seven options to extend the contract to fund certain continued development and manufacturing activities for the anthrax vaccine, including Phase 2 clinical trials.

Each option, if exercised by BARDA, would have provided additional funding ranging from approximately $1.1 million to $34.4 million for a three-year period beginning in 2021.

For the three months ended March 31, 2021, we recognized approximately $0.2 million of grant revenue under the BARDA contract.

For the three months ended March 31, 2022, we have recognized de minimis grant revenue related to the close-out of the BARDA contract.

BARDA did not extend the contract beyond the end of December 2021.

Critical Accounting Policies and Significant Judgment and Estimates

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We base our estimates and judgments on historical experience, knowledge of current conditions, and expectations of what could occur in the future given available information.

There have been no changes in our critical accounting policies and significant judgment and estimates as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2020 except for recently adopted accounting standards (See Note 2 to the consolidated financial statements appearing in Item 1 of this report).

For more information

regarding our critical accounting policies, we encourage you to read the discussion contained in Item 7 under the heading “Critical Accounting Policies and Significant Judgments and Estimates” and Note 2 “Summary of Significant Accounting Policies” included in the notes to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2020.

There have been no changes in our critical accounting policies and significant judgment and estimates as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2021.

For more information regarding our critical accounting policies, we encourage you to read the discussion contained in Item 7 under the heading “Critical Accounting Policies and Significant Judgments and Estimates” and Note 2 “Summary of Significant Accounting Policies” included in the notes to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2021.

Results of Operations

Comparison of the three months ended September 30, 2021 and 2020:

Comparison of the three months ended March 31, 2022 and 2021:

For the Three Months Ended

September 30,

Increase (Decrease)

Operating expenses:

Research and development

General and administrative

Total operating expenses

Loss from operations

Other income (expense):

Interest expense

Interest income

Other (expense) income, net

Total other (expense) income, net

Net loss before income tax benefit

Income tax benefit

Comparison of the nine months ended September 30, 2021 and 2020:

For the Nine Months Ended

September 30,

(in thousands, except percentages)

Increase (Decrease)

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General and administrative

Impairment loss on construction-in-progress

Total operating expenses

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Interest income

Other (expense) income, net

Total other (expense) income, net

Net loss before income tax benefit

Income tax benefit

Other income (expense), net

Total other income (expense), net

Revenue consists primarily of research grants in the United States from MTEC for our T-COVID product candidate and BARDA for our NasoShield vaccine product candidate.

These grants consist of firm fixed fee contracts based on milestones and cost reimbursement contracts, with a fixed fee based on either costs incurred or milestones met.

Revenue decreased by $2.8 million, or 95%, for the three months ended September 30, 2021, as compared to the same period in 2020.

The decrease was primarily the result of a decrease in MTEC revenue attributable to the timing of clinical trial and development work on the T-COVID program.

Revenue decreased by $4.7 million, or 81%, for the nine months ended September 30, 2021, as compared to the same period in 2020.

The decrease was primarily the result of:

● a decrease of $2.9 million in BARDA revenue due to timing of clinical trials, development activities and settlement of indirect rates on the NasoShield program;

● a decrease of $1.8 million in MTEC revenue attributable to the timing of clinical trial and development work on the T-COVID program.

Our T-COVID and NasoShield programs were discontinued as of the end of 2021.

Revenue decreased by $0.8 million, or 96%, for the three months ended March 31, 2022, as compared to the three months ended March 31, 2021.

The decrease was primarily the result of a decrease of $0.5 million in MTEC revenue attributable to the timing of clinical trial and the discontinuation of development work on the T-COVID program.

Research and development expenses

Research and development operating expense increased by $12.2 million, or 71%, for the three months ended September 30, 2021, as compared to the same period in 2020.

The increase was primarily the result of:

● an increase of $14.0 million due to development activities for the COVID-19 programs, which include AdCOVID (discontinued in June 2021) and T-COVID;

● an increase of $1.5 million in other pre-clinical and clinical projects and non-project specific research and development costs;

● a decrease of $3.3 million due primarily to a decrease in the fair value of contingent consideration liability with respect to the acquisition of pemvidutide and development activities for pemvidutide.

Research and development operating expense increased by $13.5 million, or 33%, for the nine months ended September 30, 2021, as compared to the same period in 2020.

Research and development operating expense increased by $3.2 million, or 27%, for the three months ended March 31, 2022, as compared to the three months ended March 31, 2021.

The increase was primarily the result of:

● an increase of $27.1 million due primarily to development activities for the COVID-19 program, AdCOVID (discontinued in June 2021);

● an increase of $4.2 million in other pre-clinical and clinical projects and non-project specific research and development costs;

● a decrease of $17.8 million due primarily to a decrease in the fair value of contingent consideration liability with respect to the acquisition of pemvidutide and development activities for pemvidutide.

● an increase of $9.2 million due to the development activities for pemvidutide primarily due to the ongoing NAFLD trials and initiation of the MOMENTUM Phase 2 trial in obesity;

● an increase of $1.9 million due to development activities for HepTcell;

● a net increase of $0.4 million due to development activities related to our other programs, along with costs associated with our pre-clinical projects and non-project specific research and development costs including employee compensation and facility costs;

● a decrease of $5.6 million due primarily to development activities for our COVID-19 programs, which included AdCOVID and T-COVID (which were discontinued in 2021);

● a decrease of $2.7 million primarily due to a decrease in the fair value of contingent consideration liability with respect to the acquisition of pemvidutide.

General and administrative expenses

General and administrative expense were consistent during the three months ended September 30, 2021, as compared to the same period in 2020.

General and administrative expense increased by $2.5 million, or 28%, for the nine months ended September 30, 2021, as compared to the same period in 2020, due primarily to an increase in stock compensation expense and other labor related costs.

Impairment loss on construction-in-progress

Impairment loss on construction-in-progress reported during the nine months ended September 30, 2021 represents a non-cash impairment charge recorded for assets that were previously capitalized in connection with the discontinuation of AdCOVID.

Total other (expense) income, net

Total other (expense) income, net decreased by $0.4 million and $0.6 million during the three and nine months ended September 30, 2021, respectively, as compared to the same period in 2020.

The net decreases are primarily due to changes in foreign currency conversion and interest income.

Income tax benefit

Income tax benefit decreased by $0.5 million and $5.3 million during the three and nine months ended September 30, 2021, respectively, as compared to the same period in 2020.

In both 2021 and 2020, we had a valuation allowance against all of our deferred tax assets, but in 2020 a benefit was recognized related to a net operating loss carryback refund claim pursuant to the Coronavirus Aid, Relief, and Economic Security Act.

General and administrative expense increased by $0.6 million, or 16%, for the three months ended March 31, 2022, as compared to the three months ended March 31, 2021.

The increase is due primarily to an increase in stock compensation expense.

Total other income (expense), net

Total other income (expense), net increased by $0.1 million during the three months ended March 31, 2022, as compared to the three months ended March 31, 2021.

The net increase is primarily due to changes in foreign currency conversion.

Liquidity and Capital Resources

Our primary sources of cash during the nine months ended September 30, 2021 were from sales of equity, maturities of short-term investments, cash receipts of accounts receivable from research grants and cash receipts of income tax refunds.

Our cash, cash equivalents, restricted cash and short-term investments were $199.9 million at September 30, 2021.

We believe, based on the operating cash requirements and capital expenditures expected for 2021 and 2022, our cash on hand and short-term investments at September 30, 2021, together with expected collections from our government sponsored contracts and tax refunds, are sufficient to fund operations for at least a twelve-month period from the issuance date of our September 30, 2021 consolidated financial statements.

Our primary sources of cash during the three months ended March 31, 2022 were from equity transactions and cash receipts of accounts receivable from research grants.

Our cash, cash equivalents and restricted cash were $180.0 million at March 31, 2022.

We believe, based on the operating cash requirements and capital expenditures expected for 2022 and 2023, our cash on hand at March 31, 2022, together with expected cash receipts from our income tax refunds and R&D incentives, are sufficient to fund operations for at least a twelve-month period from the issuance date of our March 31, 2022 consolidated financial statements.

We have not generated any revenues from the sale of any products to date, and there is no assurance of any future revenues from product sales.

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We have incurred significant losses since we commenced operations.

As of September 30, 2021, we had an accumulated deficit of $269.3 million.

As of March 31, 2022, we had an accumulated deficit of $312.6 million.

In addition, we have not generated positive cash flows from operations.

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Army Medical Research & Development Command (“USAMRDC”) to fund our Phase 1/2 clinical trial of T-COVID.

Through September 30, 2021, we have collected approximately $3.7 million in cash under the contract.

The competitive award was granted by USAMRDC in collaboration with the Medical Technology Enterprise Consortium (“MTEC”), a 501(c)(3) biomedical technology

consortium working in partnership with the Department of Defense (“DoD”).

Through March 31, 2022, we have collected approximately $4.7 million in cash under the contract, which completed the full recognition of this award.

In July 2016, we signed a five-year contract with BARDA.

The contract, as amended, has a total value of up to $136.8 million and is used to fund clinical development of NasoShield.

The contract consists of an initial base performance period providing approximately $30.9 million in funding for the period July 2016 through December 2021.

BARDA has seven options to extend the contract to fund certain continued development and manufacturing activities for the anthrax vaccine, including Phase 2 clinical trials.

Each option, if exercised by BARDA, would provide additional funding ranging from approximately $1.1 million to $34.4 million for a three-year period beginning in 2021.

Through September 30, 2021, we have collected approximately $25.8 million in cash under the current BARDA contract.

The following table provides information regarding our cash flows for the nine months ended September 30, 2021 and 2020:

Nine Months Ended September 30,

The contract, as amended, had a total value of up to $136.8 million to be used to fund clinical development of NasoShield.

The contract consisted of an initial base performance period providing approximately $30.9 million in funding for the period July 2016 through December 2021.

BARDA had seven options to extend the contract to fund certain continued development and manufacturing activities for the anthrax vaccine, including Phase 2 clinical trials.

Each option, if exercised by BARDA, would have provided additional funding ranging from approximately $1.1 million to $34.4 million for a three-year period beginning in 2021.

Through March 31, 2022, we have collected approximately $29.5 million in cash under the BARDA contract.

BARDA did not extend the contract beyond the end of December 2021.

The following table provides information regarding our cash flows for the three months ended March 31, 2022 and 2021:

Three Months Ended March 31,

(in thousands)

Net cash (used in) provided by:

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Financing activities

Net increase in cash and cash equivalents and restricted cash

Net (decrease) increase in cash and cash equivalents and restricted cash

Operating Activities

Net cash used in operating activities was $56.3 million for the nine months ended September 30, 2021 compared to $21.0 million during the nine months ended September 30, 2020.

Our sources of cash provided by operations during the nine months ended September 30, 2021 were primarily cash receipts of income tax refunds and revenue generated by our BARDA and MTEC contracts.

Net cash used in operating activities was $13.5 million for the three months ended March 31, 2022 compared to $19.6 million during the three months ended March 31, 2021.

The primary uses of cash from our operating activities include payments for labor and labor-related costs, professional fees, research and development costs associated with our clinical trials, and other general corporate expenditures.

The increase in cash used in operations of $35.2 million year over year is due to an increase in net loss as adjusted for non-cash items of $44.6 million and changes in working capital accounts of $9.3 million.

The decrease in cash used in operations of $6.0 million year over year is due to an increase in net loss as adjusted for non-cash items of $6.5 million and changes in working capital accounts of $12.6 million.

Investing Activities

Net cash provided by (used in) investing activities was $62.7 million for the nine months ended September 30, 2021 compared to $35.2 million during the nine months ended September 30, 2020.

The net cash provided by investing activities during the nine months ended September 30, 2021 was primarily due to net proceeds from short-term investment activity, partially offset by purchases of property and equipment.

The net cash used in investing activities during the nine months ended September 30, 2020 was primarily due to purchases and maturities from short-term investments.

Net cash (used in) provided by investing activities was minimal for the three months ended March 31, 2022 compared to $19.2 million during the three months ended March 31, 2021.

The net cash provided by investing activities during the three months ended March 31, 2021 was primarily due net proceeds from short-term investment activity, partially offset by purchases of property and equipment primarily associated with the COVID-19 vaccine programs.

Financing Activities

Net cash provided by financing activities during the nine months ended September 30, 2021 was $52.6 million compared to $190.8 million for the nine months ended September 30, 2020.

The net cash provided by financing activities during the nine months ended September 30, 2021 was primarily the result of the receipt of $52.4 million in proceeds from the issuance of common stock from our at-the-market offerings program.

The net cash provided by financing activities during the nine months ended September 30, 2020 was primarily the result of the receipt of $124.0 million in proceeds from a public offering (discussed below), $41.0 million in proceeds from the exercise of warrants and $25.6 million in proceeds from the issuance of common stock from our at-the-market offerings program.

Net cash provided by financing activities during the three months ended March 31, 2022 was $3.2 million compared to $34.4 million for the three months ended March 31, 2021.

The net cash provided by financing activities during the three months ended March 31, 2022 was primarily the result of the receipt of $3.0 million in proceeds from the issuance of common stock from our at-the-market offerings program.

The net cash provided by financing activities during the three months ended March 31, 2021 was primarily the result of the receipt of $34.2 million in proceeds from the issuance of common stock from our at-the-market offerings program.

Public Offering

On July 16, 2020, we offered and sold (i) 3,369,564 shares of our common stock, at a price to the public of $23.00 per share, and (ii) pre-funded warrants to purchase 1,630,436 shares of our common stock at an exercise price equal to $0.0001 per share (the “Pre-Funded Warrants”), at a price to the public of $22.9999 per share of common stock underlying the Pre-Funded Warrants (equal to the public offering price per share of Common Stock, minus the exercise price of each Pre-Funded Warrant).

The Pre-Funded Warrants are exercisable at any time, provided that each Pre-Funded Warrant holder will be prohibited from exercising such Pre-Funded Warrants into shares of our common stock if, as a result of such exercise, the holder, together with its affiliates, would own more than 4.99% of the total number of shares of our common stock then issued and outstanding, which percentage may change at the holders’ election to any other number less than or

equal to 19.99% upon 61 days’ notice to us.

The gross proceeds of this offering were approximately $132.2 million, which includes the exercise in full of the underwriters’ option to purchase an additional 750,000 shares of common stock, before deducting underwriting discounts and commissions and offering expenses during the third quarter of 2020.

The net proceeds of this offering were approximately $124.0 million, after deducting underwriting discounts and commissions and offering expenses payable by the Company.

As of March 31, 2022, 760,870 of the Pre-Funded Warrants were exercised, leaving 869,566 remaining Pre-Funded Warrants unexercised.

At-the-Market Offerings

On February 25, 2021, we entered into an Equity Distribution Agreement (the “2021 Agreement”) with Piper Sandler & Co., Evercore Group L.L.C., and B.

Riley Securities, Inc., serving as sales agents (the “Sales Agents”) with respect to an at-the-market offerings program under which we may offer and sell, from time to time at its sole discretion, shares of our common stock, par value $0.0001 per share (the “Common Stock”), having an aggregate offering price of up to $125.0 million (the “Shares”) through the Sale Agents (the “2021 Offering”).

As of September 30, 2021, we sold 3,516,510 shares of Common Stock under the 2021 Agreement resulting in approximately $52.4 million in net proceeds, with $70.9 million remaining available to be sold under the 2021 Agreement.

On March 27, 2020, we entered into an Equity Distribution Agreement (the “2020 Agreement”) with JMP Securities LLC, serving as placement agent (the “Placement Agent”) with respect to an at-the-market offerings program under which we may offer and sell, from time to time at our sole discretion, shares of our common stock, par value $0.0001 per share (the “Common Stock”), having an aggregate offering price of up to $50.0 million (the “Shares”) through the Placement Agent (the “2020 Offering”).

We offered Shares having an aggregate offering price of $18.9 million pursuant to the prospectus supplement filed with the SEC on March 27, 2020.

On June 1, 2020, we filed an amendment to the 2020 Agreement which amended the prospectus supplement dated March 27, 2020 to increase the aggregate offering price to $50.0 million.

The 2020 Agreement was fully utilized during the year ended December 31, 2020, and no Shares were sold under the 2020 Agreement during the three and nine months ended September 30, 2021.

On February 25, 2021, we entered into an Equity Distribution Agreement (the “2021 Agreement”) with Piper Sandler & Co., Evercore Group L.L.C.

During the three months ended March 31, 2022, we sold 335,485 shares of Common Stock under the 2021 Agreement resulting in approximately $3.0 million in net proceeds.

As of March 31, 2022, we sold 5,135,939 shares of Common Stock under the 2021 Agreement resulting in approximately $67.8 million in net proceeds, with $55.0 million remaining available to be sold under the 2021 Agreement.

Current Resources

We have financed our operations to date principally through our equity offerings and proceeds from issuances of our preferred stock, common stock, and warrants.

At September 30, 2021, we had $174.9 million of cash, cash equivalents and restricted cash and $25.0 million of short-term investments.

Accordingly, management believes that the Company has sufficient capital to fund its plan of operations for at least a twelve-month period from the issuance date of our September 30, 2021 financial statements.

However, in order to address our capital needs in the long-term, including our planned clinical trials, we must continue to actively pursue additional equity or debt financing, government funding, and monetization of our existing programs through partnership arrangements or sales to third parties.

At March 31, 2022, we had $180.0 million of cash, cash equivalents and restricted cash.

Accordingly, management believes that the Company has sufficient capital to fund its plan of operations for at least a twelve-month period from the issuance date of our March 31, 2022 financial statements.

However, in order to address our capital needs in the long-term, including potential future clinical trials, we must continue to actively pursue additional equity or debt financing, government funding, and monetization of our existing programs through partnership arrangements or sales to third parties.

Off-Balance Sheet Arrangements

As of September 30, 2021, we did not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as “special purpose” entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements, as defined in the rules and regulations of the Securities and Exchange Commission.

Quantitative and Qualitative Disclosures about Market Risk

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What changed 10-Q

Item 2. Management’s Discussion and Analysis