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Item 1. Business

2021-01-07 compared with 2020-01-09 · 451 added, 275 removed, 6 unchanged (99% of the section changed)

Anixa Biosciences, Inc.

is a biotechnology company focused on using the bodys immune system to diagnose, treat and prevent cancer.

We were incorporated on November 5, 1982 under the laws of the State of Delaware.

Effective October 1, 2018, the Company changed its name from ITUS Corporation to Anixa Biosciences, Inc.

From inception through October 2012, our primary operations involved the development of patented technologies in the areas of thin-film displays and encryption.

From October 2012 through June 2015, the primary operations of the Company involved the development, acquisition, licensing, and enforcement of patented technologies that were either owned or controlled by the Company.

In June 2015, we formed a subsidiary, Anixa Diagnostics Corporation (Anixa Diagnostics), to develop Cchek a platform for non-invasive blood tests for the early detection of cancer.

We then began a collaboration with The Wistar Institute (Wistar), the nations first independent biomedical research institute and a leading National Cancer Institute designated cancer research center, for the purpose of validating proprietary cancer detection methodologies and establishing protocols for identifying certain biomarker patterns in the blood which we identified and which are known to be associated with malignancies.

Through our collaboration with Wistar, we demonstrated the efficacy of our Cchek early cancer detection platform with 20 different types of cancer:

breast, lung, colon, melanoma, ovarian, liver, thyroid, pancreatic, appendiceal, uterine, osteosarcoma, leiomyosarcoma, liposarcoma, vulvar, prostate, bladder, cervical, head and neck, gastric and testicular cancers.

Breast, lung, colon and prostate cancers represent the four largest categories of cancer worldwide.

Based on a number of factors, including key scientific, clinical, and commercial considerations, for the past year the primary commercial focus for Cchek has been on developing a prostate cancer confirmatory test.

In February 2019, we formed a strategic alliance with ResearchDx, a CLIA certified, CAP Accredited laboratory, to prepare the Cchek Prostate Cancer Confirmation (Cchek PCC) test for launch as a laboratory developed test.

In December 2019, upon completion of independent validation by ResearchDx, we announced the commercial launch of Cchek PCC.

We are currently conducting a number of activities to support the marketing of Cchek PCC, including the development of marketing materials, education of key opinion leaders in urology and development of a reimbursement path for the test.

We expect Cchek PCC to be broadly available throughout the U.S.

by April 2020.

In November 2017, we formed a subsidiary, Certainty Therapeutics, Inc.

(Certainty), to develop immuno-therapy drugs against cancer.

Certainty entered into a license agreement with Wistar pursuant to which Certainty was granted an exclusive worldwide, royalty-bearing license to use certain intellectual property owned or controlled by Wistar relating to Wistars chimeric endocrine receptor targeted therapy technology (such technology being akin to chimeric antigen receptor T-cell (CAR-T) technology).

We have initially focused on the development of a treatment for ovarian cancer, but we also may pursue future applications of the technology for the development of treatments for additional solid tumors.

The license agreement requires Certainty to make certain cash and equity payments to Wistar upon achievement of specific development milestones.

With respect to Certaintys equity obligations to Wistar, Certainty issued to Wistar shares of its common stock equal to five percent (5%) of the common stock of Certainty.

Following the formation of Certainty and the license agreement with Wistar, Certainty entered into a collaboration agreement with the H.

Biosciences, Inc., incorporated on November 5, 1982 under the laws of the State of Delaware, is a biotechnology company developing

therapies and vaccines that are focused on critical unmet needs in oncology and infectious disease.

Our therapeutics programs

include the development of a chimeric endocrine receptor T-cell technology, a novel form of chimeric antigen receptor T-cell (“CAR-T”)

technology, initially focused on treating ovarian cancer, and the discovery and ultimately development of anti-viral drug candidates

for the treatment of COVID-19 focused on inhibiting certain viral protein functions of the virus.

Our vaccine programs include

the development of a vaccine against triple negative breast cancer (“TNBC”), the most lethal form of breast cancer,

and a vaccine against ovarian cancer.

subsidiary, Certainty Therapeutics, Inc.

(“Certainty”), is developing immuno-therapy drugs against cancer.

holds an exclusive worldwide, royalty-bearing license to use certain intellectual property owned or controlled by The Wistar Institute

(“Wistar”), the nation’s first independent biomedical research institute and a leading National Cancer Institute

designated cancer research center, relating to Wistar’s chimeric endocrine receptor targeted therapy technology.

initially focused on the development of a treatment for ovarian cancer, but we also may pursue future applications of the technology

for the development of treatments for additional solid tumors.

The license agreement requires Certainty to make certain cash and

equity payments to Wistar upon achievement of specific development milestones.

With respect to Certainty’s equity obligations

to Wistar, Certainty issued to Wistar shares of its common stock equal to five percent (5%) of the common stock of Certainty.

in collaboration with the H.

Lee Moffitt Cancer Center and Research Institute, Inc.

(Moffitt) to advance toward human clinical testing the CAR-T technology licensed by Certainty from Wistar aimed initially at treating ovarian cancer.

Certainty is working with researchers at Moffitt to complete studies necessary to submit an Investigational New Drug (IND) application with the U.S.

Food and Drug Administration (FDA).

In July 2019, we entered into a license agreement with The Cleveland Clinic Foundation (Cleveland Clinic) pursuant to which the Company was granted an exclusive worldwide, royalty-bearing license to use certain intellectual property owned or controlled by Cleveland Clinic relating to Cleveland Clinics breast cancer vaccine technology.

This technology pertains to the use of vaccines for the treatment or prevention of triple negative breast cancer (TNBC) and other breast cancers which express the α-lactalbumin protein.

This protein is only expressed during lactation in healthy women, but may also be expressed in individuals with certain breast cancers, most notably TNBC, the most lethal form of breast cancer.

We have been working with researchers at Cleveland Clinic to advance the breast cancer vaccine technology toward human clinical testing and are completing the activities necessary to submit an IND application with the FDA.

Over the next several quarters, we expect Cchek, our CAR-T ovarian cancer treatment and our breast cancer vaccine to be the primary focus of the Company.

As part of our legacy operations, the Company remains engaged in limited patent licensing activities in the area of encrypted audio/video conference calling.

We do not expect these activities to be a significant part of the Companys ongoing operations nor do we expect these activities to require material financial resources or attention of senior management.

Over the past several years, our revenue was derived from technology licensing and the sale of patented technologies, including revenue from the settlement of litigation.

In addition to Anixa Diagnostics and Certainty, the Company may make investments in and form new companies to develop additional emerging technologies.

Our Cchek cancer detection platform measures a patient's immune response to a malignancy by detecting the presence, absence, and quantity of certain immune cells that can be found in the blood stream.

These types of cells and the tumor micro-environment have been the focus of ground breaking published and reported research in immuno-oncology, enabling the development of revolutionary immunotherapies used for treating certain cancer types.

We have developed proprietary techniques and protocols for measuring the subtle immunological changes that occur in the blood stream during tumor development.

Specifically, we seek to identify a subset of myeloid cells that we believe are diagnostic.

These cells, often referred to as Myeloid Derived Suppressor Cells (MDSCs), are identified by specific surface proteins enabling characterization.

We generally refer to MDSCs and other cells of the immune system which we believe can be diagnostic in nature as biomarkers.

Through our proprietary protocols, we have had early success and have demonstrated accuracy in detecting these biomarkers in the peripheral blood of biopsy verified cancer patients, and in distinguishing the blood of healthy patients from the blood of cancer patients.

We utilize Artificial Intelligence (AI), specifically a Neural Network (NN) to analyze our data and to determine the presence of a tumor.

We believe that a NN is better able to identify subtle changes in immune response than other analytical approaches.

The distinguishing feature of a NN is that it can be trained to answer the key biological questions of interest, in our case whether or not the patient is tumor-bearing, and as it is trained with more data, its ability to answer these questions may improve.

Our goal is to establish Cchek as a non-invasive, inexpensive, cancer diagnostic blood test that can reduce or eliminate the need for traditionally expensive, invasive, painful, and often inaccurate cancer diagnostic procedures which are currently in use.

In each instance where we have demonstrated the efficacy of our cancer detection platform, fresh (utilized within 48 hours) blood samples from biopsy verified cancer patients have been tested using a variety of experimental methodologies and protocols, including the use of certain over the counter reagents and other supplies.

Such un-blinded, non-uniform testing is common during the initial development stage of new technologies and diagnostic tests.

Blood samples from patients with differing severities of cancers (with some cancers such as breast cancer stage I to stage IV) have been tested, including samples from both pre-treatment and post-treatment patients.

In addition, we have also tested blood from healthy donors.

A critical aspect of any cancer diagnostic is the ability to accurately distinguish patients with cancer from healthy patients.

Based upon our encouraging results, we continue working to refine protocols and methodologies for identifying and classifying the immunologic biomarkers that are the foundation for our Cchek early cancer detection platform.

While studies comparing biopsy verified cancer patients to healthy donors are critical, it is also vital to evaluate the impact of benign conditions such as benign prostatic hyperplasia, non-malignant neoplasias, systemic inflammatory conditions, infections, and other potential conditions on the immune system.

We have performed such testing comparing cancer patients to those with benign conditions in the development of Cchek PCC, as patients in need of a confirmatory test will not likely be healthy, but instead will have either prostate cancer or a benign condition.

As we develop our Cchek platform, there are multiple regulatory approval pathways available for each test.

One manner of seeking regulatory approval is to have a lab certified to run our diagnotic tests pursuant to the Clinical Laboratory Improvement Act of 1967 and the Clinical Laboratory Improvement Amendments of 1988 (collectively, CLIA).

Among other things, CLIA requires clinical laboratories that perform diagnostic testing to be certified by the state in which the lab is located, as well as the Center for Medicare and Medicaid Services.

If we seek regulatory approval pursuant to CLIA, only those laboratories that are certified under CLIA to run our diagnostic test would be able to process test samples.

CLIA certification may or may not require additional studies.

We could seek to establish our own CLIA certified laboratory to run the diagnostic tests, or we could potentially contract with an existing CLIA certified lab and seek to have that laboratory certified to run our diagnostic test.

Another manner of obtaining regulatory approval would be to seek to have our diagnostic test approved by the FDA pursuant to what are commonly referred to as either the 510(K) process, or the Premarket Application (PMA) process.

The appropriate pathway for FDA approval would depend upon a variety of factors, including the intended use of the test, and the risks associated with such use.

FDA approval can take several years and would entail additional clinical studies.

Our decision to seek CLIA certification or FDA approval of a diagnostic test or tests utilizing our Cchek technology will be dependent on a variety of factors, including the capital requirements of each approval process, the landscape for competitive diagnostic testing, and the time and resources required by each approval process.

It is possible that we may seek to have one or more diagnostic tests approved via CLIA certification, and other diagnostic test or tests approved by the FDA, or that we may seek simultaneous FDA approval and CLIA certification of a particular diagnostic test or tests.

Based on a number of factors, we have launched our Cchek PCC test as a laboratory developed test under CLIA guidelines, and our CLIA certified commercialization partner, ResearchDx, will run the test.

Under CLIA guidelines, the test must be run in ResearchDxs southern California facility, while the blood samples can come from patients anywhere in the U.S.

For other tests based on the Cchek platform, based upon and following the results of more extensive clinical studies, as well as potential discussions with the FDA, we will determine whether and when to begin the process of seeking regulatory approval.

While we believe our Cchek platform could eventually form the basis of a pan-cancer (all cancer) test, the decision to initially focus on a prostate cancer confirmation test incorporated a number of factors, including key scientific, clinical, and commercial considerations.

The current method of diagnosing prostate cancer is highly inaccurate, with approximately 75% of all prostate biopsies in the U.S.

being negative for high risk cancer.

Our most recently reported studies with Cchek PCC have demonstrated sensitivity of 92%, meaning 92% of all men with prostate cancer may be correctly diagnosed with cancer, and specificity of 41%, meaning 41% of all men without cancer may be correctly diagnosed as not having cancer.

With approximately 1-1.5 million prostate biopsies performed annually, Cchek PCC has the potential to eliminate hundreds of thousands of unnecessary prostate biopsies annually in the U.S.

Historical Biomarker Studies

On December 7, 2016 we announced the preliminary results from our initial Cchek cancer patient efficacy study.

Using our protocols and methods for measuring a patients immunological response to a malignancy, we achieved sensitivity of 92% and specificity of 92% for 88 patient samples, including 54 samples from patients with multiple types and severities of cancer, and 34 healthy patients.

During the initial phase of the study, which involved multiple experimental protocols and techniques for measuring immunological responses, we reviewed and analyzed data from a total of 315 patient samples, including 228 patients with varying stages of cancer, as well as blood samples from 87 healthy donors.

Patient samples representing 14 different types of cancer (breast cancer, lung cancer, colon cancer, melanoma, ovarian cancer, liver cancer, thyroid cancer, pancreatic cancer, appendiceal cancer, uterine cancer, osteosarcoma (cancer of the bone), leiomyosarcoma (cancer of the soft tissue), liposarcoma (cancer of the connective tissue), and vulvar cancer) were included in the study.

The study included samples from patients with early and late stage, biopsy-verified, drug-naïve (before therapy) tumors, as well as biopsy-verified, refractory (unresponsive to attempted chemotherapy) tumors.

Sensitivity and specificity are scientific measurements commonly used to determine the accuracy of a diagnostic test, where sensitivity measures how good a test is at identifying people with a particular disease, and specificity measures how good a test is at identifying people without the disease.

Although published results vary widely, established diagnostic tests such as Low Dose Computed Tomography (LDCT), which is used by other companies to screen for lung cancer, has sensitivity of approximately 93% and specificity of approximately 73%, the PSA test, which is used by other companies to screen for prostate cancer, has sensitivity of approximately 21% and specificity of approximately 91%, and mammography, used by other companies to screen for breast cancer and considered to be the gold standard for breast cancer screening, has reported sensitivity as low as approximately 68% and specificity as low as approximately 75%.

As these results indicate, current diagnostic testing is hampered by low sensitivity, low specificity or both, meaning that the tests miss a substantial portion of the cancers they are supposed to detect, or miss-diagnose a large number of healthy patients as having cancer.

There is currently no inexpensive, non-invasive, diagnostic test that excels in both sensitivity and specificity.

Initial samples in our study were tested utilizing immunostaining and fluorescent microscopic imaging.

While results were promising, subjectivity in interpreting the imaging results together with labor intensive and time consuming sample processing hampered the commercial viability of this approach.

Subsequently, patient samples were analyzed using flow cytometry, enabling more efficient processing and analysis.

In addition, the Company implemented its proprietary NN software application for analysis, which currently relies on multiple quantitative parameters to analyze test results.

This approach, which is highly data intensive and requires substantial computer processing power to develop, results in a test which can be performed using a desktop computer.

An initial version of our NN, which was trained to distinguish between the immunological responses from cancer patients and healthy patients, was responsible for the sensitivity and specificity results reported above.

We expect to continue to improve our protocols, continue to upgrade our NN software by increasing the number of patient samples used to train the software and expanding the range of markers, increase the data resolution, and enhance the architecture of the software, which may enable better results.

In a study released in January 2018, augmenting data from our preliminary study, we reported a sensitivity of 89% and a specificity of 95%.

All cancer patients were biopsy-verified with all clinical stages (I to IV) included.

The total number of patients in this study was 163, which included 81 cancer patients and 82 healthy donors.

The majority of patient samples collected for this study were from breast cancer and prostate cancer patients, but several other types were also included, bringing the total number of cancer types where we have successfully used Cchek to 20.

In an additional study released in March 2018, we announced the results of a prostate cancer study with Serametrix Corporation (Serametrix) in which data from a previous collaboration between Serametrix and Memorial Sloan Kettering Cancer Center (MSK) was re-evaluated using our Cchek technology .

Previously, Serametrix analyzed a number of metastatic prostate cancer and normal healthy blood samples using an MSK proprietary assay and algorithm for cancer detection.

Following this, a blinded re-analysis of the data was performed by Anixa Diagnostics, using Cchek.

This study achieved 92% sensitivity and 92% specificity using 121 prostate cancer and 125 healthy donor samples.

In October 2018, at the 30th Anniversary AACR Special Conference Convergence:

Artificial Intelligence, we presented data demonstrating the ability of Cchek to distinguish, among patients scheduled for biopsy, those who had high risk prostate cancer and those who had benign conditions or low grade cancer, for whom surgery is not required and a biopsy is unnecessary.

The Cchek data showed the ability to distinguish healthy males from high risk prostate cancer patients with a sensitivity of 89% and a specificity of 100%.

This study further demonstrated the potential for Cchek to reduce the number of unnecessary prostate biopsies by up to 56%, while still retaining 89% sensitivity for detecting prostate cancers.

In November 2018, we released the results of our first study demonstrating the ability of Cchek to identify the presence of early stage breast cancer.

Our Cchek technology demonstrated a sensitivity of 89% when detecting early stage breast cancer (Stage I or II) and a specificity of 95% when used to test blinded samples.

Furthermore, Cchek was also able to detect the early stages of breast cancer (Stage 0) in subjects with biopsy-confirmed ductal carcinoma in situ (DCIS), a type of pre-cancerous/non-invasive breast lesion that often leads to invasive breast cancer, with 72% sensitivity.

Since that time, we have continued to process patient samples and refine our procedures and have presented data with consistent results at several conferences and meetings.

Related to our collaborative research agreement, the Company and/or Wistar currently have or have had collaborations with doctors from University of Pennsylvania Abramson Cancer Center, The Helen F.

Graham Cancer Center and Research Institute at Christiana Hospital in Wilmington, Delaware, Virtua Healthcare System in southern New Jersey, New Jersey Urology, the largest urology practice in the country, MD Anderson Cancer Center at Cooper Hospital in southern New Jersey, Potomac Urology in northern Virginia, the University of Maryland School of Medicine, Urology San Antonio, Idaho Urologic Institute, Urology Centers of Alabama, Genesis Research, in the San Diego area, and several U.S.

Department of Veterans Affairs VA Medical Centers.

In most cases, patients from participating doctors at these healthcare institutions who are beginning or in some cases, continuing cancer treatment are asked to consent to have an additional tube of blood drawn for the purpose of participating in the Cchek patient efficacy trials.

Because the number of cancer patients treated by these hospitals varies over time, and the decision whether to participate in the Cchek patient studies is ultimately at the discretion of the patient, it is difficult to predict the number of patient samples that we will receive in any given week, or during any given month.

Due to this unpredictability in sample flow, the Company is currently in discussions with additional doctors and healthcare providers about providing blood samples for our patient efficacy trials, and the Company has capacity available to process an additional quantity of samples.

There are four primary markets for a cancer diagnostic test:

screening, confirmatory testing, treatment monitoring, and recurrence testing.

Screening occurs when asymptomatic people are tested for indications of cancer.

Examples of existing screening tests include the mammogram for breast cancer, PSA for prostate cancer, and colonoscopy for colon cancer.

All screening tests have their strengths and weaknesses, and for many cancers there are currently no recommended screening tests available.

Confirmatory Testing

Confirmatory testing is used to confirm the results of a screening test.

In certain instances, existing confirmatory testing can be invasive, painful, expensive, and have relatively high risks of complications.

For example, a positive mammogram is often followed up with additional imaging, which can lead to a biopsy during which a needle is inserted into the breast to sample suspicious tissue or lesions.

For lung cancer, existing confirmatory diagnostics include bronchoscopies, during which a flexible tube is inserted through the nose or mouth and into the lung, and needle biopsies, during which a long needle is inserted between the ribs and into the lung.

One potential side effect of a lung biopsy is a pneumothorax (commonly referred to as a collapsed lung), which has been reported to occur in approximately fifteen percent (15%) of needle biopsies of the lung.

A pneumothorax can lead to other complications and sometimes requires extended hospitalization.

In addition to the potential side effects, biopsies of any sort can be extremely painful for the patient.

Treatment Monitoring

Treatment monitoring includes follow-on testing to monitor the effectiveness of a specific regimen of treatment.

For example, diagnostic monitoring testing may be used to monitor the effectiveness of a particular type of chemotherapy, to determine how the cancer is responding and whether such treatment should be continued.

Often, imaging techniques are not able to identify whether a treatment is working, so a biopsy is useful, however it is painful and impractical to perform multiple biopsies on a patient.

Therefore, a liquid biopsy enabling therapy monitoring via a blood test can be useful.

Recurrence Testing

Recurrence testing is used for cancer survivors to test for cancer recurrence.

According to the most recently published statistics from the American Cancer Society, there were more than 15.5 million Americans living with a history of cancer as of January 1, 2016.

Most cancer survivors live in fear of recurrence, and limitations of existing diagnostics, including repeated exposure to radiation from imaging tests, and invasiveness and costs and pain from tests such as traditional biopsies, prevent cancer survivors from being tested as often as they would like.

The Companys long term vision is to have one or more tests based upon the Cchek platform to serve each of the markets identified above.

We have made the initial market focus of Cchek confirmatory, or pre-biopsy, testing, and in particular, confirmatory testing of prostate cancer.

We estimate that there is a U.S.

market of roughly 12 million biopsies annually and a high rate of negative biopsy results.

Accordingly, we believe that positioning Cchek as a pre-biopsy test will reduce the number of unnecessary biopsies, thus improving patient outcomes and reducing healthcare costs.

Continuing scientific advances and discoveries, the ability to more quickly process and analyze large amounts of scientific data, and decreases in the cost of sophisticated equipment and technologies, have resulted in the potential for significant advances in cancer treatment, and in particular, cancer diagnostics.

Cancer statistics gathered over the past several decades provide overwhelming evidence that the earlier that cancers are detected, the greater the survival rates.

Up until now, doctors have primarily relied upon technologies such as imaging (x-rays, mammograms, CT scans, MRIs, PET scans, ultrasounds) and biopsies and other invasive procedures for cancer detection and cancer diagnoses.

In many cases, these diagnostic procedures were performed after patients exhibited one or more symptoms of cancer, at which point the cancer may likely no longer be at an early stage.

Existing diagnostic technologies such as imaging have gotten better, and invasive diagnostic procedures such as colonoscopies have become more accurate and less risky, and we expect these types of traditional diagnostic tools to continue to predominate the cancer diagnostic market for the foreseeable future.

We believe that with advancing medical knowledge, improvements in equipment and technologies, and reduction in costs of new technologies, new types of cancer diagnostics will be created and new types of cancer diagnostic testing that will outperform many of the traditional diagnostic tests, eliminate many of the negative consequences of existing diagnostic testing, and ultimately predominate the cancer diagnostic market.

We have identified a class and subclasses of biomarkers that we believe are measurable in the blood of patients with malignancies, and are perfecting a process and methodology for detecting those biomarkers.

The goal is to create a platform, Cchek, that can be used to launch a series of simple and affordable blood tests that can be used to detect and monitor many of the most deadly forms of cancer, including lung cancer, breast cancer, ovarian cancer, colon cancer, pancreatic cancer, prostate cancer and others.

We will not initially simultaneously launch tests for each of the cancers identified above, but expect to develop and launch over time, specific and individual cancer tests for each of the four markets identified above (screening, confirmatory testing, treatment monitoring, recurrence).

Statistics from The American Cancer Society in 2019 indicate that one out of every three people that are born in the U.S.

today, will develop some form of cancer during their lifetimes.

With approximately 200 million adults in the United States alone, we believe that the market for new, non-invasive cancer diagnostic technologies and testing will be enormous, and that there will be sufficient demand to support many different technologies and tests.

Cancer Diagnostic Technologies

If successful, we believe Cchek will have several advantages over existing diagnostic technologies.

For example, repeated exposure to radiation from x-ray technologies, such as mammograms, has become an increasing concern for the medical community, causing authorities to re-evaluate the recommended frequency of such x-ray based tests.

Traditional biopsies are often impossible for some cancers depending on the location of the tumor, and are invasive, expensive, and painful enough to warrant only limited use for other cancers even when the tumor can be accessed.

In addition, such biopsies are limited in their inability to detect the heterogeneity of many cancerous tumors, and the ongoing mutations that are often evident as the tumor progresses.

False positives in existing testing such as the PSA test, result in otherwise healthy patients being misdiagnosed, and subject to unnecessary follow-on treatments and medical procedures.

Patient inconvenience, risk of side effects from anesthesia, and risk of other complications result in low patient compliance with otherwise effective cancer screening tests such as the colonoscopy.

These are just a few examples of the challenges with traditional diagnostic tests that we seek to eliminate with Cchek.

This will be the foundation for the competitive advantages that we expect to have over existing diagnostic testing.

We expect Cchek will be utilized as a component of multiple diagnostic technologies and patient background information to diagnose and manage the patients condition.

Many public and private companies have announced plans and ongoing research efforts to launch non-invasive cancer diagnostic tests and tools that can be used for non-invasive cancer testing.

These companies include well established, and successful biotech companies, start-ups, and companies of all sizes.

Almost every bodily fluid, including blood, plasma, urine, saliva, and excrement, are being studied for biomarkers or indicators of one or more types of cancer.

The term that has been used to describe the category of this type of non-invasive cancer diagnostic testing is liquid biopsy. In general, most of these companies are focused on identifying and analyzing one of three types of biomarkers:

circulating tumor cells (CTCs), circulating tumor DNA (ctDNA), and exosomes.

Each of these types of biomarkers has their advantages and disadvantages, and we expect that tests incorporating these and other biomarkers will make their way into the cancer diagnostic marketplace.

We believe that our Cchek diagnostic platform has the potential for at least three distinct advantages over the types of biomarker tests referred to above.

First, it appears that the biomarkers that we are using may be present in multiple types of and varying severities of cancers.

As a result, we anticipate that Cchek will become a platform from which multiple tests could be launched for multiple types of cancers.

Second, it appears that the biomarkers utilized by Cchek may be present in both advanced, and early stages of cancers.

Third, we expect Cchek to be significantly less expensive than the technologies commonly used for tests based on CTCs, ctDNA, and exosomes.

Commercialization of Cchek PCC

In order to prepare Cchek PCC for commercialization, ResearchDx, our CLIA certified CAP accredited laboratory partner, performed an independent CLIA validation study.

For this study, ResearchDx processed blood samples from biopsy verified patients, then utilized our NN to distinguish between patients with high risk prostate cancer and those with benign conditions or low grade cancer, for whom a biopsy is unnecessary.

This CLIA validation study resulted in a sensitivity of 96% and a specificity of 45%, meaning that nearly all patients with high risk prostate cancer were correctly identified and nearly half of all unnecessary biopsies could be avoided.

While Cchek PCC was commercially launched in December 2019, there are a number of activities we are currently conducting to support marketing of the test, including the development of marketing materials, education of key opinion leaders in urology and development of a reimbursement path for the test.

We anticipate that once these activities are completed, we will have a team of key opinion leaders in urology using Cchek PCC in parallel with the standard methods of prostate cancer diagnosis.

We believe that we will demonstrate to such key opinion leaders that Cchek PCC provides significantly greater diagnostic accuracy than standard methods, as well as improved patient care.

We therefore believe that with favorable clinical experience amongst key opinion leaders in urology using Cchek PCC, we will be positioned to execute a strategic partnership with national or regional testing laboratories for the sales, marketing and operations of Cchek PCC.

CAR-T therapeutics

Certainty was formed to develop immuno-therapy drugs against cancer, and in November 2017, we entered into a license with Wistar whereby we obtained rights to certain intellectual property surrounding Wistars chimeric endocrine receptor targeted therapy technology.

CAR-T therapeutics have demonstrated positive results in B-cell cancers, but very little progress has been made on solid tumors.

Our CAR-T technology is initially focused on ovarian cancer and is based on engineering killer T-cells with the Follicle Stimulating Hormone (FSH) to target ovarian cells that express the FSH-Receptor.

Data on this technology, including the animal studies showing efficacy, was published in January 2017 in the journal, Clinical Cancer Research.

The FSH-Receptor has been shown to be a very exclusive protein found on a large percentage of ovarian cancer cells, but not on a significant number of non-ovarian healthy tissues in adult females.

We are working with researchers at Moffitt to complete studies necessary to submit an IND application with the FDA.

We then anticipate taking this therapy into human clinical testing for patients suffering from ovarian cancer.

Moffitt is one of the top cancer centers in the country with pre-clinical and clinical expertise with CAR-T technology.

Moffitt has conducted many of the highest profile CAR-T trials in the world.

We have performed numerous studies in preparation for an IND application.

In those studies, several groups of tumor free, female mice were intra-peritoneally infused with increasing concentrations of the murine CAR-T construct and their health status was monitored for up to five months.

(“Moffitt”), is advancing toward

human clinical testing the CAR-T technology licensed by Certainty from Wistar aimed initially at treating ovarian cancer.

is working with researchers at Moffitt to complete and submit an Investigational New Drug (“IND”) application with

Food and Drug Administration (“FDA”) and to perform human clinical trials.

In collaboration with researchers

at Moffitt, Certainty is currently performing tests on the clinical materials and assuming successful and timely completion of

those tests, we anticipate an IND application will be submitted with the FDA during the first calendar quarter of 2021.

April 2020, we entered into a collaboration with OntoChem GmbH (“OntoChem”) to discover and ultimately develop anti-viral

drug candidates against COVID-19.

Through this collaboration, we utilized advanced computational methods, machine learning, and

molecular modeling techniques to perform in silico screening of over 1.2 billion compounds in chemical libraries (including

publicly available compounds and OntoChem’s proprietary libraries) to evaluate if any of these compounds could disrupt one

of two key enzymes of SARS-CoV-2, the virus that causes the disease COVID-19.

screening process resulted in identifiying over 30 potentially effective compounds that could disrupt either the function of a

viral enzyme called an endoribonuclease, known as Non-Structural Protein-15 (“NSP-15”), or the main protease (“M pro ”)

of the virus.

Our in silico molecular modeling indicates that any of the NSP-15 or M pro inhibitors might disrupt

the virus’

ability to replicate in humans.

Several of the most promising compounds have been synthesized and in vitro

biological assays of the compounds are ongoing.

If the biological activity of any of these compounds is verified, they will

be tested in animal studies to further evaluate their candidacy as COVID-19 therapeutics.

a number of preventative vaccines have recently been or will soon be approved for emergency use by the FDA, we believe that there

is and will continue to be a need for effective treatments for COVID-19.

There are a number of factors that may limit the effectiveness,

both in the near and long term, of the vaccines currently in use, including, but not limited to, vaccine persistence, viral escape

and long-term safety.

Furthermore, all current treatments require administration in a hospital setting, thus potentially continuing

to overburden the healthcare system, while we anticipate our treatment to use an oral formulation and to be available at pharmacies.

hold an exclusive worldwide, royalty-bearing license to use certain intellectual property owned or controlled by The Cleveland

Clinic Foundation (“Cleveland Clinic”) relating to certain breast cancer vaccine technology developed at Cleveland

This technology pertains to the use of vaccines for the treatment or prevention of TNBC and other breast cancers which

express the α-lactalbumin protein.

The α-lactalbumin protein is only expressed during lactation in healthy women,

but may also be expressed in individuals with certain breast cancers, most notably TNBC.

with researchers at Cleveland Clinic, in November 2020, we submitted an IND application with the FDA to begin human clinical trials

of the vaccine.

In December 2020, we received authorization from the FDA to commence enrollment and treatment of patients in a

Phase 1a clinical trial.

We have commenced activities necessary to prepare for treatment of patients in the Phase 1a trial, and

we anticipate being prepared to treat the first enrolled patient in the spring of 2021.

November 2020, we executed a license agreement with Cleveland Clinic pursuant to which the Company was granted an exclusive worldwide,

royalty-bearing license to use certain intellectual property owned or controlled by Cleveland Clinic relating to certain ovarian

cancer vaccine technology.

This technology pertains to among other things, the use of vaccines for the treatment or prevention

of ovarian cancers which express the anti-Mullerian hormone receptor 2 protein containing an extracellular domain (“AMHR2-ED”).

In healthy tissue, this protein regulates growth and development of egg-containing follicles in the ovary.

While expression of

AMHR2-ED naturally and markedly declines after menopause, this protein is expressed at high levels in the ovaries of postmenopausal

women with ovarian cancer.

Researchers at Cleveland Clinic believe that a vaccine targeting AMHR2-ED could prevent the occurrence

of ovarian cancer.

July 2, 2020, we implemented a strategic realignment of our business and redirected resources to exclusively focus on the development

of therapeutics and vaccines.

Accordingly, we suspended operations of our subsidiary, Anixa Diagnostics Corporation, and the development

of the Cchek™

artificial intelligence driven platform of non-invasive blood tests for the early detection of cancer.

the next several quarters, we expect the development of our breast and ovarian cancer vaccines, our COVID-19 therapeutic discovery

program and Certainty’s CAR-T technology to be the primary focus of the Company.

As part of our legacy operations, the Company

remains engaged in limited patent licensing activities regarding the Cchek™

liquid biopsy platform, as well as in the area

of encrypted audio/video conference calling.

We do not expect these activities to be a significant part of the Company’s

ongoing operations nor do we expect these activities to require material financial resources or attention of senior management.

the past several years, our revenue was derived from technology licensing and the sale of patented technologies, including revenue

from the settlement of litigation.

We have not generated any revenue to date from our therapeutics or vaccine programs.

while we pursue our therapeutics and vaccine programs, we may also make investments in and form new companies to develop additional

emerging technologies.

We do not expect to begin generating revenue with respect to any of our current therapy or vaccine programs

in the near term.

We hope to achieve a profitable outcome by eventually licensing our technologies to large pharmaceutical companies

that have the resources and infrastructure in place to manufacture, market and sell our technologies as therapeutics or vaccines.

The eventual licensing of any of our technologies may take several years, if it is to occur at all, and may depend on positive

results from human clinical trials.

was formed to develop immuno-therapy drugs against cancer, and in November 2017, we entered into a license with Wistar whereby

we obtained rights to certain intellectual property surrounding Wistar’s chimeric endocrine receptor targeted therapy technology.

therapeutics have demonstrated positive results in B-cell cancers, but very little progress has been made on solid tumors.

CAR-T technology is initially focused on ovarian cancer and is based on engineering killer T-cells with the Follicle Stimulating

Hormone (“FSH”) to target ovarian cells that express the FSH-Receptor.

Data on this technology, including the animal

studies showing efficacy, was published in January 2017 in the journal, Clinical Cancer Research.

The FSH-Receptor has been shown

to be a very exclusive protein found on a large percentage of ovarian cancer cells, but not on a significant number of non-ovarian

healthy tissues in adult females.

have shown that the FSH-Receptor is also expressed in endothelial cells of the vasculature of neoplasias We anticipate performing

further studies to evaluate the ability of our CAR-T to disrupt the vasculature of other cancers, after we commence clinical trials

of this technology against ovarian cancer.

are working with researchers at Moffitt to complete studies necessary to submit an IND application with the FDA.

We then anticipate

taking this therapy into human clinical testing for patients suffering from ovarian cancer.

Moffitt is one of the top cancer centers

in the country with pre-clinical and clinical expertise with CAR-T technology.

Moffitt has conducted many of the highest profile

CAR-T trials in the world.

have performed numerous studies in preparation for an IND application.

In those studies, several groups of tumor free, female

mice were intra-peritoneally infused with increasing concentrations of the murine CAR-T construct and their health status was

monitored for up to five months.

The following summarizes the results of these studies:

· No treated mice showed any signs of pain/stress, difficulty breathing or increased respiratory rate, reduced movement, reduced grooming or feeding, dehydration, anorexia or any other sign of distress.

treated mice showed any signs of pain/stress, difficulty breathing or increased respiratory rate, reduced movement, reduced

grooming or feeding, dehydration, anorexia or any other sign of distress.

Control mice also did not show any distress.

· The treated mice did not show any weight loss.

treated mice did not show any weight loss.

Control mice also did not show any weight loss.

· One cohort of treated mice also had blood drawn periodically for measurement of markers for liver function (AST-Aspartate transaminase/ALT-Alanine transaminase), kidney function (creatinine), and metabolic function (glucose).

No abnormal values were observed, as was the case for control mice.

· Serum IL-6 (interleukin-6) increased in the treated mice, as well as mice treated with control T-cells.

This indicated that the T-cells were inducing the expected inflammatory response.

· Histological analysis of the ovaries showed that 60% of the treated mice had significant reduction in ovarian mass, while the control mice exhibited no reduction.

cohort of treated mice also had blood drawn periodically for measurement of markers for liver function (AST-Aspartate transaminase/ALT-Alanine

transaminase), kidney function (creatinine), and metabolic function (glucose).

No abnormal values were observed, as was the

case for control mice.

IL-6 (interleukin-6) increased in the treated mice, as well as mice treated with control T-cells.

This indicated that the

T-cells were inducing the expected inflammatory response.

analysis of the ovaries showed that 60% of the treated mice had significant reduction in ovarian mass, while the control mice

exhibited no reduction.

This observation confirms that the CAR-T was successfully attacking the ovaries, as we hoped and expected.

While these results are positive, there are many uncertainties in drug development, and most drugs fail to reach commercialization.

In the future, we hope to achieve a profitable outcome by eventually licensing our technology to a large pharmaceutical company that has the resources and infrastructure in place to manufacture, market and sell our technology as a cancer treatment.

In October 2018, we attended a pre-IND meeting with the FDA to discuss numerous aspects of the planned clinical trial of our CAR-T therapy for ovarian cancer.

The FDA answered a number of questions, providing a good understanding of the design for the clinical trial in our IND application.

We are in the process of optimizing the viral vector necessary for genetically engineering patient T-cells, thereupon we believe we will have the clinical grade vector manufactured and tested and we will then be prepared to file our IND application.

We anticipate filing the IND by the end of 2020.

The IND application, after review and approval by the FDA, will enable us to begin testing our therapy in ovarian cancer patients.

Assuming the FDA approves our IND application, we anticipate beginning the human clinical trial as early as the the second calendar quarter of 2021.

According to American Cancer Society statistics, ovarian cancer accounts for just 2.5% of all female cancer cases, but 5% of cancer deaths in women due to the diseases low survival rate.

It is estimated that in 2019, 23,000 new cases of ovarian cancer will be diagnosed and 14,000 American women will die from this disease.

Despite continuous advances made in the field of cancer research every year, there remains a significant unmet medical need, as the overall five-year relative survival rate for ovarian cancer patients is 47%.

However, ovarian cancer survival varies substantially by age, with the overall five-year survival rate for women 65 and older of only 30%.

The biopharmaceutical industry is characterized by intense and dynamic competition to develop new technologies and proprietary therapies.

Any product candidates that we successfully develop and commercialize will have to compete with existing therapies and new therapies that may become available in the future.

While we believe that our proprietary FSH-Receptor targeted immuno-therapy platform for treating solid tumors and scientific expertise in the field of cell therapy provide us with competitive advantages, we face potential competition from various sources, including larger and better-funded pharmaceutical and biotechnology companies, as well as from academic institutions, governmental agencies and public and private research institutions.

Many of our competitors, either alone or with their strategic partners, have substantially greater financial, technical and human resources than we do and significantly greater experience in the discovery and development of product candidates, obtaining FDA and other regulatory approvals of treatments and commercializing those treatments.

Accordingly, our competitors may be more successful than us in obtaining approval for treatments and achieving widespread market acceptance.

Our competitors treatments may be more effective, or more effectively marketed and sold, than any treatment we may commercialize and may render our treatments obsolete or non-competitive before we can recover the expenses of developing and commercializing any of our treatments.

Mergers and acquisitions in the biotechnology and pharmaceutical industries may result in even more resources being concentrated among a smaller number of our competitors.

These competitors also compete with us in recruiting and retaining qualified scientific and management personnel and establishing clinical study sites and subject registration for clinical studies, as well as in acquiring technologies complementary to, or necessary for, our program.

Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.

We anticipate that we will face intense and increasing competition as new drugs enter the market and advanced technologies become available.

We expect any treatments that we develop and commercialize to compete on the basis of, among other things, efficacy, safety, convenience of administration and delivery, price and the availability of reimbursement from government and other third-party payers.

Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop.

Our competitors also may obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for ours, which could result in our competitors establishing a strong market position before we are able to enter the market.

Breast Cancer vaccine

We licensed certain technology from Cleveland Clinic to develop vaccines for the treatment or prevention of TNBC and other breast cancers which express the α-lactalbumin protein.

This protein is only expressed during lactation in healthy women, but may also be expressed in individuals with certain breast cancers, most notably TNBC, the most lethal form of breast cancer.

Typically, vaccines harness the immune system to protect people from infectious diseases.

Broad-based vaccination programs have essentially eliminated some of the most deadly and debilitating diseases in history, small pox and polio among them.

However, there has been little success developing a preventative (prophylactic) vaccine against cancer.

Vaccines work by exposing a benign form of a disease agent to an individuals immune system.

The immune system identifies the agent and learns to attack and destroy it, retaining a memory of the agent so the immune system knows to react quickly if an individual is exposed to the disease agent months or years later.

Most vaccines attack pathogens, such as viruses and bacteria.

The immune system is better able to assail these agents because they come from outside the body.

Cancer, however, is caused by aberrant cells that arise out of our resident cells, which can make it difficult for our immune system to find the diseased cells, especially as advancing age weakens our immune system.

Once these aberrant cells gain critical mass, they become cancer.

Despite the lack of success with cancer vaccines, recently gained knowledge about the human immune system has led to the development, approval and commercialization of revolutionary immuno-therapy drugs.

These drugs do not attack cancer directly, but rather modulate the immune system in ways that enable it to destroy or dramatically impair cancer cells.

The technology licensed from Cleveland Clinic has identified a protein called alpha-lactalbumin that is present in healthy breast tissue only when a woman is lactating and disappears when she stops nursing her child.

Alpha-lactalbumin is never present on any other cell in the body.

However, it does show up in many types of breast cancer, including TNBC, an aggressive and deadly form of the disease.

By developing a vaccine that targets alpha-lactalbumin, we feel the immune system can destroy these breast cancer cells as they arise and ultimately prevent breast tumors from forming.

Cleveland Clinic researchers have demonstrated in animal studies that vaccination against alpha-lactalbumin completely prevented breast cancer in mice that were specifically bred to develop breast cancer.

Data on this technology, including the animal studies showing efficacy, was published in March 2016 in the journal, Cancers.

While the data thus far has been positive, there are many uncertainties in drug development, and most drugs fail to reach commercialization.

We hope to achieve a profitable outcome by eventually licensing our technology to a large pharmaceutical company that has the resources and infrastructure in place to manufacture, market and sell our technology as a therapeutic or prophylactic cancer vaccine.

We have been working with researchers at Cleveland Clinic to advance the breast cancer vaccine technology toward human clinical testing, and we are in the process of testing the clinical grade materials and upon completion we will then be prepared to file our IND application.

We anticipate filing the IND in 2020.

The IND application, after review and approval by the FDA, will enable us to begin testing our therapy in breast cancer patients.

Assuming the FDA approves our IND application, we anticipate beginning the human clinical trial as soon as practicable thereafter.

According to American Cancer Society statistics, breast cancer accounts for 30% of all female cancer cases, and 15% of cancer deaths in women.

these results are positive, there are many uncertainties in drug development, and most drugs fail to reach commercialization.

In the future, we hope to achieve a profitable outcome by eventually licensing our technology to a large pharmaceutical company

that has the resources and infrastructure in place to manufacture, market and sell our technology as a cancer treatment.

October 2018, we attended a pre-IND meeting with the FDA to discuss numerous aspects of the planned clinical trial of our CAR-T

therapy for ovarian cancer.

The FDA answered a number of questions, providing a good understanding of the design for the clinical

trial in our IND application.

have completed the manufacturing of the clinical grade vector and are in the process of testing the materials and completing the

IND application.

We anticipate filing the IND in the first calendar quarter of 2021.

The IND application, after review and approval

by the FDA, will enable us to begin testing our therapy in ovarian cancer patients.

Assuming the FDA approves our IND application,

we anticipate beginning the human clinical trial as early as mid-2021.

believe that our CAR-T technology may be used as an effective treatment against multiple solid tumor types, however, we have initially

focused on ovarian cancer.

According to American Cancer Society statistics, ovarian cancer accounts for just 2.4% of all female

cancer cases, but 5% of cancer deaths in women due to the disease’s low survival rate.

It is estimated that in 2020, 22,000

new cases of ovarian cancer will be diagnosed and 14,000 American women will die from this disease.

Despite continuous advances

made in the field of cancer research every year, there remains a significant unmet medical need, as the overall five-year relative

survival rate for ovarian cancer patients is 48%.

However, ovarian cancer survival varies substantially by age, with the overall

five-year survival rate for women 65 and older of only 31%.

biopharmaceutical industry is characterized by intense and dynamic competition to develop new technologies and proprietary therapies.

Any product candidates that we successfully develop and commercialize will have to compete with existing therapies and new therapies

that may become available in the future.

While we believe that our proprietary FSH-Receptor targeted immuno-therapy platform for

treating solid tumors and scientific expertise in the field of cell therapy provide us with competitive advantages, we face potential

competition from various sources, including larger and better-funded pharmaceutical and biotechnology companies, as well as from

academic institutions, governmental agencies and public and private research institutions.

of our competitors, either alone or with their strategic partners, have substantially greater financial, technical and human resources

than we do and significantly greater experience in the discovery and development of product candidates, obtaining FDA and other

regulatory approvals of treatments and commercializing those treatments.

Accordingly, our competitors may be more successful than

us in obtaining approval for treatments and achieving widespread market acceptance.

Our competitors’

treatments may be more

effective, or more effectively marketed and sold, than any treatment we may commercialize and may render our treatments obsolete

or non-competitive before we can recover the expenses of developing and commercializing any of our treatments.

and acquisitions in the biotechnology and pharmaceutical industries may result in even more resources being concentrated among

a smaller number of our competitors.

These competitors also compete with us in recruiting and retaining qualified scientific and

management personnel and establishing clinical study sites and subject registration for clinical studies, as well as in acquiring

technologies complementary to, or necessary for, our program.

Smaller or early-stage companies may also prove to be significant

competitors, particularly through collaborative arrangements with large and established companies.

anticipate that we will face intense and increasing competition as new drugs enter the market and advanced technologies become

We expect any treatments that we develop and commercialize to compete on the basis of, among other things, efficacy,

safety, convenience of administration and delivery, price and the availability of reimbursement from government and other third-party

commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more

effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop.

Our competitors also may obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for

ours, which could result in our competitors establishing a strong market position before we are able to enter the market.

disease 2019 (“COVID-19”) is an infectious disease caused by the severe acute respiratory syndrome coronavirus 2 (“SARS-CoV-2”).

The disease was first identified in December 2019 in Wuhan, the capital of China’s Hubei province, and has since spread

globally, resulting in the ongoing coronavirus pandemic.

SARS-CoV-2 is highly infectious, and while in the majority of cases results

in mild symptoms, in many cases the symptoms progress to viral pneumonia and multi-organ failure.

are currently no proven broadly effective treatments.

Further, all treatments that are currently being employed require administration

in a hospital setting, thus continuing to overburden the healthcare system.

In addition, nearly all treatments currently in clinical

trials were originally developed for other indications, and were not designed specifically against SARS-CoV-2, and therefore may

have limited effectiveness.

We believe that newly designed drugs that are purposefully developed to specifically target SARS-CoV-2,

enabled by recent studies of the molecular biology of the virus, will have the potential to be far more effective than repurposing

existing drugs.

April 2020, we entered into a collaboration agreement with OntoChem for the purpose of discovering and ultimately developing anti-viral

drug candidates for COVID-19.

Our collaboration has focused on two specific proteins of the coronavirus.

The first protein is

the main protease (“M pro ”), which is an enzyme of the virus that severs a large poly-peptide into functional

proteins that enable the virus to replicate in a human host.

Our program will attempt to identify molecules that inhibit the function

of this enzyme, and potentially stop or slow the virus’

ability to replicate and cause disease.

Since this protease does

not have human analogs, potential inhibitors may not affect any human proteins and therefore toxic side effects may be minimized.

second target is an endoribonuclease, Non-Structural Protein-15 (“NSP-15”), which plays a role in breaking up the

ribonucleic acid, or the genetic content, of the virus.

Recent studies have demonstrated that the endoribonuclease of many viruses,

including the SARS virus of 2003 and, it is believed the SARS-CoV-2, binds to a human host protein.

This protein-protein interaction

appears to dramatically increase the infectivity of the virus.

Because this interaction between a viral protein and a human protein

appears to be common to many viruses, compounds that are able to effectively disrupt this interaction, could function as broad

spectrum anti-virals in addition to addressing COVID-19.

our collaboration, we utilized advanced computational methods, machine learning and molecular modeling techniques to perform in

silico screening of over 1.2 billion compounds in OntoChem’s chemistry and gene ontology database (including publicly

available compounds and OntoChem’s proprietary libraries) to evaluate if any of these compounds could disrupt M pro

or NSP-15 and to evaluate the molecules’

potential side effects, as well as their drug-like characteristics.

screening process resulted in identifying a large number of compounds that could potentially be safe and effective against COVID-19.

selected the ten most promising compounds for synthesis and biological analysis.

Biological testing of these compounds requires

use of live virus, which limits the laboratories qualified to perform the necessary assays to Biosafety Level 3 (“BSL-3”)

or Biosafety Level 4 labs.

While availability of these labs is limited, we successfully established a relationship with a BSL-3

government lab in Europe, where biological assays, including binding assays, cellular assays, and viral activity assays, are currently

being performed.

Further, this lab has animal facilities and upon completion of the biological testing, will be prepared to test

the compounds in animals to determine which compound may be appropriate for clinical evaluation.

Centers for Disease Control and Prevention (“CDC”) data, as of the date of this Report, in the U.S., there

have been over 20 million cases of COVID-19 and over 350,000 deaths.

According to World Health Organization (“WHO”)

data, globally, there have been over 85 million cases and approximately 1.9 million people have died.

over the last three months, infections and deaths have increased.

there are no broadly effective treatments for COVID-19.

Further, the treatments that are currently being employed, such as Remdesivir

and various steroid and antibody treatments, are all in-patient therapeutics and require hospitalization, adding to the burden

on the healthcare system.

A better approach, which we are employing, would be a therapeutic that can be formulated as a pill and

taken as soon as there is a positive test for COVID-19.

market for an orally delivered COVID-19 treatment that would dramatically reduce hospitalization rates would be significant given

the current infection rates.

The most recent CDC predictions indicate that in the U.S.

alone new infections will remain at over

1.3 million cases per week and deaths will be nearly 20,000 per week through January 2021.

in the COVID-19 treatment and prevention market is fierce, with hundreds of therapies and vaccines currently in development.

a number of preventative vaccines have received regulatory approvals in the U.S.

There are still many questions

about these vaccines, such as persistence and viral escape, and it will take time before it is known how well and for how long

they will provide protection from infection.

Any product candidates that we successfully develop and commercialize will have to

compete with existing therapies and vaccines and new therapies and vaccines that may become available in the future.

believe that our proprietary compounds for treating COVID-19 and scientific expertise in the field of synthetic chemistry provide

us with competitive advantages, we face potential competition from various sources, including larger and better-funded pharmaceutical

and biotechnology companies, as well as from academic institutions, governmental agencies and public and private research institutions.