What changed in this filing

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Item 7. Management’s Discussion and Analysis

2024-01-16 compared with 2023-01-04 · 71 added, 52 removed, 130 unchanged (49% of the section changed)

16 unchanged sentences

As part of our legacy operations, the Company remains engaged in limited patent licensing activities

regarding our 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.

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.

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

19 unchanged sentences

and development expenses are related to the development of our cancer therapeutic and vaccine programs, and our anti-viral drug program,

and increased by approximately $513,000 to approximately $6,703,000 in fiscal year 2022, from approximately $6,190,000 in fiscal year

The increase in research and development expenses was primarily due to an increase in employee compensation and related costs,

other than stock option compensation expense, of approximately $731,000, an increase in outside research and development related to our

development programs of approximately $170,000 and an increase in license fees of approximately $140,000, offset by a decrease in employee

stock option compensation expense of approximately $562,000.

and decreased by approximately $1,934,000 to approximately $4,769,000 in fiscal year 2023, from approximately $6,703,000 in fiscal year

The decrease in research and development expenses was primarily due to a decrease in employee stock option compensation expense

of approximately $1,386,000, a decrease in research and development expenses related to our COVID-19 development program of approximately

$485,000 as a result of the suspension of that program in March 2023, a decrease in license fees of approximately $225,000, a decrease

in consultant stock option expense of approximately $213,000, a decrease in research and development expenses related to our CAR-T development

program of approximately $156,000, and a decrease in research and development expenses related to our ovarian cancer vaccine development

program of approximately $130,000, offset by an increase in research and development expenses related to our breast cancer vaccine development

program of approximately $563,000 and an increase in employee compensation and related costs, other than stock option compensation expense,

of approximately $147,000.

and Administrative Expenses

and administrative expenses increased by approximately $99,000 to approximately $7,172,000 in fiscal year 2022, from approximately $7,073,000

and administrative expenses decreased by approximately $881,000 to approximately $6,291,000 in fiscal year 2023, from approximately $7,172,000

in fiscal year 2022.

The increase in general and administrative expenses was principally due to an increase in employee compensation

and related costs, other than stock option compensation expense, of approximately $593,000, an increase in investor and public relations

expense of approximately $421,000, and an increase in professional fees of approximately $235,000, offset by a decrease in director compensation

of approximately $664,000, a decrease in employee stock option compensation expense of approximately $356,000, a decrease in patent expense

of approximately $71,000 and a decrease in consultant stock option expense of approximately $57,000.

The decrease in general and administrative expenses was principally due to a decrease in employee stock option compensation

expense of approximately $309,000, a decrease in professional fees of approximately $239,000, a decrease in consultant warrant expense

of approximately $221,000, a decrease in employee compensation and related costs, other than stock option compensation expense, of approximately

$214,000, and a decrease in patent expenses of approximately $152,000, offset by an increase in director compensation expense, other

than stock option compensation expense, of approximately $121,000 and an increase in director stock option compensation expense of approximately

income increased to approximately $1,081,000 in fiscal year 2023 compared to approximately $104,000 in fiscal year 2022, due to an increase

in interest rates.

in interest rates and the increased dollar amount held in short-term investments.

Loss Attributable to Noncontrolling Interest

net loss attributable to noncontrolling interest, representing Wistar’s 5% ownership interest in Certainty’s net loss, increased

net loss attributable to noncontrolling interest, representing Wistar’s ownership interest in Certainty’s net loss, decreased

by approximately $57,000 to approximately $119,000 in fiscal year 2023, from approximately $176,000 in fiscal year 2022, as Certainty’s

net loss increased.

net loss decreased.

and Capital Resources

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to obtain more working capital.

Under our at-the-market equity program which is currently effective and may remain available for us to

use in the future, as of October 31, 2022, we may sell up to $100 million of common stock.

Under our at-the-market equity program, which is currently effective and may remain available for us

to use in the future, as of October 31, 2023, we may sell up to $100 million of common stock.

We did not sell any shares under our at-the-market

19 unchanged sentences

Cash provided by financing activities was approximately

$452,000, resulting proceeds from exercise of stock options of approximately $439,000 and proceeds from the sale of common stock pursuant

to employee stock purchase plan of approximately $13,000.

As a result, our cash, cash equivalents, and short-term investments at October

31, 2022 decreased approximately $6,040,000 to approximately $29,687,000 from approximately $35,727,000 at the end of fiscal year 2021.

have expected future cash obligation s related to the lease of our offices through 2026, estimated at approximately $268,000.

$366,000, resulting from proceeds from the exercise of stock options of approximately $353,000 and proceeds from the sale of common stock

pursuant to an employee stock purchase plan of approximately $13,000.

As a result, our cash, cash equivalents, and short-term investments

at October 31, 2023 decreased approximately $5,843,000 to approximately $23,844,000 from approximately $29,687,000 at the end of fiscal

have expected future cash obligations related to the lease of our offices through 2026, estimated at approximately $202,000.

Sheet Arrangements

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Compensation;

and Development Expense.

revenue has been derived solely from technology licensing and the sale of patented technologies.

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compensation cost for service-based stock options granted to employees, directors and consultants is measured at the grant date, based

on the fair value of the award using the Black-Scholes pricing model, and is expensed on a straight-line basis over the requisite service

period (the vesting period of the stock option).

For employee options vesting if the trading price of the Company’s common stock

exceeds certain price targets, we use a Monte Carlo Simulation in estimating the fair value at grant date and recognize compensation

cost over the implied service period.

stock awards granted to employees, directors and consultants that vest at date of grant we recognize expense based on the grant date

market price of the underlying common stock.

For restricted stock awards vesting upon achievement of a price target of our common stock

we use a Monte Carlo Simulation in estimating the fair value at grant date and recognize compensation cost over the implied service period

(median time to vest).

Black-Scholes pricing model and the Monte Carlo Simulation we use to estimate fair values requires valuation assumptions of expected

term, expected volatility, risk-free interest rates and expected dividend yield.

on the fair value of the award using the Black-Scholes pricing model, and is recognized as an expense on a straight-line basis over the

requisite service period (the vesting period of the stock option) which is one to four years.

For employee options vesting if the trading

price of the Company’s common stock exceeds certain price targets, we use a Monte Carlo Simulation in estimating the fair value

at grant date and recognize compensation cost over the implied service period.

For stock-based awards that vest upon the achievement

of a performance metric, the Company recognizes the estimated fair value of the award when achievement becomes probable.

stock awards granted to employees and directors that vest at date of grant, we recognize expense based on the grant date market price

of the underlying common stock.

For restricted stock awards vesting upon achievement of a price target of our common stock, we use a

Monte Carlo Simulation in estimating the fair value at grant date and recognize compensation cost over the implied service period (median

time to vest).

Black-Scholes pricing model and the Monte Carlo Simulation we use to estimate fair value requires valuation assumptions of expected term,

expected volatility, risk-free interest rates and expected dividend yield.

The expected term of stock options represents the weighted

3 unchanged sentences

The simplified method was adopted since we do not believe

that historical experience is representative of future performance because of the impact of the changes in our operations.

For consultants

we use the contract term for expected term.

We estimate the expected volatility of our shares of common stock based upon the historical

volatility of our share price over a period of time equal to the expected term of the grants.

We estimate the risk-free interest rate

based on the implied yield available on the applicable grant date of a U.S.

Treasury note with a term equal to the expected term of the

underlying grants.

We made the dividend yield assumption based on our history of not paying cash dividends and our expectation not to

pay dividends in the future.

will reconsider use of the Black-Scholes pricing model and Monte Carlo Simulation if additional information becomes available in the

future that indicates other models would be more appropriate.

that historical experience is representative of future performance because of the impact of the changes in our operations and the change

in terms from historical options.

For consultants we use the contract term for expected term.

Under the Black-Scholes pricing model,

we estimated the expected volatility of our shares of common stock based upon the historical volatility of our share price over a period

of time equal to the expected term of the grants.

We estimated the risk-free interest rate based on the implied yield available on the

applicable grant date of a U.S.

Treasury note with a term equal to the expected term of the underlying grants.

We made the dividend yield

assumption based on our history of not paying dividends and our expectation not to pay dividends in the future.

will reconsider use of the Black-Scholes pricing model and the Monte Carlo Simulation if additional information becomes available in

the future that indicates another model would be more appropriate.

If factors change and we employ different assumptions in future periods,

the compensation expense that we record may differ significantly from what we have recorded in the current period.

See Note 2 to the

Consolidated Financial Statements for additional information.

and Development Expense

recognize research and development expenses as incurred.

Advance payments for future research and development activities are deferred

and expensed as the services are performed.

We recognize our preclinical studies and clinical trial expenses based on the services performed

pursuant to contracts with research institutions, clinical research organizations (“CROs”), clinical manufacturing organizations

(“CMOs”), and other parties that conduct and manage various stages of research and development activities on our behalf.

Fees for such services are recognized based on management’s estimates after considering the activities and tasks completed by each

service provider in a given period, the time period over which services are expected to be performed, and the level of effort expended

in each reporting period.

each balance sheet date, management estimates prepaid and accrued research and development costs by discussing progress or stage of completion

of activities with internal personnel and external service providers, and comparing this information to payments made, invoices received,

and the agreed-upon contractual fee to be paid for such services in the applicable contract or statements of work.

addition, we allocate certain internal compensation costs to research and development expenses based on management’s estimates

of each employee’s time and effort expended.

of Recent Accounting Pronouncements

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis