What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-05-15 compared with 2023-11-13 · 257 added, 342 removed, 245 unchanged (71% of the section changed)

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financial statements and the related notes appearing under Item 1 of Part I of this Quarterly Report on Form 10-Q (this “Quarterly

This Quarterly Report, including the following discussion and analysis, contains forward-looking statements that involve

risks and uncertainties and speak only as of the date of this report.

Forward-looking information is included in our discussion of our

plans and strategy for our business and expected financial results.

You should review the “Risk Factors” discussed in our

Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 23, 2023, and the information contained

elsewhere in this Quarterly Report, for a discussion of important factors that could cause actual results to differ materially from the

results described in or implied by forward-looking statements.

Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report, including

information with respect to our plans and strategy for our business and expected financial results, includes forward-looking statements

that involve risks and uncertainties.

You should review the “Risk Factors” discussed in our Annual Report on Form 10-K for

the year ended December 31, 2023, filed with the SEC on March 27, 2024, and the cautionary statements elsewhere in this Quarterly Report

for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by

the forward-looking statements contained in the following discussion and analysis.

is a clinical-stage biotechnology company focused on the development of targeted therapies for oncology.

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(darolutamide), for the treatment of patients with metastatic castration resistant prostate cancer (mCRPC).

The Company expects

to initiate a Phase 1b/2 study, CELC-G-201, in the first quarter of 2024.

Its CELsignia companion diagnostic platform is uniquely able

to analyze live patient tumor cells to identify new groups of cancer patients likely to benefit from already approved targeted therapies.

The Company initiated a Phase

1b/2 study, CELC-G-201, in the first quarter of 2024 and is currently enrolling patients.

Its CELsignia companion diagnostic platform

is uniquely able to analyze live patient tumor cells to identify new groups of cancer patients likely to benefit from already approved

targeted therapies.

is a potent, well-tolerated, small molecule reversible dual inhibitor, administered intravenously, that selectively targets all Class

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When a therapy only inhibits a single

Class I isoform (e.g., alpelisib, a PI3K-α inhibitor) or only one mTOR kinase complex (e.g., everolimus, an mTORC1 inhibitor),

Class 1 isoform (e.g., alpelisib, a PI3K-α inhibitor ) or only one mTOR kinase complex (e.g., everolimus, an mTORC1 inhibitor),

numerous feedforward and feedback loops between the PI3K isoforms and mTOR complexes cross-activate the uninhibited sub-units.

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By contrast, in the 103-patient dose expansion

portion of the Phase 1b (B2151009) clinical trial with gedatolisib, only 7% of patients experienced Grade 3 or 4 hyperglycemia and less

than 10% discontinued treatment.

of September 30, 2023, 492 patients with solid tumors have received gedatolisib in eight completed clinical trials sponsored by Pfizer.

Of the 492 patients, 129 were treated with gedatolisib as a single agent in three clinical trials.

The remaining 363 patients received

gedatolisib in combination with other anti-cancer agents in five clinical trials.

Additional patients received gedatolisib in combination

with other anti-cancer agents in nine investigator sponsored clinical trials.

portion of the Phase 1b clinical trial with gedatolisib, only 7% of patients experienced Grade 3 or 4 hyperglycemia and less than 10%

discontinued treatment.

of March 31, 2024, 492 patients with solid tumors have received gedatolisib in eight clinical trials sponsored by Pfizer.

patients, 129 were treated with gedatolisib as a single agent in three clinical trials.

The remaining 363 patients received gedatolisib

in combination with other anti-cancer agents in five clinical trials.

Additional patients received gedatolisib in combination with other

anti-cancer agents in nine investigator sponsored clinical trials.

Phase 1b trial (B2151009) evaluating patients with HR+/HER2- metastatic breast cancer was initiated in 2016 and subsequently enrolled

138 patients.

Six patients from this study continue to receive study treatment, as of September 30, 2023, each of whom have received

study treatment for more than four years.

The B2151009 clinical was an open label, multiple arm Phase 1b study that evaluated gedatolisib

in combination with palbociclib (CDK4/6 inhibitor) and endocrine therapy (fulvestrant or letrozole) in patients with HR+/HER2- advanced

breast cancer.

Thirty-five patients were enrolled in two dose escalation arms to evaluate the safety and tolerability and to determine

the maximum tolerated dose (MTD) of gedatolisib when used in combination with the standard doses of palbociclib and endocrine therapy.

Four patients from this study continue to receive study treatment, as of March 31, 2024, each of whom have received study

treatment for more than five years.

The B2151009 clinical was an open label, multiple arm Phase 1b study that evaluated gedatolisib in

combination with palbociclib (CDK4/6 inhibitor) and fulvestrant or letrozole in patients with HR+/HER2- advanced breast cancer.

patients were enrolled in two dose escalation arms to evaluate the safety and tolerability and to determine the maximum tolerated dose

(MTD) of gedatolisib when used in combination with the standard doses of palbociclib and endocrine therapy (letrozole or fulvestrant).

The MTD was determined to be 180 mg administered intravenously once weekly.

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of four expansion arms (A, B, C, D).

objective overall response rates (ORR) were observed in all four expansion arms and were comparable in each arm for PIK3CA WT and PIK3CA

As of the data cut-off date, March 16, 2023, for treatment- naïve patients in Escalation Arm A and Expansion Arm A

(n=41), median progression free survival (mPFS) was 48.6 months, median duration of response (mDOR) was 46.9 months, and ORR was 79%.

respectively.

This data compares favorably to published data for current first-line standard-of-care treatments for patients with HR+/HER2-

advanced breast cancer.

In patients who received prior hormonal therapy alone or in combination with a CDK4/6 inhibitor (Arms B, C, and

D), ORR (including unconfirmed partial responses) ranged from 36% to 77%.

Each arm achieved its primary endpoint target, which was reporting

higher ORR in the study arm than ORR from either the PALOMA-2 (ORR=55%) study that evaluated palbociclib plus letrozole for Arm A or

the PALOMA-3 study (ORR=25%) that evaluated palbociclib plus fulvestrant for Arms B, C, and D.

For all enrolled patients, a clinical

benefit rate (CBR) of ≥79% was observed.

Median progression-free survival (PFS) was 12.9 months for patients who received a prior

CDK4/6 inhibitor and were treated in the study with the Phase 3 dosing schedule (Arm D).

objective overall response rates (ORR) were observed in all four expansion arms and were comparable in each arm for PIK3CA WT and

PIK3CA MT patients.

As of the data cut-off date, March 16, 2023, for treatment- naïve patients in Escalation Arm A and

Expansion Arm A (n=41), median progression free survival (mPFS) was 48.6 months, median duration of response (mDOR) was 46.9 months,

and ORR was 79%, respectively.

This data compares favorably to published data for current first-line standard-of-care treatments for

patients with HR+/HER2-advanced breast cancer.

In patients who received prior hormonal therapy alone or in combination with a CDK4/6

inhibitor (Arms B, C, and D), ORR (including unconfirmed partial responses) ranged from 36% to 77%.

Each arm achieved its primary

endpoint target, which was reporting higher ORR in the study arm than ORR from either the PALOMA-2 (ORR=55%) study that evaluated

palbociclib plus letrozole for Arm A or the PALOMA-3 study (ORR=25%) that evaluated palbociclib plus fulvestrant for Arms B, C, and

For all enrolled patients, a clinical benefit rate (CBR) of ≥ 79% was observed.

Median progression-free survival (PFS)was 12.9

months for patients who received a prior CDK4/6 inhibitor and were treated in the study with the Phase 3 dosing schedule (Arm

combined with palbociclib and endocrine therapy demonstrated a favorable safety profile with manageable toxicity.

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The first clinical site was activated in the third quarter of 2022, and the first patient was dosed in December 2022.

VIKTORIA-1 Phase 3 clinical trial will enable separate evaluation of subjects according to their PIK3CA status.

VIKTORIA-1 clinical trial will enable separate evaluation of subjects according to their PIK3CA status.

Subjects who meet eligibility

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(Arm E), or gedatolisib and fulvestrant (Arm F).

CELC-G-201 Phase 1b/2 clinical trial will enroll up to 54 participants with mCRPC who progressed after metastic castration resistant

prostate cancer (“mCRPC”) treatment with a next-generation androgen receptor inhibitor and have not received docetaxel

In the Phase 1b portion of the study, we expect 36 participants will be randomly assigned to receive 600 mg darolutamide

administered orally twice daily combined with either 120 mg gedatolisib in Arm 1 or 180 mg gedatolisib received intravenously in Arm

An additional 12 participants will then be enrolled in the Phase 2 portion of the study at the Recommended Phase 2 Dose (RP2D)

level to enable evaluation of 30 participants treated with the RP2D of gedatolisib.

The primary objectives of the Phase 1b portion

of the trial include assessment of the safety and tolerability of gedatolisib in combination with darolutamide and determination of

the RP2D dose of gedatolisib.

The primary objective of the Phase 2 portion of the trial is to assess the

radiographic progression-free survival (rPFS) at six months of patients who received the RP2D.

We expect to initiate the study in

the first quarter of 2024.

received approval from the FDA in mid-2023 to proceed with the clinical development

of gedatolisib in combination with Nubeqa® (darolutamide), an approved androgen receptor inhibitor, for the treatment of patients

We have since initiated a Phase 1b/2 study (CELC-G-201) that will enroll up to 54 participants with mCRPC who progressed

after treatment with an androgen receptor inhibitor.

We dosed our first patient in this trial in February 2024.

the Phase 1b portion of the study, Celcuity expects that 36 participants will be randomly assigned to receive 600 mg darolutamide

combined with either 120 mg gedatolisib in Arm 1 or 180 mg gedatolisib in Arm 2.

An additional 12 participants will then be enrolled

in the Phase 2 portion of the study at the recommended phase 2 dose (RP2D) level to enable evaluation of 30 participants treated

with the RP2D of gedatolisib.

primary objectives of the Phase 1b portion of the trial include assessment of the safety and tolerability of gedatolisib in combination

with darolutamide and determination of the recommended Phase 2 dose of gedatolisib.

The primary objective of the Phase 2 portion of the

trial is to assess the radiographic progression-free survival (rPFS) at six months of patients who received the RP2D.

proprietary CELsignia diagnostic platform is the only commercially ready technology we are aware of that uses a patient’s living

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a matching targeted therapeutic is designed to inhibit, CELsignia CDx can expand the markets for a number of already approved targeted

We are supporting the advancement of new potential indications for targeted therapies, controlled by other pharmaceutical

Our current CDx identifies breast and ovarian cancer patients whose tumors have cancer drivers potentially responsive to treatment

with human epidermal growth factor receptor 2-negative (HER2), mesenchymal-epithelial transition factor (c-MET), or phosphatidylinositol

3-kinases (PI3K) targeted therapeutics.

While FDA approval or clearance is not currently required for CELsignia tests offered as a stand-alone

laboratory developed test, if we are partnered with a drug company to launch a CELsignia test as a companion diagnostic for a new drug

indication, we would be required to obtain premarket approval, or PMA, in conjunction with the pharmaceutical company seeking a new drug

approval for the matching therapy.

are supporting the advancement of new potential indications for three different targeted therapies, controlled by other pharmaceutical

companies, that would rely on a CELsignia CDx to select patients.

Phase 2 trials are underway to evaluate the efficacy and safety of

these therapies in CELsignia selected patients.

The FACT-1 trial is expected to have interim results available in the first half of 2024

and final results approximately nine months later.

The FACT-2 trial, which was evaluating patients with early-stage triple negative breast

cancer, was terminated in the third quarter.

This decision was made in response to recent FDA approvals of new therapeutic options for

patients with early-stage triple negative breast cancer.

The availability of these new therapeutic options negatively impacted enrollment,

which led us to conclude that the study was no longer feasible.

our April 2021 license agreement with Pfizer to research, develop, manufacture and commercialize gedatolisib, we paid a $5.0 million

upfront fee and granted to Pfizer $5.0 million shares of Company common stock, which fee and grant were effected and expensed to research

& development in full for the quarter in which we signed the license agreement.

In addition, we are also required to make milestone

payments to Pfizer upon achievement of certain development and commercial milestone events, up to an aggregate of $335.0 million.

Additionally,

the Company will pay Pfizer tiered royalties on sales of gedatolisib at percentages ranging from the low to mid-teens, which may be subject

to deductions for expiration of valid claims, amounts due under third-party licenses and generic competition.

Unless earlier terminated,

the license agreement will expire upon the expiration of all royalty obligations.

The royalty period will expire on a country-by-country

basis upon the later of (a) 12 years following the date of first commercial sale of such product in such country, (b) the expiration

of all regulatory or data exclusivity in such country for such product or (c) the date upon which the manufacture, use, sale, offer for

sale or importation of such product in such country would no longer infringe, but for the license granted in the license agreement, on

a valid claim of a licensed patent right.

Company has the right to terminate the license agreement for convenience upon 90 days’ prior written notice.

Pfizer may not terminate

the agreement for convenience.

Either the Company or Pfizer may terminate the license agreement if the other party is in material breach

and such breach is not cured within the specified cure period.

In addition, either the Company or Pfizer may terminate the license agreement

in the event of specified insolvency events involving the other party.

October 2023, Celcuity announced that it entered into a securities purchase agreement to sell pre-funded warrants at a price of $8.70

per warrant, to purchase up to 5,747,787 shares of the Company’s common stock in a private placement.

The closing of the private

placement occurred on October 20, 2023 and resulted in gross proceeds of approximately $50 million.

Each Warrant to purchase one share

has a purchase price of $8.699 per share, and an exercise price of $0.001 per share for the Common Stock issuable upon exercise of the

Warrant (for aggregate consideration equating to $8.70 per share).

The Company expects to use the net proceeds to advance clinical development

of gedatolisib and for general corporate purposes.

The Company has entered into a Registration Rights Agreement in connection with the

private placement, pursuant to which it has agreed to register for resale the shares issuable upon exercise or exchange of the Warrants.

August 2023, Celcuity announced it entered into a clinical trial collaboration and supply agreement with Bayer AG for Celcuity’s

Phase 1b/2 clinical trial of gedatolisib and Nubeqa® (darolutamide) in patients with metastatic castration resistant prostate cancer

As part of the supply agreement, Bayer will provide Nubeqa to Celcuity at no cost.

August 2023, Celcuity announced it was notified by the FDA that its Investigational New Drug (IND) submission has been reviewed, and

Celcuity can proceed with the clinical development of gedatolisib in combination with Nubeqa® (darolutamide), an approved

androgen receptor inhibitor, for the treatment of patients with metastatic castration resistant prostate cancer (mCRPC).

Celcuity’s Phase 1b/2 study (CELC-G-201) will enroll up to 54 participants with mCRPC who progressed after treatment with an

androgen receptor inhibitor.

The Company expects to begin enrolling patients in the Phase 1b/2 clinical trial in the first quarter

of COVID-19 on our Business

we have largely returned to normal operations in our facility, the COVID-19 pandemic continues and its effect on our operations and financial

condition will depend in large part on future developments which cannot be reasonably estimated at this time.

Future developments include

the duration, scope and severity of the pandemic, the emergence of new virus variants that are more contagious or harmful than prior

variants, actions taken by governmental authorities, suppliers, clinical trial sites, and other business partners to contain or mitigate

the pandemic’s impact, and the potential adverse effects on the suppliers, labor market and general economic activity.

Three Phase 2 trials are underway to evaluate the efficacy and safety

of these therapies in CELsignia selected patients.

These patients are not currently eligible to receive these drugs and are not identifiable

with a molecular test.

the development of a potential first-in-class targeted therapy for breast cancer, like gedatolisib, with our CELsignia platform is a

natural extension of our strategy to use our CELsignia CDx to enable new indications for other companies’ targeted therapies.

combining companion diagnostics designed to enable proprietary new drug indications with targeted therapies that treat signaling dysregulation

our CDx identifies, we believe we are uniquely positioned to improve the standard-of-care for many early and late-stage breast cancer

Our goal is to play a key role in the multiple treatment approaches required to treat breast cancer patients at various stages

of their disease.

With each program, we are:

the proprietary insights CELsignia provides into live patient tumor cell function

a CELsignia CDx to identify new patients likely to respond to the paired targeted therapy

a new targeted therapeutic option for breast cancer patients

the probability of getting regulatory approval to market the targeted therapy indication

February 22, 2024, the Company announced that the first patient has been dosed in its Phase 1b/2 study (CELC-G-201) evaluating gedatolisib

in combination with Nubeqa® (darolutamide), an approved androgen receptor inhibitor, for the treatment of patients with mCRPC.

of Operations

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As a result, we are not and have never been profitable and have incurred losses in each period since our inception

For the three months ended September 30, 2023 and 2022, we reported a net loss of approximately $18.4 million and $10.9 million,

respectively, and for the nine months ended September 30, 2023 and 2022, we reported a net loss of approximately $44.9 million and $28.8

million, respectively.

As of September 30, 2023, we had an accumulated deficit of approximately $141.2 million.

As of September

30, 2023, we had cash and cash equivalents and short-term investments of approximately $133.9 million.

For the three months ended March 31, 2024 and 2023, we reported a net loss of approximately $21.6 million and $11.9 million,

respectively.

As of March 31, 2024, we had an accumulated deficit of approximately $181.7 million.

As of March 31, 2024, we had

cash and cash equivalents and short-term investments of approximately $177.7 million.

of Operating Results

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world-wide licensing rights to develop and commercialize gedatolisib, we initiated a Phase 3 clinical trial, VIKTORIA-1, in 2022 to support

potential regulatory approval to market gedatolisib for the treatment of breast cancer.

In August 2023, Celcuity announced its plans

to proceed with the clinical development of gedatolisib in combination with Nubeqa® (darolutamide), an approved androgen receptor

inhibitor, for the treatment of patients with metastatic castration resistant prostate cancer (mCRPC).

If we obtain regulatory approvals

to market gedatolisib, we expect to generate revenue from sales of the drug for the treatment of patients who present with the forms

of breast or prostate cancer for which gedatolisib has been approved..

Additionally, we will seek to generate revenue from partnership

agreements with pharmaceutical companies to provide companion diagnostics for such pharmaceutical partners’ existing or investigational

targeted therapies.

If a new drug indication is received that requires use of our companion diagnostic to identify eligible patients,

we expect to generate revenues from sales of tests to treating physicians.

potential regulatory approval to market gedatolisib.

In August 2023, we announced plans to proceed with the clinical development of gedatolisib

in combination with Nubeqa® (darolutamide), an approved androgen receptor inhibitor, for the treatment of patients with mCRPC.

we obtain regulatory approvals to market gedatolisib, we expect to initially generate revenue from sales of the drug for the treatment

of breast cancer patients.

Additionally, we will seek to generate revenue from partnership agreements with pharmaceutical companies to

provide companion diagnostics for such pharmaceutical partners’ existing or investigational targeted therapies.

If a new drug indication

is received that requires use of our companion diagnostic to identify eligible patients, we expect to generate revenues from sales of

tests to treating physicians.

and Development

our inception, we have primarily focused on research and development of gedatolisib, a PI3K/mTOR targeted therapy, and our CELsignia

platform and corresponding tests.

our inception, we have primarily focused on research and development of gedatolisib, a PI3K/mTOR targeted therapy and our CELsignia platform

and corresponding tests.

Research and development expenses primarily include:

● employee-related

expenses related to our research and development activities, including salaries, benefits, recruiting, travel and stock-based compensation

expenses related to our research and development activities, including salaries, benefits,

recruiting, travel and stock-based compensation expenses;

fees paid to third parties;

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and external research and development costs are expensed as they are incurred.

As we continue to develop gedatolisib and manage studies

and clinical trials, including the VIKTORIA-1 Phase 3 trial, the CELC-G-201 trial, and other clinical trials to evaluate the efficacy

of targeted therapies in cancer patients selected with one of our CELsignia tests, the proportion of research and development expenses

allocated to external spending will grow at a faster rate than expenses allocated to internal expenses.

As we continue development of gedatolisib and manage studies

and clinical trials, including the VIKTORIA-1 Phase 3 trial, the CELC-G-201 Phase 1b/2 trial, and other clinical trials to evaluate the

efficacy of targeted therapies in cancer patients selected with one of our CELsignia tests, the proportion of research and development

expenses allocated to external spending will grow at a faster rate than expenses allocated to internal expenses.

and Administrative

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To date, we have incurred immaterial

sales and marketing expenses as we continue to focus primarily on developing our first drug, gedatolisib, managing the VIKTORIA-1 Phase

3 trial, initiating the CELC-G-201 study, and developing our CELsignia platform and corresponding CELsignia tests.

sales and marketing expenses as we continue to focus primarily on the development of our first drug, gedatolisib, managing the VIKTORIA-1

Phase 3 and CELC-G-201 Phase 1b/2 trials, and developing our CELsignia platform and corresponding CELsignia tests.

We would expect to

begin to incur increased sales and marketing expenses in anticipation of the commercialization of our first drug, gedatolisib.

increased expenses are expected to include employee-related and consulting costs.

expense is primarily due to a Loan Agreement.

income consists of interest income earned on our cash equivalents and investment balances.

begin to incur increased sales and marketing expenses in anticipation of the commercialization of our first drug, gedatolisib, and CELsignia

These increased expenses are expected to include employee-related and consulting costs.

expense is primarily due to a Loan Agreement and finance lease obligations.

income consists of interest income earned on our cash, cash equivalents, and investment balances.

of Operations

of the Three Months Ended September 30, 2023 and 2022

of the Three Months Ended March 31, 2024 and 2023

Three Months Ended

September 30,

Increase (Decrease)

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$ (9,674,038 )

of the Nine Months Ended September 30, 2023 and 2022

Nine Months Ended

September 30,

Increase (Decrease)

Percent Change

Statements of Operations Data:

Operating expenses:

Research and development

General and administrative

Total operating expenses

Loss from operations

(46,501,059 )

(27,751,887 )

(18,749,172 )

Other income (expense)

Interest expense

Interest income

Other income (expense), net

Net loss before income taxes

(44,930,644 )

(28,788,694 )

(16,141,950 )

Income tax benefits

$ (44,930,644 )

$ (28,788,694 )

$ (16,141,950 )

and Development

research and development expenses for the three months ended September 30, 2023 were approximately $17.5 million, representing an increase

of approximately $7.9 million, or 82%, compared to the same period in 2022.

Of the $7.9 million increase in research and development

expense, $0.4 million was related to increased employee-related expenses.

The remaining $7.5 million increase of research and

development costs is primarily related to costs supporting activities for the VIKTORIA-1 pivotal trial.

research and development expenses for the nine months ended September 30, 2023 were approximately $42.5 million, representing an increase

research and development expenses for the three months ended March 31, 2024 were approximately $20.7 million, representing an increase

of approximately $9.4 million, or 83%, compared to the same period in 2023.

Of the $9.4 million increase in research and development

expenses, $1.8 million was related to increased employee and consulting expenses.

expense, $1.5 million was related to increased employee and consulting expenses.

The remaining $7.9 million increase of research and

development expenses is primarily related to costs supporting activities for the VIKTORIA-1 pivotal trial.

development costs are primarily related to costs supporting activities for the VIKTORIA-1 and CELC-G-201 pivotal trials.

a significant amount of research and development is central to our business model.

We plan to increase our research and development expenses

for the foreseeable future as we seek to develop gedatolisib, manage the VIKTORIA-1 Phase 3 trial and the CELC-G-201 Phase 1b/2 trial,

discover new cancer sub-types, and develop and validate additional CELsignia tests to diagnose such sub-types.

We also expect to incur

increased expenses to support companion diagnostic business development activities with pharmaceutical companies as we develop additional

CELsignia tests and manage the clinical trials for gedatolisib.

for the foreseeable future as we seek to develop gedatolisib, manage the VIKTORIA-1 Phase 3 and the CELC-G-201 Phase 1b/2 trials, discover

new cancer sub-types, and develop and validate additional CELsignia tests to diagnose such sub-types.

We also expect to incur increased

expenses to support companion diagnostic business development activities with pharmaceutical companies as we develop additional CELsignia

tests and manage the clinical trials for gedatolisib.

and Administrative

general and administrative expenses for the three months ended September 30, 2023 were approximately $1.4 million, representing an increase

of approximately $0.4 million, or 38%, compared to the same period in 2022.

Employee related expenses accounted for $0.3 million of the

The remaining $0.1 million increase resulted from professional fees and other expenses associated with being a public company.

general and administrative expenses for the nine months ended September 30, 2023 were approximately $4.0 million, representing an increase

general and administrative expenses for the three months ended March 31, 2024 were approximately $1.8 million, representing an increase

of approximately $0.5 million, or 45%, compared to the same period in 2023.

Employee related expenses accounted for $0.7 million of the

$0.9 million increase, including approximately $0.2 million in non-cash stock-based compensation.

The remaining $0.2 million of the increase

resulted from professional fees and other expenses associated with being a public company.

Of the $0.5 million increase in general and administrative

expense, $0.3 million was related to increased employee and consulting expenses.

The remaining $0.2 million of the $0.5 million increase

resulted from professional fees and other administrative expenses.

anticipate that our general and administrative expenses will increase in future periods, reflecting both increased costs in connection

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fees associated with public company regulatory developments and other compliance matters.

expense for the three months ended September 30, 2023 was $1.4 million and represents an increase of $0.8 million, or 155%, compared

to the same period in 2022.

Interest expense is primarily the result of a Loan Agreement that was executed in April 2021 and amended

in August 2022.

The increase is primarily due to the incremental $20 million funding of Term Loan B in December 2022.

The $1.4 million

of interest expense includes $0.5 million of non-cash interest expense.

expense for the nine months ended September 30, 2023 was $3.9 million and represents an increase of $2.5 million, or 175%, compared to

the same period in 2022.

The increase is primarily due to the incremental $20 million funding of Term Loan B in December 2022.

million of interest expense includes $1.5 million of non-cash interest expense.

income for the three months ended September 30, 2023 was $1.9 million and represents an increase of $1.6 million compared to the same

period in 2022.

The increase was primarily the result of the closing of financing activities, leading to higher cash, cash equivalents

and short-term investment balances.

The $1.9 million of interest income includes $0.5 million of non-cash interest income.

income for the nine months ended September 30, 2023 was $5.5 million and represents an increase of $5.1 million compared to the same

expense for the three months ended March 31, 2024 was $1.4 million and represents an increase of $0.2 million compared to the same

period in 2023.

The increase was primarily due to the closing of financing activities, leading to higher cash, cash equivalents and short-term

investment balances.

The $5.5 million of interest income includes $0.4 million of non-cash interest income.

Interest expense is the result of a Loan Agreement that was executed in April 2021 and amended in August 2022 and

The increase is due to the increase in prime interest rates.

The $1.4 million of interest expense includes $0.5 million

of non-cash interest expense.

income for the three months ended March 31, 2024 was $2.3 million and represents an increase of $0.4 million compared to the same period

The increase was primarily the result of higher market interest rates and the closing of additional financing activities, leading

to higher cash, cash equivalents and short-term investment balances.

and Capital Resources

our inception, we have incurred losses and cumulative negative cash flows from operations.

Through September 30, 2023, we have funded

our operations primarily through private placements and registered offerings of our equity securities and unsecured convertible notes,

and borrowings under loan agreements.

From inception through September 30, 2023, we raised an aggregate of approximately $223.7 million

of net proceeds through sales of our securities, and as of September 30, 2023 had $35.0 million of borrowings under loan agreements.

As of September 30, 2023, our cash and cash equivalents and short-term investments were approximately $25.8 million and $108.2 million,

respectively, and we had an accumulated deficit of approximately $141.2 million.

Through March 31, 2024, we have funded our

operations primarily through private placements and registered offerings of our equity securities and unsecured convertible notes, and

borrowings under loan agreements.

From inception through March 31, 2024, we raised an aggregate of approximately $303.7 million of net

proceeds through sales of our securities, and as of March 31, 2024 had $35.0 million of borrowings under loan agreements.

In March 2024,

an investor exercised 1,739,080 warrants at an exercise price of $8.05, which generated approximately $14 million in cash.

were issued pursuant to a previously reported private placement that closed and was funded on December 9, 2022.

Subsequent to March 31,

2024, pursuant to an Open Market Sale Agreement SM with Jefferies LLC, as agent, the Company sold 435,414 shares of common

stock at an average selling price of $ 17.55 per share, generating gross proceeds of $7.6 million before deducting commissions and other

offering expenses of $0.2 million.

As of March 31, 2024, our cash and cash equivalents and short-term investments were approximately

$31.2 million and $146.5 million, respectively, and we had an accumulated deficit of approximately $181.7 million.

On December 9, 2022, we issued 6,182,574 shares of common stock, 1,120,873 shares of Series A Preferred Stock and warrants

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and other offering expenses of $4.3 million.

Warrants On October 18, 2023, the Company entered into a securities purchase agreement to sell pre-funded warrants at a price of

$8.70 per warrant, to purchase up to 5,747,787 shares of the Company’s common stock in a private placement.

The closing of the

private placement occurred on October 20, 2023, and resulted in gross proceeds of approximately $50 million, before deducting offering

expenses of approximately $0.1 million.

Market Sale Agreement SM .

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offering price of up to $50,000,000.

On October 12, 2022, pursuant to this agreement, the Company sold 500,000 shares of common stock

On December 1, 2023, pursuant to this agreement, the Company sold 1,034,500 shares of common stock

in a single transaction at a price of $14.50 per share, generating gross proceeds of $15 million ($14.4 million net of commissions and

offering expenses).

At September 30, 2023, $44.8 million of common stock remains available for sale under the Jefferies agreement.

At March 31, 2024, $29.8 million of common stock remains available for sale under the Jefferies agreement.

Loan Agreement.

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the Company amended the Loan Agreement with Innovatus to provide for up to $75 million in term loans.

As of September 30, 2023, term

loans totaling $35 million are outstanding under the Loan Agreement, including the initial Term A loan of $15 million which was funded

on April 8, 2021, and a $20 million Term B loan which was funded on December 22, 2022 following the closing of the $100 million private

placement described above.

Additionally, the Company will be able to draw on two additional tranches of $10 million and one additional

tranche of $20 million upon achievement of certain clinical trial milestones and satisfaction of certain financial covenants determined

on a pro forma as-funded basis.

Funding of these additional tranches is also subject to other customary conditions and limits on when

the Company can request funding for such tranches.

On October 20, 2023, we issued pre-funded warrants (the “Warrants”) to purchase 5,747,787 shares of common

stock in a private placement to certain institutional investors, pursuant to a securities purchase agreement entered into on October

Each Warrant to purchase one share was sold at a purchase price of $8.699 per share and has an exercise price of $0.001 per

share for the common stock issuable upon exercise of the Warrants (for aggregate consideration equating to $8.70 per share of common

The sale of the Warrants pursuant to the securities purchase agreement generated gross proceeds of approximately $50 million

before deducting offering expenses payable by the Company.

Please see “Management’s Discussion and Analysis of Financial

Condition and Results of Operations – Recent Developments” above for additional details.

As of March 31, 2024, term loans

totaling $35 million are outstanding under the Loan Agreement, including the initial Term A loan of $15 million which was funded on April

8, 2021, and a $20 million Term B loan which was funded on December 22, 2022 following the closing of the $100 million private placement

described above.

Additionally, the Company will be able to draw on two additional tranches of $10 million and one additional tranche

of $20 million upon achievement of certain clinical trial milestones and satisfaction of certain financial covenants determined on a

pro forma as-funded basis.

Funding of these additional tranches is also subject to other customary conditions and limits on when the

Company can request funding for such tranches.

On March 29, 2024, the Company entered into a Second Amendment to Loan Agreement with

Innovatus in order to extend the date through which the Company may draw on the Term C loan from April 1, 2024 to June 1, 2024.

than as set forth in the Second Amendment to Loan Agreement, the amended Loan Agreement shall continue in full force and effect without

alteration or amendment.

expect that our research and development and general and administrative expenses will increase as we continue to develop gedatolisib,

manage the VIKTORIA-1 Phase 3 trial, initiate the CELC-G-201 trial, conduct research related to the discovery of new cancer sub-types,

conduct other studies and clinical trials, and pursue other business development activities.

We would also expect to incur sales and

marketing expenses as we commercialize gedatolisib and our CELsignia tests.

We expect to use cash on hand, which includes funds received

manage the VIKTORIA-1 Phase 3 and CELC-G-201 Phase 1b/2 trials, conduct research related to the discovery of new cancer sub-types, conduct

other studies and clinical trials, and pursue other business development activities.

We would also expect to incur sales and marketing

expenses as we commercialize gedatolisib and our CELsignia tests.

We expect to use cash on hand, together with the funds to be received

under the debt and equity financings described above, to fund our research and development expenses, clinical trial costs, capital expenditures,

working capital, sales and marketing expenses, and general corporate expenses.

on our current business plan, we believe that our current cash, cash equivalents and short-term investments, together with available

borrowings under the Innovatus Loan Agreement, will provide sufficient cash to finance our operations and pay obligations when due for

at least the next twelve months.

on our current business plan, we believe that our current cash, cash equivalents and short-term investments together with available borrowings

under the Innovatus Loan Agreement will provide sufficient cash to finance our operations and pay obligations when due through at least

expectations as to how long our current capital resources will be sufficient to fund our operations are based on assumptions that may

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available on reasonable terms, or not at all.

following table sets forth the primary sources and uses of cash for the nine months ended September 30:

September 30,

following table sets forth the primary sources and uses of cash for the three months ended March 31:

Net cash provided by (used in):

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Net increase (decrease) in cash and cash equivalents

$ (26,802,605 )

cash used in operating activities was approximately $35.3 million for the nine months ended September 30, 2023 and consisted primarily

of a net loss of approximately $44.9 million offset by non-cash expense items of approximately $4.8 million and working capital

changes of $4.8 million.

Non-cash expense items of approximately $4.8 million primarily consisted of $3.7 million of stock-based compensation

expense, net non-cash interest of $1.0 million, and depreciation expense of $0.1 million.

The approximately $4.8 million of working capital

changes was primarily due to increases in accounts payable and accrued expenses of $3.0 million and $2.8 million, respectively, offset

by an approximately $1.0 million increase in other current assets.

cash used in operating activities was approximately $26.5 million for the nine months ended September 30, 2022 and consisted primarily

of a net loss of approximately $28.8 million and working capital changes of approximately $2.0 million, offset by non-cash expense

items of approximately $4.3 million.

The approximately $2.0 million of working capital changes was primarily due to an increase of approximately

$5.9 million in other current assets, partially offset by increases in accounts payable and accrued expenses of approximately $1.6 million

and $2.3 million, respectively.

Non-cash expense items of approximately $4.3 million primarily consisted of approximately $3.5 million

of stock-based compensation expense, non-cash interest expense of approximately $0.6 million and depreciation expense of approximately

cash used in operating activities was approximately $17.1 million for the three months ended March 31, 2024 and consisted primarily of

a net loss of approximately $21.6 million, offset by working capital changes of $2.8 million and non-cash expense items of approximately

$1.7 million.

cash provided by investing activities for the nine months ended September 30, 2023 was approximately $36.2 million and consisted primarily

Non-cash expense items of approximately $1.7 million primarily consisted of $1.3 million of stock-based compensation expense

and net non-cash interest of $0.4 million.

The approximately $2.8 million of working capital changes was primarily due to increases in

accrued expenses and accounts payable and a decrease in other current assets.

The net cash used in operating activities was approximately

$12.9 million for the three months ended March 31, 2023 and consisted primarily of a net loss of approximately $11.9 million and

working capital changes of $1.0 million, offset by non-cash expense items of $0.1 million.

Non-cash expense items of approximately $0.1

million primarily consisted of $1.3 million of stock-based compensation expense and non-cash interest expense of $0.5 million, offset

by $1.7 million of non-cash interest income.

The approximately $1.0 million of working capital changes was primarily due to a decrease

in accrued expenses.

cash provided by investing activities for the three months ended March 31, 2024 was approximately $3.5 million and consisted primarily

of net proceeds from maturities of short-term investments in government securities (U.S.

Treasury Bills and U.S.

government securities)

partially offset by minimal purchase of property and equipment.

Net cash used in investing for the nine months ended September 30, 2022

were minimal and consisted of purchases of property and equipment.

cash provided by financing activities for the nine months ended September 30, 2023 was approximately $0.3 million and primarily consisted

of proceeds from the exercise of employee stock options and proceeds from employee stock purchases, partially offset by payments for

secondary registration and debt issuance costs.

Net cash used in financing activities was $0.2 million for the nine months ended September

30, 2022 and consisted of payments for secondary registration costs, offset partially by proceeds from the exercise of employee stock

options and proceeds from employee stock purchases.

Treasury Bills), partially offset by $0.1 million

purchases of property and equipment.

Net cash provided by investing activities for the three months ended March 31, 2023 was approximately

$21.9 million and consisted of net proceeds from maturities of short-term investments in government securities (U.S.

Treasury Bills and

government securities) and minimal purchases of property and equipment.

cash provided by financing activities for the three months ended March 31, 2024 was approximately $14.1 million and primarily consisted

of proceeds from the exercise of common stock warrants and the exercise of employee stock options, slightly offset by payments for secondary

registration costs.

The net cash provided by financing activities for the three months ended March 31, 2023 was minimal and primarily

consisted of the exercise of employee stock options offset by payments for secondary registration and debt issuance costs.

Accounting Pronouncements

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This Quarterly Report contains forward-looking statements that involve risks and uncertainties including,

but not limited to, (i) our clinical trial plans and the estimated costs for such trials, including our ongoing VIKTORIA-1 Phase 3 clinical

trial and our expected Phase 1b/2 study and clinical trial for gedatolisib;

(ii) our expectations with respect to costs and timelines

to develop, validate and launch CELsignia tests and to continue to develop gedatolisib;

(iii) our beliefs related to the perceived advantages

of our CELsignia tests compared to traditional molecular or other diagnostic tests;

(iv) the expected benefits of gedatolisib;

expectations regarding the timeline of patient enrollment and results from clinical trials, including our existing and upcoming clinical

trials for gedatolisib;

(vi) the future payments that may be owned to Pfizer under the license agreement;

(vii) our expectations regarding

partnering with pharmaceutical companies and other third parties;

(viii) our expectations regarding revenue from sales of CELsignia tests

and revenue from milestone or other payment sources;

(ix) our plans with respect to research and development and related expenses for

but not limited to, (i) our clinical trial plans and the estimated costs for such trials;

(ii) our expectations with respect to our

competitive advantages, including the potential efficacy of gedatolisib in various patient types alone or in combination with other treatments;

(iii) our expectations regarding the timeline of patient enrollment and results from clinical trials, including our existing Phase 3

VIKTORIA-1 clinical trial and Phase 1b/2 study and clinical trial for gedatolisib;

(iv) our expectations regarding our ability to obtain

FDA approval to commercialize gedatolisib;

(v) our expectations with respect to the development, validation, required approvals, costs

and timelines of gedatolisib and our CELsignia tests;

(vi) our plans with respect to research and development and related expenses for

the foreseeable future;

(x) our expectations regarding business development activities, including companion diagnostic related activities

with pharmaceutical companies, expanding our sales and marketing functions and the costs associated with such activities;

(xi) our expectations

with respect to the CELsignia tests and the analytical capabilities and potential impact of such tests;

(xii) our beliefs regarding the

ability of our cash on hand to fund our research and development expenses, capital expenditures, working capital, sales and marketing

expenses, and general corporate expenses, as well as the increased costs associated with being a public company;

(xiii) our plans with

respect to potentially raising capital, and (xiv) our expectations regarding the impact that the COVID-19 pandemic and related economic

effects will have on our business and results of operations.

(vii) our beliefs about our ability to capitalize on the exclusive global development and commercialization rights

obtained from our license agreement with Pfizer with respect to gedatolisib;

(viii) the future payments that may be owed to Pfizer under

the license agreement;

(ix) our beliefs related to the perceived advantages of our CELsignia tests compared to traditional molecular or

other diagnostic tests;

(x) our revenue expectations;

(xi) our expectations regarding business development activities, including collaborations

with pharmaceutical companies;

(xii) our expectations as to the use of proceeds from our recent financing activities;

(xiii) our beliefs

regarding the ability of our cash on hand to fund our research and development expenses, capital expenditures, working capital, sales

and marketing expenses, and general corporate expenses, as well as the increased costs associated with being a public company;

our plans with respect to potentially raising capital.

some cases, you can identify forward-looking statements by the following words:

“anticipate,” “believe,” “continue,”

“could,” “estimate,” “expect,” “intend,” “seek,” “may,” “ongoing,”

“plan,” “goal,” “potential,” “predict,” “project,” “should,”

“will,” “would,” or the negative of these terms or other comparable terminology, although not all forward-looking

statements contain these words.

Forward-looking statements are only predictions and are not guarantees of performance.

These statements

are based on our management’s beliefs and assumptions, which in turn are based on their interpretation of currently available information.

“could,” “estimate,” “expect,” “intend,” “may,” “ongoing,” “plan,”

“potential,” “predict,” “project,” “should,” “will,” “would,”

or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words.

Forward-looking

statements are only predictions and are not guarantees of performance.

These statements are based on our management’s beliefs and

assumptions, which in turn are based on their interpretation of currently available information.

statements involve known and unknown risks, uncertainties and other factors that may cause our results or our industry’s actual

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Certain risks, uncertainties and other factors include, but are not limited to, our limited operating history;

the potential impact of the COVID-19 pandemic on our business;

our initial success being heavily dependent on the success of our CELsignia

HER2 Pathway Activity Test and of gedatolisib;

our inability to develop and commercialize gedatolisib;

our inability to determine whether

our CELsignia tests are currently commercially viable;

challenges we may face in developing and maintaining relationships with pharmaceutical

company partners;

the complexity and timeline for development of CELsignia tests and gedatolisib;

the uncertainty and costs associated

with clinical trials;

the uncertainty regarding market acceptance by physicians, patients, third-party payors and others in the medical

community, and regarding the size of market opportunities available to us;

the pricing of molecular and other diagnostic products and

services that compete with us;

uncertainty with insurance coverage and reimbursement for our products;

we may face in managing growth, such as hiring and retaining a qualified sales force and attracting and retaining key personnel;

in government regulations;

tightening credit markets, higher interest rates, and limitations on access to capital;

increasingly sophisticated

cybersecurity threats, obtaining and maintaining intellectual property protection for our technology and time and expense associated

with defending third-party claims of intellectual property infringement, investigations or litigation threatened or initiated against

These and additional risks, uncertainties and other factors are described more fully in our Annual Report on Form 10-K for

the year ended December 31, 2022 and elsewhere in this Quarterly Report.

Copies of filings made with the SEC are available through the

SEC’s electronic data gathering analysis and retrieval system (EDGAR) at www.sec.gov.

our potential inability to develop, validate and commercialize gedatolisib on a timely basis or at all;

the uncertainties and costs associated

with clinical studies and with developing and commercializing biopharmaceuticals;

the complexity and difficulty of demonstrating the

safety and sufficient magnitude of benefit to support regulatory approval of gedatolisib and other products we may develop;

we may face in developing and maintaining relationships with pharmaceutical company partners;

the complexity and timeline for development

of CELsignia tests;

the uncertainty and costs associated with clinical trials;

the uncertainty regarding market acceptance by physicians,

patients, third-party payors and others in the medical community, and with the size of market opportunities available to us;

of molecular and other diagnostic products and services that compete with us;

uncertainty with insurance coverage and reimbursement for

our CELsignia tests;

difficulties we may face in managing growth, such as hiring and retaining

a qualified sales force and attracting and retaining key personnel;

changes in government regulations;

tightening credit markets and

limitations on access to capital;

and obtaining and maintaining intellectual property protection for our technology and time and expense

associated with defending third-party claims of intellectual property infringement, investigations or litigation threatened or initiated

These and additional risks, uncertainties and other factors are described more fully in our Annual Report on Form

10-K for the year ended December 31, 2023 and elsewhere in this Quarterly Report.

Copies of filings made with the SEC are available through

the SEC’s electronic data gathering analysis and retrieval system (EDGAR) at www.sec.gov.

should read the cautionary statements made in this Quarterly Report as being applicable to all related forward-looking statements wherever

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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-Q

Item 2. Management’s Discussion and Analysis