What changed in this filing

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Item 1. Business

2026-03-31 compared with 2025-03-31 · 138 added, 119 removed, 308 unchanged (45% of the section changed)

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We employ unique structure-based technologies and

Nobel Prize winning expertise to create first- and best-in-class antiviral drugs.

Nobel Prize winning expertise with the goal of creating viable antiviral drugs.

These technologies are designed to efficiently deliver

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We have identified promising discovery, preclinical

and clinical stage antiviral compounds for unmet medical needs caused by RNA viruses including influenza virus, coronaviruses (including

SARS-CoV-2 & MERS-CoV), norovirus, respiratory virus infections and hepatitis C virus (“HCV”) infections.

and clinical stage antiviral compounds for unmet medical needs caused by RNA viruses including influenza virus, norovirus, coronaviruses

(including SARS-CoV-2 & MERS-CoV), respiratory virus infections and hepatitis C virus (“HCV”) infections.

Company operates as one business entity.

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and chronic viral diseases.

Our goals include treating and preventing influenza virus, coronavirus, and norovirus infections by discovering

Our goals include treating and preventing influenza virus, norovirus, and coronavirus infections by discovering

and developing direct-acting antiviral drug candidates targeting required steps in the viral replication process.

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reduced off-target interactions that may cause undesirable clinical side effects.

successful application of our approach requires an extensive knowledge of viruses and drug targets.

successful application of our approach requires extensive knowledge of viruses and drug targets.

In addition, knowledge and experience

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Drug resistance is a major obstacle to developing effective antiviral therapies.

reproduce rapidly and in enormous quantities in infected human cells.

During viral replication, random changes in the viral genome,

called mutations, develop.

If such a mutation occurs in a region of the viral genome that is targeted by a given antiviral therapy,

that therapy may no longer be effective against the mutated virus.

These mutated or “resistant” viruses can freely

infect and multiply even in individuals who have received drug treatment.

In some cases, resistant virus strains may even

For example, in the 2009 swine influenza pandemic, the predominant strain was resistant to the best available

During the COVID-19 pandemic outbreak newly emergent mutated coronaviruses were identified, resulting in the

ineffectiveness of some vaccines and therapeutics.

For example, the Omicron variant that arose as the dominant strain of COVID-19 in

late 2021 until COVID-19 diminished in the winter of 2022 displayed increased resistance to available vaccines and treatments,

resulting in the limitation or suspension of emergency use authorizations by the FDA for certain therapeutic products.

2024, a new strain of COVID-19 named JN.1 became the predominant strain of the virus in circulation and was believed to be either

more transmissible or better at evading the immune system than other circulating variants.

As of early 2025, the prevalent variants

of COVID-19 were XEC and LP.8.1, each of which emerged in 2024.

These two variants are variants under monitoring (VUM) by the World

Health Organization as of February 2025 due to their increasing prevalence globally.

Viruses can reproduce

rapidly and in enormous quantities in infected human cells.

During viral replication, random changes in the viral genome, called mutations,

If such a mutation occurs in a region of the viral genome that is targeted by a given antiviral therapy, that therapy may not

be effective against the mutated virus.

These mutated or “resistant” viruses can freely infect and multiply even in individuals

who have received drug treatment.

In some cases, resistant virus strains may even predominate.

For example, in the 2009 swine influenza

pandemic, the predominant strain was resistant to the best available therapies.

During the COVID-19 pandemic outbreak newly emergent

mutated coronaviruses were identified, resulting in the ineffectiveness of some vaccines and therapeutics.

For example, the Omicron variant

that arose as the dominant strain of COVID-19 in late 2021 until COVID-19 diminished in the winter of 2022 displayed increased resistance

to available vaccines and treatments, resulting in the limitation or suspension of emergency use authorizations (EAU) by the FDA for

certain therapeutic products.

In early 2024, a new strain of COVID-19 named JN.1 became the predominant strain of the virus in circulation

and was believed to be either more transmissible or better at evading the immune system than other circulating variants.

As of late 2025,

the prevalent variants of COVID-19 were KP.3.1.1, LP.8.1, NB1.8.1, XFG, and BA.3.2, four of which emerged in 2025.

These five variants

are variants under monitoring (VUM) by the World Health Organization as of February 2026 due to their increasing prevalence globally.

Company’s focus on viral drug targets inhibiting replication proteins can potentially overcome the obstacle of viral resistance.

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and Development Update

the twelve months ended December 31, 2024 the Company continued to focus its research and development efforts primarily in three areas.

the 12 months ended December 31, 2025 the Company continued to focus its research and development efforts primarily in three areas.

have several candidates under development for the treatment of influenza infection.

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and has favorable pharmacokinetic and drug resistance profiles.

addition to the oral candidate of CC-42344, the inhaled CC-42344 is being developed for the potential prophylactic treatment of pandemic

and seasonal influenza infections.

addition to oral candidate of CC-42344, inhaled CC-42344 is being developed for the potential prophylactic treatment of pandemic and

seasonal influenza infections.

Dry powder inhalation development and toxicology studies have been evaluated.

received authorization from the United Kingdom Medicines and Healthcare Products Regulatory Agency (MHRA) to conduct a Phase 2a human

challenge study with oral CC-42344 as a potential treatment for pandemic and seasonal influenza A.

This randomized, double-blind, placebo-controlled

study is designed to evaluate the safety, tolerability, viral and clinical measurements of influenza A infection in subjects dosed with

oral CC-42344 treatment.

In May 2024 we announced completion of enrollment of 78 subjects.

In December 2024, the Company announced plans

to extend enrollment for the oral CDI-42344 Phase 2a study due to unexpectedly low influenza infection among study participants.

Specifically,

management determined that an extension of the study is necessary due to low infectivity rate of the challenge influenza strain used

in this study, as the establishment of robust influenza infection in healthy, uninfected study subjects is critical to determine clinical

endpoints for evaluating antiviral molecule, and the low infectivity obtained in this study hindered antiviral data analysis.

is currently in continuing discussions with the clinical research organization to address this study and determine a course forward with

respect thereto, including potentially by preparing a protocol amendment or a resubmission for approval by the United Kingdom Medicines

and Healthcare Products Regulatory Agency (“MHRA”) in order to seek enrollment to study and to ensure necessary infection

rates among enrolled study subjects in the study.

CC-42344 has demonstrated favorable safety and tolerability profile from the Phase

2a study to date, with no SAEs and no drug-related discontinuations by study participants.

December 2023 we received authorization from the United Kingdom Medicines and Healthcare Products Regulatory Agency (MHRA) to

conduct a Phase 2a human challenge study with oral CC-42344 as a potential treatment for pandemic and seasonal influenza A.

randomized, double-blind, placebo-controlled study was designed to evaluate the safety, tolerability, viral and clinical

measurements of healthy subjects infected with the influenza A virus dosed with oral CC-42344 treatment.

While in the Phase 2a study

CC-42344 demonstrated favorable safety and tolerability profile and no serious adverse events (“SAEs”) or drug-related

discontinuations by study participants, due to unexpectedly low influenza infection among study participants, management determined

that the low infectivity obtained in this study hindered antiviral data analysis.

A dispute has arisen with the United Kingdom

clinical research organization (the “CRO”) that performed the Phase 2a study.

The Company contends that the CRO breached

its agreement in a number of respects and is requesting that the CRO refund the $6,309,000 it was paid or redo the study.

has implicitly denied liability and is seeking to recover an additional approximately $600,000 from the Company.

As of the date of

this Report, it appears that the Company will seek to arbitrate the dispute as required under the agreement with the CRO.

risk factor entitled “We face significant risks and uncertainties surrounding our Influenza A program following an initial

Phase 2a study which failed to yield scientifically viable results relating to the product candidate’s efficacy”

beginning on page 14.

Subject to resolution of this issue or our raising capital to conduct another study, we plan to continue

development of oral CC-42344 as a treatment for pandemic and seasonal influenza A.

June 2024 we reported the potential efficacy of CC-42344 against the new Texas avian flu strain from in vitro studies with the

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cocrystal structure of this avian PB2 protein complexed with CC-42344 and confirmed that CC-42344 binds to its highly conserved PB2 region.

The in vitro data using purified Texas avian H5N1 PB2 protein further showed in vitro affinity of CC-42344 similar to that of

previous data using pandemic avian and seasonal influenza A PB proteins.

The in vitro data using purified Texas avian H5N1 PB2 protein further showed in vitro affinity of CC-42344 similar to that

of previous data using pandemic avian and seasonal influenza A PB proteins.

also continue developing novel broad-spectrum influenza antivirals targeting replication enzymes of seasonal and pandemic influenza A

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as a broad-spectrum antiviral inhibitor to a highly conserved region in the active site of noroviruses, coronaviruses and other 3CL viral

We believe CDI-988 represents a first-in-class pan-viral antiviral for the treatment of viral gastroenteritis caused by noroviruses

and coronaviruses, including SARS-CoV-2 and its variants.

CDI-988 is being clinically evaluated for safety, tolerability and pharmacokinetics including a food-effect cohort in healthy volunteers

in a single-center, randomized, double-blind, placebo-controlled Phase 1 study being conducted in Australia.

We expect that the oral

CDI-988 Phase 1 data will support future norovirus and coronavirus Phase 2 and Phase 3 studies.

We believe CDI-988 represents

only oral pan-viral antiviral in development for the treatment and prevention of viral gastroenteritis caused by noroviruses, and coronaviruses,

including SARS-CoV-2 and its variants.

CDI-988 was clinically evaluated for safety, tolerability and pharmacokinetics including a food-effect cohort in healthy volunteers in

a single-center, randomized, double-blind, placebo-controlled Phase 1 study conducted in Australia.

July 2024 we announced favorable safety and tolerability results from the single-ascending dose (SAD) cohorts of the Phase 1 study with

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study with no discontinuations.

There were no serious adverse events or severe treatment-emergent adverse events.

No clinically significant

observations were noted in laboratory assessments, physical exams or electrocardiograms.

There were no serious adverse events (“SAEs”) or severe treatment-emergent adverse events.

No clinically significant observations were noted in laboratory assessments, physical exams or electrocardiograms.

September 2024 we initiated dosing of the first subjects in the multiple-ascending dose (MAD) portion of the Phase 1 study with CDI-988.

and topline Phase 1 study safety and tolerability SAD results and testing of 800 mg for 10 consecutive days were reported in January

Topline Phase 1 study safety and tolerability SAD results and testing of 800 mg for 10 consecutive days were reported in January 2025

indicating favorable safety and tolerability results.

The topline data of the MAD cohorts, including based on an additional cohort

with a higher dose of 1200 mg and a shorter treatment duration of five consecutive days, is expected to be released in the first half

We also announced that an additional cohort with a higher dose of 1,200 mg and

a shorter treatment duration of five consecutive days would be conducted to further assess CDI-988’s safety, tolerability and pharmacokinetics.

In August 2025 we presented favorable safety and tolerability Phase 1 data from all CDI-988 doses, including the high-dose 1200 mg cohort,

at the 2025 Military Health System Research Symposium (MHSRS).

September 2025 we received a Study May Proceed Letter from the FDA to conduct a Phase 1b challenge study in the U.S.

evaluating CDI-988

as a norovirus preventive and treatment.

In December 2025, we received Institutional Review Board approval from Emory University School

of Medicine, the clinical study site for the Phase 1b trial, and announced that subject screening for the study was underway.

2026, we announced commencement of the Phase 1b challenge study at Emory University School of Medicine.

The study’s primary efficacy

endpoint is to assess the reduction in incidence of clinical symptoms, while the secondary efficacy endpoint focuses on the reduction

in viral shedding and disease severity.

The study will also assess the safety and pharmacokinetic profile of CDI-988.

A worldwide public health problem, including the potential for pandemic Avian Flu.

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is a global health concern responsible for more than 777 million reported cases globally, including more than 7 million deaths, as of

March 2025, according to data reported by the WHO.

February 2026, according to data reported by the WHO.

Coronaviruses

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a novel norovirus antiviral candidate for the prophylactic and therapeutic treatment of norovirus infection that is currently in a Phase

1 clinical study.

A few companies have been developing vaccines and are in stages of clinical testing, including Vaxart Pharmaceutical,

Moderna, Hillevax, Takeda Pharmaceuticals, Anhui Zhifei Longcom Biopharmaceutical (China) and National Vaccine and Serum Institute (China).

targeting viral replication enzymes and a viral protease, we believe it is possible to develop an effective treatment for all genogroups

of norovirus.

Also, because of the significant unmet medical need and the possibility of chronic norovirus infection in immunocompromised

individuals, new antiviral therapeutic and prophylactic approaches may warrant an accelerated path to market.

We are developing inhibitors

of the RNA-dependent RNA polymerase and protease of norovirus.

These enzymes are essential to viral replication and are highly conserved

between all noroviral genogroups.

Therefore, an inhibitor of these enzymes might be an effective treatment or short-term prophylactic

agent, when administered during a cruise or nursing home stay, for example.

We have developed X-ray quality norovirus polymerase and

protease crystals and have identified promising inhibitors.

We are implementing our proprietary drug discovery platform technology and

approaches that have proven successful in our other antiviral programs.

1b human challenge clinical study.

A few companies have been developing vaccines and are in stages of clinical testing, including Vaxart

Pharmaceutical, Moderna, Hillevax, Takeda Pharmaceuticals, Anhui Zhifei Longcom Biopharmaceutical (China) and National Vaccine and Serum

Institute (China).

targeting viral replication enzymes and a viral protease, we believe it is possible to develop an effective treatment for all

genogroups of norovirus.

Also, because of the significant unmet medical need and the possibility of chronic norovirus infection in

immunocompromised individuals, new antiviral therapeutic and prophylactic approaches may warrant an accelerated path to market.

are developing inhibitors of the RNA-dependent RNA polymerase and protease of norovirus.

These enzymes are essential to viral

replication and are highly conserved between all noroviras genogroups.

Therefore, an inhibitor of these enzymes might be an

effective treatment or short-term prophylactic agent, when administered during a cruise or nursing home stay, for example.

developed X-ray quality norovirus polymerase and protease crystals and have identified promising inhibitors.

We are implementing our

proprietary drug discovery platform technology and approaches that have proven successful in our other antiviral

A large competitive market with opportunity for shorter treatment regimens.

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with influenza A, influenza A/B, and norovirus/coronaviruses and HCV.

our Influenza A program, our patent portfolio consists of several patent families, including two pending international (PCT) applications

and two families of pending applications in the U.S.

our influenza A program, our patent portfolio consists of several patent families, that are being prosecuted in the U.S.

foreign countries.

We have a family that is directed to the clinical candidate, CC-42344, which has been granted in several jurisdictions,

including the US, China, EPO, India, and Taiwan, and pending in several others.

Assuming all necessary annuities or maintenance fees

are paid during the lifetime of these patents, their natural term will extend to 2038, absent any available patent term extensions that

may be available.

Other patent families in this program cover drug products and combination therapies, which are being prosecuted in

and various foreign countries, including Australia, Brazil, EPO, Israel, India, Japan, Korea, Mexico, and Taiwan.

necessary annuities or maintenance fees are paid during the lifetime of these patents (or applications once granted), their natural term

will extend to 2039, absent any available patent term extensions that may be available.

our influenza A/B program, our patent portfolio consists of a number of patent families pending in the U.S.

and various foreign countries.

our Influenza A/B program, our patent portfolio consists of a number of patent families pending, variously, as international (PCT) applications

and in Taiwan.

Aspects of this program were developed in collaboration with Merck, which is legally protecting the intellectual property

of the collaboration compounds.

our norovirus and coronavirus programs, our patent portfolio consists of three pending families of U.S.

provisional applications.

Aspects of this program were developed in collaboration with Merck, which is legally protecting the intellectual property of the collaboration

We have at least four patent families pending for influenza A/B therapeutics, filed in various jurisdictions including the

US, Canada, EPO, Japan, Korea, and Mexico.

Assuming all necessary annuities or maintenance fees are paid during the lifetime of these

patents (or applications once granted), their natural term will extend to 2039 or 2041, absent any available patent term extensions that

may be available.

our norovirus and coronavirus programs, our patent portfolio consists of three pending families are being prosecuted in the U.S.

various foreign countries.

We have two families that are directed to the clinical candidate CDI-988 and structural brethren, which are

pending in the U.S.

and jurisdictions such as Australia, Brazil, Canada, China, Eurasia, EPO, Indonesia, Israel, India, Japan, Korea,

Mexico, Malaysia, New Zealand, Philippines, Singapore, Thailan, Taiwan, and South Africa.

Assuming all necessary annuities or maintenance

fees are paid during the lifetime of these applications once granted, their natural term will extend to 2041 and 2042, absent any available

patent term extensions that may be available.

our HCV program, our patent portfolio consists of several patent families, with granted patents in the U.S.

and Europe, as well as China,

Canada, Eurasia, Japan, and Singapore.

Applications are pending in numerous other jurisdictions.

Collaborations

December 15, 2023, we received written notice from Merck of Merck’s election to terminate the Collaboration Agreement, dated January

2, 2019, by and between the Company and Merck, with respect to the collaboration with Merck on the development of influenza A/B antiviral

The termination of the Agreement took effect on March 14, 2024.

The termination resulted from the inability to develop the

compounds to meet a specific aspect of Merck’s program.

State University Research Foundation

entered into two License Agreement with KSURF (the “Foundation”) on February 18, 2020 to further develop certain proprietary

broad-spectrum antiviral compounds for the treatment of norovirus and coronavirus infections.

February 28, 2024, the Company provided notice to the Foundation of the Company’s election to terminate the 2020 License Agreements.

The terminations, which were made due to the Company’s determination that further development efforts under the License Agreements

would be futile, took effect on March 29, 2024.

and several foreign countries.

Assuming all necessary annuities or maintenance fees are paid during the lifetime of these patents, their natural term will extend to

2036, absent any available patent term extensions that may be available.

Business-Competition

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addition to the U.S.

requirements such as those enforced by the FDA with respect to safety and efficacy of research, testing, development

and production, we also must comply with applicable laws and regulations of any foreign jurisdictions in which we operate.

as a result of our Phase 1 trial in Australia for CDI-988, our lead norovirus and coronavirus product candidate, we are subject to the

Australian government’s laws and regulations pertaining to the research and development, including clinical testing on human subjects,

of therapeutic product candidates.

Further, our Phase 2a study for in the United Kingdom for CC-42344 subjects us to similar laws and

regulations in the United Kingdom.

Our presence in foreign countries has also subjected us to more general laws applicable to operations

abroad, such as the U.S.

Foreign Corrupt Practices Act (the “FCPA”) and comparable legislation and regulation in foreign

jurisdictions.

In general, the FCPA prohibits U.S.

corporations and their representatives from offering, promising, authorizing or making

payments to any foreign government official, government staff member, political party or political candidate to obtain or retain business

The scope of the FCPA includes interactions with certain healthcare professionals in many countries.

Other countries have enacted

similar anti-corruption laws and/or regulations.

Further, because of our reliance on one or more CROs and clinical manufacturing organizations

requirements such as those enforced by the FDA with respect to safety and efficacy of research, testing,

development and production, we also must comply with applicable laws and regulations of any foreign jurisdictions in which we

For example, our research and development efforts in Australia for CDI-988, our lead norovirus and coronavirus product

candidate, subject us to the Australian government’s laws and regulations pertaining to the research and development,

including clinical testing on human subjects, of therapeutic product candidates.

Further, our research and development efforts in

the United Kingdom for CC-42344 subject us to similar laws and regulations in the United Kingdom.

presence in foreign countries has also subjected us to more general laws applicable to operations abroad, such as the U.S.

Foreign Corrupt

Practices Act (the “FCPA”) and comparable legislation and regulation in foreign jurisdictions.

In general, the FCPA prohibits

corporations and their representatives from offering, promising, authorizing or making payments to any foreign government official,

government staff member, political party or political candidate to obtain or retain business abroad.

The scope of the FCPA includes interactions

with certain healthcare professionals in many countries.

Other countries have enacted similar anti-corruption laws and/or regulations.

Further, because of our reliance on one or more clinical research organizations (“CROs”) and clinical manufacturing organizations

(“CMOs”) with respect to our research and development activities both in the U.S.

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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 1. Business