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Item 1A. Risk Factors

2022-08-08 compared with 2022-05-05 · 126 added, 125 removed, 1003 unchanged (20% of the section changed)

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Our business involves significant risks, some of which are described below.

You should consider carefully the risks and uncertainties described below, together with all of the other information in this Quarterly Report on Form 10-Q, including our unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” If any of the following risks are realized, our business, financial condition, results of operations and

prospects could be materially and adversely affected.

Many of the following risks and uncertainties are, and will be, exacerbated by the COVID-19 pandemic and any worsening of the global business and economic environment as a result.

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Biopharmaceutical product development is a highly speculative undertaking and involves a substantial degree of risk.

To date, we have focused primarily on developing our lead product candidates, mupadolimab, CPI-818 and ciforadenant, and researching additional product candidates.

To date, we have focused primarily on developing our lead product candidates, CPI-818, ciforadenant and mupadolimab, and researching additional product candidates.

We have incurred significant operating losses since we were founded in January 2014 and have not yet generated any revenue from sales.

If our product candidates are not approved, we may never generate any revenue.

We incurred a net loss of $43.2 million, $6.0 million and $46.7 million for the years ended December 31, 2021, 2020 and 2019, respectively, and $8.3 million and $11.6 million for the three months ended March 31, 2022 and 2021, respectively.

We had an accumulated deficit of $274.7 million as of March 31, 2022.

We expect to continue to incur losses for the foreseeable future, and we anticipate these losses will increase as we continue our development of, seek regulatory approval for and, if approved, begin to commercialize mupadolimab, CPI-818 and ciforadenant, and as we develop other product candidates.

We incurred a net loss of $43.2 million, $6.0 million and $46.7 million for the years ended December 31, 2021, 2020 and 2019, respectively, and $16.7 million and $23.3 million for the six months ended June 30, 2022 and 2021, respectively.

We had an accumulated deficit of $283.0 million as of June 30, 2022.

We expect to continue to incur losses for the foreseeable future, and we anticipate these losses will increase as we continue our development of, seek regulatory approval for and, if approved, begin to commercialize CPI-818, ciforadenant and mupadolimab, and as we develop other product candidates.

Even if we achieve profitability in the future, we may not be able to sustain it in subsequent periods.

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We will require substantial additional financing to achieve our goals, and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our product development, other operations or commercialization efforts.

Since commencing our operations in 2014, the majority of our efforts have been focused on the research and development of mupadolimab, CPI-818 and ciforadenant.

We believe that we will continue to expend substantial resources for the foreseeable future as we continue clinical development of, seek regulatory approval for and, if approved, prepare for the commercialization of ciforadenant, mupadolimab, and CPI-818, as well as product candidates under our other development programs.

Since commencing our operations in 2014, the majority of our efforts have been focused on the research and development of CPI-818, ciforadenant and mupadolimab.

We believe that we will continue to expend substantial resources for the foreseeable future as we continue clinical development of, seek regulatory approval for and, if approved, prepare for the commercialization of CPI-818, ciforadenant, and mupadolimab, as well as product candidates under our other development programs.

These expenditures will include costs associated with research and development, conducting preclinical studies and clinical trials, obtaining regulatory approvals, manufacturing and supply, sales and marketing and general operations.

In addition, other unanticipated costs may arise.

Because the outcome of any clinical trial and/or regulatory approval process is highly uncertain, we may not be able to accurately estimate the actual amounts necessary to successfully complete the development, regulatory approval process and commercialization of mupadolimab, CPI-818 and ciforadenant or any other product candidates.

As of March 31, 2022, we had capital resources consisting of cash, cash equivalents and marketable securities of $62.9 million.

We do not expect our existing capital resources to be sufficient to enable us to fund the completion of all of our ongoing and planned clinical trials and remaining development program of any of ciforadenant, mupadolimab or CPI-818 through commercialization.

Because the outcome of any clinical trial and/or regulatory approval process is highly uncertain, we may not be able to accurately estimate the actual amounts necessary to successfully complete the development, regulatory approval process and commercialization of CPI-818, ciforadenant and mupadolimab or any other product candidates.

As of June 30, 2022, we had capital resources consisting of cash, cash equivalents and marketable securities of $56.7 million.

We do not expect our existing capital resources to be sufficient to enable us to fund the completion of all of our ongoing and planned clinical trials and remaining development program of any of CPI-818, ciforadenant or mupadolimab through commercialization.

In addition, while Angel Pharmaceuticals has received outside investment of approximately $41.0 million in connection with its formation and licensing of certain of our intellectual property, such cash is not available for our use.

Our operating plan may change as a result of many factors, including those described below as well as others currently unknown to us, and we may need to seek additional funds sooner than planned, through public or private equity, including pursuant to the 2020 Sales Agreement and 2021 Sales Agreement with Jefferies, debt financings or other sources, such as strategic collaborations.

public or private equity, including pursuant to the 2020 Sales Agreement and 2021 Sales Agreement with Jefferies, debt financings or other sources, such as strategic collaborations.

Such financing would result in dilution to stockholders, imposition of debt covenants and repayment obligations or other restrictions that may affect our business.

If we raise additional capital through strategic collaboration agreements, we may have to relinquish valuable rights to our product candidates, including possible future revenue streams.

For example, in October 2020 we formed Angel Pharmaceuticals with a group of investors in China to create a new China-based biopharmaceutical company with a mission to bring innovative quality medicines to Chinese patients for treatment of serious diseases including cancer, autoimmune diseases

and infectious diseases.

We granted Angel Pharmaceuticals a license to rights to develop and commercialize our three clinical-stage candidates – mupadolimab, CPI-818 and ciforadenant – in greater China and Angel obtained global rights to our BTK inhibitor preclinical programs.

We granted Angel Pharmaceuticals a license to rights to develop and commercialize our three clinical-stage candidates – CPI-818, ciforadenant and mupadolimab – in greater China and Angel obtained global rights to our BTK inhibitor preclinical programs.

In addition, additional funding may not be available to us on acceptable terms, or at all, and any additional fundraising efforts may divert our management from their day-to-day activities, which may adversely affect our ability to develop and commercialize our product candidates.

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The amount and timing of any expenditures needed to implement our development and commercialization programs will depend on numerous factors, including, but not limited to:

● the type, number, scope, progress, expansions, results of and timing of our ongoing and planned clinical trials of mupadolimab, CPI-818 and ciforadenant and any of our planned preclinical studies and clinical trials of other product candidates which we are pursuing or may choose to pursue in the future;

● the type, number, scope, progress, expansions, results of and timing of our ongoing and planned clinical trials of CPI-818, ciforadenant and mupadolimab and any of our planned preclinical studies and clinical trials of other product candidates which we are pursuing or may choose to pursue in the future;

● the impact of changes in the COVID-19 pandemic, including the impact of vaccines and therapeutic treatments;

● the need for, and the progress, costs and results of, any additional clinical trials of mupadolimab, CPI-818 and ciforadenant or any of our other product candidates we may initiate based on the results of our planned clinical trials or discussions with the United States Food and Drug Administration (“FDA”) or other regulatory agencies, including any additional trials the FDA or other regulatory agencies may require;

● the need for, and the progress, costs and results of, any additional clinical trials of CPI-818, ciforadenant and mupadolimab or any of our other product candidates we may initiate based on the results of our planned clinical trials or discussions with the United States Food and Drug Administration (“FDA”) or other regulatory agencies, including any additional trials the FDA or other regulatory agencies may require;

● the costs of obtaining, maintaining and enforcing our patents and other intellectual property rights;

● the costs and timing of obtaining or maintaining manufacturing for mupadolimab, CPI-818 and ciforadenant and our other product candidates, including commercial manufacturing if any product candidate is approved;

● the costs and timing of obtaining or maintaining manufacturing for CPI-818, ciforadenant and mupadolimab and our other product candidates, including commercial manufacturing if any product candidate is approved;

● the costs and timing of establishing sales and marketing capabilities;

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● the costs associated with being a public company.

Several of these factors are outside of our control and if we are unable to obtain funding on a timely basis, we will be unable to complete the clinical trials for mupadolimab, CPI-818 and ciforadenant and our other product candidates, and we may be required to significantly curtail some or all of our activities.

Several of these factors are outside of our control and if we are unable to obtain funding on a timely basis, we will be unable to complete the clinical trials for CPI-818, ciforadenant and mupadolimab and our other product candidates, and we may be required to significantly curtail some or all of our activities.

The COVID-19 pandemic could adversely impact our business, including our clinical trials, and financial condition.

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If we are unable to advance our product candidates through clinical development, obtain regulatory approval and ultimately commercialize such product candidates, or experience significant delays in doing so, our business will be materially harmed.

We have invested a significant portion of our efforts and financial resources in the development of our most advanced product candidates, mupadolimab, ciforadenant and CPI-818.

We have invested a significant portion of our efforts and financial resources in the development of our most advanced product candidates, CPI-818, ciforadenant and mupadolimab.

We have no products on the market and our ability to achieve and sustain profitability depends on obtaining regulatory approvals for and successfully commercializing our product candidates, either alone or with third parties.

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● the extent to which the COVID-19 pandemic may impact our clinical trials;

● delays in submitting Investigational New Drug applications (“INDs”) or comparable foreign applications or delays or failure in obtaining the necessary approvals from regulators to commence a clinical trial, or a suspension or termination of a clinical trial once commenced;

● delays in submitting INDs or comparable foreign applications or delays or failure in obtaining the necessary approvals from regulators to commence a clinical trial, or a suspension or termination of a clinical trial once commenced;

● conditions imposed by the FDA or comparable foreign authorities regarding the scope or design of our clinical trials;

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Of the large number of drugs in development in the pharmaceutical industry, only a small percentage result in the submission of a NDA or BLA to the FDA or comparable marketing applications to foreign regulatory authorities, and even fewer are approved for commercialization.

Furthermore, even if we do receive regulatory approval to market ciforadenant, mupadolimab or CPI-818, any such approval may be subject to limitations on the indicated uses for which we may market the product.

Accordingly, even if we are able to obtain the requisite financing to continue to fund our development programs, we cannot assure our stockholders that ciforadenant, mupadolimab or CPI-818 will be successfully developed or commercialized.

If we or any of our existing or potential future collaborators are unable to develop, or obtain regulatory approval for, or, if approved, successfully commercialize ciforadenant, mupadolimab or CPI-818, we may not be able to generate sufficient revenue to continue our business.

Furthermore, even if we do receive regulatory approval to market CPI-818, ciforadenant or mupadolimab, any such approval may be subject to limitations on the indicated uses for which we may market the product.

Accordingly, even if we are able to obtain the requisite financing to continue to fund our development programs, we cannot assure our stockholders that CPI-818, ciforadenant or mupadolimab will be successfully developed or commercialized.

If we or any of our existing or potential future collaborators are unable to develop, or obtain regulatory approval for, or, if approved, successfully commercialize CPI-818, ciforadenant or mupadolimab, we may not be able to generate sufficient revenue to continue our business.

Clinical drug development involves a lengthy and expensive process with an uncertain outcome, and the results of preclinical studies and early clinical trials are not necessarily predictive of future results.

Any product candidate we or any of our existing or potential future collaborators advance into clinical trials, including mupadolimab, CPI-818 and ciforadenant , may not have favorable results in later clinical trials, if any, or receive regulatory approval.

Any product candidate we or any of our existing or potential future collaborators advance into clinical trials, including CPI-818, ciforadenant and mupadolimab , may not have favorable results in later clinical trials, if any, or receive regulatory approval.

Clinical testing is expensive and can take many years to complete, and its outcome is inherently uncertain.

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Our Phase 1/1b and our amended Phase 1b/2 clinical trials are conducted in patients with advanced cancers who have failed other approved therapies for their disease, and as such, it may be difficult to establish safety and efficacy in this type of patient population.

Furthermore, a portion of our Phase 1/1b clinical trial, our amended Phase 1b/2 clinical trial and Genentech’s Phase 1b/2 clinical trial under our collaboration agreement, includes the administration of ciforadenant in combination with Genentech’s cancer immunotherapy, Tecentriq, which could exacerbate immune system related

adverse events, cause increased toxicity or otherwise lead to unexpected adverse events.

As a result, there can be no assurance that the results of historical clinical studies of ciforadenant conducted by third parties or the results of our clinical studies to-date will be indicative of the ongoing results of our Phase 1/1b clinical trial or amended Phase 1b/2 clinical trial, Genentech’s Phase 1b/2 clinical trial or any future clinical trial of ciforadenant.

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The trial is designed to enroll successive cohorts of patients with advanced cancers who will receive increasing doses of mupadolimab both alone, or in combination with ciforadenant and/or pembrolizumab.

As of February 15, 2022, mupadolimab has been generally well tolerated in the clinical trial at doses up to 24 mg/kg.

As of July 15, 2022, mupadolimab has been generally well tolerated in the clinical trial at doses up to 24 mg/kg.

However, CD73 is involved in several physiological systems and the administration of anti-CD73 antibodies such as mupadolimab could result in unforeseen safety issues.

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Similar to our clinical trials of ciforadenant and mupadolimab, it is possible that patients enrolled in our Phase 1/1b clinical trial for CPI-818 could respond in unexpected ways.

Under our collaboration with Angel Pharmaceuticals, it will be responsible for the clinical development and commercialization, including all related expenses, of the licensed pipeline programs in greater China, and for the pre-clinical BTK program globally.

It plans to initiate clinical trials in greater China for mupadolimab, CPI-818 and ciforadenant in the next 12 to 18 months and such trials will be subject to many of the same risks as our ongoing clinical programs.

Under our collaboration with Angel Pharmaceuticals, Angel will be responsible for the clinical development and commercialization, including all related expenses, of the licensed pipeline programs in greater China, and for the pre-clinical BTK program globally.

Angel is enrolling patients in China for our Phase 1/1b clinical trial with CPI-818 and is planning to initiate clinical trials with ciforadenant and mupadolimab in the next 12 to 18 months and such trials will be subject to many of the same risks as our ongoing clinical programs.

For the foregoing reasons, we cannot be certain that our ongoing or planned clinical trials or any other future clinical trials will be successful.

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Once the CTA is approved, clinical study development may proceed.

The CTR foresees a three-year transition period.

foresees a three-year transition period.

The extent to which ongoing and new clinical trials will be governed by the CTR varies.

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Delays in the completion of our planned clinical trials for product candidates could significantly affect our product development costs.

While we initiated our Phase 1/1b clinical trial for ciforadenant in January 2016, our Phase 1/1b clinical trial for mupadolimab in cancer in March 2018 and our Phase 1/1b clinical trial for CPI-818 in March 2019, we do not know whether any of our other planned trials, including a planned Phase 2 clinical trial evaluating mupadolimab as a potential first-line therapy in NSCLC patients and a planned Phase 2 clinical trial evaluating ciforadenant as a potential first-line therapy in RCC patients, will begin on time in the future or whether any of our trials will be completed on schedule, if at all.

While we initiated our Phase 1/1b clinical trial for ciforadenant in January 2016, our Phase 1/1b clinical trial for mupadolimab in cancer in March 2018 and our Phase 1/1b clinical trial for CPI-818 in March 2019, we do not know whether any of our other planned trials, including a planned Phase 2 clinical trial evaluating ciforadenant as a potential first-line therapy in RCC patients, will begin on time in the future or whether any of our trials will be completed on schedule, if at all.

The commencement and completion of clinical trials can be delayed for a number of reasons, including delays related to:

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● subjects failing to enroll or remain in our trial at the rate we expect;

● subjects choosing an alternative treatment for the indication for which we are developing mupadolimab, CPI-818 and ciforadenant or other product candidates, or participating in competing clinical trials;

● subjects choosing an alternative treatment for the indication for which we are developing CPI-818, ciforadenant and mupadolimab or other product candidates, or participating in competing clinical trials;

● lack of adequate funding to continue the clinical trial;

● subjects experiencing severe or unexpected drug-related adverse effects;

● a facility manufacturing mupadolimab, CPI-818 and ciforadenant, any of our other product candidates or any of their components being ordered by the FDA or other regulatory authorities to temporarily or permanently shut down due to violations of good manufacturing practice (“cGMP”) regulations or other applicable requirements, or infections or cross-contaminations of product candidates in the manufacturing process;

● a facility manufacturing CPI-818, ciforadenant or mupadolimab, any of our other product candidates or any of their components being ordered by the FDA or other regulatory authorities to temporarily or permanently shut down due to violations of good manufacturing practice (“cGMP”) regulations or other applicable requirements, or infections or cross-contaminations of product candidates in the manufacturing process;

● any changes to our manufacturing process that may be necessary or desired;

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● third-party clinical investigators losing the licenses or permits necessary to perform our clinical trials, not performing our clinical trials on our anticipated schedule or consistent with the clinical trial protocol, good clinical practices (“GCP”) or regulatory requirements or other third parties not performing data collection or analysis in a timely or accurate manner;

find a substitute contractor, and we may not be able to use some or all of the data produced by such contractors in support of our marketing applications;

● third-party contractors becoming debarred or suspended or otherwise penalized by the FDA or other government or regulatory authorities for violations of regulatory requirements, in which case we may need to find a substitute contractor, and we may not be able to use some or all of the data produced by such contractors in support of our marketing applications;

● one or more Institutional Review Boards (“IRBs”) or other reviewing bodies refusing to approve, suspending or terminating the trial at an investigational site, precluding enrollment of additional subjects, or withdrawing its approval of the trial;

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For example, if we make manufacturing or formulation changes to our product candidates, we may need to conduct additional studies to bridge our modified product candidates to earlier versions.

Further, if one or more clinical trials are delayed, our competitors may be able to bring products to market before we do, and the commercial viability of mupadolimab, CPI-818 and ciforadenant or other product candidates could be significantly reduced.

Further, if one or more clinical trials are delayed, our competitors may be able to bring products to market before we do, and the commercial viability of CPI-818, ciforadenant and mupadolimab or other product candidates could be significantly reduced.

Any of these occurrences may harm our business, financial condition and prospects significantly.

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From time to time, we may publicly disclose interim, top-line or preliminary data from our clinical trials, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following a more comprehensive review of the data related to the particular study or trial.

We also make assumptions, estimations, calculations and conclusions as part of our analyses of data, and we may not have received or had the opportunity to fully and carefully evaluate all data.

assumptions, estimations, calculations and conclusions as part of our analyses of data, and we may not have received or had the opportunity to fully and carefully evaluate all data.

As a result, the top-line or preliminary results that we report may differ from future results of the same studies, or different conclusions or considerations may qualify such results, once additional data have been received and fully evaluated.

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Any delay in obtaining, or inability to obtain, applicable regulatory approvals would prevent us or any of our existing or potential future collaborators from commercializing our product candidates.

We are conducting clinical trials for mupadolimab, CPI-818 and ciforadenant, and we and Angel Pharmaceuticals may in the future, conduct additional clinical trials of product candidates, at sites outside the United States, and the FDA may not accept data from trials conducted in foreign locations.

We are conducting oncology clinical trials with mupadolimab, CPI-818, and ciforadenant in North America, Australia and South Korea.

In addition, Angel Pharmaceuticals has initiated a clinical trial in China for CPI-818 and plans to initiate clinical trials for mupadolimab and ciforadenant and we expect its clinical trial activity in China to be part of our planned global pivotal study for ciforadenant.

We are conducting clinical trials for CPI-818, ciforadenant and mupadolimab, and we and Angel Pharmaceuticals may in the future, conduct additional clinical trials of product candidates, at sites outside the United States, and the FDA may not accept data from trials conducted in foreign locations.

We are conducting oncology clinical trials with CPI-818, ciforadenant and mupadolimab in North America, Australia and South Korea.

In addition, Angel Pharmaceuticals has initiated a clinical trial in China for CPI-818 and plans to initiate clinical trials for ciforadenant and mupadolimab.

The acceptance of study data from clinical trials conducted outside the U.S.

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or the applicable jurisdiction.

If the FDA or such foreign regulatory authority does not accept the data from our or Angel Pharmaceuticals’ clinical trials for ciforadenant, mupadolimab or CPI-818, or any other product candidates, it would likely result in the need for additional trials, which would be costly and time-consuming and delay or permanently halt our development of mupadolimab, CPI-818 and ciforadenant or any other product candidates.

If the FDA or such foreign regulatory authority does not accept the data from our or Angel Pharmaceuticals’ clinical trials for CPI-818, ciforadenant or mupadolimab, or any other product candidates, it would likely result in the need for additional trials, which would be costly and time-consuming and delay or permanently halt our development of CPI-818, ciforadenant or mupadolimab or any other product candidates.

If we are required by the FDA or similar regulatory authorities to obtain approval, clearance or certification of a companion diagnostic device in connection with approval of one of our product candidates, and we do not obtain or face delays in obtaining approval, clearance or certification of a companion diagnostic device, we will not be able to commercialize the product candidate and our ability to generate revenue will be materially impaired.

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In addition, the process of finding and diagnosing subjects may prove costly.

We are enrolling patients with NSCLC and HNSCC in our Phase 1/1b clinical trial of mupadolimab and patients with T-cell lymphomas in our Phase 1/1b clinical trial of CPI-818 and plan to enroll patients with NSCLC in our planned Phase 2 clinical trial of mupadolimab and patients with RCC in our planned Phase 2 clinical trial of ciforadenant.

We are enrolling patients with T-cell lymphomas in our Phase 1/1b clinical trial of CPI-818 and plan to enroll patients with RCC in our planned Phase 2 clinical trial of ciforadenant.

If patients are unwilling to participate in our studies for any reason, including the existence of competitive clinical trials for similar patient populations, the availability of approved therapies or negative perceptions of the safety or efficacy of our product candidates, the timeline for recruiting subjects, conducting studies and obtaining regulatory approval of our product candidates may be delayed.

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It is possible that as we test our product candidates in larger, longer and more extensive clinical programs with different dosing regimens and in combination with other immunotherapies, or as use of these product candidates becomes more widespread if they receive regulatory approval, illnesses, injuries, discomforts and other adverse events that were observed in earlier trials, as well as conditions that did not occur or went undetected in previous trials, will be reported by subjects.

For example, possibly drug-related or drug-related serious adverse events have been observed during our Phase 1/1b clinical trial and our amended Phase 1b/2 clinical trial in patients receiving

combination therapy with ciforadenant and Tecentriq include hemolytic anemia, encephalitis, hepatitis, pneumonitis, mucositis, myocarditis and dermatitis.

For example, possibly drug-related or drug-related serious adverse events have been observed during our Phase 1/1b clinical trial and our amended Phase 1b/2 clinical trial in patients receiving combination therapy with ciforadenant and Tecentriq include hemolytic anemia, encephalitis, hepatitis, pneumonitis,

mucositis, myocarditis and dermatitis.

Other toxicities observed during our Phase 1/1b clinical trial and our amended Phase 1b/2 clinical trial were mild and are commonly seen in patients with advanced cancers, such as nausea, vomiting, fatigue, rash, diarrhea, fever, abdominal pain, cough, constipation and decreased appetite.

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We may not be successful in our efforts to identify or discover additional product candidates.

The success of our business depends primarily upon our ability to develop and commercialize mupadolimab, CPI-818 and ciforadenant.

Although mupadolimab, CPI-818 and ciforadenant are currently in clinical development, our research programs may fail to identify other potential product candidates, or advance them into and through clinical development for a number of reasons.

The success of our business depends primarily upon our ability to develop and commercialize CPI-818, ciforadenant and mupadolimab.

Although CPI-818, ciforadenant and mupadolimab are currently in clinical development, our research programs may fail to identify other potential product candidates, or advance them into and through clinical development for a number of reasons.

Our research methodology may be unsuccessful in identifying other potential product candidates or our other potential product candidates may be shown to have harmful side effects or may have other characteristics that may make the products unmarketable or unlikely to receive marketing approval.

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We do not have the ability to conduct all aspects of our preclinical testing or clinical trials ourselves.

As a result, we are dependent on third parties to conduct our ongoing and planned clinical trials for mupadolimab, CPI-818 and ciforadenant and expect to continue to be dependent on third parties to conduct any additional future clinical trials of mupadolimab, CPI-818 and ciforadenant and preclinical and clinical trials for our other product candidates.

As a result, we are dependent on third parties to conduct our ongoing and planned clinical trials for CPI-818, ciforadenant and mupadolimab and expect to continue to be dependent on third parties to conduct any additional future clinical trials of CPI-818, ciforadenant and mupadolimab and preclinical and clinical trials for our other product candidates.

The timing of the initiation and completion of these trials will therefore be controlled by such third parties and may occur at times substantially different from our estimates.

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If these relationships and any related compensation result in perceived or actual conflicts of interest, or the FDA concludes that the financial relationship may have affected the interpretation of the study, the integrity of the data generated at the applicable clinical trial site may be questioned and the utility of the clinical trial itself may be jeopardized, which could result in the delay or rejection of any NDA, BLA or other applications we submit by the FDA or foreign regulatory authorities.

Any such delay or rejection could prevent us from commercializing mupadolimab, CPI-818 and ciforadenant or our other product candidates.

Any such delay or rejection could prevent us from commercializing CPI-818, ciforadenant and mupadolimab or our other product candidates.

We rely on third parties to conduct some or all aspects of our manufacturing, research and preclinical and clinical testing, and these third parties may not perform satisfactorily.

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If we were to experience any supply chain issues, including as a result of the COVID-19 pandemic, our product supply could be seriously disrupted.

We expect that the logistical challenges associated with our supply chain will grow more complex as we expand enrollment in our clinical trials for mupadolimab and CPI-818 and as we commence any clinical trials for additional product candidates.

We expect that the logistical challenges associated with our supply chain will grow more complex as we expand enrollment in our clinical trials for CPI-818, ciforadenant and mupadolimab and as we commence any clinical trials for additional product candidates.

Our reliance on third parties requires us to share our trade secrets, which increases the possibility that a competitor will discover them or that our trade secrets will be misappropriated or disclosed.

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Following potential approval of any of our product candidates, the FDA or foreign regulatory authorities may impose significant restrictions on a product’s indicated uses or marketing or impose ongoing requirements for potentially costly and time consuming post-approval studies, post-market surveillance or clinical trials.

Following approval, if any, of mupadolimab, CPI-818 and ciforadenant or any other product candidate, such candidate will also be subject to ongoing FDA or foreign regulatory authorities requirements governing the labeling, packaging, storage, distribution,

Following approval, if any, of CPI-818, ciforadenant and mupadolimab or any other product candidate, such candidate will also be subject to ongoing FDA or foreign regulatory authorities requirements governing the labeling, packaging, storage, distribution,

safety surveillance, advertising, promotion, recordkeeping and reporting of safety and other post-market information.

If we or a regulatory agency discovers previously unknown problems with a product, such as adverse events of unanticipated severity or frequency, or problems with the facility where the product is manufactured, a regulatory agency may impose restrictions on that product, the manufacturing facility or us, including requesting recall or withdrawal of the product from the market or suspension of manufacturing.

If we or the manufacturing facilities for mupadolimab, CPI-818 and ciforadenant or any other product candidate that may receive regulatory approval, if any, fail to comply with applicable regulatory requirements, a regulatory agency may:

If we or the manufacturing facilities for CPI-818, ciforadenant and mupadolimab or any other product candidate that may receive regulatory approval, if any, fail to comply with applicable regulatory requirements, a regulatory agency may:

● issue warning letters or untitled letters;

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Similar risk exist in foreign jurisdictions.

In addition, if mupadolimab, CPI-818 and ciforadenant or any of our other product candidates is approved, our product labeling, advertising and promotion will be subject to regulatory requirements and continuing regulatory review.

In addition, if CPI-818, ciforadenant and mupadolimab or any of our other product candidates is approved, our product labeling, advertising and promotion will be subject to regulatory requirements and continuing regulatory review.

The FDA and foreign regulatory authorities strictly regulates the promotional claims that may be made about prescription products.

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If a prolonged government shutdown occurs, or if global health concerns continue to prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA or other regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

Even if we receive regulatory approval we still may not be able to successfully commercialize mupadolimab, CPI-818 and ciforadenant or any other product candidate, and the revenue that we generate from sales, if any, could be limited.

Even if mupadolimab, CPI-818 and ciforadenant or any of our other product candidates receive regulatory approval, they may not gain market acceptance among physicians, patients, healthcare payors or the medical community.

Even if we receive regulatory approval we still may not be able to successfully commercialize CPI-818, ciforadenant and mupadolimab or any other product candidate, and the revenue that we generate from sales, if any, could be limited.

Even if CPI-818, ciforadenant and mupadolimab or any of our other product candidates receive regulatory approval, they may not gain market acceptance among physicians, patients, healthcare payors or the medical community.

The degree of market acceptance of our product candidates will depend on a number of factors, including:

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If any product candidate is approved but does not achieve an adequate level of acceptance by physicians, hospitals, healthcare payors or patients, we may not generate sufficient revenue from that product candidate and may not become or remain profitable.

Our efforts to educate the medical community and third-party payors regarding the benefits of mupadolimab, CPI-818 and ciforadenant or any of our other product candidates may require significant resources and may never be successful.

Our efforts to educate the medical community and third-party payors regarding the benefits of CPI-818, ciforadenant and mupadolimab or any of our other product candidates may require significant resources and may never be successful.

Failure to obtain or maintain adequate coverage and reimbursement for our product candidates, if approved, could limit our ability to market those products and decrease our ability to generate revenue.

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We may expend our limited resources to pursue a particular product candidate and fail to capitalize on product candidates that may be more profitable or for which there is a greater likelihood of success.

Because we have limited financial and managerial resources, we focus on specific product candidates, including mupadolimab, CPI-818 and ciforadenant.

Because we have limited financial and managerial resources, we focus on specific product candidates, including CPI-818, ciforadenant and mupadolimab.

As a result, we may forgo or delay pursuit of opportunities with other product candidates that later prove to have greater commercial potential.

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If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights to that product candidate through collaboration, licensing or other royalty arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights to such product candidate.

We may not be successful in establishing and maintaining development or other strategic collaborations, which could adversely affect our ability to develop and commercialize product candidates.

In connection with our Phase 1/1b clinical trial for ciforadenant, we entered into a clinical trial collaboration agreement with Genentech in October 2015.

Pursuant to the agreement, Genentech provides access to, and supplies of, its cancer immunotherapy, Tecentriq, to be used in combination with ciforadenant during the clinical trial.

The collaboration operates under a joint development committee with equal representation from both companies.

In May 2017, we signed a second clinical trial collaboration agreement with Genentech.

Under this second agreement, ciforadenant administered in combination with Tecentriq is being evaluated in a Phase 1b/2 randomized, controlled clinical study as second-line therapy in patients with non-small cell lung cancer who are resistant and/or refractory to prior therapy with an anti-PD-(L)1 antibody.

However, we and Genentech each have the right to terminate the respective collaboration agreements due to material breach by either party, for safety considerations, if directed by a regulatory authority or if development of ciforadenant or Tecentriq is discontinued.

If we fail to maintain these strategic collaborations with Genentech (1) the development of ciforadenant in combination with Tecentriq may be terminated or delayed;

(2) our cash expenditures related to development of ciforadenant could increase significantly, and we may need to seek additional financing;

(3) we may be required to hire additional employees or otherwise develop expertise for which we have not budgeted;

(4) we will bear all of the risk related to the development of ciforadenant as a combination therapy;

and (5) we will need to seek collaborations with other companies that have anti-PD-1 or anti-PD-L1 antibodies, which will significantly delay our development program and could have a material adverse effect on our business, financial condition and results of operations.

We may form strategic alliances and collaborative partnerships in the future, and we may not realize the benefits of such alliances.

In addition to our collaboration agreements with Genentech, we may form additional strategic alliances, create joint ventures or collaborations or enter into licensing arrangements with third parties that we believe will complement or augment our existing business, including for the continued development or commercialization of our product candidates.

We may form strategic alliances, create joint ventures or collaborations or enter into licensing arrangements with third parties that we believe will complement or augment our existing business, including for the continued development or commercialization of our product candidates.

These relationships may result in or include non-recurring and other charges, increased near- and long-term expenditures, the issuance of securities that dilute our existing stockholders or disruptions to our management and business.

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Furthermore, strategic partners may negotiate for certain rights to control decisions regarding the development and commercialization of our product candidates, if approved, and may not conduct those activities in the same manner as we do.

Any termination of strategic alliances or collaborative partnerships we enter into in the future, or any delay in entering into collaborative partnership agreements related to our product candidates, could delay the development and commercialization of our product candidates and reduce their competitiveness if they reach the market, which could have a material adverse effect on our business, financial condition and results of operations.

Any termination of strategic alliances or

collaborative partnerships we enter into in the future, or any delay in entering into collaborative partnership agreements related to our product candidates, could delay the development and commercialization of our product candidates and reduce their competitiveness if they reach the market, which could have a material adverse effect on our business, financial condition and results of operations.

In October 2020, we formed Angel Pharmaceuticals with a group of investors in China to create a new China-based biopharmaceutical company with a mission to bring innovative quality medicines to Chinese patients for treatment of serious diseases including cancer, autoimmune diseases and infectious diseases.

We granted Angel Pharmaceuticals a license to rights to develop and commercialize our three clinical-stage candidates – mupadolimab, CPI-818 and ciforadenant – in greater China and obtained global rights to our BTK inhibitor preclinical programs.

We granted Angel Pharmaceuticals a license to rights to develop and commercialize our three clinical-stage candidates – CPI-818, ciforadenant and mupadolimab – in greater China and obtained global rights to our BTK inhibitor preclinical programs.

While certain of our executive officers and directors will initially be on the board of directors of Angel Pharmaceuticals, we have limited control over it and so we will be subject to many of the same risks set forth above with respect to all collaborations.

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Astra Zeneca, Bristol-Myers Squib, and Novartis in partnership with Surface Oncology, Inc.

have initiated clinical trials with anti-CD73 antibodies in cancer patients.

have initiated

clinical trials with anti-CD73 antibodies in cancer patients.

Recently, Astra Zeneca reported positive results in a Phase 2 clinical trial in Stage 3 NSCLC with the combination of durvalumab and their anti CD73 antibody, oleclumab.

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Third-line therapies can include bone marrow transplantation, antibody and small molecule targeted therapies, more invasive forms of surgery and new technologies.

In markets with approved therapies, we expect to initially seek approval of our product candidates as a later stage therapy for patients who have failed other approved

In markets with approved therapies, we expect to initially seek approval of our product candidates as a later stage therapy for patients who have failed other approved treatments.

Subsequently, for those drugs that prove to be sufficiently beneficial, if any, we would expect to seek approval as a second-line therapy and potentially as a first-line therapy, but there is no guarantee that our product candidates, even if approved, would be approved for second-line or first-line therapy.

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We have no internal sales, marketing or distribution capabilities.

If mupadolimab, CPI-818 and ciforadenant or any of our other product candidates ultimately receives regulatory approval, we may not be able to effectively market and distribute the product candidate.

We may have to seek collaborators or invest significant amounts of financial and management resources to develop internal sales, distribution and marketing capabilities, some of which will be committed prior to any confirmation that mupadolimab, CPI-818 and ciforadenant or any of our other product candidates will be approved, if at all.

If CPI-818, ciforadenant and mupadolimab or any of our other product candidates ultimately receives regulatory approval, we may not be able to effectively market and distribute the product candidate.

We may have to seek collaborators or invest significant amounts of financial and management resources to develop internal sales, distribution and marketing capabilities, some of which will be committed prior to any confirmation that CPI-818, ciforadenant and mupadolimab or any of our other product candidates will be approved, if at all.

We may not be able to enter into collaborations or hire consultants or external service providers to assist us in sales, marketing and distribution functions on acceptable financial terms or at all.

Even if we determine to perform sales, marketing and distribution functions ourselves, we could face a number of additional related risks, including:

determine to perform sales, marketing and distribution functions ourselves, we could face a number of additional related risks, including:

● we may not be able to attract and build an effective marketing department or sales force;

● the cost of establishing a marketing department or sales force may exceed our available financial resources and the revenue generated by mupadolimab, CPI-818 and ciforadenant or any other product candidates that we may develop, in-license or acquire;

● the cost of establishing a marketing department or sales force may exceed our available financial resources and the revenue generated by CPI-818, ciforadenant and mupadolimab or any other product candidates that we may develop, in-license or acquire;

● our direct sales and marketing efforts may not be successful.

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We may encounter difficulties in managing our growth and expanding our operations successfully.

We will need to grow our organization substantially to continue development and pursue the potential commercialization of mupadolimab, CPI-818 and ciforadenant and our other product candidates.

As we seek to advance mupadolimab, CPI-818 and ciforadenant and other product candidates, we will need to expand our financial, development, regulatory, manufacturing, marketing and sales capabilities or contract with third parties to provide these capabilities for us.

We will need to grow our organization substantially to continue development and pursue the potential commercialization of CPI-818, ciforadenant and mupadolimab and our other product candidates.

As we seek to advance CPI-818, ciforadenant and mupadolimab and other product candidates, we will need to expand our financial, development, regulatory, manufacturing, marketing and sales capabilities or contract with third parties to provide these capabilities for us.

As our operations expand, we expect that we will need to manage additional relationships with various strategic partners, suppliers and other third parties.

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We are subject to various federal and state healthcare laws and regulations, and our failure to comply with these laws and regulations could harm our results of operations and financial condition.

Although we do not currently have any products on the market, if we obtain FDA or foreign approval for any of our product candidates and begin commercializing those products in the United States or abroad, our operations may be directly, or indirectly through our customers and third-party payors, subject to various U.S.

directly, or indirectly through our customers and third-party payors, subject to various U.S.

federal, state and foreign healthcare laws and regulations.

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In the event of contamination or injury, we could be held liable for damages or be penalized with fines in an amount exceeding our resources, and our clinical trials or regulatory approvals could be suspended.

If product liability lawsuits are brought against us, we may incur substantial liabilities and may be required to limit commercialization of mupadolimab, CPI-818 and ciforadenant or our other product candidates.

We face an inherent risk of product liability as a result of the clinical testing of mupadolimab, CPI-818 and ciforadenant, and the planned clinical testing of our other product candidates and will face an even greater risk if we commercialize our product candidates.

For example, we may be sued if mupadolimab, CPI-818 and ciforadenant or our other product candidates allegedly cause injury or are found to be otherwise unsuitable during product testing, manufacturing, marketing or sale.

If product liability lawsuits are brought against us, we may incur substantial liabilities and may be required to limit commercialization of CPI-818, ciforadenant and mupadolimab or our other product candidates.

We face an inherent risk of product liability as a result of the clinical testing of CPI-818, ciforadenant and mupadolimab, and the planned clinical testing of our other product candidates and will face an even greater risk if we commercialize our product candidates.

For example, we may be sued if CPI-818, ciforadenant and mupadolimab or our other product candidates allegedly cause injury or are found to be otherwise unsuitable during product testing, manufacturing, marketing or sale.

Any such product liability claims may include allegations of defects in manufacturing, defects in design, a failure to warn of dangers inherent in the product candidate, negligence, strict liability and a breach of warranties.

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Regardless of the merits or eventual outcome, liability claims may result in:

● decreased demand for mupadolimab, CPI-818 and ciforadenant or our other product candidates;

● decreased demand for CPI-818, ciforadenant and mupadolimab or our other product candidates;

● injury to our reputation;

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● loss of revenue;

● the inability to commercialize mupadolimab, CPI-818 and ciforadenant or our other product candidates;

● the inability to commercialize CPI-818, ciforadenant and mupadolimab or our other product candidates;

● a decline in our stock price.

We have product liability insurance coverage in an amount and on terms and conditions that are customary for similarly situated companies and that are satisfactory to our board of directors.

Our inability to retain sufficient product liability insurance at an acceptable cost to protect against potential product liability claims could prevent or inhibit the commercialization of mupadolimab, CPI-818 and ciforadenant or our other product candidates.

Our inability to retain sufficient product liability insurance at an acceptable cost to protect against potential product liability claims could prevent or inhibit the commercialization of CPI-818, ciforadenant and mupadolimab or our other product candidates.

Although we plan to maintain such insurance, any claim that may be brought against us could result in a court judgment or settlement in an amount that is not covered, in whole or in part, by our insurance or that is in excess of the limits of our insurance coverage.

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Further, we rely on our license agreement with The Scripps Research Institute for rights related to our lead development candidate for our anti-CD73 program, mupadolimab.

These and other licenses we may enter into in the future may not provide adequate rights to use such intellectual property and technology in all relevant fields of use or in all territories in which we may wish to develop or commercialize our technology and products in the future.

These and other licenses we may enter into in the

future may not provide adequate rights to use such intellectual property and technology in all relevant fields of use or in all territories in which we may wish to develop or commercialize our technology and products in the future.

As a result, we may not be able to develop and commercialize our technology and products in fields of use and territories for which we are not granted rights pursuant to such licenses.

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These risks and uncertainties include the following:

● the USPTO and various foreign governmental patent agencies require compliance with a number of procedural, documentary, fee payment and other provisions during the patent process, the noncompliance with which can result in abandonment or lapse of a patent or patent application, and partial or complete loss of patent rights in the relevant jurisdiction;

with which can result in abandonment or lapse of a patent or patent application, and partial or complete loss of patent rights in the relevant jurisdiction;

● patent applications may not result in any patents being issued;

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It is also possible that we will fail to identify patentable aspects of our research and development output before it is too late to obtain patent protection.

Although we enter into non-disclosure and confidentiality agreements with parties who have access to

patentable aspects of our research and development output, such as our employees, corporate collaborators, outside scientific collaborators, CROs, contract manufacturers, consultants, advisors and other third parties, any of these parties may breach such agreements and disclose such output before a patent application is filed, thereby jeopardizing our ability to seek patent protection.

Although we enter into non-disclosure and confidentiality agreements with parties who have access to patentable aspects of our research and development output, such as our employees, corporate collaborators, outside scientific collaborators, CROs, contract manufacturers, consultants, advisors and other third parties, any of these parties may breach such agreements and disclose such output before a patent application is filed, thereby jeopardizing our ability to seek patent protection.

The issuance of a patent is not conclusive as to its inventorship, scope, validity or enforceability, and our patents, if issued, or the patent rights that we license from others, may be challenged in the courts or patent offices in the United States and abroad.

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Moreover, third parties may still obtain this information or may come upon this or similar information independently, and we would have no right to prevent them from using that technology or information to compete with us.

If any of these events occurs or if we otherwise lose protection for our trade secrets, the value of this information may be greatly reduced and our competitive position would be harmed.

If any of these events occurs or if we otherwise lose

protection for our trade secrets, the value of this information may be greatly reduced and our competitive position would be harmed.

If we do not apply for patent protection prior to such publication or if we cannot otherwise maintain the confidentiality of our proprietary technology and other confidential information, then our ability to obtain patent protection or to protect our trade secret information may be jeopardized.

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However, to the extent that any claims of this patent may be interpreted to cover our potential uses of ciforadenant, we do not believe that such claims would be valid and enforceable if asserted.

We have filed a PGR petition challenging the patentability of certain claims of the patent and the

patentee subsequently disclaimed every challenged claim.

We have filed a PGR petition challenging the patentability of certain claims of the patent and the patentee subsequently disclaimed every challenged claim.

As the biotechnology industry expands and more patents are issued, the risk increases that our product candidates may be subject to claims of infringement of the patent rights of third parties.

Because patent applications are maintained as confidential for a certain period of time, until the relevant application is published we may be unaware of third-party patent applications that, if issued as patents, may be infringed by commercialization of mupadolimab, CPI-818 and ciforadenant or our other product candidates, and cannot be certain that we were the first to file a patent application related to a product candidate or technology.

Because patent applications are maintained as confidential for a certain period of time, until the relevant application is published we may be unaware of third-party patent applications that, if issued as patents, may be infringed by commercialization of CPI-818, ciforadenant and mupadolimab or our other product candidates, and cannot be certain that we were the first to file a patent application related to a product candidate or technology.

Moreover, because patent applications can take many years to issue, there may be currently-pending patent applications that may later result in issued patents that our product candidates may infringe.

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● cause development delays;

● prevent us from commercializing mupadolimab, CPI-818 and ciforadenant or our other product candidates until the asserted patent expires or is held finally invalid or not infringed in a court of law;

● prevent us from commercializing CPI-818, ciforadenant and mupadolimab or our other product candidates until the asserted patent expires or is held finally invalid or not infringed in a court of law;

● require us to develop non-infringing technology, which may not be possible on a cost-effective basis;

● require us to enter into royalty or licensing agreements, which may not be available on commercially reasonable terms, or at all.

Although no third party has asserted a claim of patent infringement against us as of the date of this report, others may hold proprietary rights that could prevent mupadolimab, CPI-818 and ciforadenant or our other product candidates from being marketed.

Any patent-related legal action against us claiming damages and seeking to enjoin commercial activities relating to our product candidates or processes could subject us to potential liability for damages, including treble damages if we were determined to willfully infringe, and require us to obtain a license to manufacture or market mupadolimab, CPI-818 and ciforadenant or our other product candidates.

Although no third party has asserted a claim of patent infringement against us as of the date of this report, others may hold proprietary rights that could prevent CPI-818, ciforadenant and mupadolimab or our other product

candidates from being marketed.

Any patent-related legal action against us claiming damages and seeking to enjoin commercial activities relating to our product candidates or processes could subject us to potential liability for damages, including treble damages if we were determined to willfully infringe, and require us to obtain a license to manufacture or market CPI-818, ciforadenant and mupadolimab or our other product candidates.

Defense of these claims, regardless of their merit, would involve substantial litigation expense and would be a substantial diversion of employee resources from our business.

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In addition, we cannot be certain that we could redesign our product candidates or processes to avoid infringement, if necessary.

Accordingly, an adverse determination in a judicial or administrative proceeding, or the failure to obtain necessary licenses, could prevent us from developing and commercializing mupadolimab, CPI-818 and ciforadenant or our other product candidates, which could harm our business, financial condition and operating results.

Accordingly, an adverse determination in a judicial or administrative proceeding, or the failure to obtain necessary licenses, could prevent us from developing and commercializing CPI-818, ciforadenant and mupadolimab or our other product candidates, which could harm our business, financial condition and operating results.

In addition, intellectual property litigation, regardless of its outcome, may cause negative publicity and could prohibit us from marketing or otherwise commercializing our product candidates and technology.

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In addition, in a patent infringement proceeding, a court may decide that a patent we own or in-license is not valid, is unenforceable and/or is not infringed.

If we or any of our existing or potential future collaborators were to initiate legal

proceedings against a third party to enforce a patent directed at one of our product candidates, the defendant could counterclaim that our patent is invalid and/or unenforceable in whole or in part.

If we or any of our existing or potential future collaborators were to initiate legal proceedings against a third party to enforce a patent directed at one of our product candidates, the defendant could counterclaim that our patent is invalid and/or unenforceable in whole or in part.

In patent litigation in the United States, defendant counterclaims alleging invalidity and/or unenforceability are commonplace.

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Such litigation or proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing or distribution activities.

We may not have sufficient financial or other resources to conduct such litigation or proceedings adequately.

We may not have sufficient financial or other resources to conduct such litigation or

proceedings adequately.

Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their greater financial resources.

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If we do not obtain patent term extension for our product candidates, our business may be materially harmed.

Depending upon the timing, duration and specifics of potential FDA marketing approval of ciforadenant, mupadolimab , CPI-818 or other product candidates, one or more of our U.S.

Depending upon the timing, duration and specifics of potential FDA marketing approval of CPI-818, ciforadenant, mupadolimab, or other product candidates, one or more of our U.S.

patents may be eligible for limited patent term restoration under the Drug Price Competition and Patent Term Restoration Act of 1984 (“Hatch-Waxman Amendments”).

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We may not be able to protect our rights to these trademarks and trade names, which we need to build name recognition among potential partners or customers in our markets of interest.

At times, competitors may adopt trade names or trademarks similar to ours, thereby impeding our

ability to build brand identity and possibly leading to market confusion.

At times, competitors may adopt trade names or trademarks similar to ours, thereby impeding our ability to build brand identity and possibly leading to market confusion.

In addition, there could be potential trade name or trademark infringement claims brought by owners of other registered trademarks or trademarks that incorporate variations of our registered or unregistered trademarks or trade names.

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We may not be able to protect our intellectual property rights throughout the world.

While we have issued patents directed at ciforadenant in the United States and certain foreign territories, and pending patent applications directed at mupadolimab, CPI-818, ciforadenant and other product candidates in the United States and other countries, filing, prosecuting and defending patents on mupadolimab, CPI-818, ciforadenant and our other product candidates in all countries throughout the world would be prohibitively expensive, and our intellectual property rights in some countries outside the United States can be less extensive than those in the United States.

While we have issued patents directed at ciforadenant in the United States and certain foreign territories, and pending patent applications directed at CPI-818, ciforadenant, mupadolimab and other product candidates in the United States and other countries, filing, prosecuting and defending patents on CPI-818, ciforadenant, mupadolimab and our other product candidates in all countries throughout the world would be prohibitively expensive, and our intellectual property rights in some countries outside the United States can be less extensive than those in the United States.

In addition, the laws of some foreign countries do not protect intellectual property rights to the same extent as federal and state laws in the United States.

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Our stock price has been volatile.

The stock market in general and the market for stock of pharmaceutical companies in particular have experienced extreme volatility that has often been unrelated to the operating performance

of particular companies.

The stock market in general and the market for stock of pharmaceutical companies in particular have experienced extreme volatility that has often been unrelated to the operating performance of particular companies.

The market price for our common stock may be influenced by those factors discussed in this “Risk Factors” section and many others, including:

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● results of the clinical trials, and the results of trials of our competitors or those of other companies in our market sector;

● regulatory approval of mupadolimab, CPI-818, ciforadenant and our other product candidates, or limitations to specific label indications or patient populations for its use, or changes or delays in the regulatory review process;

● regulatory approval of CPI-818, ciforadenant, mupadolimab and our other product candidates, or limitations to specific label indications or patient populations for its use, or changes or delays in the regulatory review process;

● Angel Pharmaceuticals’ ability to develop and commercialize product candidates in China;

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Because a small number of our existing stockholders own a majority of our voting stock, a stockholder’s ability to influence corporate matters will be limited.

As of March 31, 2022, our executive officers, directors and greater than 5% stockholders, in the aggregate, owned approximately 39% of our outstanding common stock.

As a result, such persons, acting together, have the ability to control our management and affairs and substantially all matters submitted to our stockholders for approval, including the election and removal of directors and approval of any significant transaction.

As of June 30, 2022, our executive officers, directors and greater than 5% stockholders, in the aggregate, owned approximately 38% of our outstanding common stock.

As a result, such persons, acting together, have the ability to control our management and affairs and substantially all matters submitted to our stockholders for approval, including

the election and removal of directors and approval of any significant transaction.

This concentration of ownership may have the effect of delaying, deferring or preventing a change in control, impeding a merger, consolidation, takeover or other business combination involving us, or discouraging a potential acquiror from making a tender offer or otherwise attempting to obtain control of our business, even if such a transaction would benefit other stockholders.

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333-237040), covering the offering of up to $200 million of shares of common stock, preferred stock, warrants and units and entered into a Sales Agreement (“2020 Sales Agreement”) with Jefferies to sell shares of our common stock, from time to time, with aggregate gross sales proceeds of up to $50,000,000, through an at-the-market equity offering program under which Jefferies will act as our sales agent.

As of March 31, 2022, we had sold 6,920,339 shares of common stock for gross proceeds of $31.1 million under the 2020 Sales Agreement.

As of June 30, 2022, we had sold 6,920,339 shares of common stock for gross proceeds of $31.1 million under the 2020 Sales Agreement.

On November 1, 2021 we entered into another Sales Agreement (“2021 Sales Agreement”) with Jefferies to sell shares of our common stock, from time-to-time, with aggregate gross sales proceeds of up to $40,000,000.

As of March 31, 2022, $18.9 million remained for sale under the 2020 Sales Agreement and $40.0 million remained for sale under the 2021 Sales Agreement.

As of June 30, 2022, $18.9 million remained for sale under the 2020 Sales Agreement and $40.0 million remained for sale under the 2021 Sales Agreement.

Sales of a substantial number of shares of our common stock by our existing stockholders in the public market could cause our stock price to fall.

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We are a smaller reporting company, which allows us to take advantage of exemptions from various reporting requirements that are applicable to other public companies that are not smaller reporting companies, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended, reduced disclosure obligations regarding executive compensation in our Annual Report and our periodic reports and proxy statements and providing only two years of audited financial statements in our Annual Report and our periodic reports.

We will remain an smaller reporting company until (a) the aggregate market value of our outstanding common stock held by non-affiliates as of the last business day our most recently completed second fiscal quarter exceeds $250 million or (b) (1) we have over $100 million in annual revenues and (2) the aggregate market value of our outstanding common stock held by non-affiliates as of the last business day our most recently completed second fiscal quarter exceeds $700 million.

We cannot predict whether investors will find our common stock less attractive if we rely on certain or all of these exemptions.

We will remain a smaller reporting company until (a) the aggregate market value of our outstanding common stock held by non-affiliates as of the last business day our most recently completed second fiscal quarter exceeds $250 million or (b) (1) we have over $100 million in annual revenues and (2) the aggregate market value of our outstanding common stock held by non-affiliates as of the last business day our most recently completed second fiscal quarter exceeds $700 million.

We cannot predict whether investors will find our common stock less attractive if we rely

on certain or all of these exemptions.

If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile and may decline.

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Our future growth may depend, in part, on our ability to develop and commercialize our product candidates in foreign markets.

We are not permitted to market or promote any of our product candidates before we receive regulatory approval from applicable regulatory authorities in foreign markets, and we may never receive such regulatory approvals for any of our product candidates.

for any of our product candidates.

To obtain separate regulatory approval in many other countries we must comply with numerous and varying regulatory requirements regarding safety and efficacy and governing, among other things, clinical trials, commercial sales, pricing and distribution of our product candidates.

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In addition, such a breach may require notification to governmental agencies, or affected individuals pursuant to applicable data privacy and security laws.

We would also be exposed to a risk of loss, including financial assets or litigation and potential liability, which could materially adversely affect our business, reputation, financial condition, results of operations and prospects.

We would also be exposed to a risk of loss, including financial assets or litigation and potential liability, which

could materially adversely affect our business, reputation, financial condition, results of operations and prospects.

We also rely on third parties to manufacture our product candidates, and similar events relating to their computer systems could also have a material adverse effect on our business.

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In addition, we may obtain health information from third parties (including research institutions from which we obtain clinical trial data) that are subject to privacy and security requirements under HIPAA.

Depending on the facts and

circumstances, we could be subject to criminal penalties if we knowingly obtain, use, or disclose individually identifiable health information that was provided to us by a HIPAA-covered entity in a manner that is not authorized or permitted by HIPAA.

Depending on the facts and circumstances, we could be subject to criminal penalties if we knowingly obtain, use, or disclose individually identifiable health information that was provided to us by a HIPAA-covered entity in a manner that is not authorized or permitted by HIPAA.

Further, California enacted the CCPA, on June 28, 2018, which went into effect on January 1, 2020.

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on July 16, 2020, the Court of Justice of the European Union, or the CJEU invalidated the EU-US Privacy Shield Framework, or the Privacy Shield under which personal data could be transferred from the EEA to US entities who had self-certified under the Privacy Shield scheme.

While the CJEU upheld the adequacy of the standard contractual clauses, or SCCs, it made clear that reliance on them alone may not necessarily be sufficient in all circumstances.

While the CJEU upheld the adequacy of the standard contractual clauses, or SCCs, it made

clear that reliance on them alone may not necessarily be sufficient in all circumstances.

The European Commission issued revised SCCs on June 4, 2021 to account for the decision of the CJEU and recommendations made by the European Data Protection Board.

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However, the UK adequacy decision will automatically expire in June 2025 unless the European Commission re-assesses and renews or extends that decision and remains under review by the Commission during this period.

In September 2021, the UK government

launched a consultation on its proposals for wide-ranging reform of UK data protection laws following Brexit.

In September 2021, the UK government launched a consultation on its proposals for wide-ranging reform of UK data protection laws following Brexit.

There is a risk that any material changes which are made to the UK data protection regime could result in the European Commission reviewing the UK adequacy decision, and the UK losing its adequacy decision if the European Commission deems the UK to no longer provide adequate protection for personal data.

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We currently rely on several different manufacturers who supply different parts of the ciforadenant molecule and CPI-818 molecule, on one manufacturer for mupadolimab drug substance and on other third-party manufacturers to produce our other product candidates.

Our ability to obtain clinical supplies of mupadolimab, CPI-818 and ciforadenant or our other product candidates could be disrupted if the operations of these suppliers were affected by a man-made or natural disaster or other business interruption.

Our ability to obtain clinical supplies of CPI-818, ciforadenant and mupadolimab or our other product candidates could be disrupted if the operations of these suppliers were affected by a man-made or natural disaster or other business interruption.

The occurrence of any of these business disruptions could seriously harm our operations and financial condition and increase our costs and expenses.

2 unchanged sentences

In the event of a continuation of shelter-in-place orders or mandated local travel restrictions, our employees conducting research and development activities may not be able to access our facilities and our activities may be significantly limited or curtailed, possibly for an extended period of time.

Furthermore, it is possible that over the long term our operational efficiency may be decreased if our employees and third-party collaborators are unable to meet and work in the same physical location .

Furthermore, it is

possible that over the long term our operational efficiency may be decreased if our employees and third-party collaborators are unable to meet and work in the same physical location .

Our ability to use net operating loss carryforwards and other tax attributes may be limited.

22 unchanged sentences

Institutional, individual, and other investors, proxy advisory services, regulatory authorities, consumers and other stakeholders are increasingly focused on environmental, social and governance (ESG) practices of companies.

As we look to respond to evolving standards for identifying, measuring, and reporting ESG metrics, our efforts may result in a significant increase in costs and may nevertheless not meet investor or other stakeholder expectations and evolving standards or regulatory requirements, which may negatively impact our financial results, our reputation, our ability to attract or retain employees, our attractiveness as an investment or business partner, or expose us to government enforcement actions, private litigation, and actions by stockholders or stakeholders.

enforcement actions, private litigation, and actions by stockholders or stakeholders.

Unregistered Sales of Equity Securities and Use of Proceeds

Recent Sales of Unregistered Securities.

Use of Proceeds from Registered Securities

Not applicable

Repurchases of Shares or of Company Equity Securities

Defaults Upon Senior Securities

Mine Safety Disclosures

Not applicable

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 1A. Risk Factors