What changed in this filing

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Item 1A. Risk Factors

2023-03-02 compared with 2022-03-03 · 228 added, 110 removed, 1085 unchanged (24% of the section changed)

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an investment decision regarding our common stock.

We have incurred significant losses since our inception and anticipate that we will continue to incur losses for the foreseeable future.

We will require additional capital to fund our operations and if we fail to obtain necessary financing we will not be able to complete the development and commercialization of our product candidates.

We are significantly dependent on the success of our DN-TNF product platform and Natural Killer Cell Priming Platform (INKmune) and our product candidates based on these platforms.

We need to attract and retain highly skilled personnel;

We have incurred significant

losses since our inception and anticipate that we will continue to incur losses for the foreseeable future.

ability to successfully engage with, and satisfactorily

respond to, requests for additional information from the FDA concerning the clinical hold

on our investigational new drug application for XPro and the timing and outcomes of such

interactions, including our plans to engage the FDA in order to lift the clinical hold.

will require additional capital to fund our operations and if we fail to obtain necessary

financing, we will not be able to complete the development and commercialization of our product

have a substantial amount of debt, and we may be unable to make required payments of interest

and principal as they become due.

We are significantly dependent

on the success of our DN-TNF product platform and Natural Killer Cell Priming Platform (INKmune) and our product candidates based

on these platforms.

We need to attract and

retain highly skilled personnel;

we may be unable to effectively manage growth with our limited resources.

We depend upon our senior management and key consultants and their loss or unavailability could put us at a competitive disadvantage.

The biotechnology and immunotherapy industries are characterized by rapid technological developments and a high degree of competition.

We may be unable to compete with more substantial enterprises.

We can provide no assurance that our clinical product candidates will obtain regulatory approval or that the results of clinical studies will be favorable.

Drug discovery and development is a complex, time-consuming and expensive process with a high rate of failure.

We may face legal claims;

legal disputes are expensive and we may not be able to afford the costs.

We depend upon our senior

management and key consultants and their loss or unavailability could put us at a competitive disadvantage.

The biotechnology and immunotherapy

industries are characterized by rapid technological developments and a high degree of competition.

We may be unable to compete with

more substantial enterprises.

We can provide no assurance

that our clinical product candidates will obtain regulatory approval or that the results of clinical studies will be favorable.

Drug discovery and development

is a complex, time-consuming and expensive process with a high rate of failure.

may face legal claims;

legal disputes are expensive, and we may not be able to afford the

We can provide no assurance of the successful and timely development of new products.

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and development programs, reduce our commercialization efforts or curtail our operations.

In order to develop and bring our product candidates

to market, we must commit substantial resources to costly and time-consuming research, preclinical and clinical trials and marketing activities.

We anticipate that our existing cash and cash equivalents will enable us to maintain our current operations for at least the next twelve

We anticipate using our cash and cash equivalents to fund further research and development with respect to our lead product candidates.

We may, however, need to raise additional funding sooner if our business or operations change in a manner that consumes available resources

more rapidly than we anticipate.

Our requirements for additional capital will depend on many factors, including:

As of December

31, 2022, we had cash and cash equivalents of $52.2 million and we had $15 million of outstanding debt.

In order to develop and

bring our product candidates to market, we must commit substantial resources to costly and time-consuming research, preclinical and clinical

trials and marketing activities.

We anticipate that our existing cash and cash equivalents will enable us to maintain our current operations

for at least the next twelve months.

We anticipate using our cash and cash equivalents to fund further research and development with respect

to our lead product candidates.

We may, however, need to raise additional funding sooner if our business or operations change in a manner

that consumes available resources more rapidly than we anticipate.

Our requirements for additional capital will depend on many factors,

successful commercialization of our product candidates;

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market acceptance of our products, if any.

To the extent we raise additional capital through

the sale of equity securities, the issuance of those securities could result in dilution to our shareholders.

In addition, if we obtain

debt financing, a substantial portion of our operating cash flow may be dedicated to the payment of principal and interest on such indebtedness,

thus limiting funds available for our business activities.

If adequate funds are not available, we may be required to delay, reduce the

scope of or eliminate our research and development programs, reduce our commercialization efforts or curtail our operations.

we may be required to obtain funds through arrangements with collaborative partners or others that may require us to relinquish rights

to technologies, product candidates or products that we would otherwise seek to develop or commercialize ourselves or license rights to

technologies, product candidates or products on terms that are less favorable to us than might otherwise be available.

The Company will require substantial additional

funds to support its research and development activities, and the anticipated costs of preclinical studies and clinical trials, regulatory

approvals and eventual commercialization.

Such additional sources of financing may not be available on favorable terms, if at all.

we do not succeed in raising additional funds on acceptable terms, we may be unable to initiate clinical trials or obtain approval of

any product candidates from the FDA and other regulatory authorities.

In addition, we could be forced to discontinue product development,

forego sales and marketing efforts and forego attractive business opportunities.

Any additional sources of financing will likely involve

the issuance of our equity securities, which will have a dilutive effect on our stockholders.

Issuances of additional

debt or equity securities could impact the rights of the holders of our common stock and will dilute their ownership percentage.

the establishment of other funding facilities may impose restrictions on our operations.

These restrictions could include limitations

on additional borrowing and specific restrictions on the use of our assets, as well as prohibitions on our ability to create liens, pay

dividends, redeem our stock or make investments.

We may also raise additional capital by pursuing opportunities for the licensing

or sale of certain intellectual property and other assets.

We cannot offer assurances, however, that any strategic collaboration,

sales of securities or sales or licenses of assets will be available to us on a timely basis or on acceptable terms, if at all.

be required to enter into relationships with third parties to develop or commercialize products or technologies that we otherwise would

have sought to develop independently, and any such relationships may not be on terms as commercially favorable to us as might otherwise

In the event that sufficient

additional funds are not obtained through strategic collaboration opportunities, sales of securities, funding facilities, licensing arrangements,

borrowing arrangements and/or asset sales on a timely basis, we may be required to reduce expenses through the delay, reduction or curtailment

of our projects, or further reduction of costs for facilities and administration.

We cannot provide assurances

that changed or unexpected circumstances will not result in the depletion of our capital resources more rapidly than we currently anticipate.

There can be no assurances that we will be able to raise additional capital in sufficient amounts or on favorable terms, or at all.

we are unable to raise adequate additional capital when required or in sufficient amounts or on terms acceptable to us, we may have to

delay, scale back or discontinue one or more product development programs, curtail our commercialization activities, significantly reduce

expenses, sell assets (potentially at a loss), enter into relationships with third parties to develop or commercialize products or technologies

that we otherwise would have sought to develop or commercialize independently, cease operations altogether, pursue an acquisition of our

company at a price that may result in up to a total loss on investment for our stockholders, file for bankruptcy or seek other protection

from creditors, or liquidate all of our assets.

To fund our operations

and service our debt, we will be required to generate a significant amount of cash.

Our ability to generate cash depends on a number of

factors, some of which are beyond our control, and any failure to meet our debt obligations would have a material adverse effect on our

business, financial condition, cash flows and results of operations and could cause the market value of our common stock to decline.

Prevailing economic conditions

and financial, business and other factors, many of which are beyond our control, may affect our ability to make payments on our debt.

If we do not generate sufficient cash flow to satisfy our debt obligations, we may have to undertake alternative financing plans, such

as refinancing or restructuring our debt, selling assets, reducing or delaying capital investments or seeking to raise additional capital.

Alternatively, we may also attempt to refinance certain of our debt, for example, to extend maturities.

Our ability to restructure or

refinance our debt will depend on the capital markets and our financial condition at such time.

If we are unable to access the capital

markets, whether because of the condition of those capital markets or our own financial condition or reputation within such capital markets,

we may be unable to refinance our debt.

In addition, any refinancing of our debt could be at higher interest rates and may require us

to comply with more onerous covenants, which could further restrict our business operations.

Our inability to generate sufficient cash

flow to satisfy our debt obligations or to refinance our obligations on commercially reasonable terms, or at all, could have a material

adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common

stock and/or debt securities to decline.

Our ability to continue

to reduce our indebtedness will depend upon factors including our future operating performance, our ability to access the capital markets

to refinance existing debt and prevailing economic conditions and financial, business and other factors, many of which are beyond our

We can provide no assurance of the amount by which we will reduce our debt, if at all.

In addition, servicing our debt will result

in a reduction in the amount of our cash flow available for other purposes, including operating costs and research and development costs.

Our debt agreement contains covenant restrictions that may limit

our ability to operate our business.

The terms of our debt agreement

contains, and any of our other future debt agreements may contain, covenant restrictions that limit our ability to operate our business,

including restrictions on our ability to, among other things, incur additional debt or issue guarantees, create liens, repurchase stock,

or make other restricted payments, and make certain voluntary prepayments of specified debt.

As a result of these covenants, our ability

to respond to changes in business and economic conditions and engage in beneficial transactions, including to obtain additional financing

as needed, may be restricted.

Furthermore, our failure to comply with our debt covenants could result in a default under our debt agreements,

which could permit the holders to accelerate our obligation to repay the debt.

If any of our debt is accelerated, we may not have sufficient

funds available to repay it.

The Company violated certain non-financial debt covenants during 2022 and obtained a waiver from its lender

for the violations during February 2023.

The FDA has placed

a clinical hold on XPro.

If the FDA does not remove the clinical hold on a timely basis, or at all, our development timelines and

our business may be adversely affected, and our stock price may decline.

previously announced by the Company in a press release dated on May 23, 2022, the FDA placed a full clinical hold on XPro, requesting

additional information around the Company’s chemistry manufacturing and controls for the treatment.

The Company is working

with the regulatory body to have the current hold removed as soon as possible, but it is not yet clear when the hold will be lifted.

If the FDA does not lift the clinical hold in a timely manner, or at all, our long-term development

timeline for XPro and our business, financial condition or results of operations, may be

adversely affected.

The trial for XPro in Alzheimer’s disease is currently open in Australia and Canada.

We face intense competition in the markets

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protection is crucial to the success of our business and prospects, and there is a substantial risk that such protections will prove inadequate.

We license our patents from third party

If such owners do not properly maintain or enforce the intellectual property underlying such licenses, our competitive position

and business prospects could be harmed.

We license our patents from others.

owners do not properly maintain or enforce the intellectual property underlying such licenses, our competitive position and business prospects

could be harmed.

Our licensors may also seek to terminate our license.

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The license agreement relates to our natural killer program, INKmune.

Ventures is owned by our President and a member of our Board of Directors, David Moss, our Chief Financial Officer and Treasurer and Mark

Lowdell, our Chief Scientific Officer.

Because our officers and directors also own Immune Ventures there may be an inherent conflict of

interest which could result in unanticipated actions that adversely affect us.

Ventures is owned by our RJ Tesi, our CEO and Chairman of the Board of Directors, David Moss, our Chief Financial Officer and Treasurer

and Mark Lowdell, our Chief Scientific Officer.

Because our officers and directors also own Immune Ventures there may be an inherent conflict

of interest which could result in unanticipated actions that adversely affect us.

We have a limited operating history and

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we may decide, or regulators may require us, to conduct additional clinical trials or abandon product development programs;

the number of patients required for clinical trials of our product candidate may be larger than we anticipate, patient enrollment in these clinical trials may be slower than we anticipate or participants may drop out of these clinical trials at a higher rate than we anticipate;

the number of patients required for clinical trials of our product

candidate may be larger than we anticipate, patient enrollment in these clinical trials may be slower than we anticipate, or participants

may drop out of these clinical trials at a higher rate than we anticipate;

data safety monitoring committees may recommend suspension, termination or a clinical hold for various reasons, including concerns about patient safety;

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is affected by many factors, including:

have the FDA clinical hold on XPro lifted;

the size and nature of the patient population;

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we may be required to adopt an alternative brand name for our product candidates.

If we adopt an alternative brand name, we would lose

If we adopt an alternative brand name, we will lose

the benefit of our existing trademark applications for such product candidate and may be required to expend significant additional resources

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clinical trials, make changes in the labeling of our product or obtain re-approvals.

This may cause our reputation in the market place

This may cause our reputation in the marketplace

to suffer or subject us to lawsuits, including class action suits.

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If we develop internal sales, marketing and distribution organization,

this would require significant capital expenditures, management resources and time, and we would have to compete with other pharmaceutical

this will require significant capital expenditures, management resources and time, and we would have to compete with other pharmaceutical

and biotechnology companies to recruit, hire, train and retain marketing and sales personnel.

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third party as a defendant in a district court action.

The outbreak of

COVID-19 may adversely affect our business and the market price of our common stock.

The ongoing COVID-19

pandemic has broadly affected the global economy, resulted in significant travel and work restrictions in many regions and put a significant

strain on healthcare resources.

The pandemic has had, and we expect it will continue to have, an impact on our operations and on the operations

of our collaborators, third-party contractors and other entities, including governmental agencies with which we interact.

We have experienced

delays in obtaining materials and supplies needed to manufacture our product candidates as a result of production shortages experienced

by our suppliers.

Additionally, at times we have been subject to temporary pauses in enrollment and dosing implemented by some clinical

trial sites due to COVID-19, and some clinical trial sites have also restricted initiation of new trials at times as well as visits by

sponsors and clinical research organizations (CROs) for ongoing trials to protect both site staff and patients from possible COVID-19

The COVID-19 pandemic,

including the emergence of new variants, has impacted, and may in the future impact, the clinical development of our product candidates

if we are subject to restrictions or limitations on, or delays in, the performance of study procedures (particularly any procedures that

may be deemed non-essential), participant dosing, distribution of our product candidates or clinical trial materials, study monitoring,

or site inspections and data analysis, including as a result of changes in hospital or research institution policies, federal, state or

local regulations, prioritization of hospital and other medical resources toward pandemic efforts, reduced availability of site staff

supporting the conduct of clinical trials, heightened risks of exposure of study participants, principal investigators or site staff to

COVID-19 if an outbreak occurs in their geographic region, or other reasons related to the pandemic.

Quarantine or other travel limitations

(whether voluntary or required) also may impede participant movement, affect access to study sites, or interrupt healthcare services.

Furthermore, the pandemic

could cause delays in review and response times by the FDA and other regulatory agencies, or such health regulatory agencies may refuse

to accept data from our clinical trials due to mitigation strategies we implement in response to the COVID-19 pandemic and current regulatory

In addition, our ability to manufacture and ship our product candidates for our clinical trials may be impacted if we, or any

third parties which manufacture and supply materials used in either the manufacture of our product candidates or the conduct of our research

and development activities, or which perform certain testing relating to our product candidates, are adversely impacted by restrictions

resulting from the coronavirus outbreak.

There is also the potential that manufacturing facilities, equipment, and materials required

for manufacture or administration of our product candidates could be commandeered under the Defense Production Act of 1950, or equivalent

foreign legislation, which may make it more difficult to obtain materials, equipment, or manufacturing slots necessary for the clinical

supply of our product candidates.

The extent to which the pandemic affects our operations and the research

and development of our product candidates will depend on continuously changing circumstances, which are highly uncertain and cannot be

predicted with confidence, such as the duration of the pandemic, including the emergence of new variants of the virus, such as the Delta

and Omicron variants, which may impact rates of infection and vaccination efforts, developments or perceptions regarding the safety of

vaccines, future waves of infection, and the effectiveness of actions taken to contain the pandemic or mitigate its impact, including

vaccination campaigns.

While the ultimate impact of the COVID-19 pandemic on our business is highly uncertain, any negative impacts that

materialize could materially adversely affect our clinical development and operations, financial performance and stock price.

Deterioration in general economic conditions

in the United States, Canada and globally, including the effect of prolonged periods of inflation on our suppliers, third-party

service providers and potential partners, could harm our business and results of operations.

Our business and results

of operations could be adversely affected by changes in national or global economic conditions.

These conditions include but are not limited

to inflation, rising interest rates, availability of capital markets, energy availability and costs, the negative impacts caused

by pandemics and public health crises, negative impacts resulting from the military conflict between Russia and the Ukraine, and the effects

of governmental initiatives to manage economic conditions.

Impacts of such conditions could be passed on to our business in the form of

higher costs for labor and materials, higher investigator fees, possible reductions in pharmaceutical industry-wide spending on research

and development and acquisitions and higher costs of capital.

Public health threats could have an

adverse effect on our operations and financial results.

Public health threats,

such as the novel coronavirus (COVID-19), influenza and other highly communicable diseases or viruses could adversely impact our operations

and disrupt our ongoing or planned research and development activities.

We cannot presently predict the scope and severity of any potential

future business shutdowns or disruptions, but if we or any of the third parties with whom we engage, including the suppliers, clinical

trial sites, regulators and other third parties with whom we conduct business, were to experience shutdowns or other business disruptions,

our ability to conduct our business in the manner and on the timelines presently planned could be materially and negatively impacted.

We are exposed to risks related to currency

exchange rates.

We conduct a significant

portion of our operations outside of the United States.

Because our financial statements are presented in U.S.

dollars, changes in currency

exchange rates have had and could have in the future a significant effect on our operating results when our operating results are translated

Our employees, principal investigators, consultants and commercial partners may engage in misconduct or other improper activities, including

noncompliance with regulatory standards and requirements and insider trading, which could cause significant liability for us and harm

our reputation.

We are exposed to the

risk of fraud or other misconduct by our employees, principal investigators, consultants and collaborators, including intentional failures

to comply with FDA or Office of Inspector General regulations or similar regulations of comparable non-U.S.

regulatory authorities, provide

accurate information to the FDA or comparable non-U.S.

regulatory authorities, comply with manufacturing standards we have established,

comply with federal and state healthcare fraud and abuse laws and regulations and similar laws and regulations established and enforced

by comparable non-U.S.

regulatory authorities, report financial information or data accurately or disclose unauthorized activities to

Misconduct by these parties could also involve the improper use of information obtained in the course of clinical trials, which could

result in regulatory sanctions and serious harm to our reputation.

It is not always possible to identify and deter misconduct, and the

precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in

protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws,

standards or regulations.

Such actions could have a significant impact on our business and results of operations, including the imposition

of significant fines or other sanctions.

A cybersecurity incident and other technology

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brand damage, violation of privacy laws, loss of customers, potential liability and competitive disadvantage.

Use of social media platforms presents

We believe that our potential

patient population is active on social media.

Social media practices in the pharmaceutical and biotechnology industries are evolving,

which creates uncertainty and risk of noncompliance with regulations applicable to our business.

For example, patients may use social

media platforms to comment on the effectiveness of, or adverse experiences with, a product candidate, which could result in reporting

In addition, there is a risk of inappropriate disclosure of sensitive information or negative or inaccurate posts or comments

about us or our product candidates on any social networking website.

In addition, our employees or third parties with whom we contract,

such as our CROs or CMOs, may knowingly or inadvertently make use of social media in a manner that may give rise to liability, lead to

the loss of trade secrets or other intellectual property or result in public exposure of personal information of our employees, clinical

trial patients, customers and others or information regarding our product candidates or clinical trials.

Any of these events could have

a material adverse effect on our business, prospects, operating results and financial condition and could adversely affect the price of

our common shares.

Risks Related to our Common Stock

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foreseeable future.

We have paid no dividends on our common stock

to date, and we do not anticipate paying any dividends to holders of our common stock in the foreseeable future.

While our future dividend

policy will be based on the operating results and capital needs of the business, we anticipate that we will retain any earnings to finance

our future expansion and for the implementation of our business plan.

As an investor, you should take note of the fact that a lack of

a dividend can further affect the market value of our common stock, and could significantly affect the value of any investment in our

We have paid no dividends on our common stock to date, and we do not

anticipate paying any dividends to holders of our common stock in the foreseeable future.

While our future dividend policy will be based

on the operating results and capital needs of the business, we anticipate that we will retain any earnings to finance our future expansion

and for the implementation of our business plan.

As an investor, you should take note of the fact that a lack of a dividend can further

affect the market value of our common stock and could significantly affect the value of any investment in our Company.

We are subject to the reporting requirements

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inability to develop or acquire new or needed technology or products.

In addition, the securities markets have from

time to time experienced significant price and volume fluctuations that are unrelated to the operating performance of particular companies.

These market fluctuations may also materially and adversely affect the market price of our Common Stock.

In addition, the securities markets have from time-to-time experienced

significant price and volume fluctuations that are unrelated to the operating performance of particular companies.

These market fluctuations

may also materially and adversely affect the market price of our Common Stock.

You may have difficulty trading and obtaining

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rights plan could make a third-party acquisition of us difficult.

We have a stockholder rights plan that may have

the effect of discouraging unsolicited takeover proposals.

Specifically, the rights issued under the stockholder rights plan could cause

significant dilution to a person or group that attempts to acquire us on terms not approved in advance by our board of directors.

rights plan is not intended to prevent a takeover, and we believe it will enable all our stockholders to realize the full potential value

of their investment in the Company and protect the Company and its stockholders from efforts to obtain control of the Company that are

inconsistent with the best interests of the Company and its stockholders.

The rights under the plan will expire on December 30, 2022,

subject to a possible earlier expiration to the extent provided in the stockholder rights plan, unless extended.

We have a stockholder rights plan that may have the effect of discouraging

unsolicited takeover proposals.

Specifically, the rights issued under the stockholder rights plan could cause significant dilution to

a person or group that attempts to acquire us on terms not approved in advance by our board of directors.

The rights plan is not intended

to prevent a takeover, and we believe it will enable all our stockholders to realize the full potential value of their investment in the

Company and protect the Company and its stockholders from efforts to obtain control of the Company that are inconsistent with the best

interests of the Company and its stockholders.

The rights under the plan will expire on December 30, 2023, subject to a possible earlier

expiration to the extent provided in the stockholder rights plan, unless extended.

UNRESOLVED STAFF COMMENTS

Not applicable.

The Company leases approximately

5,000 square feet of office space in Boca Raton, Florida from a third-party, which serves as the headquarters of the Company.

pay approximately $15,000 per month for this lease which expires in January 2027.

We believe our current facilities are suitable

and adequate to meet our current needs.

LEGAL PROCEEDINGS

We currently are not a party to any material litigation

or other material legal proceedings.

We may, from time to time, be subject to legal proceedings and claims arising in the normal course

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-K

Item 1A. Risk Factors