What changed in this filing

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Item 7. Management’s Discussion and Analysis

2025-04-15 compared with 2024-03-27 · 121 added, 123 removed, 128 unchanged (66% of the section changed)

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delivery technology (LNC Platform).

We are seeking to develop an internal pipeline of products utilizing the LNC Platform to successfully

encapsulate small molecules and small oligonucleotides and facilitate targeted and extrahepatic delivery to desired cells tissues without

elements of our strategy include:

MAT2203 into the ORALTO trial for the treatment of invasive aspergillosis in patients with limited treatment options by securing

a development and/or commercial partner.

This initial indication is designed to be a gateway indication to establish the pharmacodynamic

bridge necessary to expand the use of MAT2203 into other indications to treat deadly invasive fungal infections (e.g., mucormycosis,

candidiasis and the endemic mycoses) through limited additional clinical work under a 505(b)(2) pathway, thereby making MAT2203 a

pipeline in a product.

the utilization of our LNC Platform with other small molecules and small oligonucleotides into inflammation and oncology in order

to develop an internal pipeline of differentiated drug candidates.

Oral, extrahepatic and non-toxic intracellular delivery of these

molecules would represent a significant advancement.

an external pipeline of collaborations focused on our LNC Platform with leading pharmaceutical companies to provide delivery solutions

for their complex small molecules and small oligonucleotides, including ASOs and siRNAs.

elements of our strategy now include:

one or more partners to monetize the value of MAT2203 in the short term and raise additional non-dilutive capital through the licensing

or sale of our lead LNC Platform product candidate.

A partnership would likely seek to advance MAT2203 into Phase 3 development as

quickly as possible, which could position a partner to commercialize MAT2203 upon approval and which could bring additional longer-term

value to the Company and its shareholders.

our cash resources while identifying and evaluating other strategic options for the Company, which could include the in-license of one

or more assets or seeking a merger partner for the Company.

October 31, 2024, we announced that negotiations under the MAT2203 Term Sheet were terminated following notification from the perspective

partner for reasons unrelated to MAT2203.

As a result, we implemented an immediate 80% workforce reduction, eliminating 15 positions,

including three members of senior management, and paused clinical development of MAT2203 to preserve cash while it evaluated a

potential sale of MAT2203 and/or other strategic alternatives, including a potential winddown or dissolution of the Company.

February 13, 2025, we announced that the Company entered into a securities purchase agreement (the “February 2025 Agreement”)

with a certain group of investors (the “February 2025 Investors”), pursuant to which they agreed to purchase from the Company

3,300 shares of Series C Convertible Preferred Stock (the “Preferred Stock”) and warrants to purchase up to 11,262,808 shares

of common stock (the “February 2025 Warrants”) at a purchase price of $1,000 per share of Preferred Stock and accompanying

warrants for aggregate gross proceeds of $3.3 million before deducting offering expenses payable by the Company.

The Investors purchased

1,650 shares of Preferred Stock and accompanying warrants to purchase up to 5,631,404 shares of common stock for gross proceeds to the

Company of $1.65 million at an initial closing on February 13, 2025.

On April 8, 2025, upon the satisfaction of certain closing conditions, including approval by the Company’s stockholders of the issuance of all of the shares of Common Stock upon conversion of the Preferred

Stock and warrants, as required by the applicable rules and regulations of the NYSE American LLC (the “Shareholder Approval”),

the Investors paid an additional $1.65 million in exchange for an additional 1,650 shares of Preferred Stock and accompanying warrants

to purchase up to 5,631,404 shares of common stock at a second closing.

The shares of Preferred Stock are convertible into common

stock at a conversion price of $0.586, and each share of Preferred Stock is initially convertible into 1,706 shares of common stock.

The warrants have an exercise price of $0.6446 per share, will be exercisable, subject to certain exceptions, beginning on the effective

date of the Shareholder Approval and will expire five years from the effective date of the Shareholder Approval.

funds will be used for general corporate purposes, with a focus on reducing operating expenses and exploring strategic alternatives for

MAT2203, the Company’s Phase 3-ready antifungal drug candidate for the treatment of invasive fungal infections, as well as other

strategic alternatives for the Company.

the years ended December 31, 2024 and 2023, our net loss was $24,251 and $22,942, respectively.

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period from our inception and expect to incur additional losses for the foreseeable future.

We do not believe that the cash, cash

equivalents and marketable debt securities on hand are sufficient to fund planned operations beyond the next twelve months from the filing date of this Annual Report.

We do not believe that the cash and cash

equivalents on hand are sufficient to fund planned operations beyond the next twelve months from the filing date of this Annual

We will seek to fund our operations through public or private equity offerings, debt financings, government or other

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Operations Overview

the year ended December 31, 2023, we generated $1,096 in contract research revenue resulting from the research collaboration with BioNTech

SE and Genentech Inc.

During the year ended December 31, 2022, we generated $3,188 in contract revenue resulting from the research collaboration

with BioNTech SE.

Our ability to generate product revenue, which we do not expect to occur for many years, if ever, will depend heavily

on the successful development and eventual commercialization of our early-stage product candidates.

did not generate any revenue during the year ended December 31, 2024.

During the year ended December 31, 2023, we generated $1,096 in

contract research revenue resulting from the research collaboration with BioNTech SE and the feasibility study agreement with Genentech

Our ability to generate product revenue, which we do not expect to occur for many years, if ever, will depend heavily on the successful

development and eventual commercialization of our early-stage product candidates.

and Development Expenses

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We anticipate that our general and administrative expenses during 2025 will decrease

slightly compared to expenses incurred during 2023.

slightly compared to expenses incurred during 2024 as a result of cost-cutting measures implemented to conserve cash.

Impairment Charges

During the fourth quarter of 2024,

we identified impairment indicators for certain long-lived assets, primarily due to the terminated partnership negotiations for the

future development and commercialization of MAT2203 and the subsequent cost-cutting measures.

We remeasured the fair value of the

Company’s long-lived assets and recognized non-cash impairment charges of $4,431, $1,336 of which related to goodwill, $757

related to IPR&D and $2,338 related to other assets.

These amounts are reflected as impairment charges in the consolidated

statements of operations and comprehensive loss for 2024.

We did not recognize any impairment charges during 2023.

of Net Operating Losses (NOLs) & Tax Credits

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Tax Certificate Program was $0 and $484 for the years ended December 31, 2024 and 2023, respectively.

The income recorded in 2023

included sales related to tax year 2022, while income recorded in 2022 included sales related to tax years 2021 and 2020.

The income recorded in 2023 included

sales related to tax year 2022.

income, net is largely comprised of interest income (expense) and dividends.

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the application of the most difficult, subjective and complex judgments;

(i) Research and development costs, and (ii) Goodwill and other

(i) Research and development expenses and (ii) Goodwill and other

intangible assets.

Operating Trends

current R&D efforts are focused on advancing our lead LNC product candidate, MAT2203, through clinical development and expanding

application of our LNC Platform through both internal efforts and collaborations with third parties.

Our R&D expenses consist of

manufacturing work and the cost of active pharmaceutical ingredients and excipients used in such work, fees paid to consultants for work

related to clinical trial design and regulatory activities, fees paid to providers for conducting various clinical studies as well as

for the analysis of the results of such studies, and for other medical research addressing the potential efficacy and safety of our drugs.

We believe that significant investment in product development is a competitive necessity, and we plan to continue these investments to

be in a position to realize the potential of our product candidates and proprietary technologies.

expect that most of our R&D expenses in the near-term future will be incurred in support of our current and future preclinical and

clinical development programs.

These expenditures are subject to numerous uncertainties relating to timing and cost to completion.

test compounds in numerous preclinical studies for safety, toxicology, and efficacy.

At the appropriate time, subject to the approval

of regulatory authorities, we expect to conduct early-stage clinical trials.

We anticipate funding these trials ourselves, and possibly

with the assistance of federal grants, contracts, or other agreements.

As we obtain results from trials, we may elect to discontinue

or delay clinical trials for certain products to focus our resources on more promising products.

Completion of clinical trials may take

several years, and the length of time varies substantially according to the type, complexity, novelty and intended use of a product candidate.

commencement and completion of clinical trials for our products may be delayed by many factors, including lack of efficacy during clinical

trials, unforeseen safety issues, slower than expected participant recruitment, lack of funding or government delays.

In addition, we

may encounter regulatory delays or rejections as a result of many factors, including results that do not support the intended safety

or efficacy of our product candidates, perceived defects in the design of clinical trials and changes in regulatory policy during the

period of product development.

As a result of these risks and uncertainties, we are unable to accurately estimate the specific timing

and costs of our clinical development programs or the timing of material cash inflows, if any, from our product candidates.

Our business,

financial condition and results of operations may be materially adversely affected by any delays in, or termination of, our clinical

trials or a determination by the FDA that the results of our trials are inadequate to justify regulatory approval, insofar as cash in-flows

from the relevant drug or program would be delayed or would not occur.

current R&D efforts are focused on advancing our lead LNC product candidate, MAT2203.

Our R&D expenses consist of fees paid to

consultants for work related to clinical trial design and regulatory activities, fees paid to providers for conducting various clinical

studies as well as for the analysis of the results of such studies, and for other medical research addressing the potential efficacy

and safety of our drugs.

We believe that significant investment in product development is a competitive necessity, and we are seeking

a partner to assist us in continuing to make these investments to be in a position to realize the potential of our product candidates

and proprietary technologies.

expect that most of our R&D expenses in the near-term, if any, will be incurred in support of MAT2203 and positioning that drug for

a partnership with a well-funded and experienced third party biotech or pharmaceutical company.

of Operations

Ended December 31, 2024 and 2023

following table summarizes our operating expenses for the years ended December 31, 2023 and 2022:

following table summarizes our operating results for the years ended December 31, 2024 and 2023:

Years Ended December 31,

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General and administrative

Impairment charges of goodwill and other intangible assets

Impairment charges of other assets

Operating Expenses

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of contract research revenue resulting from the research collaboration with BioNTech SE and the feasibility study agreement with Genentech

Inc., while the amount earned during 2022 resulted exclusively from the research collaboration with BioNTech SE.

and Development expenses.

R&D expense for the years ended December 31, 2024 and 2023 was $11,433 and $14,489, respectively.

The decrease of $2,189 was due to a decrease of $1,302 of clinical trial expenses and $541 decrease in professional & consulting

fees, primarily related to the pause of our MAT2203 development program, and a $291 decrease due to the license agreement amendment expense

recorded in 2022.

The decrease of $3,056 was due to a decrease of $1,657 of clinical trial expenses, primarily related to the pause of our MAT2203 development

program, $1,215 decrease in total compensation expenses related to the reduction in force, and $184 decrease in facility and travel expenses.

and Administrative expenses.

G&A expense for the years ended December 31, 2024 and 2023 was $8,729 and $10,373, respectively.

The decrease of $727 over the prior year was primarily due to a decrease in certain insurance premiums, and lower consulting fees and

facility expenses related to certain projects that began in the prior year.

The decrease of $1,644 over the prior year was primarily due to a $671 decrease in total compensation expenses related to the reduction

in force, $528 in lower consulting fees, $223 decrease in certain insurance premiums, and $222 decrease in travel and facility expenses.

For the year ended December 31, 2024, we recorded $4,431 of impairment charges, $1,336 of which related to

goodwill, $757 related to IPR&D and $2,338 related to other long-lived assets, primarily due to the terminated partnership negotiations for the future development

and commercialization of MAT2203 and subsequent cost-cutting measures.

We did not record an

impairment loss for the year ended December 31, 2023.

of net operating losses (NOLs) & tax credits.

The Company recognized $484 and $3,491 for the years ended December 31, 2023

and 2022, respectively, in connection with the sale of state net operating losses and state research and development credits to a third

party under the New Jersey Technology Business Tax Certificate Program.

The income recorded in 2023 included sales related to tax year

2022, while income recorded in 2022 included sales related to tax years 2021 and 2020.

The Company recognized $0 and $484 for the years ended December 31, 2024 and

2023, respectively, in connection with the sale of state net operating losses and state research and development credits to a third party

under the New Jersey Technology Business Tax Certificate Program.

and capital resources

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of our equity securities since inception in 2013.

of December 31, 2023, we had cash, cash equivalents and marketable debt securities, excluding restricted cash, totaling $13,756.

of December 31, 2024, we had cash and cash equivalents, excluding restricted cash, totaling

At-The-Market Sales Agreement

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BTIG may terminate the Sales Agreement in certain limited circumstances.

We did not sell any shares

of our common stock under the Sales Agreement during either 2023 or 2022.

At December 31, 2023, the Sales Agreement’s available

capacity was $44,247.

During 2024, we sold 218 thousand

shares of our common stock under the Sales Agreement generating gross proceeds of $56 thousand.

We did not sell any shares under the

Sales Agreement during 2023.

At December 31, 2024, the Sales Agreement’s available capacity was $44,191.

following table sets forth the primary sources and uses of cash for each of the periods set forth below:

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Cash provided by investing activities

Cash (used in) provided by financing activities

Net decrease in cash and cash equivalents and restricted cash

Cash provided by (used in) financing activities

Net increase/(decrease) in cash and cash equivalents and restricted cash

cash used in operating activities for the year ended December 31, 2024 was $15,885, compared to $15,278 in the prior year.

of $3,878 for the period was primarily due to a decrease of $6,456 of working capital adjustments due to the timing of receipts and payments

in the ordinary course of business, partially offset by a $1,945 increase in net loss in the current period, $280 decrease in stock based

compensation expense, and a decrease associated with the license agreement charge of $291 in 2022.

We expect the amount of cash used

in operations during 2024 to be slightly higher as we continue to move our product candidates and LNC Platform forward in their development

of $24,251 and $22,942 for the years ended December 31, 2024 and 2023, respectively, were offset by working capital adjustments due to

the timing of receipts and payments in the ordinary course of business and adjustments for non-cash stock based compensation expense

and impairment charges.

cash provided by investing activities for the year ended December 31, 2024 was $9,208, compared to $13,242 of net cash provided by investing

activities for the year ended December 31, 2023.

The increase of $8,365 provided by investing activities was primarily due to a $7,691

net decrease in the purchases and maturities of marketable debt securities and $674 decrease in purchases of equipment and leasehold

improvements as compared to the prior year.

cash (used in) and provided by financing activities was ($7) and $79 for the years ended December 31, 2023 and 2022, respectively.

decrease of $86 in cash provided by financing activities is primarily due to the decrease in the receipt of proceeds of $99 from the

exercise of stock options in 2022.

The decrease in cash used in investing activities was primarily due to a $8,437 purchase

of marketable securities offset by a $4,185 increase in maturities of marketable debt securities and a $218 decrease in the purchases

of leasehold improvements and equipment.

cash provided by/(used in) and financing activities was $9,174 and ($7) for the years ended December 31, 2024 and 2023, respectively.

The increase in cash provided by financing activities is primarily due to the net proceeds of $9,125 received from the sale of our common

stock under the April 2024 Purchase Agreement and $54 of net proceeds received from the sale of our common stock under the Sales Agreement

with BTIG, LLC.

Requirements and Other Liquidity Matters

expect to continue to incur significant expenses and increasing operating losses for the foreseeable future.

We anticipate that our expenses

will increase substantially if and as we:

further clinical studies of MAT2203, our lead product candidate, even is such studies are primarily financed with non-dilutive funding

to discover and develop additional product candidates;

regulatory approvals for any product candidates that successfully complete clinical trials;

the manufacture of larger quantities of product candidates for clinical development and potentially commercialization;

expand, and protect our intellectual property portfolio;

additional clinical, quality control and scientific personnel;

operational, financial and management information systems and personnel, including personnel to support our product development and

planned future commercialization efforts and personnel and infrastructure necessary to help us comply with our obligations as a public

do not believe that our existing cash, cash equivalents and marketable debt securities will be sufficient to fund our operating expenses and

capital expenditures requirements beyond the next twelve months from the filing date of this Annual Report.

As a result, substantial doubt exists about the Company’s

ability to continue as a going concern.

such time, if ever, that we can generate product revenues sufficient to achieve profitability, we expect to finance our cash needs through

a combination of private and public equity offerings, debt financings, government or other third-party funding, collaborations, and licensing

arrangements.

To the extent that we raise additional capital through the sale of common stock, convertible securities or other equity

securities, the ownership interest of our stockholders may be materially diluted, and the terms of these securities may include liquidation

or other preferences that adversely affect your rights of our common stockholders.

Debt financing and preferred equity financing, if

available, would result in increased fixed payment obligations and may involve agreements that include covenants limiting or restricting

our ability to take specific actions, such as incurring additional debt, making capital expenditures, or declaring dividends, that could

adversely impact our ability to conduct our business.

Securing additional financing could require a substantial amount of time and attention

from our management and may divert a disproportionate amount of their attention away from day-to-day activities, which may adversely

affect our management’s ability to oversee the development of our product candidates.

we raise additional funds through collaborations, strategic alliances or marketing, distribution, or licensing arrangements with third

parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates

or grant licenses on terms that may not be favorable to us.

If we are unable to raise additional funds through equity or debt financings

when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant

rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

do not believe that our existing cash and cash equivalents will be sufficient to fund our operating expenses

and capital expenditures requirements beyond the next twelve months from the filing date of this Annual Report.

As a result, substantial

doubt exists about the Company’s ability to continue as a going concern.

such time, if ever, that we can generate revenues sufficient to achieve profitability, we expect to finance our cash needs through a

combination of private and public equity offerings, debt financings, government or other third-party funding, collaborations, and

licensing arrangements.

To the extent that we raise additional capital through the sale of common stock, convertible securities or

other equity securities, the ownership interest of our stockholders may be materially diluted, and the terms of these securities may

include liquidation or other preferences that adversely affect your rights of our common stockholders.

Debt financing and preferred

equity financing, if available, would result in increased fixed payment obligations and may involve agreements that include

covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital

expenditures, or declaring dividends, that could adversely impact our ability to conduct our business.

Securing additional financing

could require a substantial amount of time and attention from our management and may divert a disproportionate amount of their

attention away from day-to-day activities, which may adversely affect our management’s ability to secure one or more partners

to monetize the value of MAT2203 or future product candidates.

Moreover, under the terms of a recent financing, we are prohibited,

subject to certain exceptions, from issuing, entering into any agreement to issue, or announcing the issuance or proposed issuance

of any shares of common stock or common stock equivalents until November 2025.

we raise additional funds through collaborations, strategic alliances or marketing, distribution, or licensing arrangements with

third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product

candidates or grant licenses on terms that may not be favorable to us.

financial condition and results of operations may also be impacted by other factors we may not be able to control, such as global supply

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Additionally, rising inflation rates may affect us by increasing operating expenses, such as employee-related costs and

clinical trial expenses, negatively impacting our results of operations.

other expenses, negatively impacting our future results of operations.

Obligations and Commitments

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

What changed 10-K

Item 7. Management’s Discussion and Analysis