What changed in this filing

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Item 1A. Risk Factors

2022-08-02 compared with 2022-05-02 · 25 added, 29 removed, 710 unchanged (7% of the section changed)

29 unchanged sentences

There is no guarantee that even if we do engage in a strategic transaction that such strategic transaction will increase stockholder value.

In April 2022, the Board of Directors established a Special Committee to evaluate strategic options, including transactions involving the merger or sale of all or part of our assets, and other alternatives with the goal of maximizing stockholder value .

In April 2022, the Board of Directors established a Special Committee and, in May, retained Ladenburg Thalmann & Co.

to evaluate strategic options, including transactions involving the merger or sale of all or part of our assets, and other alternatives with the goal of maximizing stockholder value .

We do not have a defined timeline for the strategic review process and the review may not result in any specific action or transaction.

9 unchanged sentences

Failure to successfully provide for the commercialization of rNAPc2, Gencaro or any other product candidate, if approved, would damage our business.

If we encounter difficulties enrolling patients in our clinical trial of rNAPc2, any potential enrollment milestones or potential regulatory approvals could be delayed or otherwise adversely affected.

We may encounter difficulty enrolling a sufficient number of patients in the trial, due to circumstances which are outside our control, including improvements in the COVID-19 pandemic resulting from the development of vaccines and therapies, as well as other clinical trials or capacity constraints at potential COVID-19 clinical trial sites, that may limit the availability of study participants.

If we encounter difficulties enrolling patients in our clinical trials, any potential enrollment milestones or potential regulatory approvals could be delayed or otherwise adversely affected.

We may encounter difficulty enrolling a sufficient number of patients in our clinical trials, due to circumstances which are outside our control, including other clinical trials that may limit the availability of study participants.

As a result, we may need to delay or terminate our trial, which would have a negative impact on our business.

Delays in enrolling patients in the clinical trial of rNAPc2 would also adversely affect our ability to meet projected enrollment milestones or timelines for completing the study and obtaining regulatory approval.

Delays in enrolling patients in the clinical trial would also adversely affect our ability to meet projected enrollment milestones or timelines for completing the study and obtaining regulatory approval.

Development of other COVID-19 targeted therapies may mean there are no patients who need rNAPc2 as a therapy.

rNAPc2 may not yield results that will enable us to further develop it as a therapy and obtain regulatory approvals necessary to be used as a drug.

Our clinical trials from our product candidates may not yield results that will enable us to further develop our products as a therapy and obtain regulatory approvals necessary to be used as a drug.

We will receive regulatory approval for our product candidates only if we can demonstrate, in carefully designed and conducted clinical trials, that the product candidate is safe and effective.

We do not know whether any future clinical trials for rNAPc2, Gencaro or any other product candidate will demonstrate sufficient safety and efficacy to obtain the requisite regulatory approvals or will result

in marketable products.

rNAPc2 has never been tested for safety or efficacy in any pre-clinical COVID-19 models or any patients diagnosed with COVID-19.

It may not be effective for any COVID-19 associated diseases.

The results from preclinical testing and early clinical trials may not be predictive of results from later studies, including our studies of rNAPc2 .

rNAPc2 has never been tested for safety or efficacy in any pre-clinical COVID-19 models.

It may not be

effective for any COVID-19 associated diseases.

The results from preclinical testing and early clinical trials may not be predictive of results from later studies.

We may suffer significant setbacks in advanced clinical trials, even after seeing promising results in earlier studies.

Based on results at any stage of clinical trials, we may decide to repeat or redesign a trial or discontinue development of one or more of our product candidates, including rNAPc2 .

If we fail to adequately demonstrate the safety and efficacy of our rNAPc2, or other product candidates, we will not be able to obtain the required regulatory approvals to commercialize it and our business, results of operations and financial condition would be materially adversely affected.

In addition, administering rNAPc2, or other product candidates, to humans may produce undesirable side effects.

These side effects could interrupt, delay or halt clinical trials of rNAPc2, or other product candidates, and could result in the FDA or other regulatory authorities denying approval of rNAPc2, or other product candidates , for any or all targeted indications.

Based on results at any stage of clinical trials, we may decide to repeat or redesign a trial or discontinue development of one or more of our product candidates.

If we fail to adequately demonstrate the safety and efficacy of our product candidates, we will not be able to obtain the required regulatory approvals to commercialize it and our business, results of operations and financial condition would be materially adversely affected.

In addition, administering our product candidates to humans may produce undesirable side effects.

These side effects could interrupt, delay or halt clinical trials of our product candidates, and could result in the FDA or other regulatory authorities denying approval of our product candidates , for any or all targeted indications.

We may not achieve our projected development goals in the time frames we announce and expect.

We set goals for, and make public statements regarding, the timing of certain accomplishments, such as the initiation of our clinical trials, including rNAPc2 , the duration of the planned rNAPc2 Phase 2b clinical trial, the steps for commencing and continuing our clinical trials, the disclosure of trial results, the obtainment of regulatory approval and the sale of drug products, which we sometimes refer to as milestones.

We set goals for, and make public statements regarding, the timing of certain accomplishments, such as the initiation of our clinical trials, the steps for commencing and continuing our clinical trials, the disclosure of trial results, the obtainment of regulatory approval and the sale of drug products, which we sometimes refer to as milestones.

These milestones may not be achieved, and the actual timing of these events can vary dramatically due to a number of factors such as delays or failures in our clinical trials, disagreements with any collaborative partners, the uncertainties inherent in the regulatory approval process and manufacturing scale-up, delays in achieving manufacturing or marketing arrangements sufficient to commercialize our products or our inability to obtain sufficient financing in a timely manner.

2 unchanged sentences

We expect the PRECISION-AF clinical trial will require substantially more capital to complete, and we cannot guarantee when or if we will be able to secure such additional financing.

We have put the potential initiation of the PRECISION-AF trial on hold due to the ongoing COVID-19 pandemic and prioritizing the development of rNAPc2.

Initiation of the PRECISION-AF clinical trial will depend on receiving additional funding and an abatement of the COVID-19 pandemic to the point of being able to recruit patients for a cardiovascular clinical trial.

7 unchanged sentences

Even if we are able to fund continued development of rNAPc2, Gencaro or any of our other product candidates is approved, we expect that we will need to complete a strategic transaction or raise substantial additional funding through public or private equity or debt securities to successfully commercialize rNAPc2, Gencaro or any other product candidate.

We believe our cash and cash equivalents as of March 31, 2022 will be sufficient to fund our operations at the current levels through at least the middle of fiscal year 202 3 .

We believe our cash and cash equivalents as of June 30 , 2022 will be sufficient to fund our operations at the current levels through at least the end of fiscal year 202 3 .

Our review of our strategic options may impact this projection .

5 unchanged sentences

333-254585) .

As of April 29, 2022, the amount available for the offering under the prospectus supplement is subject to the limitation of not selling a total value amount of shares exceeding more than on e-third of our public float in any 12-month period, which as of April 29, 2022 would have been approximately $10.1 million .

As of August 1 , 2022, the amount available for the offering under the prospectus supplement is subject to the limitation of not selling a total value amount of shares exceeding more than one-third of our public float in any 12-month period, which as of August 1 , 2022 would have been approximately $ 9.9 million .

Sales of our common stock dilute the ownership interest of our stockholders and may cause the price per share of our common stock to decrease.

51 unchanged sentences

In future periods, if we do not meet the minimum stockholders’ equity, minimum closing bid price requirements, or any other listing requirements, we would be subject to delisting from the Nasdaq Capital Market.

As of April 29, 2022, the closing price of our common stock was $2.37 per share, and the total market value of our listed securities was approximately $34.2 million.

As of March 31, 2022, we had stockholders’ equity of $47.9 million.

Our financial statements for the quarter ended March 31, 2022 were prepared assuming that we will continue as a going concern.

As of August 1, 2022, the closing price of our common stock was $2.39 per share, and the total market value of our listed securities was approximately $34.4 million.

As of June 30, 2022, we had stockholders’ equity of $45.0 million.

Our financial statements for the quarter ended June 30, 2022 were prepared assuming that we will continue as a going concern.

Our management has concluded that due to our need for additional capital, and the uncertainties surrounding our ability to raise such funding, there may be uncertainty about our ability to continue as a going concern in future years.

Our financial statements for the quarter ended March 31, 2022 were prepared assuming that we will continue as a going concern.

Our financial statements for the quarter ended June 30, 2022 were prepared assuming that we will continue as a going concern.

The going concern basis of presentation assumes that we will continue in operation for the foreseeable future and will be able to realize our assets and discharge our liabilities and commitments in the normal course of business and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from our inability to continue as a going concern.

As of December 31, 2019, our management and our independent registered public accounting firm concluded that, due to our need for additional capital and the uncertainties surrounding our ability to raise such funding, substantial doubt existed as to our ability to continue as a going concern for a period from one year after our annual financial statements had been issued.

We believe our cash and cash equivalents as of March 31, 2022 will be sufficient to fund our operations at the current levels through at least the middle of fiscal year 2023.

We believe our cash and cash equivalents as of June 30, 2022 will be sufficient to fund our operations at the current levels through at least the end of fiscal year 2023.

Our review of our strategic options may impact this projection .

543 unchanged sentences

Sales in the public market of substantial amounts of our common stock could depress prevailing market prices of our common stock.

As of March 31, 2022, approximately 14.4 million shares of common stock were outstanding, and all of these shares are freely transferable without restriction or further registration under the Securities Act of 1933, as amended, or the Securities Act, except for shares held by our directors, officers and other affiliates and unregistered shares held by non-affiliates.

As of June 30, 2022, approximately 14.4 million shares of common stock were outstanding, and all of these shares are freely transferable without restriction or further registration under the Securities Act of 1933, as amended, or the Securities Act, except for shares held by our directors, officers and other affiliates and unregistered shares held by non-affiliates.

The sale of these additional shares, or the perception that such sales may occur, could depress the market price of our common stock.

As of March 31, 2022 , approximately 133,000 shares of our common stock were issuable upon the exercise of outstanding warrants.

Once a warrant is exercised, if the shares of our common stock issued upon the exercise of any such warrant are not available for sale in the open market without further registration under the Securities Act, then the holder can arrange for the resale of shares either by invoking any applicable registration rights, causing the shares to be registered under the Securities Act and thus freely transferable, or by relying on an exemption to the Securities Act.

For instance, in July 2015, we filed a registration statement on Form S-3 which registered for resale an aggregate of 0.1 million shares of our common stock issuable upon exercise of outstanding warrants.

If these registration rights, or similar registration rights that may apply to securities we may issue in the future, are exercised, it could result in additional sales of our common stock in the market, which may have an adverse effect on our stock price.

As of March 31, 2022, there were approximately 869,000 shares of our common stock which may be issued upon the exercise of outstanding stock options, and we anticipate that we will continue to issue stock option awards to our employees and consultants in the fiscal year ended December 31, 2022 and thereafter.

As of June 30 , 202 2 , there were approximately 8 81 ,000 shares of our common stock which may be issued upon the exercise of outstanding stock options, and we anticipate that we will continue to issue stock option awards to our employees and consultants in the fiscal year ended December 31, 202 2 and thereafter.

If and when these options are exercised, such shares will be available for sale in the open market without further registration under the Securities Act.

41 unchanged sentences

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