What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2023-03-22 compared with 2022-03-22 · 362 added, 461 removed, 311 unchanged (73% of the section changed)

Phio Pharmaceuticals Corp.

“ we ,” “ our ” or the “ Company ”) is seeking to address the biggest challenges in

immuno-oncology by creating new pathways to a cancer-free future for patients.

We are developing therapeutics that leverage our INTASYL™

technology to target both tumor and immune cells by regulating genes to strengthen a patient’s immune system while weakening tumor

defense mechanisms.

With our INTASYL self-delivering RNAi technology, we aim to bring the benefits of RNA therapeutics into cancer care

where other modalities may fall short.

Our Development Pipeline

are developing a pipeline of immuno-oncology therapies using our INTASYL technology that has the ability to attack cancers in multiple

Our INTASYL-based therapeutics are used to:

(1) strengthen immune cells, for example those administered as part of adoptive cell

therapy (“ ACT ”), and (2) directly modify cells in the tumor microenvironment (the “ TME ”) to weaken

a tumor’s defense.

These two strategies allow for multiple therapeutic applications of our INTASYL products.

contrast to other RNA technologies and platforms, the self-delivering nature of our INTASYL platform makes it ideally suited for use with

ACT treatments, as well as for direct therapeutic use.

By using INTASYL technology during the manufacturing of ACT cell products we can

improve the phenotype and function of these cells, potentially leading to better therapeutic outcomes.

Multiple inhibitory mechanisms

restrain immune cells from effectively eradicating tumors, including immune checkpoints, reduced cell fitness and cell persistence.

the immunosuppressive TME can pose a formidable barrier to immune cell infiltration and function.

By using INTASYL based drugs administered

directly, we can also reprogram cells in the TME to help overcome these immunosuppressive mechanisms.

INTASYL Use To Improve Adoptive Cell Therapy Products

ACT consists of the administration of immune cells

with antitumor properties to patients to fight cancer after growing the cells in a lab to large numbers.

These cells can be derived from

unmodified (i.e.

naturally occurring) immune cells, immune cells isolated from resected tumors or genetically engineered immune cells

that recognize tumor cells.

These cells have several shortcomings that inhibit their full therapeutic potential in patients with solid

There are several types of ACT, including:

non-engineered cell therapy in which immune cells are grown from the patient’s tumor or blood, such as tumor infiltrating lymphocytes

(“ TILs ”), or from donor blood or tissue such as natural killer (“ NK ”) cells, dendritic cells (“ DC ”)

and macrophages, and b.) genetically engineered immune cells that are genetically modified to recognize specific tumor proteins and to

remain in an activated state (such as T cell receptor technology (“ TCRs ”), chimeric antigen receptor (“ CAR ”)

T cells, or CAR-NK cells).

inhibitory mechanisms restrain immune cells used in ACT from effectively eradicating tumors, including immune checkpoints, reduced cell

fitness and cell persistence, and other barriers to immune cell infiltration and function mainly in solid tumors.

When used in ACT, we

believe our INTASYL compounds can improve immune cell function, differentiation and metabolism, in order to make these immune cells more

effective without the need for additional complicated manufacturing steps and/or genetic engineering.

approach builds on well-established methodologies of ACT and involves the treatment of immune cells with our INTASYL compounds ex

vivo while they are grown in the lab and before administering them to the patient.

In contrast to other RNA technologies, our

INTASYL compounds do not require a delivery vehicle to penetrate into the cells, therefore we are able to enhance the function of these

cells by merely adding our INTASYL compounds during the expansion process and without the need for genetic engineering, complex delivery

vehicles or formulations, or additional complex manufacturing steps, which in themselves may be detrimental to the cells.

By adding INTASYL

to the cell culture media used during the cell expansion, we can reduce or eliminate the expression of genes that make the immune cells

less effective.

For example, with our INTASYL compounds, we can reduce the expression of immunosuppressive proteins by the therapeutic

immune cells, potentially enabling them to overcome tumor resistance mechanisms and thus improving their ability to destroy the tumor

In various types of immune cells tested to date, INTASYL treatment results in potent silencing with close to 100% transfection

efficiency and while maintaining cell viability and cell growth rate.

After expanding these cells and enhancing them with INTASYL ex

vivo , they are returned to the patient for treatment.

table below sets forth the Company’s pipeline for its INTASYL product candidates for use in ACT:

Our lead product

candidate, and our most advanced program being developed by the Company in ACT, is PH-762.

PH-762 is an INTASYL compound that activates

immune cells to better recognize and kill cancer cells by reducing the expression of the checkpoint protein PD-1, a clinically validated

target for immunotherapy.

Checkpoint proteins, such as PD-1, normally act as a type of “off switch” that prevent T cells,

immune cells that protect the body from cancer cells and infections, from attacking certain cells in the body, such as cancer cells.

expression of PD-1 enables the cancer cell to evade the T cell.

Reducing the expression of PD-1 can thereby reduce the ability of cancer

cells to avoid T cell detection.

Data has shown that PH-762 silences PD-1 checkpoint

expression in T cells, thereby removing the “off switch” and enabling T cells to overcome tumor resistance mechanisms, and

thus improving their ability to destroy tumor cells.

Preclinical studies show that PH-762 can silence the expression of PD-1 in target

human T cells in a potent and durable manner and can increase their tumor cell-killing ability.

Patient derived T cells treated with PH-762,

in comparison to untreated T cells, were shown to have increased tumor killing potency against tumor cells of the same patient.

we believe that PH-762 in ACT is well-positioned to enhance therapeutic responses in cancer.

In March 2021, the Company announced that it entered

into a clinical development collaboration with AgonOx, Inc.

(“ AgonOx ”), a private company developing a pipeline of

novel immunotherapy drugs targeting key regulators of the immune response to cancer, in which the companies will collaborate on the development

of novel T cell-based therapies using PH-762 and AgonOx’s “double positive” TIL (“ DP TIL ”) technology.

Per the terms of the clinical development agreement, AgonOx will receive financial support from Phio to conduct a clinical trial in ACT

with their DP TIL technology and PH-762, and Phio will be entitled to certain future development milestones and sales-based royalty payments

from AgonOx’s DP TIL technology.

AgonOx has demonstrated that their DP TIL enriched cell populations have increased tumor killing

activity when compared to TILs that were not enriched prior to expansion.

Preclinical data from our research collaboration with AgonOx

has shown that treating DP TILs with PH-762 increases the tumor killing activity of the DP TILs even further (a two-fold increase).

a result, we expect the use of PH-762 treated DP TILs to enhance therapeutic responses in cancer.

Based on these data, our clinical development

collaboration will focus on conducting a clinical study for PH-762 treated DP TILs.

The Company expects to start the clinical trial evaluating

the use of PH-762 and DP TILs in ACT in the second quarter of 2022.

in ACT is not limited to TILs, but can also be used on other forms of T cell-based cell therapy.

We recently presented in

vivo data showing that PH-762 significantly enhanced the antitumor efficacy of HER2-targeted

CAR-T cells (“ HER2CART ”) in solid tumors.

Compared to untreated HER2CART

cells, HER2CART cells treated with PH-762 showed a statistically significant and durable inhibition of tumor growth.

Analysis of the PH-762

treated HER2CART cells isolated from the tumors suggest that PH-762 enhances CAR-T function through multiple mechanisms including enhanced

“ we ,” “ our ” or the “ Company ”) is a clinical stage biotechnology company whose

proprietary INTASYL™ self-delivering RNAi technology platform is designed to make immune cells more effective in killing tumor

We are developing therapeutics that are designed to leverage INTASYL to precisely target specific proteins that reduce the body’s

ability to fight cancer, without the need for specialized formulations or drug delivery systems.

We are committed to discovering and

developing innovative cancer treatments for patients by creating new pathways toward a cancer-free future.

INTASYL Platform

Overall, RNA is involved in the synthesis, regulation

and expression of proteins.

RNA takes the instructions from DNA and turns those instructions into proteins within the body’s cells.

RNA interference, or RNAi, is a biological process that inhibits the expression of genes or the production of proteins.

Diseases are often

related to the incorrect protein being made, excessive amounts of a specific protein being made, or the correct protein being made, but

at the wrong location or time.

RNAi offers a novel approach to drug development because RNAi compounds can be designed to silence any

one of the thousands of human genes, many of which are considered “undruggable” by traditional therapeutics.

Our development efforts are based on our proprietary

INTASYL self-delivering RNAi technology platform.

It is a patented platform from which specific patented compounds are developed.

compounds are comprised of a unique sequence of chemically modified nucleotides (modified small interfering RNA, or siRNAs) that target

a broad range of cell types and tissues.

The compounds are designed to effectively silence genes that tumors use to evade the immune system.

Since the initial discovery of RNAi, drug delivery

has been the primary challenge in developing RNAi-based therapeutics.

Other siRNA technologies require cell targeting chemical conjugates

which limit delivery to specific cell types.

INTASYL is based on proprietary chemistry that is designed to maximize the activity and adaptability

of the compound and is unique in that it can be delivered to any cell type or tissue without the need to modify the chemistry.

designed to eliminate the need for formulations or delivery systems (for example, nanoparticles or electroporation).

This provides efficient,

spontaneous, cellular uptake with potent, long-lasting intracellular activity.

believe that our INTASYL platform provides the following benefits including, but not limited to:

Ability to target a broad range of cell types and tissues;

Ability to target both intracellular and extracellular protein targets;

Efficient uptake by target cells, avoiding the need for assisted delivery;

Sustained, or long-term, effect in vivo ;

Ability to target multiple genes in one drug product;

Favorable clinical safety profile with local administration;

Readily manufactured under current good manufacturing practices.

INTASYL compounds are

designed to precisely target specific proteins that reduce the body’s ability to fight cancer, without the need for specialized

formulations or drug delivery systems, and are designed to make immune cells more effective in killing tumor cells.

Our efforts are focused

on developing immuno-oncology therapeutics using our INTASYL platform.

We have demonstrated preclinical activity against multiple gene

targets including PD-1, BRD4, CTLA-4, TIGIT and CTGF and have demonstrated preclinical efficacy in both direct-to-tumor injection and

adoptive cell therapy (“ ACT ”) applications with our INTASYL compounds.

The following table summarizes

our product pipeline.

Below we provide important information and context regarding each compound.

PH-762 is an INTASYL compound designed to reduce

the expression of cell death protein 1 (“ PD-1 ”).

PD-1 is a protein that inhibits T cells’ ability to kill cancer

cells and is a clinically validated target in immunotherapy.

Decreasing the expression of PD-1 can thereby increase the capacity of T

cells, which protect the body from cancer cells and infections, to kill cancer cells.

Preclinical studies conducted by the Company have

demonstrated that direct-to-tumor application of PH-762 resulted in potent anti-tumoral effects and have shown that direct-to-tumor treatment

with PH-762 inhibits tumor growth in a dose dependent fashion in PD-1 responsive and refractory models.

Importantly, direct-to-tumor administration

of PH-762 resulted in activity against distant untreated tumors, indicative of a systemic anti-tumor response.

We believe these data further

support the potential for PH-762 to provide a strong local immune response without the dose immune-related adverse effects seen with systemic

antibody therapy.

PH-762 is currently being

evaluated in a Phase 1b dose escalation clinical trial in France that is expected to enroll up to 21 subjects with advanced melanoma.

PH-762 will be administered as a neoadjuvant monotherapy intratumorally once a week, for a total of four injections, across five escalating

Dosing will be followed by tumoral excision after an additional two weeks.

The primary study objectives are to evaluate the

safety and tolerability, and pharmacokinetics of PH-762;

to determine the potential immunologic and pathologic tumor responses;

determine the recommended dose for later clinical trials.

Safety data from the initial cohort of three subjects in the clinical trial

was evaluated by a Data Monitoring Committee in the first quarter of 2023.

The safety data review disclosed no dose-limiting toxicity,

and no drug-related severe or serious adverse events, and the Data Monitoring Committee recommended proceeding to the enrollment of the

subsequent dose cohort.

The next cohort is now open for enrollment of subjects.

In addition to the French

clinical trial, we expect to commence a U.S.

Phase 1b clinical trial with PH-762 in the second half of 2023.

trial is expected

to focus on the application of PH-762 to treat cutaneous squamous cell carcinoma (“ cSCC ”) and other selected cutaneous

malignancies.

Due to INTASYL’s ease

of administration, we have shown that our compounds can easily be incorporated into current ACT manufacturing processes.

In ACT, T cells

are usually taken from a patient's own blood or tumor tissue, grown in large numbers in a laboratory, and then given back to the patient

to help the immune system fight cancer.

By treating T cells with our INTASYL compounds while they are being grown in the laboratory, we

believe our INTASYL compounds can improve these immune cells to make them more effective in killing cancer.

Preclinical data generated

in collaboration with AgonOx, Inc.

(“ AgonOx ”), a private company developing a pipeline of novel immunotherapy drugs

targeting key regulators of the immune response to cancer, demonstrated that treating AgonOx’s “double positive” tumor

infiltrating lymphocyte (“ DP TIL ”) with PH-762 increased by two-fold their tumor killing activity.

In March 2021, we entered

into a clinical co-development collaboration agreement (the “ Clinical Co-Development Agreement ”) with AgonOx to conduct

a Phase 1 clinical trial using DP TIL and PH-762.

Under the Clinical Co-Development Agreement, we paid AgonOx $0.3 million as an upfront

payment in December 2022 and have agreed to provide up to $4 million in total financial support to AgonOx to conduct a Phase 1 clinical

trial of PH-762 treated DP TIL.

Phio is also eligible to receive certain future development milestones and low single-digit sales-based

royalty payments from AgonOx’s licensing of its DP TIL technology.

PH-762 treated DP TILs are

expected to be evaluated in a Phase 1 clinical trial in the United States with up to 18 subjects with advanced melanoma and other advanced

solid tumors.

The primary study objectives are to evaluate the safety and to study the potential for enhanced therapeutic benefit from

the administration of PH-762 treated DP TILs.

Enrollment of subjects is expected to commence in the second quarter of 2023.

PH-762’s use in ACT

is not limited to TILs.

We have presented preclinical data showing that PH-762 significantly enhanced the antitumor efficacy of HER2-targeted

chimeric antigen receptor (“ CAR ”) T cells (“ HER2CART ”) in solid tumors.

Analysis of the PH-762 treated

HER2CART cells isolated from the tumors suggest that PH-762 enhances CAR-T cell function through multiple mechanisms including enhanced

efficiency, degranulation and promotion of memory/stem populations.

We believe that this data provides proof of concept for the application

of PD-1 checkpoint silencing with INTASYL in CAR-T cells prior to ACT to enhance the therapeutic efficacy of CAR-T cell therapy in solid

Our second product candidate in development for

use in ACT is PH-894.

PH-894 is an INTASYL compound that silences the epigenetic protein BRD4, which is an intracellular regulator of

gene expression that impacts cell differentiation, and hence, cell function.

Like other epigenetic targets, BRD4 is a protein that has

been shown to be difficult to target with current drug modalities.

Since BRD4 is an intracellular protein, antibody therapies cannot be

used and small molecule inhibitors tested to date typically lack the required specificity.

As our INTASYL compounds can target intracellular

proteins as well as extracellular proteins with a high level of specificity, we believe that PH-894 has significant potential.

In collaboration

with the Karolinska Institutet in Sweden, PH-894 has been shown to improve T cell function and persistence by differentiating T cells

into a more active state (stem-cell like memory phenotype).

We have demonstrated that the application of PH-894 is shown to silence BRD4

in human T cells during expansion for ACT, which has the potential to confer superior anti-tumor activity.

Our INTASYL compound PH-804 is also being developed

for use in ACT.

PH-804 targets the suppressive immune receptor TIGIT, which is a checkpoint protein present on immune cells, such as T

cells and NK cells.

Similar to PD-1, cancer cells can suppress the activity of these immune cells by activating TIGIT.

This triggers an

“off switch,” resulting in tumor immune evasion, which can be prevented by blocking or silencing TIGIT.

PH-804 provides powerful

dose-dependent silencing of TIGIT that can be seen in both T cells and NK cells and we have shown that PH-804 can silence the expression

of TIGIT in these cells, overcoming their “off switch” and thereby becoming “weaponized” to kill cancer cells.

Direct Therapeutic Use of INTASYL Towards the Tumor Microenvironment

have evolved natural defenses that can suppress the immune system surrounding the tumor, in an area called the tumor microenvironment,

which decreases the effectiveness of many traditional immunotherapies.

Reprogramming different cell types in the TME, such as cancer cells

and immune cells, may overcome these natural tumor defenses and decrease resistance to immunotherapy.

An optimal treatment therapy should

have the ability to address targets both inside and on the surface of tumor and immune cells, creating multiple ways to prevent tumors

from evading immune detection.

Our INTASYL compounds can target both intracellular and extracellular targets, and are also being developed

for use as direct therapeutics to reprogram the TME, for example, by in situ transfection and activation of immune cells

Therefore, INTASYL-based drug therapy is a novel way of fighting cancer by reprogramming the cells in the TME to make cancer

more responsive to a patient’s immune system and to other anti-cancer drugs.

table below sets forth the Company’s pipeline for its direct-to-tumor INTASYL product candidates:

Our most advanced program

being developed by the Company in our direct to tumor therapy programs, is PH-762.

We have shown that we can reprogram the TME with PH-762

and achieve local activation of immune cells.

Preclinical studies conducted by the Company showed that local administration of PH-762

through intratumoral injection resulted in potent anti-tumoral effects.

Treated animals showed a complete and statistically significant

inhibition of tumor growth, whereas placebo treated animals displayed exponential tumor growth.

Recently announced in vivo data

showed that intratumoral treatment with PH-762 inhibits tumor growth in a dose dependent fashion in PD-1 responsive and refractory models.

Furthermore, on target efficacy was supported by modulation of immune cell populations toward anti-tumor phenotypes.

Importantly, local

administration of PH-762 resulted in activity against distal untreated tumors, indicative of a systemic anti-tumor response.

believes this data further supports the potential for PH-762 to provide a strong local immune checkpoint blockade without the dose immune-related

adverse effects seen with systemic antibody therapy.

In January 2022, the Company was granted

clinical trial authorization (CTA) by the French National Agency for the Safety of Medicines and Health

Products to proceed with our first-in-human clinical trial for PH-762 to treat patients with melanoma at the Gustave

Roussy Institute, one of the largest cancer centers in Europe.

This first clinical trial with PH-762 will be a Phase 1b study

to evaluate the safety, tolerability, pharmacokinetics and anti-tumor activity of PH-762 in a neoadjuvant setting in subjects with

advanced melanoma.

Currently, there are no neoadjuvant treatment options approved for these patients.

The clinical study will

feature a dose escalation of PH-762 monotherapy and is designed to allow for a data driven evaluation of the recommended Phase 2

The Company expects to start patient enrollment in the first quarter of 2022.

Our second direct to tumor product candidate

In a study conducted in collaboration with the Karolinska Institutet, we demonstrated that PH-894 resulted in a strong,

concentration dependent and durable silencing of BRD4 in T cells, and in various cancer cells.

Data published with PH-894 in a

hepatocellular carcinoma model showed potent and statistically significant anti-tumoral effects when administered locally.

data show that our PH-894 compound can reprogram T cells and other cells in the TME to provide enhanced immunotherapeutic activity.

Recent in vivo data showed that local administration of PH-894 also resulted in a systemic anti-tumor response, similar to

PH-894 shows the power of our INTASYL compounds to modulate the expression of intracellular and/or commonly considered

“undruggable” targets, a limitation for small molecule and antibody therapies.

The Company currently expects to finalize

investigational new drug (“IND”)-enabling studies for PH-894 in the second half of

PH-894 is an INTASYL compound that is designed

to silence BRD4, a protein that controls gene expression in both T cells and tumor cells, thereby effecting the immune system as well

as the tumor.

Intracellular and/or commonly considered “undruggable” targets, such as BRD4, represent a challenge for small

molecule and antibody therapies.

Therefore, what sets this compound apart is its dual mechanism:

PH-894 suppression of BRD4 in T cells

results in T cell activation, and suppression of BRD4 in tumor cells results in tumors becoming more sensitive to being killed by T cells.

Preclinical studies conducted have demonstrated that

PH-894 resulted in a strong, concentration dependent and durable silencing of BRD4 in T cells and in various cancer cells.

PH-762, preclinical studies have also shown that direct-to-tumor application of PH-894 resulted in potent and statistically significant

anti-tumoral effects and demonstrated a systemic anti-tumor response.

These preclinical data indicate that PH-894 can reprogram T cells

and other cells in the tumor microenvironment to provide enhanced immunotherapeutic activity.

The Company has completed the investigational

new drug (“ IND ”)-enabling studies and is in the process of finalizing the study reports required for an IND submission

As a result of the reprioritization to advance the Company’s clinical trial with PH-762 in the U.S., the Company has

elected to defer the IND submission for PH-894.

Phio has also demonstrated in preclinical studies

that PH-894 has been shown to improve T cell function and persistence by differentiating T cells into a more active state (stem-cell like

memory phenotype).

Preclinical data indicates that silencing BRD4 with PH-894 may be used to improve the characteristics of CAR-T cell

products during the cell manufacturing process.

These data demonstrate that PH-894 could enhance the activity of CAR-T cells by improving

the quality of the final CAR-T cell product by overcoming immunosuppression, reversing exhaustion, and preserving the characteristics

associated with cell persistence.

Other Compounds in Discovery

PH-804 is an INTASYL compound that is designed to target

TIGIT, a protein that inhibits the activity of Natural Killer (“ NK ”) cells.

Preclinical studies conducted have demonstrated

that NK cells treated with PH-804 displayed increased activation and enhanced the ability of NK cells to kill cancer cells.

PH-109 is an INTASYL compound that is designed to suppress

the connective tissue growth factor (“ CTGF ”) protein, a protein that regulates a number of cellular functions and is

associated with poor prognosis in breast cancer.

In a preclinical study, mice were treated with either the drug doxorubicin, a chemotherapeutic

which has a high toxicity profile, or with PH-109.

In this study, PH-109 reduced tumor growth and reduced metastatic lung lesions, with

no evidence of toxicity as compared to the toxicity profile of doxorubicin.

Phio has developed an INTASYL compound that is designed

to target CTLA-4, a protein that inhibits the ability of T cells to kill tumor cells.

The CTLA-4 targeting INTASYL compound demonstrated

dose-associated anti-tumor efficacy in two preclinical tumor models.

Delivering CTLA-4 by intratumoral injection may avoid or minimize

the severe systemic adverse events associated with current CTLA-4 therapeutics.

We are also investigating the use of INTASYL to

target multiple genes in a single formulation.

New study data showed that PH-3861, a dual-targeting INTASYL towards PD-1 and BRD4, elicited

complete cure of tumors in an in vivo hepatoma model and outperformed the efficacy of the small molecule and antibody

control treatments toward the same targets.

In addition, local INTASYL therapy was shown to induce a systemic anti-tumor response with

clearance of untreated distal tumors.

The animals which showed complete cure of their tumors were then rechallenged over two months after

the original treatment of PH-3861 by re-implanting hepatoma cancer cells at a different location to the original tumor.

All of the mice

that were rechallenged with new tumors were cured again without requiring further treatment, while tumors grew steadily in the control

group as expected.

We believe that these data demonstrate that local administration of PH-3861 provides a durable and systemic anti-tumor

immune response that can combat tumor growth.

Our INTASYL Platform

Our development efforts are based on our broadly

patented INTASYL technology platform.

Our INTASYL compounds do not require a delivery vehicle to penetrate into tissues and cells and

are designed to “silence” or down-regulate the expression of a specific gene which is over-expressed in cancer.

Diseases are often related to the wrong protein

being made, excessive amounts of a specific protein being made, or the correct protein being made but at the wrong location or time.

RNA is involved in the synthesis, regulation and expression of proteins.

RNA interference (“ RNAi ’) is a biological

process in which specific RNA molecules inhibit gene expression or translation into proteins.

RNAi offers a novel approach to drug development

because RNAi compounds can be designed to silence any one of the thousands of human genes, many of which are “undruggable”

by other modalities.

The potential of RNAi as a powerful drug development platform has been shown by several RNAi based drugs becoming

approved over the last few years.

The first design of RNAi compounds to be pursued

for the development of human therapeutics were short, double-stranded RNAs that included limited modifications, known as small-interfering

RNA (“ siRNA ”).

Since the initial discovery of RNAi, drug delivery has been the primary challenge in developing RNAi-based

therapeutics.

One solution to the delivery problem involves encapsulation of siRNA into lipid-based formulations, such as liposomes, to

improve cellular uptake.

Another approach is to use chemical conjugations of a ligand, such as GalNAC, for cell specific delivery limited

to hepatocytes.

We have developed an alternative approach where delivery and drug-like properties are built directly into the RNAi compound

itself, whereby the RNAi uptake is neither dependent on complex formulation nor limited to addressing a specific cell type.

compounds are termed self-delivering RNAi compounds, or INTASYL.

Our INTASYL compounds are hybrid oligonucleotide

compounds that the Company believes combines the beneficial properties of both conventional RNAi and antisense technologies.

In an attempt

to combine the best properties of both technologies, INTASYL compounds have a single-stranded phosphorothioate region, a short duplex

region, and contain a variety of nuclease-stabilizing and lipophilic chemical modifications.

The combination of these features allows

INTASYL compounds to achieve efficient spontaneous cellular uptake and potent, long-lasting intracellular activity.

The key to therapeutic success with RNAi lies in

delivering intact RNAi compounds to the target tissue and the interior of the target cells.

To accomplish this, our chemically synthesized

INTASYL compounds are optimized for stability and efficacy and have unique properties that improve tissue and cell uptake.

believe that our INTASYL platform uniquely positions the Company in the field of immuno-oncology for the following reasons:

· Targets multiple genes (i.e.

multiple immunosuppression pathways) in a single therapeutic entity;

· Results in a sustained, or long-term, effect in vivo ;

· Favorable clinical safety profile of INTASYL with local administration;

· Efficient uptake of INTASYL by target cells, obviating the need for facilitated delivery (e.g.

mechanical or formulation which can

be detrimental to the cells);

· Readily manufactured under current good manufacturing practices.

Unlike other combination approaches, we believe the INTASYL platform can target multiple

protein drug targets in a specific therapeutic dose, enhancing potency while maintaining a favorable tolerability and safety profile.

Preclinical data has shown that combining PH-762 and PH-894 in a single formulation elicited complete cure of tumors in a liver cancer

model and outperformed the efficacy of the small molecule and antibody control treatments toward the same targets.

In addition, local

INTASYL therapy was shown to induce a systemic anti-tumor response with the clearance of distant untreated tumors.

We believe that these

data demonstrate that the use of INTASYL to target multiple genes may provide a durable and systemic anti-tumor immune response that can

combat tumor growth.

Intellectual Property

We protect our proprietary information by means

of United States and foreign patents, trademarks and copyrights.

INTASYL compounds have a single-stranded phosphorothioate

region, a short duplex region, and contain a variety of nuclease-stabilizing and lipophilic chemical modifications that we believe combines

the beneficial properties of both conventional RNAi and antisense technologies.

We protect our proprietary information by means of United

States and foreign patents, trademarks and copyrights.

In addition, we rely upon trade secret protection and contractual arrangements

3 unchanged sentences

discovery platform.

Much of our technology and many of our processes

depend upon the knowledge, experience and skills of key scientific and technical personnel.

To protect our rights to our proprietary know-how

and technology, we require all employees, as well as our consultants and advisors when feasible, to enter into confidentiality agreements

that require disclosure and assignment to us of ideas, developments, discoveries and inventions made by these employees, consultants and

advisors in the course of their service to us.

We have also obtained rights to various patents

10 unchanged sentences

property and are prosecuting a number of patents and pending patent applications covering our compounds and technologies.

summary of these patents and patent applications is set forth below in the following table:

A combined summary

of these patents and patent applications is set forth below in the following table:

United States

Other Markets

Our portfolio includes 122 issued patents, 85 of

which cover our INTASYL platform.

Our portfolio includes 119 issued patents, 87 of which

cover our INTASYL platform.

There are 17 patent families broadly covering both the composition and methods of use of our self-delivering

11 unchanged sentences

during the regulatory approval process relating to human drug products (or processes for making or using human drug products).

Key Intellectual

Property License Agreements

Key Intellectual Property License Agreements

As we develop our own proprietary compounds, we

1 unchanged sentence

our intellectual property portfolio and unique intellectual property position.

On September 24, 2011, we entered

into an agreement with Advirna, LLC (“ Advirna ”) pursuant to which Advirna assigned to us its existing patent and technology

rights related to the INTASYL technology and we granted back to Advirna a license for use of the assigned patent and technology rights

outside of human therapeutics and diagnostics.

Under the terms of the agreement, in April 2012, the Company issued to Advirna shares of

common stock equal to 5% of the Company’s fully-diluted shares outstanding at the time of issuance and paid a one-time milestone

payment of $350,000 in 2014 upon the issuance of the first patent under the agreement.

The Company also pays to Advirna an annual maintenance

fee of $100,000 and is required to pay a low single-digit royalty on any license revenue received by the Company with respect to future

licensing of the assigned Advirna patent and technology rights.

To date, royalties owed to Advirna have been minimal.

Advanced RNA Technologies, LLC (“ Advirna ”).

In September 2011, the Company entered into an agreement with Advirna, pursuant to which Advirna assigned to us its existing patent and

technology rights related to the INTASYL technology in exchange for an annual maintenance fee, a one-time milestone payment upon the future

issuance of the first patent with valid claims covering the assigned patent and technology rights and the issuance of shares of common

stock of the Company equal to 5% of the Company’s fully-diluted shares outstanding at the time of issuance.

In 2012, we issued shares

of common stock of the Company to Advirna equal to 5% of our fully-diluted shares outstanding at the time of issuance and paid $350,000

to Advirna upon the issuance of the first patent in 2014.

Additionally, we also pay to Advirna an annual maintenance fee of $100,000 and

are required to pay low single-digit royalties on any licensing revenue received by us with respect to future licensing of the assigned

Advirna patent and technology rights.

To date, any royalties owed to Advirna under the agreement have been minimal.

Our rights under the Advirna agreement will expire

upon the later of:

(i) the expiration of the last-to-expire of the “patent rights” (as defined therein) or (ii) the

abandonment of the last-to-be abandoned of such patents, unless earlier terminated in accordance with the provisions of the agreement.

We may terminate the Advirna agreement at any time upon 90 days’ written notice to Advirna, and Advirna may terminate the agreement

upon 90 days’ prior written notice in the event that we cease using commercially reasonable efforts to research, develop, license

or otherwise commercialize the patent rights or “royalty-bearing products” (as defined therein), provided that we may refute

such claim within such 90-day period by showing budgeted expenditures for the research, development, licensing or other commercialization

consistent with other technologies of similar stage of development and commercial potential as the patent rights or royalty-bearing products.

Further, either party at any time may provide to the other party written notice of a material breach of the agreement.

If the other party

fails to cure the identified breach within 90 days after the date of the notice, the aggrieved party may terminate the agreement by written

notice to the party in breach.

Research and Development

Our research and development expense primarily

consists of compensation and benefits for research and development personnel, facility-related expenses, supplies, external services,

costs to acquire technology licenses, expenses associated with preclinical and clinical development activities and other operating costs.

Total research and development expense for the

years ended December 31, 2021 and 2020 was $8,886,000 and $3,716,000, respectively.

(i) the expiration of the last-to-expire of the “patent rights” (as defined therein) included in the

agreement or (ii) the abandonment of the last-to-be abandoned of such patents, unless earlier terminated in accordance with the provisions

of the agreement.

Further, the Company also granted back to Advirna a license under the assigned patent and technology rights for fields

of use outside human therapeutics.

Manufacturing and

do not have any manufacturing capability and therefore we currently rely on and intend to continue to rely on contract manufacturing organizations

to produce our product candidates in accordance with regulatory requirements.

We currently rely on and contract

with third parties for the manufacture of drug substances and drug products for use in our preclinical studies and clinical trials in

accordance with regulatory requirements.

We intend that we will continue to rely on and contract with third parties to manufacture our

product candidates in the future.

The biotechnology and pharmaceutical industries,

2 unchanged sentences

institutions, government agencies and other private and public research organizations.

A variety of cell-based autologous and allogeneic

approaches are being researched and developed for the treatment of cancer.

We believe that competitors developing TIL-based and NK cell-based

therapies in this field, our initial areas of focus in ACT, include, but are not limited to, Acepodia Inc., Achilles Therapeutics plc,

AgonOx, Inc., Artiva Biotherapeutics, Inc., Caribou Biosciences, Inc., Century Therapeutics, Inc., Cytovia Therapeutics, Inc., Editas

Medicine, Inc., Fate Therapeutics, Inc., Gamida Cell Ltd., Glycostem Therapeutics B.V., Instil Bio, Inc., Iovance Biotherapeutics, Inc.,

KSQ Therapeutics, Inc., Lyell Immunopharma, Inc., MiNK Therapeutics, Inc., Nkarta, Inc., ImmunityBio, Inc., NKGen Biotech, Inc., ONK Therapeutics

Limited, Sanofi S.A., Shoreline Biosciences, Inc., Sorrento Therapeutics, Inc., SQZ Biotechnologies Company, Takeda Pharmaceutical Company

Limited and Turnstone Biologics Corp.

All of these companies are larger than us and have greater financial resources and human capital

to develop competing products.

A number of companies have taken the direct therapeutic

approach to modulating gene expression in the field of immuno-oncology and are conducting research and development.

We believe that competitors

in this field include, but are not limited to, Portage Biotech Inc., Cytovation ASA, Targovax ASA, Lytix Biopharma AS, Checkmate Pharmaceuticals,

Inc., Idera Pharmaceuticals, Inc., SillaJen, Inc., Duet Therapeutics, a wholly owned subsidiary of Scopus Biopharma Inc., OncoSec Medical

Incorporated and Philogen S.p.A.

Many of these companies are larger than us and

have greater financial resources and human capital to develop competing products.

Government Regulation

and Approval of Drugs in the United States

Review and Approval of Drugs in the United States

The United States and many other countries

6 unchanged sentences

information on the manufacture and composition of the product candidate.

In most cases, this will require extensive laboratory tests and

preclinical and clinical trials.

The collection of these data, as well as the preparation of applications for review by the FDA involve

significant time and expense.

In most cases, this will require extensive laboratory tests,

preclinical studies and clinical trials.

The collection of these data, as well as the preparation of applications for review by the FDA

involve significant time and expense.

The FDA also may require post-marketing testing to monitor the safety and efficacy of approved products

5 unchanged sentences

data, together with proposed clinical protocols, manufacturing information, analytical data and other information submitted to the FDA

in an investigational new drug (“ IND ”) application, must become effective before human clinical trials may commence.

Preclinical studies generally involve FDA regulated laboratory evaluation of product characteristics and animal studies to assess the

efficacy and safety of the product candidate.

in an IND application, must become effective before human clinical trials may commence.

Preclinical studies generally involve FDA regulated

laboratory evaluation of product characteristics and animal studies to assess the efficacy and safety of the product candidate.

After the IND becomes effective, a company may

11 unchanged sentences

case of a biologic, a biologics license application (“ BLA ”).

The amount of time taken by the FDA for approval

of an NDA or BLA will depend upon a number of factors, including whether the product candidate has received priority review, the quality

The amount of time taken by the FDA for approval of

an NDA or BLA will depend upon a number of factors, including whether the product candidate has received priority review, the quality

of the submission and studies presented, the potential contribution that the compound will make in improving the treatment of the disease

in question and the workload at the FDA.

in question and the workload of the FDA’s staff.

The FDA may, in some cases, confer upon an investigational

3 unchanged sentences

The FDA can base

approval of an NDA or BLA for a fast track product on an effect on a surrogate endpoint, or on another endpoint that is reasonably likely

to predict clinical benefit.

If a preliminary review of clinical data suggests that a fast track product may be effective, the FDA may

initiate review of entire sections of a marketing application for a fast track product before the sponsor completes the application.

approval of an NDA or BLA for a fast track product utilizing a surrogate endpoint, or on another endpoint that is reasonably likely to

predict clinical benefit.

If a preliminary review of clinical data suggests that a fast track product may be effective, the FDA may initiate

review of entire sections of a marketing application for a fast track product before the sponsor completes the application.

We anticipate that our products will be manufactured

23 unchanged sentences

In addition, we will be subject to various laws and regulations governing laboratory practices and the experimental use of

In each of these areas, as above, the FDA has broad regulatory and enforcement powers, including the ability to levy fines and

civil penalties, suspend or delay issuance of product approvals, seize or recall products and deny or withdraw approvals.

In each of these areas, failure to comply with the applicable requirements could result in administrative or judicial enforcement

action, which could include refusal to permit clinical trials, refusal to approve an application, withdrawal of an approval, issuance

of a warning letter, product recall, product seizure, suspension of production or distribution, fines, refusals of government contracts,

and restitution, disgorgement or civil or criminal penalties.

Any agency or judicial enforcement action could have a material adverse

effect on us.

We will also be subject to a variety of regulations

7 unchanged sentences

processes are similar, in principle, to those in the United States.

and Approval of Drugs in the European Union Including France

Review and Approval of Drugs in the European Union Including France

In order to market any pharmaceutical product outside

13 unchanged sentences

negatively impact the regulatory process in others.

The United Kingdom (“ UK ”)

formally left the European Union (“ EU ”) on January 31, 2020 and the transition period, during which EU laws continued

to apply to the UK, expired on December 31, 2020.

This means EU laws now only apply to the UK in respect of Northern Ireland as laid

out in the Protocol on Ireland and Northern Ireland.

Following the end of the transition period, the EU and the UK concluded a trade

and cooperation agreement (“ TCA ”), which applied provisionally from January 1, 2021 and entered into force on May

The United Kingdom (“ UK ”) formally

left the European Union (“ EU ”) on January 31, 2020 and the transition period, during which EU laws continued to apply

to the UK, expired on December 31, 2020.

This means EU laws now only apply to the UK in respect of Northern Ireland as laid out in the

Protocol on Ireland and Northern Ireland.

Following the end of the transition period, the EU and the UK concluded a trade and cooperation

agreement (“ TCA ”), which applied provisionally from January 1, 2021 and entered into force on May 1, 2021.

The TCA includes provisions affecting the life

14 unchanged sentences

safeguard public health.

Specified provisions of the Medicines and Medical

Devices Act 2021 entered into force on February 11, 2021.

The remaining provisions came into effect within two months of February 11,

2021 or will otherwise come into effect as stipulated in subsequent statutory instruments.

The Medicines and Medical Devices Act 2021

supplements the UK Medical Devices Regulations 2002 (UK Regulations), which are based on the EU Medical Devices Directive as amended to

reflect the UK’s post-Brexit regulatory regime.

Notably, the UK Regulations do not include any of the revisions that have been made

by the EU Medical Devices Regulation (EU) 2017/745, which, since May 26, 2021, now applies in all EU Member States.

The UK’s Medicines and Healthcare products

Regulatory Agency (“ MHRA ”) conducted a comprehensive consultation between September and November 2021 on proposals

to develop a new UK regime for medical devices in the UK.

The proposals include more closely aligning definitions for medical devices

and in vitro medical devices with internationally recognized definitions and changing the classification of medical devices according

to levels or risk.

The proposals are intended to improve patient and public safety and increase the appeal of the UK market.

The new regime

is planned to come into force on July 1, 2023, which will align with the date from which the UK is due to stop accepting CE marked medical

devices and require UKCA (UK Conformity Assessed) marking.

It is envisaged that, in Northern Ireland, the amended regime could run in

parallel with any existing or future EU rules in accordance with the Protocol on Ireland and Northern Ireland.

Specified provisions of the Medicines and Medical Devices

Act 2021 entered into force on February 11, 2021.

The remaining provisions came into effect within two months of February 11, 2021 or

will otherwise come into effect as stipulated in subsequent statutory instruments.

The Medicines and Medical Devices Act 2021 supplements

the UK Medical Devices Regulations 2002 (the “ UK Regulations ”), which are based on the EU Medical Devices Directive

as amended to reflect the UK’s post-Brexit regulatory regime.

Notably, the UK Regulations do not include any of the revisions that

have been made by the EU Medical Devices Regulation (EU) 2017/745, which, since May 26, 2021, now applies in all EU Member States.

The UK’s Medicines and Healthcare products Regulatory

Agency conducted a comprehensive consultation between September and November 2021 on proposals to develop a new UK regime for medical

devices in the UK.

The proposals include more closely aligning definitions for medical devices and in vitro medical devices with internationally

recognized definitions and changing the classification of medical devices according to levels or risk.

The proposals are intended to improve

patient and public safety and increase the appeal of the UK market.

The new regime is planned to come into force on July 1, 2023, which

will align with the date from which the UK is due to stop accepting CE marked medical devices and require UKCA (UK Conformity Assessed)

It is envisaged that, in Northern Ireland, the amended regime could run in parallel with any existing or future EU rules in accordance

with the Protocol on Ireland and Northern Ireland.

Drug Development Process

The conduct of clinical trials is currently governed

by the EU Clinical Trials Directive 2001/20/EC (Clinical Trials Directive), and will be gradually replaced by the EU Clinical Trials Regulation

by the EU Clinical Trials Directive 2001/20/EC (the “ Clinical Trials Directive ”), and will be gradually replaced by

the EU Clinical Trials Regulation (EU) No.

536/2014 (“ CTR ”).

The CTR introduces a complete overhaul of the existing regulation of clinical trials for

medicinal products in the EU.

The CTR introduces a complete overhaul of the existing

regulation of clinical trials for medicinal products in the EU.

It entered into force on January 31, 2022.

17 unchanged sentences

One national regulatory authority (the reporting EU Member State proposed by the applicant) takes

the lead in validating and evaluating the application consult and coordinate with the other concerned Member States.

the lead in validating and evaluating the application, and will consult and coordinate with the other concerned Member States.

If an application

6 unchanged sentences

the rules on safety reporting, and introduces enhanced transparency requirements such as mandatory submission of a summary of the clinical

trial results to the EU Database.

While Member States will work in CTIS immediately after the system has gone live, the CTR provides for

two transition periods for sponsors:

For one year, until January 31, 2023, clinical trial sponsors can still choose whether to submit

an initial clinical trial application in line with the current system (Clinical Trials Directive) or via CTIS.

From January 31, 2023,

submission of initial clinical trial applications via CTIS becomes mandatory, and by January 31, 2025, all ongoing trials approved under

the current Clinical Trials Directive will be governed by the new Regulation and have to be transitioned to CTIS.

trial results to the EU Database (“ CTIS ”).

While Member States will work in CTIS immediately after the system has gone

live, the CTR provides for two transition periods for sponsors:

For one year, until January 31, 2023, clinical trial sponsors can still

choose whether to submit an initial clinical trial application in line with the current system (Clinical Trials Directive) or via CTIS.

From January 31, 2023, submission of initial clinical trial applications via CTIS becomes mandatory, and by January 31, 2025, all ongoing

trials approved under the current Clinical Trials Directive will be governed by the new Regulation and have to be transitioned to CTIS.

Under both the current regime and the new CTR,

6 unchanged sentences

products may only be placed on the market after obtaining a Marketing Authorization (“ MA ”).

To obtain an MA of a drug

under European Union regulatory systems, an applicant can submit a Marketing Authorization Application (“ MAA ”) through,

amongst others, a centralized or decentralized procedure.

To obtain a MA of a drug

under EU regulatory systems, an applicant can submit a Marketing Authorization Application (“ MAA ”) through, amongst

others, a centralized or decentralized procedure.

The centralized procedure provides for the grant

16 unchanged sentences

Under the centralized procedure,

the timeframe for the evaluation of an MAA by the EMA’s CHMP is, in principle, 210 days from receipt of a valid MAA.

the timeframe for the evaluation of a MAA by the EMA’s CHMP is, in principle, 210 days from receipt of a valid MAA.

However, this

27 unchanged sentences

or minimize the risks associated with the product.

The regulatory authorities may also impose specific obligations as a condition of the

RMPs and Periodic Safety Update Reports (“ PSUR s”) are routinely available to third parties requesting access, subject

to limited redactions.

The regulatory authorities may also impose specific obligations as a condition of

RMPs and Periodic Safety Update Reports are routinely available to third parties requesting access, subject to limited

Marketing Authorizations have an initial duration

5 unchanged sentences

the EMA at least nine months before the five-year period expires.

Data and Market Exclusivity in the European Union

Data and Market Exclusivity in the European

As in the United States, it may be possible to

obtain a period of market and/or data exclusivity in the European Union that would have the effect of postponing the entry into the marketplace

of a competitor’s generic, hybrid or biosimilar product (even if the pharmaceutical product has already received an MA) and prohibiting

obtain a period of market and/or data exclusivity in the EU that would have the effect of postponing the entry into the marketplace of

a competitor’s generic, hybrid or biosimilar product (even if the pharmaceutical product has already received a MA) and prohibiting

another applicant from relying on the MA holder’s pharmacological, toxicological and clinical data in support of another MA for

7 unchanged sentences

biosimilar applicants from relying on the preclinical and clinical trial data contained in the dossier of the reference medicinal product

when applying for a generic or biosimilar marketing authorization in the European Union during a period of eight years from the date on

which the reference product was first authorized in the European Union.

The market exclusivity period prevents a successful generic or

biosimilar applicant from commercializing its product in the European Union until 10 years have elapsed from the initial authorization

of the reference product in the European Union.

when applying for a generic or biosimilar marketing authorization in the EU during a period of eight years from the date on which the

reference product was first authorized in the EU.

The market exclusivity period prevents a successful generic or biosimilar applicant

from commercializing its product in the EU until 10 years have elapsed from the initial authorization of the reference product in the

Post-approval Regulation

9 unchanged sentences

that apply to the conduct of clinical trials, manufacturing approval, marketing authorization of pharmaceutical products and marketing

of such products, both before and after grant of marketing authorization, manufacturing of pharmaceutical products, statutory health

insurance, bribery and anti-corruption or with other applicable regulatory requirements may result in administrative, civil or criminal

These penalties could include delays or refusal to authorize the conduct of clinical trials or to grant marketing authorization,

product withdrawals and recalls, product seizures, suspension, withdrawal or variation of the marketing authorization, total or partial

suspension of production, distribution, manufacturing or clinical trials, operating restrictions, injunctions, suspension of licenses,

fines and criminal penalties.

Pricing and Reimbursement Environment

Even if a pharmaceutical product obtains a marketing

authorization in the European Union, there can be no assurance that reimbursement for such product will be secured on a timely basis

The EU Member States are free to restrict the range of pharmaceutical products for which their national health insurance systems

provide reimbursement, and to control the prices and reimbursement levels of pharmaceutical products for human use.

An EU Member State

may approve a specific price or level of reimbursement for the pharmaceutical product, or alternatively adopt a system of direct or indirect

controls on the profitability of the company responsible for placing the pharmaceutical product on the market, including volume-based

arrangements, caps and reference pricing mechanisms.

To obtain reimbursement or pricing approval in

some countries, including the EU Member States, we may be required to conduct studies that compare the cost-effectiveness of our product

candidates to other therapies that are considered the local standard of care.

There can be no assurance that any country will allow favorable

pricing, reimbursement and market access conditions for any of our products, or that we will be feasible to conduct additional cost-effectiveness

studies, if required.

of such products, both before and after grant of marketing authorization, manufacturing of pharmaceutical products, statutory health insurance,

bribery and anti-corruption or with other applicable regulatory requirements may result in administrative, civil or criminal penalties.

These penalties could include delays or refusal to authorize the conduct of clinical trials or to grant marketing authorization, product

withdrawals and recalls, product seizures, suspension, withdrawal or variation of the marketing authorization, total or partial suspension

of production, distribution, manufacturing or clinical trials, operating restrictions, injunctions, suspension of licenses, fines and

criminal penalties.

European Union Data Laws

The collection and use of personal health data

and other personal information in the European Union is governed by the provisions of the General Data Protection Regulation (“ GDPR ”),

and other personal information in the EU is governed by the provisions of the General Data Protection Regulation (“ GDPR ”),

which came into force in May 2018, and related implementing laws in individual EU Member States.

In addition, following the United Kingdom’s

formal departure from the European Union on January 31, 2020 and the end of the transition period on December 31, 2020, the United Kingdom

has become a “third country” for the purposes of EU data protection law.

A “third country” is a country other

than the EU Member States and the three additional European Economic Area countries (Norway, Iceland and Liechtenstein) that have adopted

a national law implementing the GDPR.

However, the TCA includes a provision, whereby the transfer of personal data from the EU to the

United Kingdom will not be considered as a transfer to a “third country” for a period of four months starting from the entry

into force of the TCA.

This period will be extended by two further months, unless the EU or the United Kingdom objects.

Under the GDPR,

personal data can only be transferred to third countries in compliance with specific conditions for cross-border data transfers.

safeguards are required to enable transfers of personal data from the EU Member States.

This status has a number of significant practical

consequences, in particular for international data transfers, competent supervisory authorities and enforcement of the GDPR.

increased responsibility and liability in relation to personal data that we process.

In addition, following the UK’s

formal departure from the EU on January 31, 2020 and the end of the transition period on December 31, 2020, the United Kingdom has become

a “third country” for the purposes of EU data protection law.

A “third country” is a country other than the EU

Member States and the three additional European Economic Area countries (Norway, Iceland and Liechtenstein) that have adopted a national

law implementing the GDPR.

However, the TCA includes a provision, whereby the transfer of personal data from the EU to the UK will not

be considered as a transfer to a “third country” for a period of four months starting from the entry into force of the TCA.

This period will be extended by two further months, unless the EU or the UK objects.

Under the GDPR, personal data can only be transferred

to third countries in compliance with specific conditions for cross-border data transfers.

Appropriate safeguards are required to enable

transfers of personal data from the EU Member States.

This status has a number of significant practical consequences, in particular for

international data transfers, competent supervisory authorities and enforcement of the GDPR.

The GDPR increased responsibility and liability

in relation to personal data that we process.

The GDPR imposes a number of strict obligations

5 unchanged sentences

the personal data.

The GDPR also prohibits the transfer of personal data to countries outside of the European Union that are not considered

by the EU to provide an adequate level of data protection, except if the data controller meets very specific requirements.

These countries

include the United States, and following the end of the six month period as laid out in the TCA, it may include the United Kingdom if

no adequacy decision is given prior to this.

Following the Schrems II decision of the Court of Justice of the European Union on July 16,

2020, there is uncertainty as to the general permissibility of international data transfers under the GDPR.

In light of the implications

of this decision we may face difficulties regarding the transfer of personal data from the European Union to third countries.

Data Protection Board has adopted draft recommendations for data controllers and processors who export personal data to third countries

regarding supplementary measures to ensure compliance with the GDPR when transferring personal data outside of the EU.

These recommendations

were submitted to public consultation until December 21, 2020, however it is unclear when and in which form these recommendations will

be published in final form.

The GDPR also prohibits the transfer of personal data to countries outside of the EU that are not considered by the

EU to provide an adequate level of data protection, except if the data controller meets very specific requirements.

These countries include

the United States, and following the end of the six month period as laid out in the TCA, it may include the UK if no adequacy decision

is given prior to this.

Following the Schrems II decision of the Court of Justice of the European Union on July 16, 2020, there is uncertainty

as to the general permissibility of international data transfers under the GDPR.

In light of the implications of this decision we may

face difficulties regarding the transfer of personal data from the EU to third countries.

The European Data Protection Board has adopted

draft recommendations for data controllers and processors who export personal data to third countries regarding supplementary measures

to ensure compliance with the GDPR when transferring personal data outside of the EU.

These recommendations were submitted to public consultation

until December 21, 2020, however it is unclear when and in which form these recommendations will be published in final form.

Failure to comply with the requirements of the

4 unchanged sentences

EU Member States may still implement certain variations, enforce the GDPR and national data protection laws differently, and introduce

additional national regulations and guidelines, which adds to the complexity of processing personal data in the European Union.

developed at both EU level and at the national level in individual EU Member States concerning implementation and compliance practices

are often updated or otherwise revised.

additional national regulations and guidelines, which adds to the complexity of processing personal data in the EU.

Guidance developed

at both EU level and at the national level in individual EU Member States concerning implementation and compliance practices are often

updated or otherwise revised.

There is, moreover, a growing trend towards required

public disclosure of clinical trial data in the European Union which adds to the complexity of obligations relating to processing health

data from clinical trials.

public disclosure of clinical trial data in the EU which adds to the complexity of obligations relating to processing health data from

clinical trials.

Such public disclosure obligations are provided in the new EU Clinical Trials Regulation, EMA disclosure initiatives

7 unchanged sentences

From time to time, legislation is drafted, introduced

and passed in the European Union, its Member States and other states of Europe that could significantly change the statutory provisions

governing the testing, approval, manufacturing, marketing, coverage and reimbursement of pharmaceutical products.

and passed in the EU, its Member States and other states of Europe that could significantly change the statutory provisions governing

the testing, approval, manufacturing, marketing, coverage and reimbursement of pharmaceutical products.

In addition to new legislation,

2 unchanged sentences

Environmental Compliance

Our research and development activities involve

the controlled use of potentially harmful biological materials as well as hazardous materials, chemicals and various radioactive compounds.

Our research and development activities involve the

controlled use of potentially harmful biological materials as well as hazardous materials, chemicals and various radioactive compounds.

We are subject to federal, state and local laws and regulations governing the use, storage, handling and disposal of these materials and

5 unchanged sentences

expensive capital equipment to meet regulatory requirements.

However, to date, compliance with such environmental laws and regulations

has not had a material impact on our capital expenditures.

Human Capital Management

As of December 31, 2021, we had twelve full-time

and no part-time employees at our facility in Marlborough, Massachusetts.

None of our employees are represented by a labor union or covered

by a collective bargaining agreement, nor have we experienced any work stoppages.

We expect to add additional employees in fiscal

year 2022 to increase our expertise and resources available in our preclinical and clinical research and development.

We continually evaluate

our business needs and weigh the use of in-house expertise and capacity with outsourced expertise and capacity.

The Company currently

outsources substantial preclinical and clinical trial work to third party contract research organizations and drug manufacturing contractors.

Our ability to

identify, attract, retain and integrate additional qualified key personnel is also critical to our success and the competition for

skilled research, product development, regulatory and technical personnel is intense.

To attract qualified applicants to the

Company, we offer a total rewards package consisting of base salary and cash target bonus based on geography and size of company, a

comprehensive benefit package and equity compensation for every employee.

Bonus opportunity and equity compensation increase

as a percentage of total compensation based on level of responsibility.

Actual bonus payout is based on performance.

A large majority of Phio’s

As of December 31, 2022, we had nine full-time

employees and one part-time employee at our facility in Marlborough, Massachusetts.

None of our employees are represented by a labor union

or covered by a collective bargaining agreement, nor have we experienced any work stoppages.

We expect to add additional employees in fiscal year

2023 to increase our expertise and resources available in our clinical development and administrative areas.

We continually evaluate our

business needs and weigh the use of in-house expertise and capacity with outsourced expertise and capacity.

We currently outsource substantially

all preclinical and clinical trial work to third party contract research organizations and drug manufacturing contractors.

Our ability to identify, attract,

retain and integrate additional qualified key personnel is also critical to our success and the competition for skilled research, product

development, regulatory and technical personnel is intense.

To attract qualified applicants, we offer a total rewards package consisting

of base salary and cash target bonus, a comprehensive benefit package and equity compensation for every employee.

Bonus opportunity and

equity compensation increase as a percentage of total compensation based on level of responsibility.

Actual bonus payouts are based

on performance.

A majority of Phio’s

employees have obtained advanced degrees in their professions and we support our employees’ further development with individualized

1 unchanged sentence

Corporate Information

Effective January 26, 2023, the Company completed

a 1-for-12 reverse stock split of the Company’s outstanding common stock.

The reverse stock split did not reduce the number of authorized

shares of the Company’s common or preferred stock.

All share and per share amounts have been adjusted to give effect to the reverse

We were incorporated in the state of Delaware in 2011

as RXi Pharmaceuticals Corporation.

On November 19, 2018, the Company changed its name to Phio Pharmaceuticals Corp., to reflect

its transition from a platform company to one that is fully committed to developing groundbreaking immuno-oncology therapeutics.

Our executive

offices are located at 257 Simarano Drive, Suite 101, Marlborough, MA 01752, and our telephone number is (508) 767-3861.

On November 19, 2018, we changed our name to Phio Pharmaceuticals Corp., to reflect our transition

from a platform company to one that is fully committed to developing groundbreaking immuno-oncology therapeutics.

Our executive offices

are located at 257 Simarano Drive, Suite 101, Marlborough, MA 01752, and our telephone number is (508) 767-3861.

The Company’s website address is http://www.phiopharma.com .

4 unchanged sentences

We also make available

on our website the charters of our audit committee, compensation committee and nominating and corporate governance committee, as well

as our corporate code of ethics and conduct.

You may read and copy any materials the Company

files with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, DC 20549.

You may obtain information on the

operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.

on our website the charters of our audit, compensation, nominating and governance committees, as well as our corporate code of ethics

The SEC maintains an internet site that contains reports,

1 unchanged sentence

website address is http://www.sec.gov .

The contents of these websites are not incorporated by reference into this report and should

not be considered to be part of this report.

The contents of this website, and our website, are not incorporated by reference into this

report and should not be considered to be part of this report.

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

What changed 10-K

Item 1. Business