Pluri Inc. 10-Q

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. Forward-Looking Statements This Quarterly Report on Form 10-Q contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other Federal securities laws, and is subject to the safe-harbor created by such Act and laws. Forward-looking statements may include statements regarding our goals, beliefs, strategies, objectives, plans, including product and technology developments, future financial conditions, results or projections or current expectations. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” the negative of such terms, or other variations thereon or comparable terminology. These statements are merely predictions and therefore inherently subject to known and unknown risks, uncertainties, assumptions and other factors that may cause actual results, performance levels of activity, or our achievements, or industry results to be materially different from those contemplated by the forward-looking statements. Such forward-looking statements appear in this Item 2 – “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and may appear elsewhere in this Quarterly Report on Form 10-Q and include, but are not limited to, statements regarding the following: ● the expected development and potential benefits from our products in regenerative medicine, biologics and food tech, as well as potentially in other industries and verticals that have a need for our mass scale and cost-effective cell expansion platform; ● the prospects of entering into additional license agreements, or other forms of cooperation with other companies, research organizations and medical institutions, including, without limitation Tnuva (as defined below); ● our pre-clinical and clinical study plans, including timing of initiation, expansion, enrollment, results, and conclusion of trials; ● achieving regulatory approvals; ● receipt of future funding from the Israel Innovation Authority, or IIA, the European Union’s Horizon programs, as well as grants from other independent third parties; ● developing capabilities for new clinical indications of placenta expanded, or PLX, cells and new products; ● our expectation to demonstrate a real-world impact and value from our pipeline, technology platform and commercial-scale manufacturing capacity; ● the possible impacts of cybersecurity incidents on our business and operations; ● our expectations regarding our short- and long-term capital requirements; ● our outlook for the coming months and future periods, including but not limited to our expectations regarding future revenue and expenses; ● information with respect to any other plans and strategies for our business; ● our expectations regarding the impact of the COVID-19 pandemic, including on our clinical trials and operations; and ● the Israeli government is currently pursuing extensive changes to Israel’s judicial system, which may negatively impact the business environment in Israel with reluctance for investments or transactions as well as lead to increased currency fluctuations, downgrades in credit rating and increased interest rates. 21 Our business and operations are subject to substantial risks, which increase the uncertainty inherent in the forward-looking statements contained in this report. In addition, historic results of scientific research, clinical and preclinical trials do not guarantee that the conclusions of future research or trials would not suggest different conclusions. Also, historic results referred to in this periodic report would be interpreted differently in light of additional research, clinical and preclinical trials results. Except as required by law, we undertake no obligation to release publicly the result of any revision to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Further information on potential factors that could affect our business is described under the heading “Risk Factors” in Part I, Item 1A, of our Annual Report on Form 10-K for the fiscal year ended June 30, 2022, or the 2022 Annual Report, as well as Item 1A of this Quarterly Report. Readers are also urged to carefully review and consider the various disclosures we have made in that report. As used in this Quarterly Report on Form 10-Q, the terms “we”, “us”, “our”, the “Company” and “Pluri” mean Pluri Inc. and our wholly owned subsidiaries, Pluri Biotech Ltd. and Pluristem GmbH, and our subsidiary Ever After Foods Ltd., or Ever After, formerly known as Plurinuva Ltd., unless otherwise indicated or as otherwise required by the context. Overview We are a biotechnology company with an advanced cell-based technology platform. We have developed a unique three-dimensional, or 3D, technology platform for cell expansion with an industrial scale in-house Good Manufacturing Practice, or GMP, cell manufacturing facility. We are utilizing our technology in the field of regenerative medicine and food tech and plan to utilize it in other industries and verticals that have a need for our mass scale and cost-effective cell expansion platform. We use our advanced cell-based technology platform in the field of regenerative medicine to develop placenta-based cell therapy product candidates for the treatment of inflammatory, muscle injuries and hematologic conditions. Our placental expanded, or PLX, cells are adherent stromal cells that are expanded using our 3D platform. Our PLX cells can be administered to patients off-the-shelf, without blood or tissue matching or additional manipulation prior to administration. PLX cells are believed to release a range of therapeutic proteins in response to the patient’s condition. Our operations are focused on the research, development and manufacturing of cells and cell-based products, conducting clinical studies and the business development of cell therapeutics and cell-based technologies, such as our collaboration with Tnuva Food Industries – Agricultural Cooperative in Israel Ltd., through its fully owned subsidiary, Tnuva Food-Tech Incubator (2019), Limited Partnership, or Tnuva, to use our technology to establish a cultivated food platform and the recent collaboration agreement we signed with a leading European manufacturer of active pharmaceutical ingredients, or APIs, to use our expansion technology, which aims to revolutionize the production of biologics by enabling a cost-effective, sustainable and cruelty-free ingredient. We expect to demonstrate a real-world impact and value from our cell-based technology platform, our current PLX pipeline and from other cell-based product candidates that may be developed based on our platform. Our business model for commercialization and revenue generation includes, but is not limited to, licensing deals, joint ventures, partnerships, joint development agreements and direct sale of our products. 22 In the pharmaceutical area, we have focused on a number of indications utilizing our product candidates, including, but not limited to, muscle recovery following surgery for hip fracture, incomplete recovery following bone marrow transplantation, critical limb ischemia, or CLI, Chronic Graft versus Host Disease and a potential treatment for Acute Radiation Syndrome. Some of these studies have been completed while others are still ongoing. We believe that each of these indications is a severe unmet medical need. In April 2023, we unveiled a breakthrough in cell manufacturing that potentially solves one of the biggest hurdles facing cell-based industries: cost-effective, industrial scale cell manufacturing. PluriMatrix, built upon our platform 3D cell expansion technology, significantly scales high-quality cell production, potentially having a catalytic impact across numerous industries that require mass-scale cell production including pharma, biologics, foodtech and agri-tech.PluriMatrix is also used by our majority-owned subsidiary Ever After, to produce cultivated meat . Food Tech On February 24, 2022, we announced the closing of the joint venture pursuant to joint venture agreement, or the Joint Venture Agreement, with Tnuva through the Subsidiary. Under the Joint Venture Agreement, we established a new company, Ever After, with the purpose of developing cultivated meat products of all types and kinds. Pursuant to the Joint Venture Agreement, Tnuva entered into a share purchase agreement, or the SPA, with Ever After and the Subsidiary, pursuant to which Ever After issued on the closing date of the SPA, or the Closing Date, 187,500 ordinary shares, representing 15.79% of its share capital, to Tnuva, as well as a warrant to purchase additional shares of Ever After, in consideration of an aggregate of $7.5 million in cash. In December 2022, we reported that our joint venture successfully completed proof of concept in its development of cultivated meat based on our cell-based technology platform. Technology Collaboration the Biologics Field In September 2022, we entered into a collaboration agreement with a leading European manufacturer of APIs for liver and gastroenterological diseases, or API Collaboration. As part of our collaboration, our platform is being utilized to develop and manufacture a unique biologic API used in drugs that treat liver and gastroenterological diseases. The current source of this API is derived from animals that are sacrificed during the extraction process. The joint goal of the collaboration is to grow the specific cells needed for this API in our 3D cell expansion bioreactor systems that secrete the biological molecule without harming animals. As of March 31, 2023 we recorded revenues of $160,000 relates to API Collaboration. We believe that proof of concept with this agreement and APIs will open opportunities for us to serve additional API manufacturers in the rapidly growing biologics market. 23 RESULTS OF OPERATIONS – THREE AND NINE MONTHS ENDED MARCH 31, 2023 COMPARED TO THREE AND NINE MONTHS ENDED MARCH 31, 2022. Revenues Revenues for each of the nine-month and three-month periods ended March 31, 2023 were $176,000 and $87,000, respectively, as compared to $234,000 in revenues during the nine-month and three-month periods ended March 31, 2022. Revenues for the nine-month and three-month periods ended March 31, 2023 were mainly related to our API Collaboration. Research and Development Expenses, Net Research and development, or R&D, expense, net (costs less participation by the IIA, Horizon 2020, Horizon Europe and other parties) for the nine-month period ended March 31, 2023 decreased by 36% from $19,016,000 for the nine-month period ended March 31, 2022 to $12,223,000. The decrease is mainly attributed to: (1) a decrease in clinical studies subcontractor expenses following the completion of our critical limb ischemia and ARDS associated with COVID-19 studies and the end of enrollment of our muscle regeneration following hip fracture study in November 2021, (2) a decrease in materials purchases in accordance with our manufacturing needs and plan, (3) a decrease in salaries and related expenses as part of our efficiency cost-reduction plan, specifically a reduction of 29 R&D employees (107 on March 31, 2023, compared to 136 on March 31, 2022), (4) a decrease in share-based compensation expenses and (5) higher participation by the European Union with respect to the Horizon 2020 grants, which relate to our critical limb ischemia and muscle regeneration following hip fracture studies. R&D expense, net (costs less participation by the IIA, Horizon 2020, Horizon Europe and other parties) for the three-month period ended March 31, 2023 decreased by 32% from $6,156,000 for the three-month period ended March 31, 2022 to $4,167,000. The decrease is mainly attributed to: (1) a decrease in clinical studies subcontractor expenses following the completion of our critical limb ischemia and ARDS associated with COVID-19 studies and the end of enrollment of our muscle regeneration following hip fracture study in November 2021, (2) a decrease in salaries and related expenses as part of our efficiency cost reduction plan, specifically a reduction of 29 R&D employees (107 on March 31, 2023, compared to 136 on March 31, 2022) and (3) a decrease in share-based compensation expenses. General and Administrative Expenses General and administrative expenses for the nine-month period ended March 31, 2023 decreased by 38% from $13,929,000 for the nine-month period ended March 31, 2022 to $8,655,000. The decrease is mainly attributed to a decrease in share-based compensation expenses related to market based vesting conditioned restricted stock units, or RSUs, granted to our Chief Executive Officer and Chairman which was recorded as an expense of $7,283,000 between September 11, 2020 and October 30, 2021, decrease in share-based compensation expenses related to allocation of shares of Ever After to our Chief Executive Officer, Chief Financial Officer and Chairman of our board of directors pursuant to their employment or consulting agreement, employee terminations and RSU expenses amortization over time. Offset by an increase in share-based compensation expenses related to the amount of RSUs granted to employees. General and administrative expenses for the three-month period ended March 31, 2023 decreased by 34% from $4,553,000 for the three-month period ended March 31, 2022 to $3,020,000. The decrease is mainly attributed to a decrease in share-based compensation expenses related to allocation of shares of Ever After to our Chief Executive Officer, Chief Financial Officer and chairman of our board of directors pursuant to their employment or consulting agreement, offset by an increase in share-based compensation expenses related to the amount of RSUs granted to employees. Other Financial Income (Expenses), net Other financial income (expenses) decreased from $1,097,000 in financial income for the nine-month period ended March 31, 2022 to $956,000 in financial expenses for the nine-month period ended March 31, 2023. This decrease is mainly attributable to expenses relating to exchange rate differences related to the EIB loan provided to us in June 2021 pursuant to the finance agreement executed with the EIB, or the EIB Finance Agreement. During the nine-month period ended March 31, 2023, the strength of the Euro against the U.S. dollar, increased by 4% compared to a decrease of 6% during the nine-month period ended March 31, 2022. Other financial income (expenses) decreased from $780,000 in financial income for the three-month period ended March 31, 2022 to $441,000 in financial expenses for the three-month period ended March 31, 2023. This decrease is mainly attributable to expenses from exchange rate differences related to the EIB loan provided to us in June 2021 pursuant to the EIB Finance Agreement. During the three-month period ended March 31, 2023, the strength of the Euro against the U.S. dollar, increased by 2% compared to a decrease of 2% during the three-month period ended March 31, 2022. 24 Interest Expenses Interest expenses decreased from $676,000 for the nine-month period ended March 31, 2022 to interest expenses of $623,000 for the nine-month period ended March 31, 2023. This decrease is attributable solely to exchange rate differences due to the strength of the Euro against the U.S. dollar. Interest expenses decreased from $223,000 for the three-month period ended March 31, 2022 to interest expenses of $217,000 for the three-month period ended March 31, 2023. This decrease is attributable solely to exchange rate differences due to the strength of the Euro against the U.S. dollar. Net Loss Net loss for nine-month and three-month periods ended March 31, 2023 was $22,281,000 and $7,759,000, respectively, as compared to net loss of $32,290,000 and $9,918,000 for the nine-month and three-month periods ended March 31, 2022. The decrease was due to a decrease in general and administrative expenses and research and development expenses, as a result of our efficiency cost reduction plan and the implementation of our new business strategy, alongside the completion or termination of several clinical studies (in critical limb ischemia, ARDS associated with COVID 19, incomplete recovery following bone marrow transplantation and completion of enrollment of muscle regeneration following hip fracture). Net loss per share attributed to shareholders for the nine-month and three-month periods ended March 31, 2023 was $0.63 and $0.19, respectively, as compared to $1.00 and $0.31 for the nine-month and three-month periods ended March 31, 2022. We had net loss attributed to our non-controlling interest in Ever After for the nine-month and three-month periods ended March 31, 2023 of $419,000 and $135,000, respectively. For the nine-month and three-month periods ended March 31, 2023 and 2022, we had weighted average common shares outstanding of 35,217,037, 39,947,602, and 32,131,503, 32,261,628, respectively, which were used in the computations of net loss per share for the nine and three-month periods. The increase in weighted average common shares outstanding reflects the issuance of additional shares pursuant to a private placement offering we conducted in December 2022, or the December 2022 Private Placement, and the issuance of additional shares upon the vesting of RSUs issued to directors, employees and consultants. Liquidity and Capital Resources As of March 31, 2023, our total current assets were $46,687,000 and total current liabilities were $5,377,000. On March 31, 2023, we had a working capital surplus of $41,310,000, total equity of $20,881,000, out of which $1,817,000 is attributed to the non-controlling interest in Ever After, and an accumulated deficit of $393,125,000. Our cash and cash equivalents as of March 31, 2023 amounted to $3,677,000, compared to $23,791,000 as of March 31, 2022, and compared to $9,772,000 as of June 30, 2022. Cash balances changed in the nine months ended March 31, 2023 and 2022 for the reasons presented below. Net cash used for operating activities was $19,960,000 in the nine months ended March 31, 2023, compared to $28,074,000 in the nine months ended March 31, 2022. The decrease is mainly attributed to a decrease in net loss following the completion of clinical trials and the implementation of our cost reduction and efficiency plan that we initiated in order to align with the change in our business strategy. Cash used in operating activities in the nine months ended March 31, 2023 and 2022 consisted primarily of payments of fees to our suppliers, subcontractors, professional services providers and consultants, and payments of salaries to our employees, partially offset by grants from the IIA, the EU’s Horizon 2020 and 2022 programs, Israel’s Ministry of Economy and other research grants. Investing activities provided cash of $5,374,000 in the nine months ended March 31, 2023, compared to cash used of $14,738,000 for the nine months ended March 31, 2022. The investing activities in the nine-month period ended March 31, 2023 consisted primarily of the withdrawal of $5,539,000 of short-term deposits. The investing activities in the nine-month period ended March 31, 2022 consisted primarily of the investment of $4,233,000 in short-term deposits and proceeds of $19,052,000 from withdrawal of long-term deposits. Financing activities provided cash of $8,034,000 in the nine months ended March 31, 2023, compared to $7,500,000 for the nine months ended March 31, 2022. The financing activities in the nine-month period ended March 31, 2023 related to issuances of common shares and warrants, net of issuance cost, that were paid in cash, in the December 2022 Private Placement. The financing activities in the nine-month period ended March 31, 2022 were related to proceeds of $7,500,000 we received from Tnuva as an investment in Ever After. 25 Between December 13, 2022 and December 27, 2022, we entered into a series of securities purchase agreements with several purchasers for an aggregate of 8,155,900 common shares and warrants, or the Warrants, to purchase up to 8,155,900 common shares. On December 13, 2022, we executed securities purchase agreements to sell, at a purchase price of $1.03 per share, up to 5,579,883 common shares and Warrants to purchase up to 5,579,833 common shares, with an exercise price of $1.03 per share and a term of three years. On December 14, 2022, we executed securities purchase agreements to sell, at a purchase price of $1.05 per share, up to 2,068,517 common shares and Warrants to purchase up to 2,068,517 common shares, with an exercise price of $1.05 per share and a term of three years. On December 15, 2022, we executed securities purchase agreements to sell, at a purchase price of $1.06 per share, up to 237,500 common shares and Warrants to purchase up to 237,500 common shares, with an exercise price of $1.06 per share and a term of three years. On December 19, 2022, we executed a securities purchase agreement to sell, at a purchase price of $1.09 per share, up to 135,000 common shares and Warrants to purchase up to 135,000 common shares, with an exercise price of $1.09 per share and a term of three years. On December 27, 2022, we executed a securities purchase agreement to sell, at a purchase price of $1.12 per share, up to 135,000 common shares and Warrants to purchase up to 135,000 common shares, with an exercise price of $1.12 per share and a term of three years. The Warrants sold in the December 2022 Private Placement will be exercisable upon the later of six months from their issuance date, or from the date the authorized shares increased. As March 31, 2023, the Company issued 8,155,900 common shares and warrants that relate to the December 2022 Private Placement and received $8,034,000 as of that date net of $435 from issuance expenses. In addition, the purchasers in the December 2022 Private Placement agreed to execute proxies permitting our Chief Executive Officer and Chief Financial Officer to vote the securities purchased in the December 2022 Private Placement in favor of any shareholder vote relating to a future increase of our authorized shares. Pursuant to the securities purchase agreements executed with the purchasers, we agreed to hold a meeting of shareholders within 200 days of the execution of the securities purchase agreements for the purpose of increasing our authorized shares. On April 27, 2023, our shareholders approved an amendment to our articles of incorporation of to increase the number of authorized common shares from 60,000,000 shares to 300,000,000 shares and such increase was effectuated on May 1, 2023 when the Company filed its amendment to its articles of incorporation reflecting such increase. As such, the Warrants became exercisable on May 1, 2023. On December 14, 2022, Yaky Yanay, our Chief Executive Officer, agreed to forgo, starting January 1, 2023, $375,000 of his annual cash salary for the next twelve months in return for equity grants, issuable under our existing equity compensation plans. In that regard, we granted Mr. Yanay (i) 334,821 RSUs, vesting ratably each month, and (ii) options to purchase 334,821 common shares, vesting ratably each month, with a term of 3 years, at an exercise price of $1.12 per share. In addition, the Board of Directors also agreed to grant Mr. Yanay options to purchase 1,500,000 common shares, with a term of 3 years, with the following terms: (i) options to purchase 500,000 common shares at an exercise price of $1.56 per share, 50% vesting on June 30, 2023 and 50% vesting on December 31, 2023, (ii) options to purchase 500,000 common shares at an exercise price of $2.08 per share, 50% vesting on June 30, 2023 and 50% vesting on December 31, 2023, and (iii) options to purchase 500,000 common shares at an exercise price of $2.60 per share, 50% vesting on June 30, 2023 and 50% vesting on December 31, 2023. All options were granted in January 2023 and will expire three years from the later of the vesting date or the date which the Company increased its authorized share capital. On July 16, 2020, we entered into an Open Market Sale Agreement SM , or the ATM Agreement, with Jefferies LLC, or Jefferies, pursuant to which we were able to issue and sell our common shares having an aggregate offering price of up to $75,000,000 from time to time through Jefferies. Upon entering into the ATM Agreement, we filed a new shelf registration statement on Form S-3, which was declared effective by the SEC on July 23, 2020. On September 21, 2022, as a result of General Instruction I.B.6 of Form S-3, and in accordance with the terms of the Sales Agreement, we reduced the amount available to be sold under the ATM Agreement to a maximum aggregate offering price of up to $11,800,000 of our common shares from time to time through Jefferies. During the nine-month period ended March 31, 2023, we did not sell of our any common shares under the ATM Agreement. 26 In April 2020, we and our subsidiaries, Pluri Biotech Ltd. and Pluristem GmbH, executed the EIB Finance Agreement for non–dilutive funding of up to €50 million in the aggregate, payable in three tranches. The proceeds from the EIB Finance Agreement were intended to support our research and development in the European Union to further advance our regenerative cell therapy platform, and to bring the products in our pipeline to market. The term of the project was three years commencing on January 1, 2020. During June 2021, we received the first tranche in the amount of €20 million pursuant to the EIB Finance Agreement. The amount received is due to be repaid on June 1, 2026 and bears annual interest of 4% to be paid together with the principal of the loan. As of March 31, 2023, the interest accrued was in the amount of €1,463,000. In addition to the interest payable, the EIB is also entitled to royalty payments, pro-rated to the amount disbursed from the EIB loan, on the Company’s consolidated revenues beginning in the fiscal year 2024 up to and including its fiscal year 2030, in an amount equal to up to 2.3% of the Company’s consolidated revenues below $350 million, 1.2% of the Company’s consolidated revenues between $350 million and $500 million and 0.2% of the Company’s consolidated revenues exceeding $500 million. As the project term ended on December 31, 2022, we do not expect to receive additional funds pursuant to the EIB Finance Agreement. According to the IIA grant terms, we are required to pay royalties at a rate of 3% on sales of products and services derived from technology developed using this and other IIA grants until 100% of the dollar-linked grants amount plus interest are repaid. In the absence of such sales, no payment is required. Through March 31, 2023, total grants obtained from the IIA aggregated to approximately $27,760,000 and total royalties paid and accrued amounted to $169,000. In June 2020, we announced that we were selected as a member of the CRISPR-IL consortium, a group funded by the IIA. CRISPR-IL brings together the leading experts in life science and computer science from academia, medicine, and industry, to develop Artificial Intelligence, or AI, based end-to-end genome-editing solutions. These next-generation, multi-species genome editing products for human, plant, and animal DNA, have applications in the pharma, agriculture, and aquaculture industries. CRISPR-IL is funded by the IIA with a total budget of approximately $10,000,000 of which, an amount of approximately $480,000 was a direct grant allocated to us, for the initial period of 18 months. During October 2021, we received an approval for an additional grant of approximately $583,000 from the IIA pursuant to the CRISPR-IL consortium program, for an additional period of eighteen months. During January 2023, we received approval for an extension of an additional 2 months to finish the program until June 30, 2023. The CRISPR-IL consortium program does not include any obligation to pay royalties. Through March 31, 2023, we received total grants of approximately $775,000 in cash from the IIA pursuant to the CRISPR-IL consortium program, out of which an amount of $80,000 was received during the nine-months ended March 31, 2023. As of March 31, 2023, we received total grants of approximately $6,614,000 in cash from the European Union research and development consortiums pursuant to the Horizon programs. During December 2022, we received an approval for an additional budget allocation of approximately $735,000 to us, relates to PLX-PAD program for muscle recovery following surgery for hip fracture. The full amount was received by us in April 2023. On September 6, 2022, we announced that a €7.5 million non-dilutive grant from the European Union’s Horizon program was awarded to Advanced PeRsOnalized Therapies for Osteoarthritis (PROTO), an international collaboration led by Charité Berlin Institute of Health Center for Regenerative Therapies. The goal of the PROTO project is to utilize our PLX-PAD cells in a Phase I/IIa study for the treatment of mild to moderate knee osteoarthritis. Final approval of the grant is subject to completion of the consortium agreement. An amount of approximately Euro 500,000 (approximately $533,745) will be a direct grant that will be allocated to us. Through March 31, 2023, we received a payment of approximately $185,000 in cash, which relates to the PROTO program. 27 The Phase I/II study will be carried out by Charité, together with us and other members of the international consortium under the leadership of Professor Tobias Winkler, Principal Investigator, at the Berlin Institute of Health Center of Regenerative Therapies, Julius Wolff Institute and Center for Musculoskeletal Surgery. The currency of our financial portfolio is mainly in U.S. dollars and we use options contracts and other financial instruments in order to hedge our exposures to currencies other than the U.S. dollar. For more information, please see Item 7A. - “Quantitative and Qualitative Disclosures about Market Risk” in the 2022 Annual Report. We have an effective Form S-3 registration statement (File No. 333-239890), filed under the Securities Act of 1933, as amended, with the SEC using a “shelf” registration process. Under this shelf registration process, we may, from time to time, sell our common shares, preferred shares and warrants to purchase common shares, and units of two or more of such securities in one or more offerings up to a total dollar amount of $250,000,000. As of February 13, 2022, other than the $11,800,000 of common shares we are eligible to sell pursuant to the ATM Agreement, and the $30,000,000 of common shares we sold in a registered direct offering in February 2021, no securities have been sold pursuant to our effective Form S-3 registration statement. Outlook We have accumulated a deficit of $393,125,000 since our inception in May 2001. We do not expect to generate any significant revenues from sales of products in the next twelve months. We expect to generate revenues, from the sale of licenses to use our technology or products, but in the short and medium terms will unlikely exceed our costs of operations. We may be required to obtain additional liquidity resources in order to support the commercialization of our products and technology and maintain our research and development and clinical study activities. We are continually looking for sources of funding, including non-diluting sources such as collaboration with other companies via licensing agreements, joint venture and partnerships, research grants such as the IIA grants and the European Union grant, and sales of our common shares. We believe that we have sufficient cash to fund our operations for at least the next twelve months.