What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2024-03-29 compared with 2023-04-14 · 298 added, 908 removed, 223 unchanged (84% of the section changed)

We are a clinical-stage biopharmaceutical company focused on the development of proprietary immunotherapeutic fully-human antibodies, or fully-human immunoglobulins (hIgGs), to treat and prevent immune and autoimmune disorders as well as infectious diseases that have significant mortality and health impacts on high-risk patients.

These antibodies are target-specific and polyclonal, meaning they are made up of many different hIgGs that bind to multiple sites specific to an immunogen as opposed to a monoclonal antibody that binds to only a single site.

Our development programs include autoimmune disorders, gastroenterological, and respiratory diseases.

Using private resources and more than $200 million of funds awarded by the U.S.

Government emerging infectious disease and medical countermeasures programs since September 2019, we have developed a novel drug development platform, which we refer to as our DiversitAb platform.

This platform is based on the natural human immune system and has the unique capability to generate large quantities of specifically targeted, high-potency, hIgG that target multiple epitopes, antigens or binding sites without the need for producing these antibodies from convalescent plasma or human donors.

We have refined, optimized, and advanced genetic engineering and antibody science to develop transchromosomic cattle (which we refer to as Tc Bovine) that produce hIgGs and the engineering of the platform drives IgG1 production primarily.

These Tc Bovine form a key component of our versatile DiversitAb platform, a fully scalable production system for producing immunotherapies to multiple disease indications.

Our platform represents the technology that can produce disease-targeted, fully human IgG without the need for human donors.

We are leveraging our DiversitAb platform to discover and develop product candidates with the potential to be first-in-class against novel targets or best-in-class against known, complex targets that treat diseases with significant unmet medical needs, including immune and autoimmune disorders, infectious gastroenterological and respiratory diseases, and oncology.

Key Product Differentiators Over Existing Technologies

The DiversitAb platform represents the first of its kind technology to produce large scale human high-titer, high-avidity antibodies across multiple modalities and a new source for novel treatments from a unique targeted human hIgG discovery and product development engine.

(See Figure 1).

Polyclonal Antibody Development (hIgG)  represents the first time that fully human antibodies allow targeting to complex diseases with multiple dysregulated pathways through hyperimmunization to be fully explored as potent immunotherapies that can target multiple different targets and different modes of action all in the same regulated product.

This is the first scalable technology that mimics the natural way humans fight disease through production of hIgG.

Human Immunoglobulin (hIgG)  is used to treat patients with primary and secondary immune deficiencies as well as other indications and SAB’s antibodies have demonstrated comparability to approved subcutaneous delivered, human-derived products with the potential benefits that come from having a controlled source of human antibodies without the need for human donors.

Monoclonal Antibody (mAb) Discovery  is accomplished in two ways using the DiversitAb platform:

1) by sequencing antibodies produced from Tc Bovine B-cell clones;

and 2) by direct sequencing of target-specific immunogen purified hIgG produced at high concentrations, each representing the potential to capture unique monoclonal antibody candidates.

Versatile Antibody Platform with Ability to Capture Multiple Modalities

While we can rapidly generate specific, high-affinity monoclonal antibodies, the biggest potential in delivering new highly effective treatments lies within the multi-target approach.

Complex diseases are conditions where multiple targets and multiple dysregulated pathways are involved.

Except for diseases driven by a single genetic mutation, a vast majority of diseases that consistently cause human suffering with high unmet medical needs are complex.

Examples of complex diseases include autoimmune disorders such as Type 1 diabetes or cancer.

Historically we treat complex diseases by prescribing multiple single-target treatments to patients, that can have drug interactions and toxicities, and from the R&D perspective, inevitably results in operational, organizational, and financial challenges tied to requirements to conduct very large, long, and costly combination trials.

Our DiversitAb platform develops treatments that address multiple dysregulated pathways, multiple targets, multiple epitopes in a single powerful fully human immunoglobulin treatment.

Regulation of this approach primarily rests within the U.S.

FDA Center for Biologics Evaluation and Research (CBER), which regulates the safety, activity and potency of the immunoglobulin mixture and not by characterization of individual antibody molecules.

hIgGs have natural multivalency that can be effective against highly mutating viruses and other diseases with epitope mutations or variants, due to the large number of different hIgGs and their ability to bind to or block multiple epitopes.

hIgGs are the natural way the human body fights disease, as they work organically with the rest of the immune system to activate effector cell function, which are the cells that defend the body in an immune response.

hIgGs can be rapidly and consistently produced to target many different diseases, and the regulatory pathway for plasma-derived hIgGs allows for broad potency to multiple disease targets within a single drug product vial.

Our hIgGs can be used as both pre- and post-exposure prophylaxis and treatments.

Our discovery and hIgG production process can occur simultaneously using our DiversitAb platform, which accelerates development of our hIgGs by leveraging the natural antibody selection that occurs in our Tc Bovine.

We have a demonstrated regulatory pathway through the Center for Biologics Evaluation and Research (CBER) that understands our science and is familiar with the multivalent and multitarget properties of our single vial drug products.

This further streamlines our ability to rapidly and efficiently develop new and novel drug products where mAbs simply can’t replicate or duplicate our drug product attributes.

DiversitAb Platform Produces a Natural Mixture of Many Human hIgGs

that bind to Multiple Epitopes but are Regulated as a Single Product

We are a clinical-stage biopharmaceutical company focused on the development of human polyclonal immunotherapeutic antibodies, or human immunoglobulins (hIgG), to address immune system disorders and infectious diseases.

Our antibodies are both target-specific and polyclonal, meaning they are comprised of multiple hIgGs and can bind to multiple sites on specific immunogens, making them ideally suited to address the complexities associated with many immune-mediated disorders.

Our lead candidate, SAB-142 is a human anti-thymocyte globulin (ATG) focused on preventing or delaying the progression of type 1 diabetes (T1D).

We recently initiated a Phase 1 trial of SAB-142 to establish its safety and pharmacokinetic profiles in human subjects.

In addition to SAB-142, we also have clinical stage assets targeting infectious diseases that have significant mortality and morbidity in the general population and in high-risk patients.

To date, we have conducted seven clinical trials, including Phase 1, Phase 2 and Phase 3, totaling more than 700 individuals dosed with our proprietary hIgGs.

In May of 2023, we received Fast Track Designation and Breakthrough Therapy Designation from the Food and Drug Administration Center for Biologics Evaluation and Research (“CBER”) for our SAB-176 immunoglobulin targeting multiple strains of influenza based upon positive clinical data from a Phase 2a trial.

More broadly, we believe that our proprietary platform, referred to as DiversitAb, holds the potential to generate additional novel therapeutic candidates to expand our pipeline.

DiversitAb utilizes the human immune response to generate the optimal repertoire of IgGs for drug targets of interest.

We believe it is the only technology capable of producing disease-targeted, hIgG in large quantities without the need for human plasma donors.

We have optimized genetic engineering in the development of transchromosomic cattle, or Tc Bovine, which produce hIgGs.

Our engineering of the DiversitAb production system drives IgG1 production across our pipeline.

As our lead program SAB-142 advances, we intend to expand our pipeline in complimentary indications through strategic utilization of our platform.

BUSINESS STRATEGY

• We are focused on developing product candidates for disease targets where a differentiated approach has the greatest potential to be either first-in-class against novel targets or best-in-class against complex targets to treat diseases with significant unmet medical needs, including immune and autoimmune disorders including T1D.

• We are leveraging our proprietary production system to advance a robust pipeline of differentiated hIgG-based therapies for the treatment of immune system disorders and infectious diseases.

• Our business strategy is focused on SAB-142 as a first-in-class, human, multi-target antibody treatment designed to provide superior efficacy and safety in delaying the onset or progression of T1D.

• Our production system (DiversitAb TM) represents the first technology of its kind to produce large-scale human high-titer and high-avidity antibodies across multiple modalities.

• We have a demonstrated regulatory pathway through each of the U.S.

Food and Drug Administration (the “FDA”), CBER, UK Medicines and Healthcare products Regulatory Agency (“MHRA”), and Australian Therapeutic Goods Administration (“TGA”).

These organizations understand our science and are familiar with the multivalent and multitarget properties of our single vial drug products.

This further streamlines our ability to develop new and novel drug products rapidly and efficiently where single target monoclonal antibodies (mAbs) cannot replicate or duplicate our drug product attributes.

• Our hIgGs have been safely demonstrated up through Phase 3 clinical trials with a patient safety database that includes over 700 patients who were safely administered our hIgG therapeutics.

RECENT MILESTONES

Since September 2019, we achieved multiple milestones, including:

Established proof-of-concept for our DiversitAb platform and Chemistry, Manufacturing and Controls (CMC) for multiple disease indications.

Performed multiple clinical trials establishing the safety profile of hpAbs produced in DiversitAb platform in hundreds of patients and have demonstrated proof of clinical concept for our DiversitAb platform across three SAB-sponsored INDs and one CTA (filed Ex-US) that encompass seven clinical trials from Phase 1 to Phase 3 across treatment of three indications (MERS, Influenza, and COVID-19) briefly summarized below (Figure 3)

Completed Phase 2a challenge study for SAB-176 in adults infected with influenza virus and Phase 2 study for SAB-185 in adults infected with SARS-CoV-2 virus.

Announced topline data demonstrating SAB-176 met its primary endpoint in our Phase 2a challenge study in adults infected with influenza virus.

Reported positive topline Phase 2 virology data demonstrating SAB-185 met criteria for advancement to Phase 3 and completed 50% enrollment in Phase 3.

Phase 3 patient safety follow-up is ongoing.

Announced that recent data demonstrated that SAB-185 retains neutralization activity against the Omicron SARS-CoV-2 in an in vitro  pseudovirus model and in a human ACE2 receptor in vivo  model study.

Completed IND enabling in-vivo pilot and GLP tox safety and pharmacodynamic studies for SAB-142 for autoimmune disorders including Type 1 Diabetes.

Established proof-of-concept for production of human anti-idiotype IgGs to human auto-antibodies using the DiversitAb platform.

DiversitAb ™

Platform Clinical Validations

Accomplishment Summary

Fact Sheet of Accomplishments

Figure 4 shows a summary of our accomplishments in proof of principle and proof of concept for the use of the DiversitAb platform in development of multiple assets as well as the establishment of a clear regulatory framework.

Two (2) or less is the number of years it takes us to develop a new investigational product from concept to IND filing.

Rapid response during the Covid-19 pandemic allowed for IND enablement and the start of Phase 1 clinical trials in 128 days.

Eleven (11) is the number anti-infectives assets that have been developed in the DiversitAb platform through proof of concept and beyond in the preclinical or clinical setting.

Ninety (90) is the percent of our biologic immunotherapeutics that successfully reached predefined milestones.

Greater than seven hundred (>700) subjects have been treated with investigational therapeutics produced by the DiversitAb platform.

Zero (0) assets to date lost total efficacy to viral escape mutants.

One (1) SAB Biotherapeutics is the First and Only company able to produce an unlimited supply of fully human broadly neutralizing hIgGs without the need for human donors.

We have achieved multiple recent milestones, including:

• Initiated a Phase 1 clinical trial of SAB-142 for safety and tolerability in autoimmune disorders including T1D.

• Financing of up to $110 million in gross proceeds dedicated to clinically advance SAB-142 to 2026 and topline Phase 2 results.

• Completed IND enabling in-vivo pilot and GLP toxicity safety and pharmacodynamic studies for SAB-142 for disease-modifying approach for autoimmune disorders including T1D.

• Completed manufacturing and release testing of two lots of Phase 1 clinical drug product of SAB-142.

• Initiated in-vivo GLP juvenile toxicity safety and pharmacodynamic studies to enable Phase 2b clinical trial advancement to adolescent patients for SAB 142.

• Secured Fast Track Designation and Breakthrough Therapy Designation from FDA for SAB-176 for treatment and prophylaxis of influenza virus, providing an accelerated regulatory timeline for this asset as well as evidence of a clear regulatory strategy for all production system assets.

• Established proof-of-concept for our DiversitAb production system and Chemistry, Manufacturing and Controls (CMC) for multiple disease indications.

• Performed multiple clinical trials establishing the safety profile in >700 patients of hIgG produced in the DiversitAb production system and have demonstrated proof of clinical concept for our DiversitAb production system across three SAB-sponsored INDs and one CTA (filed in UK) that encompass seven clinical trials from Phase 1 to Phase 3 across treatment of three indications (MERS, Influenza, and COVID-19).

KEY PRODUCT DIFFERENTIATORS

Multivalent product platform to address complex diseases

Our unique production system harnesses the natural advantages of polyclonal immunoglobulins to protect against evolving disease targets by activating our body’s immune system in a target-specific way.

Our IgGs are engineered primarily to produce >90% of the IgG1 isotype with fully functional human antibody variable regions (or Fab domains) that specifically bind to target antigens, thus providing multivalent properties.

This multi-epitope capability can address individual variability of epitopes associated with immunological diseases and neutralize highly mutating targets, thus preventing mutation escape in infectious diseases.

There is a demonstrable and significant potential advantage of Tc Bovine-produced hIgGs characterized by their ability to bind to both foreign exogenous or human endogenous protein targets, ability to activate human effector cells, and do so in a way that does not cause serum sickness or anti-drug antibody formation.

Another key product differentiator of our platform is the ability to produce a multitarget product that addresses the complexity of disease in a single drug product vial.

This is a particularly powerful multivalent combination when multiple antigen targets are combined with the muti-epitope targeting of a single antigen (described above), as the therapeutic advantage is expanded to address multiple disease modalities all within a single vial.

Rapid Product Development Capability with Proven Regulatory Pathway

Our polyclonal development approach leverages our production system to capture discovery and production efficiencies not available to mAb product development.

Through the utilization of our Tc Bovine, we can simultaneously perform discovery and production functions of our polyclonal development, significantly improving the time of antibody discovery and production.

This efficiency was demonstrated during the COVID-19 pandemic where SAB-185 product that is in compliance with Current Good Manufacturing Practice regulations enforced by the FDA (cGMP), was produced in 90 days from initial product concept.

Our discovery process simply involves antigen design and production as the vaccinated Tc Bovine does the rest including antibody design, down selection, and scaled production all in one system.

Our regulatory pathway has also been established with the US FDA as well as MHRA in the United Kingdom and TGA in Australia.

The FDA regulates polyclonal hIgGs and mAbs differently, as mAbs are regulated through the Center for Drug Evaluation and Research (“CDER”) while pAbs are regulated by CBER.

CBER has approved over 36 IgG products from both human- and animal-derived plasma.

Further, CBER is very familiar with our DiversitAb production system and pAb product.

We have navigated three SAB drug products through seven clinical trials with one product having advanced to Phase 3.

PIPELINE PROGRAMS

We are leveraging our DiversitAb platform to advance a robust pipeline of differentiated hIgG-based therapies for the treatment of immune system disorders and infectious diseases.

We are focused on developing, with partners or on our own, product candidates where we believe a differentiated human hIgG approach has the greatest potential to be either first-in-class against novel targets or best-in-class against complex targets to treat diseases with significant unmet medical needs, including diseases such as influenza, CDI, immune system disorders (including Type 1 diabetes or T1D), organ transplantation and early discovery oncology.

We believe route of administration is also an important component of the ability to access specific markets.

While we are currently testing our lead programs using intravenous administration, we are pursuing the development of alternate routes of administration as an expansion of our market reach.

These include subcutaneous and intramuscular routes of administration.

Figure 5 summarizes the status of the therapeutic candidates in our current pipeline.

Summary of Therapeutic Candidates in Our Current Pipeline

Potential applications of multi-target multi-epitope approach are virtually limitless and our pipeline shows examples of targeted hIgG assets across several therapeutic areas.

We continue building on our successful track record in respiratory diseases, including previous positive clinical trials in COVID-19 and Middle Eastern Respiratory Syndrome (MERS) indications, by focusing on SAB-176, a multitarget hIgG broadly neutralizing anti-influenza immunotherapy.

This is one of the most advanced clinical assets and has progressed to mid-Phase 2 stage. 

Another asset is SAB-195, the first human hIgG for treatment of Clostridioides difficile Infection (also known as CDI or C.

diff infection) and for prevention of recurrence of CDI. This asset is preclinical stage and anticipated to proceed to IND in the next 12 months.

Finally, we are entering into the autoimmunity space with SAB-142, another preclinical stage asset, that is a disease-modifying fully human hIgG aimed to prevent onset or disease progression of Type 1 Diabetes and subsequently expand into other immunology indications.  Additionally, we have a robust discovery and preclinical-stage pipeline in anti-idiotype disorders as well as emerging oncology programs.

Our top portfolio is balanced across early and late development assets with meaningful inflection points delivered every 12 months to assure rapid de-risking of individual assets and investments into these three programs as well as the entire DiversitAb platform. (See Figure 6).

Clinical Development Programs and Expected Asset Progress

HIGH RISK COVID-19

SAB-185 (anti-SARS-CoV-2) Demonstrates Clinical Advancement to Phase 3 Clinical Trials

SAB-185 is a fully-human, specifically targeted, highly potent, and broadly neutralizing human IgG therapeutic candidate for COVID-19.

SAB-185, generated from the full-length spike protein of the SARS-CoV-2 Wuhan strain, has shown neutralization of the Munich, Washington, South African, Delta, Lambda, and other variant strains in preclinical and nonclinical studies.

In addition, recent data has demonstrated that SAB-185 retains neutralization activity against the Omicron variant of COVID-19 in an in vitro pseudovirus model.

Preclinical data has shown SAB-185 to be significantly more potent than human-derived COVID-19 convalescent hIgG.

We have completed multiple clinical and nonclinical studies to date, including a Phase 1 trial in healthy volunteers, and a Phase1b and Phase 2b clinical trial, both in COVID-19 patients.

SAB-185 was being assessed in a Phase 3 clinical trial as part of the ACTIV-2 master protocol, sponsored, funded and conducted by the National Institute of Allergy and Infectious Diseases, part of the U.S.

National Institutes of Health (NIH) in collaboration with the AIDS Clinical Trials Group (ACTG).

On February 28, 2022, the NIH decided to terminate the ACTIV-2 program, including ALL other COVID-19 products active at the time in the ACTIV-2 protocol, after determining that the decrease in hospitalizations resulted in operational futility and made it cost-prohibitive to demonstrate statistically significant clinical efficacy with the existing study design.

SAB-185 was advanced in collaboration with the U.S.

Government, as part of the Countermeasures Acceleration Group, formerly Operation Warp Speed.

We filed the IND application, produced the initial clinical doses, and entered the Phase 1 clinical trial in just 128 days from the program initiation.

SAB-185 was designed and developed without the need for human convalescent plasma or human B-cell donations and has once again demonstrated DiversitAb platform advantage to neutralize multiple pathogen strains mutated overtime without significant loss of potency.

Equally important, the data also confirmed that high-risk patient populations unable to generate a sufficient endogenous immune response may benefit the most from IgG treatments produced by the DiversitAb platform.

Due to COVID-19 market and commercialization uncertainties, we have chosen to pause development of SAB-185.

This program has shown that we can rapidly develop and deliver a clinical trial-ready asset as well as the clear product development, manufacturing, control and regulatory pathway of assets developed from the DiversitAb platform.

Further data and information on this program can be found in the Proprietary DiversitAb Platform Section.

HIGH RISK INFLUENZA

SAB-176 is a multivalent, broadly neutralizing fully-human polyclonal hIgG therapeutic candidate in development for the treatment or prevention of severe influenza.

This novel, specifically targeted high-potency immunotherapy leverages the natural human immune response and is designed to bind and neutralize both Type A and Type B influenza, including emerging and mutating strains.

SAB-142 HUMAN ANTI-THYMOCYTE GLOBULIN FOR TYPE 1 DIABETES

Summary of SAB 142 for T1D

SAB-142 is a first-in-class, human, multi-target anti-thymocyte globulin treatment designed to provide superior efficacy and safety in delaying the onset or progression of T1D.

The mechanism of action of SAB-142 has been clinically validated in numerous clinical trials with a rabbit anti-thymocyte globulin (rATG).

Data from more than 700 human subjects treated with antibodies produced by our platform support expectation of a zero serum sickness rate and zero incidence of neutralizing anti-drug antibodies (ADA) within the upcoming SAB-142 trials.

There is an established regulatory path for T1D indications using the SAB-142 modality.

We initiated the Phase 1 clinical study with the first patient dosed November 2023.

Finally, our next steps will be to file a clinical trial application (CTA) in the EU and an investigational new drug (IND) application in the United States to expand the clinical trials to global jurisdictions.

Type 1 Diabetes Background

T1D is a complex and life-threatening autoimmune disease in which the body mistakenly attacks the insulin-producing beta cells of the pancreas.

Living with this disease requires daily, sometimes hourly, intensive insulin management with the potential for numerous complications.

Despite improvements in glucose monitoring and insulin administrations, mortality amongst people with T1D remains up to 13 times higher compared to matched controls.

From a drug development perspective, shifting away from chronic disease management and towards disease-modifying therapies has the potential to change and save millions of lives.

• According to the T1D Index, a global data simulation tool launched by Juvenile Diabetes Research Foundation (“JDRF”) in 2022, the prevalence of T1D has increased at four times the rate of population growth in every country across the globe since 2000.

• Nearly 1 in 300 children in the United States will be diagnosed with T1D during childhood, and one in every seven healthcare dollars can be attributable to the cost of managing diabetes over the lifetime.

• An estimated 8.4 million people were living with T1D worldwide in 2021, and this number is predicted to increase to 17.4 million by 2040.

Based on birth cohorts from 1950 to 2040, 6.85 million lives will be lost by 2040 if people are unable to access interventions to diagnose and treat T1D.

According to these estimates, T1D stands to become one of the world’s largest deadly chronic health conditions, similar in scale and impact to HIV.

Therapeutic Potential of the Polyclonal Modality in New-Onset Type 1 Diabetes

Maintenance of the level of connecting peptide, a short 31 amino acid polypeptide that connects insulin’s A chain to its B chain in the proinsulin molecule, commonly referred to as C-peptide, is a validated surrogate endpoint for endogenous insulin production, essential for the prevention of progression of T1D.

Placebo controlled trials with low-dose rATG, defined as a single dose of 2.5 milligram per kilogram (mg/kg), have shown statistically significant maintenance of C-peptide levels and thus a delay in progression of recent onset T1D.

Based on the results of a Phase 2 clinical trial conducted at the University of Florida, a single dose of rATG showed sustained benefit in T1D over a two-year period by maintaining significantly higher C-peptide levels than a placebo control.

However, more than 65% of treated patients in this study acquired serum sickness due to the infusion of a non-human antibody, with symptoms that included rash, malaise, fever, and joint swelling.

The symptoms often required treatment with steroids that control serum sickness but impair diabetes management and reduces the capacity to re-dose rATG when C-peptide levels begin to drop as shown in Figure 2 below.

Rabbit ATG Study for Type 1 diabetes

Comparison Efficacy of SAB-142 to rATG

The journey for a polyclonal antibody began over 15 years ago when the first preclinical study demonstrating efficacy of rabbit anti-thymocyte globulin (rATG, Thymoglobulin) in non-obese diabetic (NOD) mice was performed.

Since then, groundbreaking clinical trials with rabbit ATG have been conducted in patients with a recent T1D onset diagnosis.

Rabbit ATG, as shown in Figure 1 below, has shown potential therapeutic benefit in T1D as a multi-target polyclonal antibody known to bind multiple lymphocyte cell markers likely associated with this mechanism of action in the modulation of the immune system.

Multi-Target Binding of Thymoglobulin (rATG) IgG Polyclonal Immunoglobulin

All antibody products targeting human proteins have the potential for on-target or off-target adverse effects.

Figure 3 below summarizes an indicative safety assay, showing that compared to rATG, SAB-142 has a potentially better safety profile as much more of the SAB-142 antibody is required to have the same red blood cell binding activity as the FDA-approved rATG.

We have also shown in the table to the right that SAB-142 has potentially higher potency relative to rATG as measured by complement-dependent cytotoxicity activity, using human complement.

SAB-142 has Potential for a Best-in-Class Safety Profile with Higher Potency Compared to FDA Approved rATG (Thymoglobulin)

To characterize the multi-target binding profile of SAB-142, we compared the target-specific binding profile of SAB-142 to rATG against CD markers associated with human lymphocytes.

The data shows similar targeted binding activity between SAB-142 and rATG to the CD2 cell marker associated with human lymphocytes.

Figure 4 below illustrates SAB-142’s similar binding profile to T-cell subsets compared to rATG.

This in-vitro flow cytometry data shows SAB-142 on the X-axis binding to the exact same human T-lymphocyte, T helper cells and cytotoxic T-cell populations as rATG on the Y-axis.

SAB-142 Demonstrates Similar T-Cell Subset Binding Profile as rATG

We further demonstrated that SAB-142 has a similar mechanism of action associated with T-cell subsets compared to rATG shown in Figure 5 below.

Similar to rATG, SAB-142 induced a significant reduction of live cytotoxic CD8+T-cells in a dose-dependent manner compared to the non-target-specific human IgG control.

Furthermore, SAB-142 activated the

conversion of naïve CD4+ cells to an activated state and most importantly, preserved T regulatory cells, again, similar to rATG.

As the data shows, SAB-142 demonstrated a multi-target binding profile and mechanism of action similar to FDA-approved rATG with the potential of an improved safety profile and potency.

SAB-142 Demonstrates Similar T-Cell Subset Mechanism of Action as rATG

A review of safety parameters based on both short and long-term safety data (up to five years from three separate clinical trials conducted with low-dose rATG in Stage 3 T1D patients) highlights issues associated with dosing humans with rabbit-derived antibodies.

Three studies were conducted with two doses of rATG:

a single trial with a 6.5 mg/kg dose, and two studies using a low dose of 2.5 mg/kg.

Each trial was adequately designed, randomized, double-blind, and placebo controlled.

In all three trials, extensive safety assessments and a long-term safety follow-up showed no increase in infection versus placebo, no opportunistic infections or infections known to develop predominantly in immunosuppressed patients, and no difficulty in clearing infections.

The 6.5 mg/kg trial investigated an immune response to either a recall or novel antigen as a representative of an immune response to vaccination or an infection.

The findings demonstrated that the administration of a single dose of rATG did not result in decreased humoral response versus placebo.

Finally, none of the three trials observed an increase in liquid cancers or solid malignancies.

In summary, the overall long-term safety profile of a low-dose ATG is supportive of the vision to use SAB-142 as a lifelong disease-modifying treatment without a risk of immunosuppression associated with clinically significant effects such as infections, malignancies or suppressed humoral response.

Comparative MoA and Administration of rabbit ATG and SAB-142

Rabbit ATG shows therapeutic promise but offers problematic potential for adverse events that could inhibit long term disease modification and redosing;

we believe those issues are resolved by SAB-142.

SAB-142 represents an opportunity to offer a novel human alternative to rabbit- or equine-derived ATG IgGs with potential for safe and reliable re-dosing while avoiding the risk factors observed with currently available therapies.

While the mechanism of action of our compound closely resembles rATG, SAB-142 has clear advantages that are fundamental for safe and reliable re-dosing required to delay disease progression.

It is well established that treatment with heterologous proteins such as rATG can result in serum sickness, which can trigger Grade 3 adverse events.

Serum sickness is defined as a Type 3 hypersensitivity reaction.

The heterologous nature of rATG also results in the production of neutralizing anti-drug antibodies (ADAs) in the majority of patients even after a single course of therapy.

Neutralizing anti-drug antibodies, or NAbs, are a subset of ADAs that bind to the drug and inhibit its pharmacologic action or activity.

Once pharmacological function is inhibited, beta cells are left unprotected from attacks by the cytotoxic CD8-positive T-cells or inflammatory mediators, and the disease continues to progress.

Data from preclinical studies and clinical trials suggest that commercially approved rATG has been shown to transiently restore immune-tolerance and reduce autoimmune attack on pancreatic beta cells in T1D patients.

Following IV administration, both rATG and SAB-142 have been shown to target key circulating immune cell types involved in an autoimmune response in T1D.

Both ATGs cause a dose-proportional transient reduction of CD4+ and CD8+ T-cells while sparing T regulatory (Treg) cells in addition to modulating other autoimmune pathways involved in T1D pathophysiology.

These include macrophages and B cells.

By reducing overreactive CD4+ and CD8+ T cells while preserving T reg cells, SAB-142 is expected to reduce autoimmune β-cell destruction and delay progression or onset of T1D in patients with Stage 3 or Stage 2 T1D respectively.

In addition to potentially preserving beta cell function in early T1D patients, SAB-142 offers the potential of re-dosing when examining clinically meaningful indicators such as C-peptide levels and glycosylated hemoglobin (HbA1c), without the potential risk of inducing major immune reactions of animal derived IgGs.

A short-term safety signal observed in these clinical trials includes serum sickness (SS) and cytokine release syndrome (CRS).

In all three trials with rATG, cytokine release syndrome (CRS) was observed.

However, its incidence appears to be dose dependent.

Comparative Efficacy of teplizumab and SAB-142

Teplizumab, sold under the brand name Tzield, is a humanized anti-CD3 monoclonal antibody that is the first approved treatment indicated to delay the onset of 2 T1D.

Teplizumab was approved by the FDA in November of 2022 and is the first approved disease-modifying drug for T1D.

To complete a comparative profile of the SAB-142, it is important to understand how it could be benchmarked against teplizumab, a humanized monoclonal antibody.

Teplizumab exclusively binds to the CD3 receptor on T-cells, while the mode of action for SAB-142 is multifactorial, binding to multiple T cell receptors associated with various lymphocyte subsets.

Teplizumab is currently approved in a single indication, Stage 2 T1D.

With SAB-142, we are targeting both Stage 2 and Stage 3 T1D patients.

(See Figures 6 and 8 ) It is anticipated that Sanofi may file a supplemental NDA with the US FDA for approval for use in patients with Stage 3 T1D.

Based on the published peer-reviewed analysis, teplizumab showed a 63% effect on C-peptide AUC after year two, whereas rATG showed 103% effect on C-peptide AUC at year two.

Teplizumab also has immunogenicity liability.

Of patients treated with teplizumab, 57% had ADAs, 46% of which were neutralizing ADAs.

Due to the human nature of SAB-142, the probability of ADA or neutralizing ADA is very low, which is supported by the immunogenicity data from our clinical trials.

Lastly, teplizumab is administered intravenously with a daily IV required over 12-14 days, while SAB-142 dosing is expected to be administered over one to two days.

Comparative MoA and Administration of teplizumab and SAB-142

SAB-142 Comparison with Teplizumab (Tzield)

Manufacturing of SAB-142

To produce SAB-142, we strategically focused on making a best-in-class, human, anti-thymocyte globulin.

To accomplish this, we focused our development on improving both the potency and safety profile of SAB-142 benchmarked against FDA-approved rATG or Thymoglobulin .

Recapitulating the rATG mechanism of action was anticipated as the production process of SAB-142 is nearly identical to rATG, wherein the wild-type rabbits are vaccinated with human thymocytes which mount a rabbit polyclonal response.

These antibodies are subsequently purified from the plasma ( Figure 7 ).

SAB uses a similar production process where we also vaccinate our Tc Bovine with human thymocytes.

However, instead of producing animal polyclonal antibodies, our production system produces human anti-thymocyte globulin, which elicits a mechanism of action similar to that of rATG.

According to our estimates, between 15-20 Tc bovine could produce tens of thousands of doses of SAB-142.

SAB-142 Production Similar to FDA Approved rATG

Indication and Clinical Strategy for SAB-142

Immunological processes resulting in the breakdown of self-tolerance and gradual destruction of pancreatic beta cells by the patient’s own immune system preceding the clinical onset of disease oftentimes starts very early in patients’ lives, sometimes as early as in utero.

The average age of clinical onset of T1D is 13 years old.

Stage 1 is the start of T1D, marked by individuals having two or more diabetes-related autoantibodies and still normal blood sugar concentrations.

In Stage 2, individuals have dysglycemia but without symptoms.

Stage 3 is the time of a full clinical diagnosis.

Unfortunately, when an individual is first diagnosed with clinical stage T1D, 50- 90% of pancreatic insulin-producing beta cells are already destroyed.

Hence, it is critical to start therapy that preserves the remaining fully functional beta cells as soon as possible as it may provide the highest benefit throughout the patient’s lifetime (see Figure 8 ).

SAB-142 has Strong Potential to Control or Prevent T1D Over the Entire Life Span

One of the early proposed studies in our clinical development program will be in those patients with Stage 3 T1D.

The trial participants will be patients who are recently diagnosed with the disease.

Following the trials in Stage 3, we would progress into clinical trials in Stage 2 patients.

Stage 2 patients are those who do not yet have a full clinical onset of T1D and have even more functional beta cells that can be further preserved.

In this patient population, we will aim to delay the onset of full clinical T1D along with evaluation of the re-dosing potentially aimed at fully preventing clinical onset of disease.

The ultimate vision for SAB-142 is founded on the potential ability to safely re-dose by delivering a consistent and effective dose of this medication only once per year to fully halt progression of established clinical disease or delay its onset indefinitely.

Preclinical Studies for SAB-142

We have completed the GLP toxicology study that enables filing an IND submission.

• Determine the potential toxicity of SAB-142 vs.

an anti-thymocyte globulin (ATG) when given by single intravenous infusion to non-human primates.

• Characterize mechanism of action, toxicokinetic and immunogenicity profile of SAB-142.

• GLP toxicology study demonstrated SAB-142 is well tolerated at escalating doses tested.

• Both SAB-142 and rATG induced transient dose-proportional change in lymphocytes with dose-dependent recovery to baseline.

The dynamics of such depletion appears to be more prolonged with SAB-142 treatment in a dose-dependent manner.

This data demonstrates the power of our multi-target approach, which is currently only possible with our production system, where SAB-142 directly impacts each individual immune cell subset.

These in vivo results suggest that SAB-142 may have pharmacokinetic and pharmacodynamic attributes relevant for disease-modifying effects in T1D while having the impactful product advantage of an improved safety profile.

IND/CTA filings are anticipated by fourth quarter 2024.

SAB-142 GLP Toxicology Study Results Shows Impacts on Major Relevant T-cell Subsets in-vivo Enables IND Submission

Additionally, we have started a GLP juvenile toxicology study in non-human primates that will read out in the second half of 2024 to enable inclusion of adolescent T1D patients in the future Phase 2b study of SAB-142.

Clinical Trial Design and Timelines

Our Phase 1 trial is a randomized, double-blind, single ascending dose trial to assess safety, tolerability, pharmacokinetics, pharmacodynamics, and proof of biological activity (POBA) of SAB-142 for T1D indications (See Figure 10 ).

We commenced dosing in healthy volunteers in November of 2023.

The proposed dose range for SAB-142 is projected to be a single infusion over two days ranging between 0.03 and 2.5 mg/kg.

We believe major outcomes from this Phase 1 trial will include validating SAB-142 potential for safety superiority based on an anticipated 0% serum sickness and 0% neutralizing anti-drug antibody.

We also believe the study will validate the mechanism of action of SAB-142 in humans and establish proof of biological activity based on the change versus baseline in the most important cell lineages such as CD3, CD4, CD8-positive T-cells and Tregs vs.

those of rATG in a cross-study comparison.

SAB-142 Phase 1 Clinical Plan

In addition to the currently approved and ongoing Phase 1, we plan to bring this program to IND and CTA filings with global regulatory authorities by the mid-2024.

As there are unmet medical needs globally for disease-modifying treatments of T1D, we plan to work with global health authorities and file clinical trial applications and clinical trial notifications in other countries to have a global footprint and reach patients with T1D worldwide.

We anticipate topline results by the end of 2024.

Topline data will include the safety data to support re-dosing along with proof of biological activity.

Topline data will further enable global Phase 2 clinical proof of concept and dose-range finding trials in adults and even more importantly, in adolescent T1D population, another critical milestone for 2024 as T1D onset most often occurs in pediatric and adolescent patient populations.

Figure 11 shows a proposed timeline of our planned milestones in the next 24 months.

SAB-142 Timeline and Key Milestones

SAB-176 HUMAN ANTI-INFLUENZA GLOBULIN FOR HIGH-RISK INFLUENZA

Summary of SAB-176

SAB-176 is a multivalent, broadly neutralizing -human polyclonal IgG therapeutic candidate in development for the treatment or prevention of severe influenza.

This novel, specifically targeted high-potency immunotherapy leverages the human immune response and is designed to bind and neutralize both Type A and Type B influenza, including emerging and mutating strains.

It may also be modified to address annual strain changes when needed.

3 unchanged sentences

We believe that this promising therapy is well-suited to address highly mutating viruses that have significant annual health impacts as well as pandemic potential.

Influenza Market

Intravenous, sub-cutaneous, and intra-muscular routes of administration are in development for this product.

Influenza Background

Despite numerous available vaccines and treatments, influenza remains a disease with high-unmet medical need, accounting for ~500,000 cases, ~30,000+ deaths, and $11.2 billion dollars per year in direct and indirect costs in the US alone.

Only ~50% of high-risk patients vaccinate, and even when vaccines are used, CDC reports adjusted vaccine effectiveness (VE) ranged from only 10% to 60% from 2004 through 2022, with 60% reported only in a single season.

Immunocompromised/immunosenescent patients show even lower levels of response to vaccines, with VE at ~24%.

No approved treatment of influenza showed any efficacy in hospitalized patients and viral mutations result in reduced susceptibility or resistance to current treatments.

Seasonal influenza remains a meaningful burden for the healthcare system.

While the influenza season differs each year, the CDC estimates there are on average 9 to 41 million cases of influenza each year, with 140,000-710,000 hospitalizations and 12,000-52,000 deaths per year (average 2010-2020).

While the influenza season differs each year, the CDC estimates there are on average 9 to 41 million cases of influenza each year, with 140,000-710,000 hospitalizations and

12,000-52,000 deaths per year (average 2010-2020).

Oseltamivir phosphate (branded:

Tamiflu®) is an effective therapy for treating the flu if used within two days of onset.

However, some patients still develop severe disease and are resistant to treatment (estimates of resistance vary:

As such, we see the potential for an additional treatment for flu, particularly in higher-risk patients.

While the severity of influenza is challenging to forecast year to year, for simplicity’s sake, we assume a consistent incidence rate of 30 million cases in the U.S., within the average range of the last 10 years.

In the 2020-2021 influenza season, cases and hospitalizations were down markedly (approximately 60% and 90%, respectively), as many of the vulnerable patients contracted COVID, rather than influenza, and COVID prevention measures stopped the spread of influenza.

It is our expectation that influenza is globally persistent and case rates are expected to come back to historical levels in the coming years.

We expect that at the time of launch, there will be approximately 30 million cases of influenza in the U.S.

annually, about half of which will require a medical visit.

Competition and SAB-176 Value Proposition

Only SAB-176 Provide Potential for “

EVERGREEN ”

Influenza Biologic with Low Risk of Escape Mutants

Only SAB-176 Provides Potential for Influenza Biologic with Low Risk of Escape Mutants

SAB-176 represents a comprehensive approach to treatment and prophylaxis (PreP and PEP) of high-risk patients with influenza as a broadly neutralizing -human polyclonal immunoglobulin therapeutic with several anti-viral mechanisms.

To summarize, a few key differentiation aspects of this asset include a multi-pronged approach by neutralizing the virus directly and by inducing Antibody Dependent Cellular Cytotoxicity (ADCC), coupled with a long half-life aimed at providing an extended protection against viral shedding and recrudescent infection, low risk of antiviral resistance/escape mutants, and potential to treat patients infected with anti-viral resistant strains.

( See Figure 12 ) .

Phase 2a Challenge Trial

In December 2021, we announced topline data for a Phase 2a challenge trial that was initiated in June 2021.

This was a randomized, double-blind, placebo-controlled study evaluating the safety and treatment efficacy of SAB-176 in 60 healthy adults challenged with a pandemic influenza virus strain (pH1N1).

This was a randomized, double-blind, placebo-controlled study evaluating the safety and treatment efficacy of SAB-176 in 60 healthy adults challenged with a pandemic influenza virus strain (pH1N1).

Participants were randomized to receive either SAB-176 (25 mg/kg dose) or placebo and were intranasally inoculated with pandemic H1N1 (2009/California) virus.

3 unchanged sentences

Phase 2a Double-Blind, Placebo-Controlled Study

Secondary end points produced similar results, showing separation of SAB-176 vs placebo.

Secondary endpoints produced similar results, showing separation of SAB-176 vs placebo.

One of the secondary endpoints of the challenge study was reduction of clinical flu signs and symptoms in the subjects receiving active treatment (n=8) compared to placebo controls (n=12) for those who had signs and symptoms.

7 unchanged sentences

Although anticipated adverse events were noted among the SAB-176 and placebo participants, no drug related SAEs were identified by the SRC.

Preclinical Studies

Preclinical Study Conducted at Utah State University

A pre-clinical study, conducted at Utah State University in 2017, demonstrated the ability of our anti-influenza human hIgGs (an earlier, non-optimized candidate designated SAB-149) to produce cross-reactive hIgGs to mutating influenza strains we did not initially target.

The panel to the left above is a phylogenetic tree or ancestral map of the B Yamagata seasonal influenza strain.

Specifically highlighted are the 2013 B/Phuket/ strain used to produce hIgGs from our platform and its distant relative from 2006, the B/Florida strain which we used as the challenge strain in a lethal mouse model in the left image of Figure 9.

As shown in Figure 10, the hIgGs provided 100% protection down to 12.5 mg/kg demonstrating cross-protection to current and future emerging flu variants due to mutational drift.

This is a potential advantage of hIgGs and our platform.

SAB-176 Study Conducted at Utah State University

One of the areas of growing concern with small molecule antivirals used to treat influenza is neuraminidase inhibitor resistance.

For this reason, new treatments for influenza are needed.

In this study conducted at Utah State University in 2019, the in-vivo efficacy of SAB-176 compared to a human-derived antibody product and the small molecule, Oseltamivir was assessed in a lethal mouse model after challenge with an Oseltamivir resistant pandemic H1N1 strain.

Five mg/kg of SAB-176 provided 100% protection while 5, 10 and 20 mg/kg of the human-derived anti-influenza antibody or Oseltamivir did not.

This suggests that SAB-176, at very low doses, could be effective in the treatment of humans infected with neuraminidase resistant or non-resistant H1N1 influenza.

SAB-176 Tissue Cross Reactivity

The objective of this study conducted in 2019 was to determine the potential cross reactivity of biotinylated SAB-176, a polyclonal human hIgG antibody directed against influenza virus, with cryosections of human and rabbit (New Zealand White) tissues.

To detect binding, the biotinylated test article, designated SAB-176-Bio, was applied to cryosections of normal human tissues (at least three donors per tissue, where available) and rabbit tissues (at least two animals per tissue, where available) at two concentrations (20 and 2 μg/mL).

In addition, the test article was substituted with a biotinylated human hIgG antibody, which has a different immunogenic specificity from that of the test article, designated HuIgG-Bio (control article).

Other controls were produced by omission of the test or control articles from the assay (assay control).

SAB-176-Bio produced weak to strong staining of the positive control material (rHA1-H1N1 [A/Cal/07/09]-His [recombinant hemagglutinin protein] UV-resin spot slides [designated rHA1-H1N1]) at both concentrations.

SAB-176-Bio did not specifically react with the negative control material (human hypercalcemia of malignancy peptide, amino acid residues 1-34, UV-resin spot slides [designated PTHrP 1-34]) at either staining concentration.

The control article, HuIgG-Bio, did not specifically react with either the positive or negative control materials.

There also was no staining of the assay control slides.

The specific reactions of SAB-176-Bio in all staining runs with the positive control material and the lack of specific reactivity with the negative control material, as well as the lack of reactivity of the control article, indicated that the assay was sensitive, specific, and reproducible.

No staining was present with SAB-176-Bio in the human panel examined.

As SAB-176-Bio binds to an influenza virus protein not expected to be expressed in normal human tissues, this result was anticipated.

In the rabbit tissue panel, staining with SAB-176-Bio was restricted to the cytoplasm of rare epithelial cells in hair follicles in the skin.

Binding to cytoplasmic sites in tissue cross-reactivity studies generally is considered of little to no toxicologic significance due to the limited ability of antibody drugs to access the cytoplasmic compartment in vivo.

(Hall, et al., Preclinical Safety Evaluation of Biopharmaceuticals:

A Science-Based Approach to Facilitating Clinical Trials.

Wiley-Interscience;

208-40 and Leach et.

Toxicol Pathol 2010 December;38(7):1138-66.)

SAB-176 Toxicology

The objectives of this study, conducted in 2019, were to determine the potential toxicity of SAB-176 for the treatment of Type A and Type B influenza illnesses, when given as a single intravenous infusion to rabbits and to evaluate the potential reversibility of any findings.

In addition, the toxicokinetic characteristics of SAB-176 were determined.

The following parameters and end points were evaluated in this study:

clinical signs, body weights, body weight gains, food consumption, ophthalmology, clinical pathology parameters (hematology, coagulation, clinical chemistry, and urinalysis), toxicokinetic parameters, immunogenicity analysis, gross necropsy findings, organ weights, and histopathologic examinations.

There were no test article-related effects noted on clinical signs, body weights, body weight gains, food consumption, ophthalmology, gross necropsy findings, organ weights, or histopathologic examinations.

There were no test article-related adverse effects on clinical pathology parameters.

Decreased leukocytes (WBC) (down to 0.82X), lymphocytes (0.74X), monocytes (0.61X), eosinophils (0.50X), basophils (0.57X), and large unstained cells (0.73X), as well as increased neutrophils (1.2X) were noted in test article-treated females on Day 1 when compared to concurrent controls.

These differences improved, but most were still present on Day 3 of the study.

By Day 50, these values were similar to that of concurrent controls.

Decreased activated partial thromboplastin time (0.76X and 0.80X) was noted in test article-treated females on Day 3 and Day 50 when compared to concurrent controls.

Increased globulin (up to 1.59X) with associated decreased albumin to globulin ratio was noted in test article-treated males and females on Day 3 when compared to concurrent controls.

These differences were not noted on Day 50.

In conclusion, administration of SAB-176 by single intravenous infusion was well tolerated in rabbits at levels of 362.65 and 725.30 mg/kg/day.

No target organs were observed.

Based on these results, the no-observed-adverse effect level (NOAEL) was considered to be 725.30 mg/kg/day.

SAB-176 was assessed in IND-enabling studies including Good Laboratory Practice (GLP) tissue cross reactivity and toxicology studies.

The results were submitted to the FDA for review as part of the IND submission.

CLOSTRIDIOIDES DIFFICILE (C.DIFF) INFECTION (CDI)

SAB-195 is the first in class fully human hIgG treatment for treatment of CDI

We are currently advancing our top-priority preclinical therapeutic candidate, SAB-195, a high-unmet medical need asset for treatment of CDI-associated diarrhea and reduction in recurrence of CDI.

CDI is a bacterial infection of the large intestine.

A spectrum of clinical disease ranges from mild to very severe infection characterized by abdominal pain, fever, diarrhea, nausea, and vomiting.

Complications of severe CDI include kidney failure, toxic megacolon, bowel perforation, and death.

Epidemiology data support high unmet medical needs globally

CDI is one of the most prevalent healthcare–associated bacterial infections in the U.S.

and developed world.

CDC estimates that there are ~ 500,000 infections per year and >30,000 deaths from CDI in the U.S.

CDI is associated with significant costs:

Up to $4.8 billion each year in excess health care costs for acute care facilities alone.

Patients with the first CDI recurrence have a risk of subsequent recurrence from 25% to 40% and higher.

CDI-attributable median length of stay and costs (in US$) increased from 7 (4-13) days and $13,168 ($7,525-$24,456) for patients with primary CDI only to 15 (8-25) days and $28,218 ($15,050-$47,030) for patients with recurrent CDI.

The risk of death for patients with recurrent CDI is 33% higher compared to those patients without recurrence.

While treatments exist, they are associated with high rates of recurrent CDI that are even more difficult to treat than primary infection.

It is also well known that antibiotics, the current standard of care treatment for CDI, are associated with emergence of bacterial resistance.

Finally, fecal transplants, last-line treatment of CDI, may be associated with a risk of transmitting infectious agents as they are manufactured from human fecal matter, and many are contraindicated in immuno-compromised patients.

That triple mechanism of action –

diff spores, vegetative cells, and multiple types of toxins –

not only comprehensively target the entire complex life-cycle of this pathogen, but also aim to provide superior efficacy in reducing infection recurrence, hospitalizations, and hospitalization duration of hospital stay.

Only SAB-195 Can Target Multiple CDI Bacterial Antigens and Toxins in One Therapeutic

Preclinical proof of principle data of DiversitAb platform in CDI

Available preclinical data indicates that SAB-195 will deliver on its product value proposition to target multiple antigens including vegetative state of bacteria and toxins from multiple strains.

The data was published in the peer-reviewed journal “Vaccine.”

Fully human polyclonal antitoxin hIgGs were produced in the DiversitAb platform by immunizing transgenic bovine with 4 fusion proteins representing several types of toxins from different C.

diff strains.

In a hamster CDI model presented on this slide, hamsters treated with human antitoxin hIgG were protected when challenged with historical (left image of Figure 12) or epidemic strains of C.diff as presented in the right image of Figure 12.

All animals in the control group died within 24 to 48 hours following challenge, while 40% treated with 10 mg hIgG and 90–100% treated with 60 mg hIgGs survived the 8-day observation period.

SAB-195 Preclinical Data

Clinical Development Path

We plan to file an IND in first quarter 2024 and subsequently have topline results from Phase 1 and Proof of Biological activity available in 2024.

Confirmation of SAB-195 antibacterial effects and good microbiome-sparing effects are highly critical for prevention of CDI recurrence.

Following such confirmations and the subsequent initiation of the dose-range finding Phase 2b trial in 2024, we would expect top line results to be available by the end of 2025.

TYPE 1 DIABETES

We are currently advancing therapeutic candidates through its SAB-142 program aimed at delaying the onset and progression of T1D.

SAB-142 is a multi-indication potential asset also being developed for organ transplant induction and organ transplant rejection among other immunological indications.

Therapeutic Potential in New-Onset Type 1 Diabetes

A potentially significant application for SAB-142 is for the delay or prevention of the onset of T1D, a serious lifelong autoimmune disease.

T1D affects 1.6 million people and there are 60,000+ new diagnoses each year in the U.S.

The full potential of agents such as Thymoglobulin to delay or prevent T1D is limited by the unsuitability of animal products for repeat dosing.

SAB-142 represents an opportunity to offer a novel fully-human alternative to rabbit- or equine-derived ATG IgGs, which has the potential for re-dosing and avoids current risk factors such as serum sickness, anaphylaxis, and loss of efficacy of currently available therapies.

Based on results of a Phase 2 clinical trial conducted by Dr.

Michael Haller at the University of Florida, a single dose of rabbit ATG (Thymoglobulin) showed sustained benefit in T1D over two years by maintaining significantly higher C-peptide levels (a marker of pancreatic beta cell function) than placebo controls.

However, more than 65% of treated patients in this study acquired serum sickness due to infusion of an animal antibody (rather than human) that included rash, 3-4 days of malaise, fever, and joint swelling.

The symptoms often required treatment with steroids that impair diabetes management and reduces capacity to give the rabbit ATG again as C-peptide levels begin to drop as shown in Figure 13 below.

In addition to potentially preserving beta cell function in early T1D patients, a human ATG like SAB-142 could open the possibility of re-dosing when clinically meaningful indicators such as C-peptide levels and glycosylated hemoglobin blood tests indicate worsening disease, without the potential risk of inducing the major immune reactions that can occur with fully-animal IgGs (See Figure 14).

Rabbit ATG Study for Type 1 Diabetes

Competition and SAB-142 Value Proposition

SAB-142 is the Only Fully-Human IgG Anti-Thymocyte Globulin showing the

Same In-Vitro Mode of Action as Low Dose Rabbit ATG

Preclinical Studies for SAB-142

We have completed the GLP toxicology results that enable filing an IND submission.

Figure 14 shows lymphocyte cell population comparing SAB-142 to one of the approved and commercially available animal ATG products.

Following administration of 5mg/kg animal ATG and 1mg, 5mg/kg, and 10mg/kg SAB-142 to treatment-naive non-human primates, immuno-profiling analysis of two top SAB-142 dose-levels shows significant reduction of lymphocytes vs baseline.

While both SAB-142 and animal ATG induced substantial lymphocyte reduction, the dynamics of such depletion show more prolonged effects with SAB-142 treatment.

These in vivo results strongly suggest that SAB-142 may have efficacy attributes desired for numerous auto-immune indications including but not limited to T1D, organ transplant induction and maintenance therapy, aplastic anemia among others while having the impactful product advantage of an improved safety profile. 

IND filing is anticipated on or before the first quarter of 2024.

Determine the potential toxicity of SAB-142 vs.

an anti-thymocyte globulin (ATG) when given by single intravenous infusion to non-human primates

Characterize mechanism of action, toxicokinetic & immunogenicity profile of SAB-142

GLP-tox study demonstrated SAB-142 is well tolerated at escalating doses tested

Both SAB-142 and its active control, an FDA-approved rabbit-derived ATG, induced transient and prolonged lymphodepletion for the duration of the study.

The dynamics of such depletion appears to be more prolonged with SAB-142 treatment in a dose-dependent manner

SAB-142 GLP Toxicology Study Results Enable IND Submission

Potentially Significant Opportunity in Transplant and Other Immunological Diseases

SAB-142 is a fully-human anti-thymocyte globulin (ATG) candidate for preventing organ transplant rejection.

Current approved ATG products are sourced from animals, including transplant market leader rabbit-derived Thymoglobulin, and equine-derived ATGAM.

A human ATG alternative has the potential for higher potency without toxicity, presenting an opportunity to redefine the standard of care.

Dosing advantages of a human ATG may include a longer half-life and potential for repeat dosing, without significant potential to generate serum sickness or anaphylaxis, which can be caused by the presence of animal proteins in the current therapies. 

Despite broad use, there are several limitations of approved ATG products.

Risks of serum sickness and anti-drug antibody (ADA) formation have limited use of animal ATG products, with rates of serum sickness >30% and repeat dosing not recommended.

Therefore, physicians typically reserve its use for immune induction or acute rejection –

but not both.

A human alternative such as SAB-142 is expected to have several advantages over ATG animal antibody products.

In the established transplant market, a human ATG that has a reduced risk of adverse events such as serum sickness has the potential to penetrate the current market and expand existing clinical use.

SAB-142, has demonstrated a comparable profile in vitro to approved animal ATG products–equine-derived ATGAM and rabbit-derived Thymoglobulin.

The Tc Bovine-derived human ATG has also demonstrated higher potency compared to Thymoglobulin in vitro .

We expect to show improved safety, dosing, and efficacy profiles for our human ATG program in future human studies.

SAB-142 Flow Cytometry Analysis

Figure 16 provides a flow cytometry analysis of a gated lymphocyte cell population comparing SAB-142 to the two FDA approved and commercially available rabbit and horse ATG products on the market.

As you can see, SAB-142 binds to the same T-cell population as both rabbit and horse ATG IgGs, suggesting comparable mode of action.

SAB 142 Study –

Mode of Action Against T-Cell Subsets

We further explored the mode of action of SAB-142 against T-cell subsets.

SAB-142 had higher CD8 killing activity compared to the rabbit antibody and had similar performance in survival of T-regulatory cells, induction of activated CD4 T Cells, and reduction of naïve CD4 cells.

These in vitro results strongly suggest that SAB-142 may have the potency attributes needed for transplant induction and rejection therapy while having the impactful product advantage of an improved safety profile.

The product attributes of SAB-142 are potentially also well aligned to address the desired safety profile of ATG treatments that have been shown to be beneficial in treating T1D.

AUTOANTIBODY IMMUNE DISORDERS

DiversitAb Platform Anti-Idiotype Proof of Principle in Autoimmune Disease

Figure 18 shows recent data on using the DiversitAb platform to produce Anti-idiotype hIgGs to treat auto-antibody mediated immune disease such as System Lupus Erythematosus (SLE) or Scleroderma.

Known mAb autoantibodies were selected and used as antigens for hyperimmunization in Tc bovine.

One was an IgG1 isotype and the other an IgG4 isotype.

Tc bovine derived hIgGs against these autoantibodies were produced and purified.

Anti-Variable/Anti-Idiotype hIgGs are Specific to the Variable Region

This in-vitro data for Tc bovine hIgGs produced to both autoantibodies in a single Tc bovine shows the percent of inhibition of binding to the variable regions of both the IgG1 and IgG4 auto-antibodies.

Controls showed the specificity of binding to the variable regions indicated by the lack of inhibition of binding to the Fc fragments of each antibody as well as the mAb framework of each of the autoantibodies.

As an example, this polyclonal mechanism of action of these Tc bovine derived hIgGs is differentiated from current treatments of autoantibody mediated disease like Systemic Lupus Erythematosus by presumably NOT causing general immune suppression nor suppression of all B-cells but by actively suppressing or eliminating specific autoreactive antibodies and B cell clones, and through polyclonality and somatic hypermutation, have activity against mutated antibodies and their B-cell clones.

This approach has the potential further benefit of extending remission without immune suppression.

We are very excited to continue to explore this novel approach using the DiversitAb Platform with proven ability to produce antibodies to multiple human antigen targets including autoreactive antibodies.

ONCOLOGY (Undisclosed Targets)

We have the potential to develop IgG therapeutic candidates that address multiple aspects of cancer.

We are pursuing undisclosed target opportunities for which we expect to release early developmental data in the fourth quarter of 2023.

We believe that the DiversitAb platform may lead to oncology applications for our IgGs because of our potential to address mutations, polymorphisms, and resistance pathways.

Our human IgGs may offer advantages as cancer therapies, including:

Multi-targeting – Ability to simultaneously target multiple modalities of cancer in a single product.

Multivalency – Leverages native immune response – IgGs – with binding to multiple epitopes to address mutations.

Metastasis Prevention – Literature suggests human polyclonal IVIG may help prevent tumor metastases.

Effector Function – Enhanced effector functions such as antibody-dependent cellular cytotoxicity and complement dependent cytotoxicity.

Replicability – Developed IgGs against a variety of oncology targets using our DiversitAb platform.

We have recruited and deployed an oncology-focused team with the goal of pioneering human IgGs for use in treating cancer.

We have filed several patent applications and expect to demonstrate initial proof-of-principle in oncology in the fourth quarter of 2023.

Proprietary DiversitAb Platform Overview

Our proprietary DiversitAb platform gives us the unique ability to generate targeted, fully-human hIgGs without the need for human donors or plasma.

These diverse and high-potency IgGs can be targeted to viruses, bacteria, toxins, and human immunogen targets.

The current platform relies on advanced genetic engineering that functionally replaces bovine IgGs with human hIgGs (resulting in our Tc Bovine) produced from the full germ-line repertoire of human antibody heavy chain and kappa light chain genes on an engineered human artificial chromosome (HAC).

Proprietary DiversitAb Production System Overview

Our proprietary DiversitAb production system gives us the unique ability to generate targeted, human IgGs without the need for human donors or plasma.

These diverse and high-potency hIgGs can be targeted to human immunogens for immune disorders or cancer, viruses, bacteria, and toxins.

The production system relies on advanced genetic engineering that functionally replaces bovine IgGs with human hIgGs (resulting in our Tc Bovine) produced from the full germ-line repertoire of human antibody heavy chain and kappa light chain genes on an engineered human artificial chromosome (HAC).

The human antibody genes have been further engineered to efficiently produce a diverse repertoire of human immunoglobulin G (which is referred to as hIgG) in bovine B-cells in response to specifically targeted immunogens as a result of the hyperimmunization of the Tc Bovine.

Bovine were selected because they are large animals that produce large amounts of plasma, and as ruminants, have high concentrations of circulating hIgGs with a robust response to immunogen challenge that produces high potency, high avidity human immunoglobulins (hIgGs).

The novel capability of the DiversitAb platform uses the natural human biological immune response that makes our platform well-suited to address multiple therapeutic categories, presenting potential opportunities for new therapies to address unmet medical needs.

Figure 20 below depicts the main elements of product development and manufacturing using our DiversitAb platform.

Development and Manufacturing Using DiversitAb ™

Through our DiversitAb platform, we have engineered a targeted human immunoglobulin production system that emulates the way that the natural human immune system synergistically targets the complexity of human disease.

The discovery, development and production process represent a “plug-and-play”

Through our DiversitAb production system, we have engineered a targeted human immunoglobulin production system that emulates the way that the human immune system synergistically targets the complexity of human disease.

The discovery, development and production process represent a “plug-and-play” approach:

• Develop Immunogen for Disease Target .

An immunogen is developed for a specific target in much the same that human vaccines are developed.

The platform is designed to address virtually any target including bacteria (whole killed), viruses, toxins, nucleic acids (i.e., RNA and DNA vaccines), whole cells, and human tissues.

The production system is designed to address virtually any target including

bacteria (whole killed), viruses, toxins, nucleic acids (i.e., RNA and DNA vaccines), whole cells, and human tissues.

• Hyperimmunize Tc Bovine .

Tc Bovine are genetically engineered to produce fully-human IgGs, and then hyperimmunized with the immunogen, driving the immune response beyond protective levels that have been shown in some cases to be 40-60 times more potent than hIgGs produced in convalescent patients.

Tc Bovine are genetically engineered to produce human IgGs.

They are then hyperimmunized with the desired immunogen, driving the immune response beyond protective levels that have been shown in some cases to be 40-60 times more potent than hIgGs produced in convalescent patients.

• Collect Plasma .

3 unchanged sentences

These IgGs are then ready for use as a human immunotherapy treatment or prophylactic.

Our DiversitAb platform is replicable and scalable since the Tc Bovine are all clones.

If more plasma is needed, more animals can be produced through cloning technology and plasma fractionation is a well-established and scalable GMP process.

Our DiversitAb production system is replicable and scalable given Tc Bovine are genetic clones.

Animals can be produced through cloning technology and plasma fractionation to meet market demand through a well-established and scalable GMP process.

We believe that targeted human IgGs can be produced against the same immunogen or multiple immunogens, depending on the disease target and indication, in as many Tc Bovine as necessary to generate sufficient doses to fully supply the target market.

Human IgG consistency of product is achieved by testing the potency of IgGs contained in each plasma collection and then combining plasma collections in a manufacturing pool that generates specified potencies within a specified antibody protein concentration.

We believe that the speed with which we can deploy our DiversitAb platform to develop countermeasures for emerging diseases and pandemics represents a significant advantage relative to other antibody manufacturers.

We have successfully utilized our DiversitAb platform technology to generate early proof –of concept and initial clinical lots that address specified immunotherapy targets in as little as 128 days, including completion of IND-enabling studies, in response to the COVID-19 pandemic.

We have vertically integrated the platform technology across a significant series of value inflection points.

Our capabilities include advanced animal reproduction methods (cloning) to produce Tc Bovine, animal husbandry, immunogen or antigen development, plasma collection, plasma purification, drug substance manufacturing and product fill/finish, nonclinical and clinical study management, quality assurance, quality control, regulatory compliance, and program collaboration.

We have built a broad-based network of third-party collaborators, service providers, vendors, consultants, and government partners that can help support each of these vertically integrated activities.

This work has generated a technology which allows collaborating companies that may be unfamiliar with animal production systems or plasma fractionation processes to partner with us in the development and commercialization of products derived from the DiversitAb platform with confidence in the CMC and regulatory pathways that have been established.

Scaled Infrastructure & Capacity:

Tc Bovine & Plasma Production Facility

Scaled Infrastructure & Capacity:

Laboratory & Manufacturing

Fully Human Target Specific High Potency IgGs

Our novel multivalent IgG approach, including hyperimmunization of the Tc Bovine results in specifically targeted, highly potent, high-avidity, broadly diverse, fully human IgGs, overcoming the challenges and exceeding the capabilities of traditional animal and human-derived IgGs.

Animal-derived IgGs, such as from horses or rabbits, have the disadvantage of being immunogenic in humans, and they often cause severe hypersensitivity reactions, limiting their clinical use for repeat dose administration.

Human-derived IgGs are limited by the difficulty of collecting IgGs from humans and the inability of humans to produce IgGs to endogenous proteins under normal circumstances.

In addition, only our proprietary process of hyperimmunization of the Tc Bovine can yield high target potency as demonstrated in Figure 23 below where SAB-185 potency was superior to the highest titer convalescent plasma.

SAB 185 Study - Neutralization Evaluation Conducted at The University of Pittsburgh

In this study conducted at the University of Pittsburgh in 2020, SAB-185 was compared to the highest titer convalescent plasma available using the plaque reduction neutralization titer needed to neutralize 100% of the SARS- CoV-2 virus.

These results suggest that SAB-185 is 40 times more potent than high titer convalescent plasma.

This high titer, target-specific human IgG is achieved through our hyperimmunization strategy.

These high-titer human IgGs cannot be achieved with convalescent plasma from human donors.

Natural Multivalent and Effector Function Properties of IgGs

Nature has spent millions of years evolving the sophisticated mammalian innate and adaptive immune system to protect humans and all other mammals against disease.

We have harnessed that nature by design through our DiversitAb platform to produce our fully-human IgG therapeutics and by doing so have intentionally harnessed the competitive advantage of the natural properties of a polyclonal immunoglobulin to protect against highly mutating or evolving pathogens or disease targets like a cancer that fully activates our body’s own immune system in a target-specific way.

Our IgGs are engineered to primarily produce the IgG1 isotype, and to a lesser extent the IgG2 isotype, and have fully functional unmodified antibody variable regions (or Fab domains) that specifically bind to target antigens that provide natural multivalent properties.

This multiepitope targeting neutralizes highly mutating targets and prevents mutation escape.

The broad diversity of the Fab domains also contain the natural mixture of high and low affinity binding IgGs referred to as avidity and have fully functional IgG Fc domains that further activate the native human immune system by activating effector cells.

We believe there is a demonstrable and significant potential advantage of Tc Bovine-produced human IgGs in their ability to bind to both foreign exogenous or human endogenous protein targets, activate human effector cells, and not cause hypersensitivity reactions.

Multivalent properties of our Tc Bovine Derived hIgGs

Figure 24 shows preclinical data demonstrating the multivalent properties of our hIgGs for SAB-185, an anti-SARS-CoV-2 hIgG therapeutic that has shown broad neutralization potency to recent SARS-CoV-2 variants that have emerged over the COVID-19 pandemic, which including the Delta and Omicron variants.

In vitro Neutralization Against VSV-SARS-CoV-2 Mutants

Multiple SARS-CoV-2 variants with spike protein mutations have arisen and are infecting humans globally, and their impact on the effectiveness of both vaccines and immunotherapies is a growing concern.

We collaborated with the U.S.

Government COVID response team throughout 2020 and 2021 to evaluate the ability of SAB-185 to neutralize these mutant strains using a pseudovirus assay developed and conducted by scientists at the US Food and Drug Administration ("FDA") Center for Biologics Evaluation and Research (CBER).

In this study, FDA researchers evaluated the inhibitory concentration at 50% of SAB-185 against lentiviral-based pseudovirions containing mutations in the spike protein representative of the Alpha, Delta, Lambda, and Omicron (B.1.1.529) SARS-CoV-2 variants.

This assay incorporates a stable 293T cell line expressing human angiotensin converting enzyme 2 (ACE2) and transmembrane serine protease 2 (TMPRSS2).

The results in Figure 24 above demonstrate that SAB-185 effectively neutralizes all tested recombinant S protein lentiviral pseudoviruses that mimics the SARS-CoV-2 variants.

Although SAB-185 retained potent neutralization of the Omicron variant, it did show a mild-to-moderate reduction in potency compared to the Alpha wild type.

In vitro Neutralization Against Clinical SARS-CoV-2 Isolates

In Figure 25 we further expanded our analysis to a broader panel of pandemic SARS-CoV-2 variants, specifically the Omicron lineage that emerged in 2022 which contained novel mutations that rendered many of the existing monoclonal antibody therapeutics ineffective.

In this study, we collaborated with the Center for Vaccine Research and Department of Immunology at the University of Pittsburgh (UPITT) to evaluate the ability of SAB-185 to neutralize clinically isolated SARS-CoV-2 variants using a Vero hAce2/TMPRSS2 cell plaque reduction neutralization assay.

SAB-185 retained potent neutralization to all variants despite a reduction of activity against the Omicron lineage.

Due to the nature of SAB-185 fully human IgGs, it is important to note that neutralization of viral entry into the cell as measured in Figure 24 and Figure 25 is only one component of the overall efficacy measurement for a polyclonal antibody therapeutic.

SABs hIgGs contain a fully human antibody Fc domain that activates the immune system through effector functions that kill the virus, so SAB-185 efficacy is not just measured by effective blocking of the RBD used for viral entry but activating immune effector functions that target and kill the virus.

This in combination with the fact that SAB-185 targets multiple epitopes spanning the entire surface of the spike protein including the RBD means that changes observed in neutralization activity due to specific mutations in the RBD should not significantly impact the overall efficacy of SAB-185 as a therapeutic.

This is not the case for mAbs that targeted a single epitope on the spike protein as viral mutations spanning the single binding site could result in complete loss of blocking virus entry (neutralization) and/or complete loss of efficacy as effector functions are no longer possible which is exactly what transpired for many of the mAb therapeutics during the pandemic.

To demonstrate the competitive advantage of our hIgGs and measure the full therapeutic potential of SAB-185 against clinical isolates of the SARS-CoV-2 variants, we collaborated with UPITT and Utah State University (USU) to perform an in-vivo efficacy study using a human ACE2 (hACE2) transgenic Syrian hamster model (Figure 26).

This hamster model exhibits rapid lethality after intratracheal SARS-CoV-2 challenge with the Munich, Alpha, Beta, Delta, and D144-146 variants;

the Omicron B.1.1529 variant resulted in a delayed, less severe and non-lethal disease similar to what is observed in the clinic with the Omicron variants.

As can be seen detailed in Figure 26 and Figure 27 below, prophylactic treatment with SAB-185 provided 100% protection from death and minimized clinical signs of infection when challenged with six clinical isolates of the SARS-CoV-2 variant viruses including the Omicron variant.

Although reduced in vitro neutralization activity was observed with Delta and Omicron variants, SAB-185 was still highly protective at human-relevant doses in vivo .

Therefore, reduced in vitro neutralization titers of SAB-185 against SARS CoV-2 variants were not associated with any reduction of in vivo efficacy.

SAB-185 protection from mortality in hACE2 hamsters challenged with six variant SARSCoV-2 isolates

Figure 26 shows data on hamsters that were administered SAB-185 (50mg/kg) or PBS intramuscularly and then challenged intratracheally 24 hours later with 1000 plaque forming units of variant viruses.

Mortality for individual variant PBS controls (A) and for combined (all SARS-CoV-2 variants tested) PBS control versus SAB-185 treated groups (B).

Individual mortality data for Munich (C), D144-146 (D) Alpha (E), Beta (F), Delta (G), and Omicron (H) viruses.

Mantel-Cox log-rank significance is indicated within each panel.

*p<0.05, **p<0.01, ***p<0.005.

SAB-185 protection from clinical signs in hamsters challenged with six variant SARSCoV-2 isolates

Figure 27 shows data presented as the inverse of the clinical score sum values.

Each data point represents an average of morning and afternoon observations.

A) Clinical sign scoring for individual hamsters in all groups.

B) Combined clinical sign scoring data for SAB-185-treated and control hamsters.

(C) Combined clinical sign scoring data for SAB-185-treated and control hamsters on D5 (last day all animals were alive) post challenge or D8 post challenge for Omicron-infected animals (peak clinical signs).

Individual clinical sign scoring data for Munich (D), D144-146 (F) Alpha (H), Beta (J), Delta (L) and Omicron (N) viruses.

Individual clinical sign scoring data for Munich (E), D144-146 (G) UK (I), SA (K), Delta (M) and Omicron (O) variants on D5 (last day all animals were alive) post challenge or D8 post challenge for Omicron (peak clinical signs).

* p<0.05, **p<0.01, ***p<0.005.

Open circles are surviving (controls and Omicron) and the SAB-185 treated animal that exhibited delayed replication (data not shown).

The multivalent competitive advantages of our hIgGs have the potential to prevent escape mutations that could arise from natural selective pressures of a highly mutating communicable disease like COVID-19 or therapeutic selective pressure where mutations arise from an inferior monovalent targeted treatment regimen like a single monoclonal antibody or small molecule.

To further support this point the preclinical data in Figure 28 and Figure 29 below demonstrates the ability of our hIgG therapeutics to potentially prevent mutation escape and protect against new mutations that may arise due to natural or monovalent drug induced selective pressure.

This unfortunately played out with the COVID-19 pandemic, where monovalent monoclonal antibody treatments as single or in combination were reported to have lost significant neutralization activity against the highly mutating SARS-CoV-2 variants like Omicron.

SAB-185 Study Conducted at Washington University School of Medicine

The study represented in Figure 28 was conducted at Washington University School of Medicine in 2020, we evaluated the ability of three different lots of SAB-185 and an anti-SARS-CoV-2 monoclonal antibody (2H04) to prevent SARS-CoV-2 escape mutants.

The three different lots of SAB-185 and the monoclonal antibody were serially passaged in the presence of SARS-CoV-2 virus.

As shown, no SAB-185 lots allowed the development of escape mutants.

However, several SARS-CoV-2 escape mutants developed in the presence of the monoclonal antibody indicated by the three red arrows in Figure 28 above, one of which included a E484K mutant.

This specific mutation that was lab generated was also a naturally circulating mutation found in multiple SARS-CoV-2 variants of concern and variants of interest that were infecting humans globally.

SAB-159 Study

Figure 29 above demonstrates the potential therapeutic advantage of our IgGs to effectively neutralize highly mutating pathogens such as Hantaan viruses.

A study conducted in 2019 demonstrated SAB-159, an anti-Hantaan hIgG, completely neutralized the original wild-type virus, as well as both single mutants, and a double mutant of Hantaan virus.

Effective neutralizing potency is indicated by the low in vitro IC50 threshold concentration below 100ng/mL indicated by the small grey area at the bottom of Figure 29.

In contrast, two neutralizing mAbs alone or in combination could not completely neutralize the two different mutations individually or in combination.

Effector Functions of our hIgGs

hIgGs specifically bind to antigens through their variable regions, but also, depending on their specific hIgG isotype, activate effector functions via their Fc domains.

Native humoral immune responses against pathogens or target antigens do not consist of a single antibody, but of complex hIgGs composed of multiple affinity matured hIgGs binding to numerous epitopes.

The binding of polyclonal hIgG’s to multiple epitopes aids in eliciting the activation of innate host effector mechanisms, such as antibody dependent-cellular cytotoxicity (ADCC), complement-dependent cytotoxicity (CDC) and antibody-dependent cellular phagocytosis (ADCP).

As mentioned previously our DiversitAb produced hIgG therapeutics also contain a fully functional antibody Fc domain that is unmodified and naturally diverse as well.

This fully functional Fc domain allows for effector cell engagement and activation as demonstrated in the data presented below.

Activation of Human Effector Cell Function

In Figure 30 above, the lines with solid black and white circles represent monocyte and neutrophil phagocytosis in Figure A and Figure B and Natural Killer cell degranulation in Figure C from the serum of two Tc Bovines hyperimmunized with Ebola glycoprotein on eight occasions.

The blue and purple bars represent two Tc Bovine human IgG lots produced from their plasma after the third and fourth immunizations and from the sixth, seventh and eighth immunizations respectively.

The red and white bars represent a naïve Tc Bovine human IgG and normal saline respectively.

The green and orange bars represent two anti-Ebola glycoprotein monoclonals.

As can be seen, both lots of anti-Ebola Tc Bovine human IgGs demonstrated the ability to induce monocyte and neutrophil cell phagocytosis and Natural Killer cell degranulation.

The lot produced from plasma after the sixth to the eighth immunization had better activity and is consistent with avidity maturation of the IgGs.

In contrast, while the monoclonals induced monocyte phagocytosis, only one was able to induce neutrophil phagocytosis.

And critically, neither monoclonal antibody had the ability to induce Natural Killer cell degranulation.

This demonstrates that Tc Bovine-produced human IgGs induce human effector cells which are critically important to the control of viruses, bacteria, and other pathogens.

Multitarget Immunoglobulin Diversity in a Single Vial Designed to Effectively Treat Complex Disease

Another key product differentiator of our hIgGs is the ability to produce a multitarget product that addresses the complexity of disease in a single drug product vial.

This is a particularly powerful multivalent combination when multiple antigen targets are combined with the natural muti-epitope targeting of a single antigen (described above), as the therapeutic advantage is expanded to address multiple disease modalities all within a single vial.

We believe single or combinatorial monoclonal antibody therapies are significantly challenged to reproduce this competitive product advantage.

Replicating this hIgG product attribute is costly and challenging for mAbs due to constraints adhering to the full factorial clinical trial design requirements by CDER where dosing two mAbs targeting separate epitopes for a combinatorial product is challenging enough let alone potentially hundreds of epitopes to multiple antigen targets covered by a hIgG therapeutic.

In addition, mAbs are specifically at risk regarding the treatment of highly mutating disease targets such as upper respiratory viral infections like Influenza or COVID-19, complex bacterial infections (like C.

), or anti-microbial resistant bacteria, highly complex immune diseases like Type 1 diabetes, or highly mutating cancers.

This risk was realized for monoclonal antibody therapy during the COVID-19 pandemic where single and combinatorial mAb therapies were reported to have lost significant neutralizing activity against highly mutating SARS-CoV-2 viruses.

A multi-target approach was used to produce SAB-176 developed to target both Type A and Type B seasonal influenza strains, and data demonstrating the multi-target neutralization from cross protective IgGs to non-targeted influenza strains like pandemic H1N1 (pH1N1) is shown in the Figure 31 below.

The competitive advantage of this multi-target product approach for SAB-176 was further supported with our Phase 2a challenge trial where the primary endpoint was met by significantly reducing the viral load of patients challenged with pH1N1 influenza.

The versatility of this multitarget approach can be further expanded with a strain add approach, where new seasonal strains are included in the production of SAB-176.

This will maintain or expand the broad neutralization capability to both current and future seasonal influenza variants, and potentially extend to pandemic outbreaks.

This strain add approach was implemented in producing SAB-176 for our Phase 2a challenge trial, where two influenza seasonal vaccines were used.

This seasonal strain add approach simply requires strain add supplements to our regulatory filings.

We have additionally implemented this similar multi-target approach to produce our current preclinical pipeline products SAB-195 and SAB-142.

SAB-176 Study

Hemagglutination Inhibition (HAI) titers of SAB-176 and anti-Flu human IVIG (hIVIG) are reported against the individual viruses indicated in the heading with color coded for specific annual flu season vaccines.

Three lots of anti-Flu human IVIG were cGMP manufactured from the pooled human plasma selected with high anti-Flu HAI titers in 2013, 2017 and 2018, respectively.

SAB-176 was purified from Tc Bovine plasma vaccinated with the 2018-19 flu season vaccine strains.

As shown in Figure 31 above, SAB-176 had higher HAI titers than anti-Flu hIVIG against seasonal flu vaccine strains and demonstrates the broad neutralization capability to past & future non-vaccine or non-targeted strains including the pandemic H1N1 strain.

Rapid Product Development Capability with Proven Regulatory Pathway

A final key differentiator is embedded in our polyclonal development approach that leverages our DiversitAb platform to capture discovery and production efficiencies not available to mAb product development.

Through the utilization of our Tc Bovine, we are able to simultaneously perform discovery and production functions of our polyclonal development, significantly improving the time of antibody discovery and production.

This efficiency was demonstrated during the COVID-19 pandemic where SAB-185 cGMP product was produced in 90 days from initial product concept.

Our discovery process simply involves antigen design and production as the vaccinated Tc Bovine does the rest including antibody design, down selection, and scaled production all in one system.

Our regulatory pathway has also been established with the FDA.

The FDA regulates polyclonal hIgGs and mAbs completely differently as mAbs are regulated through CDER and pAbs through CBER.

CBER has approved over 40 IgG products from human- and animal-derived plasma and is very familiar with our DiversitAb platform and pAb product.

We have navigated three SAB drug products through seven clinical trials with one product advanced to Phase 3.

In combination with our rapid product development and vertically integrated process we have demonstrated our ability to file and IND in 128 days from product concept and rapidly advance through the clinic.

Proven DiversitAb Platform Product Development Versatility

Overview of Our In-Vivo Animal Data From 2008 to 2018

Figure 32 provides an overview of our in vivo animal data from 2008 to 2018 that has enabled several pre-clinical studies with efficacy data demonstrating the broad potential of the DiversitAb platform to address diverse human diseases, globally.

As shown in Figure 32, infectious disease has been a strategic proving ground for the validation of our platform.

Listed above are several significant human diseases for which adequate countermeasures may not exist.

These include Ebola, Middle East respiratory syndrome coronavirus (MERS-CoV), and Zika, among others.

We have completed preclinical development for multiple potential infectious disease products to address these global emerging human biothreats, and we have repeatedly demonstrated 100% preclinical efficacy in several animal models for most targets.

This consistent in vivo efficacy demonstrates the broad potential of the platform and has ultimately led to the clinical advancement of multiple Phase 1 clinical trials including MERS-CoV, and our advanced infectious disease pipeline products, SAB-176 and SAB-185.

Clinically Validated Across Several Targets Spanning Ph1 to Ph3 Clinical Trials

Initial Demonstration of Human Efficacy and Multi-Dosing Capability

Demonstration of Human Efficacy and Multi-Dosing Capability

Figure 33 depicts a small efficacy trial in a single patient who had an antibiotic-resistant mycoplasma hominus infection.

Conducted in 2017 at Brigham and Women’s Hospital, this study showed an initial indication of efficacy in Tc Bovine-derived anti-Mycoplasma human hIgGs in an immunosuppressed 68-year- old man diagnosed with a M.

hominis septic polyarthritis who developed a chronically draining right hip fistula following a failed hip replacement surgery.

The fistula is shown on the far-left image in Figure 33.

He was treated with human-derived intravenous immunoglobulin and antibiotics for seven years during which time the mycoplasma became multi-antibiotic resistant.

At the request of the patient and his physician, we produced the anti-mycoplasma human IgG therapeutic, which was intravenously administered to the subject at doses up to 100 mg/kg as shown in the center image of Figure 32.

This was done under an FDA allowed Phase 1b study.

The human hIgG product was well tolerated, and the subject’s mycoplasma load fell to undetectable levels with rapid healing and closure of the fistula as shown on the far-right image in Figure 33.

The patient then elected to undergo a repeat hip replacement surgery and he developed a Staphylococcus Aureus and other bacteria wound infection including mycoplasma.

The patient was then re-treated with the Tc Bovine- derived human IgGs which resulted in marked reductions in mycoplasma load as shown in the center table.

This remarkable case study demonstrates the potential utility of Tc Bovine-derived human hIgGs to treat serious antibiotic resistant infections in general, but also the potential opportunity to produce specific human IgG therapeutics to treat individuals with intractable infections using a personalized medicine approach.

We have performed multiple clinical trials demonstrating safety in hundreds of patients and have demonstrated proof of concept for our DiversitAb platform in the clinic that includes three SAB-sponsored INDs and one CTA (filed Ex-US) that encompass seven clinical trials from Phase 1 to Phase 3 across treatment of three indications (MERS, Influenza, and COVID-19) briefly summarized below.

First-in-Man Clinical Safety and Efficacy

The first-in-human clinical trial of SAB-301for MERS-CoV, conducted in 2017 and sponsored by the NIH, evaluated safety of this Tc Bovine-derived human IgGs.

The study was a blinded, placebo controlled, ascending dose study in healthy adults that investigated doses of 1.5 mg/kg to 50 mg/kg of intravenously administered product in 38 participants that were followed for 90 days post-infusion.

The conclusion was that SAB-301 was safe and well tolerated.

Pharmacokinetic analysis demonstrated a half-life of the anti-MERS-CoV human IgGs of 28 1/2 days, which is the reported half-life of human-derived hIgGs in humans.

Importantly, anti-drug antibodies, or antibodies to ligands used in our DiversitAb purification process, or anti-bovine plasma protein antibodies were not detected.

SAB-176 (anti-Influenza) Advanced through a Phase 2a Challenge Trial

Our SAB-176 program is a multitarget anti-influenza product that specifically targets both Type A and Type B seasonal influenza strains.

In December 2021, we announced topline data for a Phase 2a challenge trial that was initiated in June 2021.

This was a randomized, double-blind study in 60 healthy adults that were challenged with a pandemic influenza virus strain (pH1N1).

The primary endpoint of the study was achieved despite the fact that SAB-176 was not produced specifically targeting the pH1N1 strain.

This was not only a successful Phase 2a for our influenza program but demonstrated in a human study the multivalent competitive advantage of our DiversitAb produced hIgGs as cross protective IgGs generated from our multitarget seasonal Type A and Type B influenza product, SAB-176 met the primary end point criteria of significantly reducing patient pH1N1 influenza viral load.

Our SAB-176 program is further detailed in the Pipeline section above.

SAB-185 Study - Double-Blind Study in Ambulatory Adults

Figure 34 above presents a randomized double-blind study in ambulatory adults with confirmed SARS-CoV-2 infection with symptoms less than 7 days.

110 were randomized to low dose, 110 randomized to high dose, and 110 to placebo.

The graduation criteria to the Phase 3 portion of this adaptive phase 2/3 study included a minimum posterior probability of reducing nasopharyngeal qRT-PCR of > 0.5 log compared to placebo by at least 0.6.

Both doses exceeded this criterion at day 3.

A post hoc sub-analysis showed that pronounced reductions in NP viral load was only observed in high-risk patients (obesity, chronic illness, etc.).

This suggests that similar reductions in lung viral load could also occur and possibly provide protection against progression to pneumonia and/or severe disease.

Government Contracts and Collaborations

We have collaborated extensively with U.S.

Government agencies within both the U.S.

Department of Defense ("DoD") and the U.S.

Department of Health & Human Services (HHS).

We executed an award from Joint Program Executive Office for Chemical, Biological, Radiological, and Nuclear Defense (JPEO - CBRND) Joint Project Lead for Enabling Biotechnologies (JPL-EB) (hereafter JPEO-EB) within the DoD that includes co-funding from the Defense Health Authority and from BARDA (within HHS).

The award totaled approximately $200 million.

The scope of the award included proof-of-concept, scaling and live-fire of a Rapid Response Antibody Program leveraging our response capabilities and was expanded to include our COVID-19 therapeutic, SAB-185, as part of the Countermeasures Acceleration Group (formerly Operation Warp Speed).

That expansion included significant capacity growth, addition of capabilities, and expansion of infrastructure including human resources and facilities.

On August 3, 2022, we received notice from the DoD terminating the JPEO Rapid Response contract.

No termination penalties were incurred by SAB in connection with the termination.

SAB received two final payments from the U.S.

Government for work performed and winddown activities on this award in November 2022 and January 2023 which totaled approximately $16.8M.

We believe that the speed with which we can deploy our DiversitAb production system to develop countermeasures for emerging diseases and pandemics represents a significant advantage relative to other antibody manufacturers.

We have successfully utilized our DiversitAb production system technology to generate early proof of concept and initial clinical lots that address specified immunotherapy targets in as little as 128 days, including completion of IND-enabling studies, in response to the COVID-19 pandemic.

Manufacturing Strategy

2 unchanged sentences

In addition, we maintain supportive laboratory facilities and operations in Sioux Falls, South Dakota, for drug discovery, product and process development, and clinical manufacturing.

We have fully compliant quality control testing facilities and we have further developed our own internal antigen (immunogen) discovery and production capabilities to accommodate the Tc Bovine immunizations that improve our overall plasma production speed and efficiency further enhancing our drug discovery and clinical manufacturing timeline.

Our Tc Bovine are housed at dedicated specialty facilities that cater to the production, health, safety, and welfare of the animals, and provide plasma production.

We have fully GLP and cGMP compliant quality control testing facilities and we have further developed our own internal antigen (immunogen) discovery and production capabilities to accommodate the Tc Bovine immunizations that improve our overall plasma production speed and efficiency further enhancing our drug discovery and clinical manufacturing timeline.

Our Tc Bovine are housed at dedicated specialty facilities, accredited by the American Association for Accreditation of Laboratory Animal Care (the “AAALAC”) that cater to the production, health, safety, and welfare of the animals, and provide plasma production.

We recently completed an expansion of our research and development laboratory facilities to accommodate our discovery programs, support for our pre-clinical pipeline programs, and process development research for our product candidates.

3 unchanged sentences

The biopharmaceutical industry is highly competitive and subject to rapid and significant technological change as research provides a deeper understanding of the pathology of diseases and new technologies and treatments are developed.

We believe our scientific knowledge, technology, and development capabilities provide us with substantial competitive advantages, but we face potential competition from multiple sources, major pharmaceutical, specialty pharmaceutical and existing or emerging biotechnology companies, academic research institutions, governmental agencies, and public and private research institutions worldwide.

We believe our scientific knowledge, technology, and development capabilities provide us with substantial competitive advantages, but we face potential competition from multiple sources, major pharmaceutical, specialty pharmaceutical and existing or emerging biotechnology companies, academic research institutions, governmental agencies, and public and private research institutions worldwide.

Our competitors may have significantly greater financial resources, robust drug pipelines, established presence in the market and expertise in research and development, manufacturing, pre-clinical and clinical testing, obtaining regulatory approvals and reimbursement and marketing approved products than we do.

These competitors also compete with us in recruiting and retaining qualified clinical, regulatory, scientific, sales, marketing, and management personnel, in establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs.

Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.

Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.

If any future product candidates identified through our current lead programs are eventually approved for sale, they will likely compete with a range of treatments that are either in development or currently marketed for use in those same disease indications.

Our success will partially depend on our ability to obtain, maintain, enforce, and defend patents and other intellectual property rights with respect to our IgGs that are proven to be safer or more effective or are less expensive than competing products.

Our success will partially depend on our ability to obtain, maintain, enforce, and defend patents and other intellectual property rights with respect to our hIgGs that are proven to be safer or more effective or are less expensive than competing products.

We could see a reduction or elimination in our commercial opportunity if our competitors develop and commercialize drugs that are safer, better tolerated, more effective, more convenient to administer, less expensive, more resistant to viral escape, or receive a more favorable label than our product candidates.

INTELLECTUAL PROPERTY

We actively seek to protect the intellectual property and proprietary technology platform that we believe is important to our business, which includes seeking and maintaining patents covering our technology platform and products, and any other inventions that are commercially or strategically important to the development of our business.

We actively seek to protect the intellectual property and proprietary technology production system that we believe is important to our business, which includes seeking and maintaining patents covering our technology production system and products, and any other inventions that are commercially or strategically important to the development of our business.

We also seek to protect the confidentiality of trade secrets that may be important to the development of our business.

Our ability to stop third parties from making, using, selling, offering to sell, or importing our products may depend on the extent to which we have rights under valid and enforceable patents or trade secrets that cover these activities.

For more information, please see “Risk Factors –

Risks Related to Our Intellectual Property.”

The portfolio of intellectual property and trade secrets that we have developed includes patents related to the activity of our human artificial chromosome and methods that we expect to generate fully human IgGs at commercial scale.

For more information, please see “Risk Factors – Risks Related to Our Intellectual Property”.

The patent portfolio includes composition and method patents.

Our goal is to continue expansion of the breadth of claims and length of claim protections.

Our technologies may be difficult to replicate, creating potential barriers to entry, as our genetic engineering know-how and suite of proprietary platform IP and trade secrets have been developed and optimized over nearly two decades.

We expect our global patent protection to extend to 2041 and beyond with respect to producing commercial-scale human IgGs using our chromosome engineering that generates high concentrations of human IgGs in ungulates.

Our technologies may be difficult to replicate, creating potential barriers to entry, as our genetic engineering know-how and suite of proprietary production system IP and trade secrets have been developed and optimized over nearly two decades.

We expect our global patent protection to extend to 2041 and beyond with respect to producing commercial-scale hIgGs using our chromosome engineering that generates high concentrations of hIgGs in ungulates.

However, we recognize that patents and other intellectual property rights in biotechnology are constantly evolving with many risks and uncertainties, which may affect those rights.

As of December 2022, our patent portfolio includes over 40 issued patents or pending applications.

As of March 2024, our patent portfolio includes over 40 issued patents or pending applications.

We have made strategic filings in jurisdictions including the United States, Australia, Canada, China, Europe, Japan, Korea, and Mexico.

These patent families cover:

patent relating to methods of cloning a non-human mammal using transgenic ungulate embryos of one or more cells that have a human chromosome fragment and transgenic ungulate embryos of one or more cells that have a human chromosome fragment, and methods for making them (expiring in 2023 and 2025).

• Granted patents in the U.S., Europe, Japan, and other major markets relating to a human artificial chromosome vector comprising a gene encoding the human antibody heavy chain, a gene encoding the human antibody light chain, and a gene encoding IgM heavy chain constant region derived (at least in part) from a nonhuman animal (expiring in 2033.

Granted patents U.S., Europe, Japan, and other major markets relating to large-scale production of human IgGs by transgenic animals with high production of fully human hIgG of at least 1 g/L in sera (expiring in 2030 and in the U.S., 2031).

A granted U.S.

patent relating to reprogramming a call to express a T-cell receptor reactive with an antigen of interest (expiring in 2025).

• Granted patents in the U.S., Europe, Japan, and other major markets relating to large-scale production of human IgGs by transgenic animals with high production of -human IgG of at least 1 g/L in sera (expiring in 2030 and in the U.S., 2031).

• A granted U.S.

1 unchanged sentence

application relating to methods for producing human IgGs against a pathogen comprising injecting a non-human animal with a viral pathogen-derived DNA vaccine in at least two locations of the animal (expiring in 2036).

patents covering cloned transgenic ungulates (e.g., bovines) in which prion protein activity is reduced by one or more genetically engineered mutations (expiring in 2023 and 2025).

Related to anti-thymocyte globulin (ATG) products, pending patent applications in the U.S., Europe, Japan, and other major markets covering ungulate-derived polyclonal immunoglobulin compositions comprising fully human or substantially human immunoglobulins that specifically bind human thymocytes, T cells, B cells, and/or monocytes, and methods of making and using the same in treating or preventing organ transplant rejection or type 1 diabetes (if issued, naturally expiring in 2041).

Pending international and U.S.

patent applications covering ungulate-derived human immunoglobulins that specifically bind coronavirus S protein, and methods of making and using the same in treating or preventing coronavirus disease (if issued, naturally expiring in 2041).

• Granted U.S.

patent covering ungulate-derived human immunoglobulins that specifically bind coronavirus S protein, and methods of making and using the same in treating or preventing coronavirus disease (expiring in 2041).

• Related to anti-thymocyte globulin (ATG) products, pending patent applications in the U.S., Europe, Japan, and other major markets covering ungulate-derived polyclonal immunoglobulin compositions comprising -human or substantially human immunoglobulins that specifically bind human thymocytes, T cells, B cells, and/or monocytes, and methods of making and using the same in treating or preventing organ transplant rejection or T1D (if issued, naturally expiring in 2041).

• Pending U.S.

provisional application covering ungulate-derived human immunoglobulins that specifically bind influenza antigen, and methods of making and using the same in treating or preventing influenza (if issued, naturally expiring in 2042).

Our proprietary know-how and trade secrets include the following:

Complex chromosome engineering trade secrets.

Immunogen dose levels used for nucleotides, peptides, proteins, closely autologous proteins, virus particles, whole inactivated viruses, cell membranes, whole cells, bacteria, glycol-proteins, human cell immunogens, tissue preparation.

Our adjuvants formulations for immunogen hyperimmunization.

Bovine plasma fractionation procedures and trade secrets contained within our proprietary Standard Operating Procedures.

Animal husbandry procedures for human antibody-producing ungulates.

Transgenic neo-natal ungulate IVIG administration for failure of passive immunity.

Certain cell culture and cloning practices.

Plasma collection procedures.

• Granted U.S.

that have a human chromosome fragment, and methods for making them (expiring in 2025).

These patents are not material to the Company at this time, and we believe patents issued subsequently allow the Company to maintain its competitive position.

• A granted U.S.

patent relating to reprogramming a call to express a T-cell receptor reactive with an antigen of interest (expiring in 2025).

This patent is not material to the Company at this time, and we believe patents issued subsequently allow the Company to maintain its competitive position.

• Granted U.S.

patents covering cloned transgenic ungulates (e.g., bovines) in which prion protein activity is reduced by one or more genetically engineered mutations (expiring in 2025).

These patents are not material to the Company at this time, and we believe patents issued subsequently allow the Company to maintain its competitive position.

PATENT SYSTEM

In most countries in which we file, including the United States, the patent term is 20 years from the earliest date of filing a non-provisional patent application.

In the United States, a patent’s term may potentially be lengthened by patent term adjustment, which compensates a patentee for administrative delays by the U.S.

PTO in examining and granting a patent considering delays on the part of the patentee or may be shortened if a patent is terminally disclaimed over an earlier filed patent.

In the United States, the patent term of a patent that covers an FDA-licensed biologic may also be eligible for patent term extension, which permits patent term restoration as compensation for the patent term lost during the FDA regulatory review process.

In the United States, the patent term that covers an FDA-licensed biologic may also be eligible for patent term extension, which permits patent term restoration as compensation for the patent term lost during the FDA regulatory review process.

The Hatch-Waxman Act permits a patent term extension of up to five years beyond the expiration of the patent.

2 unchanged sentences

Similar provisions are available in Europe and other foreign jurisdictions to extend the term of a patent that covers a licensed biologic.

In the future, if and when our product candidates.

Receive FDA approval or licensure, we expect to apply for patent term extensions on patents covering those products.

In the future, if and when our product candidates receive FDA approval or licensure, we expect to apply for patent term extensions on patents covering those products.

We expect to seek patent term extensions to any of our issued patents in any jurisdiction where these are available, however there is no guarantee that the applicable authorities, including the FDA in the United States, will agree with our assessment of whether such extensions should be granted, and if granted, the length of such extensions.

For more information regarding the risks related to our intellectual property, see the section titled “Risk Factors –

Risks Related to Our Intellectual Property.”

For all patent applications, we determine claiming strategy on a case-by-case basis.

Advice of counsel and our business model and needs are always considered.

We file patents containing claims for protection of useful applications of our proprietary technologies and products, as well as new applications and/or uses we discover for existing technologies and products, assuming these are strategically valuable.

We may periodically reassess the number and type of patent applications, as well as the pending and issued patent claims to ensure that coverage and value are obtained for our processes, and compositions, given existing patent law and court decisions.

Further, claims may be modified during patent prosecution to meet our intellectual property and business needs.

We recognize that the ability to obtain patent protection and the degree of such protection depends on several factors, including the extent of the prior art, the novelty and non-obviousness of the invention, and the ability to satisfy subject matter, written description, and enablement requirements of the various patent jurisdictions.

In addition, the coverage claimed in a patent application can be significantly reduced before the patent is issued, and its scope can be reinterpreted or further altered even after patent issuance.

Consequently, we may not obtain or maintain adequate patent protection for any of our future product candidates or for our technology platform.

We cannot predict whether the patent applications we are currently pursuing will be issued as patents in any particular jurisdiction or whether the claims of any issued patents will provide sufficient proprietary protection from competitors.

Any patents that we hold may be challenged, circumvented, or invalidated by third parties.

In addition to patent protection, we also rely on trade secrets, know-how, other proprietary information and/or continuing technological innovation to develop and maintain our competitive position.

We seek to protect and maintain the confidentiality of proprietary information to protect aspects of our business that are not amenable to, or that we do not consider appropriate for, patent protection.

It is our policy to require our employees, consultants, outside scientific collaborators, sponsored researchers, and other advisors to execute confidentiality agreements upon the commencement of employment or consulting relationships with us.

These agreements provide that all confidential information concerning our business or financial affairs developed or made known to the individual during the individual’s relationship with us is to be kept confidential and not disclosed to third parties except in specific circumstances.

Our agreements with employees also provide that all inventions conceived by the employee in the course of employment with us or from the employee’s use of our confidential information are our exclusive property.

However, such confidentiality agreements and invention assignment agreements can be breached, and we may not have adequate remedies for any such breach.

In addition, our trade secrets may otherwise become known or be independently discovered by competitors.

To the extent that our consultants, contractors, or collaborators use intellectual property owned by others in their work for us, disputes may arise as to the rights in related or resulting trade secrets, know-how and inventions.

For more information regarding the risks related to our intellectual property, see the section titled “Risk Factors –

Risks Related to Our Intellectual Property.”

The patent positions of biotechnology companies like ours are generally uncertain and involve complex legal, scientific, and factual questions.

Our commercial success will also depend in part on not infringing upon the proprietary rights of third parties.

It is uncertain whether the issuance of any third-party patent would require us to alter our development or commercial strategies, or our products or processes, obtain licenses or cease certain activities.

Our breach of any license agreements or our failure to obtain a license to proprietary rights required to develop or commercialize our future products may have a material adverse impact on us.

If third parties prepare and file patent applications in the United States that also claim technology to which we have rights, we may have to participate in interference or derivation proceedings in the U.S.

PTO to determine priority of invention.

For more information, see the section titled “Risk Factors –

Risks Related to Our Intellectual Property.”

For more information regarding the risks related to our intellectual property, see the section titled “Risk Factors – Risks Related to Our Intellectual Property”.

Patent Term Restoration

Depending upon the timing, duration, and specifics of FDA approval of product candidates, some of a sponsor’s U.S.

patents may be eligible for limited patent term extension under the Drug Price Competition and Patent Term Restoration Act of 1984, or the Hatch-Waxman Amendments.

The Hatch-Waxman Amendments permit a patent restoration term of up to five years as compensation for patent term lost during the product development and FDA regulatory review process.

However, patent term restoration cannot extend the remaining term of a patent beyond a total of 14 years from the product’s approval or licensure date.

The patent term restoration period generally is- once the patent issues- one-half the time between the effective date of an IND and the submission date of a biologics license application (“BLA”) less any time the sponsor did not act with due diligence during the period, plus the time between the submission date of a BLA and the approval of that application less any time the sponsor did not act with due diligence during the period.

6 unchanged sentences

Regulation of Transgenic Animals and New Animal Drugs

Department of Agriculture (USDA) regulates the company’s Tc Bovine husbandry activities, including housing, healthcare, and general management of these specialized animals.

This includes regulations and periodic facility inspections and reporting.

We also are voluntarily accredited by the American Association for Accreditation of Laboratory Animal Care (AAALAC).

We also are voluntarily accredited by the AAALAC.

The AAALAC International accreditation program evaluates organizations that use animals in research, teaching or testing.

2 unchanged sentences

The FDA considers, with limited exclusions, the altered genomic DNA in an animal to be a drug because such altered DNA is an article intended to affect the structure or function of the body of the animal, and, in some cases, intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease in the animal.

In the United States, new animal drugs are subject to regulation under the Federal Food, Drug, and Cosmetic (FD&C) Act, and under the FD&C Act, in general, a new animal drug is “deemed unsafe”

and adulterated unless the FDA has approved a new animal drug application (NADA) for its intended use or unless the drug is only for investigational use and conforms to specified exemptions for such use under an investigational new animal drug (INAD) exemption.

Further, early in the development process, FDA has allowed the submission of information to FDA’s Center for Veterinary Medicine (CVM), without the establishment of an INAD file, such as through creation of a veterinary master file (VMF), subject to certain conditions such as restrictions on introducing any food derived from such investigational animals into the food supply.

In the United States, new animal drugs are subject to regulation under the Federal Food, Drug, and Cosmetic (the “FDCA”), and under the FDCA, in general, a new animal drug is “deemed unsafe” and adulterated unless the FDA has approved a new animal drug application (NADA) for its intended use or unless the drug is only for investigational use and conforms to specified exemptions for such use under an investigational new animal drug (INAD) exemption.

The requirements governing development and approval of a new animal drug are analogous to those for new human drugs.

A NADA must generally be accompanied by payment of a substantial user fee and must contain substantial evidence of the safety and effectiveness of the new animal drug as well as detailed descriptions of the methods used in and the facilities and controls used for the manufacturing, processing and packaging of the new animal drug to enable FDA to reach a determination that such methods, facilities and controls are adequate to preserve the identify, strength, quality and purity of the new animal drug.

A NADA must generally be accompanied by payment of a substantial user fee and must contain substantial evidence of the safety and effectiveness of the new animal drug as well as detailed descriptions of the methods used in and the facilities and controls used for the manufacturing, processing and packaging of the new animal drug to enable FDA to reach a determination that such methods, facilities and controls are adequate to preserve the identify, strength, quality and purity of the new animal drug.

Further, when FDA reviews and approves a NADA, FDA generally conducts a review of environmental risks pursuant to the requirements of the National Environmental Policy Act (NEPA), if any and where required.

The steps involved in completing the INAD/NADA process are cumulative and risk based with each component of the assessment forming the basis on which the next step is evaluated.

Product Identification

Product identification (21 CFR 514.1(b)(1)), which many molecular biologists would refer to as product definition, forms the foundation for the evaluation process and drives subsequent data generation and review.

It encompasses the specific GE animal (that is, the article as well as the GE animal containing it) and the purpose (i.e., intended use) of the article that is the subject of the NADA.

Molecular Characterization of the Construct

This step of the process serves to describe the components and composition of the article.

(21 CFR 514.1(b)(4).

Molecular Characterization of the GE Animal Lineage

This step continues the analysis of the rDNA construct in the resulting GE animal, as well as the production of the GE animal(s) intended to be used in commerce and any potential hazards that may be introduced into those animals as part of their production.

Phenotypic Characterization of GE Animal

The previous steps of the review process have concentrated on establishing and characterizing the rDNA construct and its integration into the resulting GE animals.

Information in this and the following steps helps establish whether the GE animal poses any risks to humans, risks to health of the GE animal, or risks to the environment.

Genotypic and Phenotypic Durability Assessment

As in Step 3, this step also addresses some additional components of the manufacturing requirements codified in 21 CFR 514.1(b)(5).

It is intended to provide information to ensure that the rDNA construct in the GE animal resulting from the specific transformation event and defining (identifying) the GE animal being evaluated is durable –

that there is a reasonable expectation that the rDNA construct is stably inherited, and the phenotype is consistent and predictable.

The Food/Feed Safety and Environmental Safety Assessments

Food/Feed Safety

This portion of step 6 addresses the food and feed safety requirements in 21 CFR 514.1(b)(8).

It focuses on the issue of whether food or feed derived from a GE animal is safe for humans or animals consuming edible products from the animals.

Environmental Safety

This portion of Step 6 addresses the environmental component of an NADA.

21 CFR 514.1(b)(14).

GE animal applications have to be evaluated to determine whether such an application individually or cumulatively affects the environment (i.e., whether an extraordinary circumstance exists).

21 CFR 25.21.

An Environmental Assessment that demonstrates the GE animal will not significantly affect the quality of the human environment leads to a finding of no significant impact (FONSI).

Effectiveness/Claim Validation

The previous steps of the review process primarily address identity and safety issues.

This last step of pre-market review addresses effectiveness, i.e., whether the claims have been validated for the characteristics that the GE animal is intended to exhibit.

21 CFR 514.1(b)(8).

CVM manages the regulation of our Tc Bovine technology, and we engage in scientific and regulatory communications with CVM focused on SAB’s animal plasma as the source of drug substance and product.

CVM has regulatory oversight of animals with intentional genomic alterations (IGA) to produce drugs and biological products intended for human use.

This is a one-time approval process for a platform technology that may produce multiple targeted products in the future that would be regulated by another Center at FDA (i.e., CBER).

CVM has regulatory responsibility for veterinary and food safety issues associated with final products and the use of IGA animals.

CVM and other FDA Centers work interactively to regulate IGA animals and their products.

Regulations 21 CFR, Parts 58, 210, 211, 600, 680 and 9 CFR, Parts 1, 2, 3 are applicable to aspects of production or disposition of these IGA animals.

CVM has Guidance 187 for Regulation of Intentionally Altered Genomic DNA in Animals for the regulatory oversight and approval process for IGA animals intended for production of biological products for human use, as well as CBER’s Points to Consider in the Manufacture and Testing of Therapeutic Products for Human Use Derived from Transgenic Animals (CBER 1995).

We have a longstanding relationship with CVM and have an Investigational New Animal Drug (INAD-011204) on file.

Data and information on the safety and effectiveness of the genetic modifications of Tc Bovine are currently in the process of being submitted in a series of seven steps in accordance with Guidance 187 and under review by CVM.

Once all steps are completed and reviewed by CVM, an administrative New Animal Drug Application (NADA) will be submitted for final review and approval.

The current expectation is to have the NADA completed by the fourth quarter of 2024.

We are also currently filing a new animal drug application (NADA) assessing the safety and effectiveness of genetic modifications to the Tc Bovine animals with the CVM.

This is a one-time process that includes future post approval responsibilities related to the durability of animal health and antibody response.

Biological Products Development Process

In the United States, biologic products are licensed by the FDA for marketing under the Public Health Service Act, (PHS Act), and regulated under the Federal Food, Drug, and Cosmetic Act (FDCA).

In the United States, biologic products are licensed by the FDA for marketing under the Public Health Service Act, (PHS Act), and regulated under the FDCA.

Both the FDCA and the PHS Act and their corresponding regulations govern, among other things, the testing, manufacturing, safety, purity, potency, efficacy, labeling, packaging, record keeping, storage, distribution, marketing, sales, import, export, reporting, advertising, and other promotional practices involving biologic products.

2 unchanged sentences

The process of obtaining regulatory approvals and the subsequent compliance with appropriate federal, state, local and foreign statutes and regulations require the expenditure of substantial financial resources and time.

Multiple immunoglobulin and monoclonal antibody products have been approved by the FDA to prevent or treat human diseases.

Though the FDA regulates both monoclonal antibodies and immunoglobulin products, Monoclonal antibodies are regulated by the Center for Drug Evaluation and Research (CDER).

A monoclonal antibody is characterized by its molecular structure.

This approach is similar to the process that CDER uses to regulate small molecule drugs.

Because mAbs are designed to bind to a single epitope, mutation is a significant concern due to selective pressure.

IgGs derived from animals or humans are regulated by the Center for Biologics Evaluation and Research (CBER).

CBER has currently approved thirty-nine unique immunoglobulin products for commercial sale.

Human and animal-derived IgGs are characterized by their in vitro potency and not by the molecular structure of each antibody in the product.

Development Process.

Hybrid Process for a Biological Product Is Developed from Animals with Intentionally Altered Genomic DNA

The process required by the FDA before a biologic product may be marketed in the United States is generally well documented.

In the case of a product that is developed from animals with intentionally altered genomic DNA as the donor material source, the process is more complex and involves both CVM, to oversee the intentionally altered genomic DNA in animals and the Office of Tissues and Advanced Therapies (OTAT) at FDA’s Center for Biologics Evaluation and Research (CBER) to oversee the immunoglobulin products.

Key aspects of the process include the following:

completion of nonclinical laboratory tests and animal studies according to Good Laboratory Practices (GLPs), and the Animal Welfare Act administered and enforced by the U.S.

Department of Agriculture;

submission to CVM of an application for an INAD, which must become effective before human clinical trials may begin;

completion of nonclinical laboratory tests and animal studies according to Good Laboratory Practices (GLPs), and the Animal Welfare Act administered and enforced by the U.S.

Department of Agriculture;

preparation of clinical trial material in accordance with Good Manufacturing Practices (GMPs);

submission to the FDA of an application for an Investigational New Drug Application (IND), which must become effective prior to beginning any human clinical trials;

approval of the protocol and related documentation by an institutional review board (IRB) or ethics committee at each clinical site prior to initiation of each clinical trial;

performance of adequate and well-controlled human clinical trials according to Good Clinical Practices (GCPs), and any additional requirements for the protection of human research subjects and their health information to establish the safety, purity, potency, and efficacy of the proposed biologic product for its intended use;

preparation of and submission to CVM of a NADA for marketing approval that includes sufficient evidence of establishing the safety, purity, and potency of the proposed altered genome in animals for its intended indication, including from results of nonclinical testing and clinical trials;

submission to the FDA of a BLA for marketing approval that includes substantive evidence of safety, purity, potency, and efficacy from results of nonclinical testing and clinical trials;

payment of user fees for FDA review of the NADA and BLA, unless a fee waiver applies;

satisfactory completion of an FDA inspection prior to a BLA approval of the manufacturing facility or facilities where the biologic product is produced to assess compliance with GMPs to assure that the facilities, methods, and controls are adequate to preserve the biologic’s identity, strength, quality and purity;

potential FDA Advisory Committee meeting to elicit expert input on critical issues, including a vote by external committee members;

FDA review and approval of the NADA and BLA, which may be performed in parallel, but the NADA must be granted before a final decision can be made on the BLA, resulting in the licensure of the biological product for commercial marketing;

compliance with any post-approval requirements, including the potential requirement to implement a REMS, and the potential requirement to conduct post-approval studies.

Before testing any biologic product candidate in humans, the product candidate enters the preclinical testing stage.

Nonclinical tests include laboratory evaluations of product chemistry, pharmacology, toxicity, and formulation, as well as animal studies to assess the potential safety and activity of the product candidate.

The conduct of the nonclinical tests must comply with federal regulations and requirements, including GLPs.

Prior to beginning the first clinical trial with a product candidate developed from an animal with altered genomic DNA in the United States, an INAD must be submitted to CVM and an IND must be submitted to CBER, and the FDA must allow the INAD and IND to proceed.

INAD submission is a one-time process and doesn’t have to be repeated with our investigational products for each IND submission for products produced by Tc Bovine with the same HAC.

An INAD and IND are exemptions from the FD&C Act that allow an unapproved product candidate to be shipped in interstate commerce for use in an investigational clinical trial and a request for FDA allowance that such investigational product may be administered to humans in connection with such trial.

Such authorization must be secured prior to interstate shipment and administration.

In support of a request for an INAD, applicants must submit to the FDA the results of the preclinical tests, together with manufacturing information, analytical data, any available clinical data or literature and plans for clinical trials, among other things.

In support of a request for an IND, applicants must submit to the FDA a protocol for each clinical trial and any subsequent protocol amendments.

In addition, the results of the preclinical tests, together with manufacturing information, analytical data, any available clinical data or literature and plans for clinical trials, among other things, must be submitted as part of an IND.

An INAD and IND must become effective before human clinical trials may begin.

An IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA, within the 30-day time period, raises safety concerns or questions about the proposed clinical trial.

In such a case, the IND may be placed on clinical hold or partial clinical hold.

In this case, the IND sponsor and the FDA must resolve any outstanding concerns before clinical trials can begin.

Submission of an IND therefore may or may not result in FDA allowance to begin a clinical trial.

Additionally, under the NIH Guidelines for Research Involving Recombinant DNA Molecules (NIH Guidelines), supervision of human gene transfer trials includes evaluation and assessment by an institutional biosafety committee (IBC), a local institutional committee that reviews and oversees research utilizing recombinant or synthetic nucleic acid molecules at that institution.

The IBC assesses the safety of the research and identifies any potential risk to public health or the environment, and such review may result in some delay before initiation of a clinical trial.

While the NIH Guidelines are not mandatory unless the research in question is being conducted at or sponsored by institutions receiving NIH funding of recombinant or synthetic nucleic acid molecule research, many companies and other institutions not otherwise subject to the NIH Guidelines voluntarily follow them.

Clinical trials may involve the administration of the biologic product candidate to healthy volunteers or subjects under the supervision of qualified investigators, generally physicians not employed by or under the study sponsor’s control.

Clinical trials involving some products for certain diseases may begin with testing in patients with the disease.

Clinical trials are conducted under protocols detailing, among other things, the objectives of the clinical trial, dosing procedures, subject selection and exclusion criteria and the parameters to be used to monitor subject safety, including stopping rules that assure a clinical trial will be stopped if certain adverse events should occur.

Each protocol and any amendments to the protocol must be submitted to the FDA as part of the IND.

Clinical trials must be conducted and monitored in accordance with the FDA’s regulations comprising the GCP requirements, including the requirement that all research subjects or his or her legal representative provide informed consent.

Further, each clinical trial must be reviewed and approved by an independent IRB at or servicing each institution at which the clinical trial will be conducted.

IRBs are charged with protecting the welfare and rights of study participants and consider such items as whether the risks to individuals participating in clinical trials are minimized and are reasonable in relation to anticipated benefits.

The IRB also approves the form and content of the informed consent that must be signed by each clinical trial subject or his or her legal representative and must monitor the clinical trial until it is completed.

Additionally, some trials are overseen by an independent group of qualified experts organized by the trial sponsor, known as a data safety monitoring board or committee.

Human clinical trials are typically conducted in three sequential phases that may overlap or be combined:

The biologic product is initially introduced into healthy human subjects and tested for safety. In the case of some biologic products for rare diseases, the initial human testing is often conducted in patients.

The biologic product is evaluated in a limited patient population to identify possible adverse effects and safety risks, to preliminarily evaluate the efficacy of the biologic product for specific targeted diseases and to determine dosage tolerance, optimal dosage, and dosing schedule.

Clinical trials are undertaken to further evaluate dosage, clinical efficacy, potency, and safety in an expanded patient population at geographically dispersed clinical trial sites.

These clinical trials are intended to establish the overall risk/benefit ratio of the biologic product and provide an adequate basis for product labeling.

In biologics for rare diseases where patient populations are small and there is an urgent need for treatment, Phase 3 trials might not be required if an adequate risk/benefit can be demonstrated from the Phase 2 trial.

Post-approval clinical trials, sometimes referred to as Phase 4 clinical trials, may be conducted after initial marketing approval.

These clinical trials are used to gain additional experience from the treatment of patients in the intended therapeutic indication, particularly for long-term safety follow-up.

In the case of a product that is developed from animals with intentionally altered genomic DNA as the donor material source, the process is more complex and involves both CVM, to oversee the intentionally altered genomic DNA in animals and the Office of Tissues and Advanced Therapies (“OTAT”) at CBER to oversee the immunoglobulin products.

During all phases of clinical development, regulatory agencies require extensive monitoring and auditing of all clinical activities, clinical data, and clinical trial investigators.

2 unchanged sentences

The sponsor must submit an IND safety report within 15 calendar days after the sponsor determines that the information qualifies for reporting.

The sponsor also must notify the FDA of any unexpected fatal or life-threatening suspected adverse reaction within seven calendar days after the sponsor’s initial receipt of the information.

Phase 1, Phase 2, and Phase 3 clinical trials may not be completed successfully within any specified period, if at all.

The FDA or the sponsor or its data safety monitoring board may suspend a clinical trial at any time on various grounds, including a finding that the research subjects or patients are being exposed to an unacceptable health risk.

Similarly, an IRB can suspend or terminate approval of a clinical trial at its institution if the clinical trial is not being conducted in accordance with the IRB’s requirements or if the biologic has been associated with unexpected serious harm to patients.

Similarly, an IRB can suspend or terminate approval of a clinical trial at its institution if the clinical trial is not being

conducted in accordance with the IRB’s requirements or if the biologic has been associated with unexpected serious harm to patients.

Concurrent with clinical trials, companies usually complete additional animal studies and must also develop additional information about the physical characteristics of the biologic as well as finalize a process for manufacturing the product in commercial quantities in accordance with GMP requirements.

4 unchanged sentences

In each of these areas, the FDA and other regulatory authorities have broad regulatory and enforcement powers, including the ability to levy fines and civil penalties, suspend or delay issuance of approvals, seize or recall products and withdraw approvals.

Information about certain clinical trials must be submitted within specific timeframes to the NIH for public dissemination on its clinicaltrials.gov website.

Disclosure of the results of such trials can be delayed in some cases for up to two years after the date of completion of the trial.

Failure to timely register a covered clinical trial or to submit trial results as provided for in the law can give rise to civil monetary penalties and also prevent the non-compliant party from receiving future grant funds from the federal government.

The NIH’s Final Rule on clinicaltrials.gov registration and reporting requirements became effective in 2017, and both NIH and FDA have recently begun enforcing those requirements against non-compliant clinical trial sponsors.

Sponsors or distributors of investigational products for the diagnosis, monitoring, or treatment of one or more serious diseases or conditions must also have a publicly available policy on evaluating and responding to requests for expanded access requests.

Review and Approval Processes

2 unchanged sentences

The testing and approval processes require substantial time and effort, and there can be no assurance that the FDA will accept the BLA for filing and, even if filed, that any approval will be granted on a timely basis, if at all.

Under the Prescription Drug User Fee Act, as amended, or the PDUFA, each BLA may be accompanied by a significant user fee.

Under the Prescription Drug User Fee Act (PDUFA), as amended, each BLA may be accompanied by a significant user fee.

Under federal law, the submission of most applications for approval of drug and biologic products is subject to an application user fee.

9 unchanged sentences

Once the sponsor reactivates the NADA by addressing identified deficiencies, the FDA targets 135 to 180 days, depending in part on whether the deficiencies are identified as not substantial or substantial, respectively, to complete its review and respond to the applicant.

The sponsor of a new animal drug may voluntarily decide to utilize FDA’s “phased review”

process to complete all technical sections required for approval of a new animal drug before submitting a NADA by submitting such information during the investigational phase of the animal drug development process.

The sponsor of a new animal drug may voluntarily decide to utilize FDA’s “phased review” process to complete all technical sections required for approval of a new animal drug before submitting a NADA by submitting such information during the investigational phase of the animal drug development process.

Utilizing this process, the sponsor may submit an administrative NADA, which is a NADA submitted after all technical sections necessary to fulfill the requirements for the approval of a new animal drug have been reviewed by the CVM and the CVM has issued a technical section complete letter for each of the required technical sections.

The FDA targets 60 days from the filing date to complete its review and act on an administrative NADA.

Under the performance goals and policies implemented by the FDA under the Prescription Drug User Fee Act (PDUFA) for original BLAs, the FDA targets ten months from the filing date in which to complete its initial review of a standard application and respond to the applicant, and six months from the filing date for an application with priority review.

Under the performance goals and policies implemented by the FDA under the PDUFA for original BLAs, the FDA targets ten months from the filing date in which to complete its initial review of a standard application and respond to the applicant, and six months from the filing date for an application with priority review.

The FDA does not always meet its PDUFA goal dates, and the review process is often significantly extended by FDA requests for additional information or clarification.

6 unchanged sentences

the FDA will not approve the BLA without a REMS, if required.

Before approving a NADA or BLA, the FDA may inspect the facilities at which the product is manufactured.

The FDA will not approve the product unless it determines that the manufacturing processes and facilities are in compliance with GMP requirements and adequate to assure consistent production of the product within required specifications.

Additionally, before approving a BLA, the FDA will typically inspect one or more clinical trial sites to assure that the clinical trials were conducted in compliance with IND study requirements and GCP requirements.

To ensure GMP and GCP compliance, an applicant must incur significant expenditure of time, money, and effort in the areas of training, record keeping, production and quality control.

After the FDA evaluates a NADA or BLA and conducts inspections of manufacturing facilities where the investigational product and/or its drug substance will be produced, the FDA may issue an approval letter or for an NADA and BLA respectively, an Incomplete Letter or a Complete Response Letter.

An approval letter authorizes commercial marketing of the product with specific prescribing information for specific indications.

An Incomplete Letter or a Complete Response Letter will describe all of the deficiencies that the FDA has identified in the NADA or BLA.

Where the FDA determines that the data supporting a BLA are inadequate to support approval, the FDA may issue a Complete Response Letter without first conducting required inspections, testing submitted product lots, and/or reviewing proposed labeling.

In issuing an Incomplete Letter or Complete Response Letter, the FDA may recommend actions that the applicant might take to place the NADA or BLA in condition for approval, including requests for additional information or clarification.

The FDA may delay or refuse approval of a NADA or a BLA if applicable regulatory criteria are not satisfied or require additional testing or information.

If a product receives regulatory approval, the approval may be significantly limited to specific diseases and dosages or the indications for use may otherwise be limited, including to subpopulations of patients, which could restrict the commercial value of the product.

Further, the FDA may require that certain contraindications, warnings precautions or interactions be included in the product labeling.

The FDA also may condition approval on, among other things, changes to proposed labeling or the development of adequate controls and specifications.

Once approved, the FDA may withdraw the product approval if compliance with pre- and post-marketing requirements is not maintained or if problems occur after the product reaches the marketplace.

Further, for biological products, the FDA may impose restrictions and conditions on product distribution, prescribing, or dispensing in the form of a REMS, or otherwise limit the scope of any approval.

The FDA may require one or more Phase 4 post-market studies and surveillance to further assess and monitor the biological product’s safety and effectiveness after commercialization and may limit further marketing of the product based on the results of these post-marketing studies.

Post-Approval Requirements

6 unchanged sentences

If not done in accordance with FDA expectations, the FDA may restrict supply and may take further enforcement action.

Annual product reports are required to be submitted annually.

Annual product reports are required to be submitted.

Other post-approval requirements applicable to biological products include reporting of GMP deviations that may affect the identity, potency, purity and overall safety of a distributed product, record-keeping requirements, reporting of adverse events, reporting updated safety and efficacy information, and complying with electronic record and signature requirements.

After a BLA is approved, the product also may be subject to official lot release.

As part of the manufacturing process, the manufacturer is required to perform certain tests on each lot of the product before it is released for distribution.

If the product is subject to official release by the FDA, the manufacturer submits samples of each lot of product to the FDA together with a release protocol showing a summary of the history of manufacture of the lot and the results of all the manufacturer’s tests performed on the lot.

The FDA also may perform certain confirmatory tests on lots of some products, such as viral vaccines, before releasing the lots for distribution by the manufacturer.

In addition, the FDA may conduct laboratory research related to the regulatory standards on the safety, purity, potency, and effectiveness of biological products.

Manufacturers of biological products must establish systems to record and evaluate adverse events reported by healthcare providers and patients and to assess product complaints.

An increase in severity or new adverse events can result in labeling changes or product recalls.

Defects in manufacturing of commercial products can result in product recalls.

We also must comply with the FDA’s advertising and promotion requirements, such as those related to direct-to-consumer advertising, the prohibition on promoting products for uses or inpatient populations that are not described in the product’s approved labeling (known as “off-label use”), industry-sponsored scientific and educational activities and promotional activities involving the internet.

Discovery of previously unknown problems or the failure to comply with applicable regulatory requirements may result in restrictions on the marketing of a product or withdrawal of the product from the market, as well as possible civil or criminal sanctions.

Failure to comply with applicable U.S.

requirements at any time during the product development process, approval process or after approval may subject an applicant or manufacturer to administrative or judicial civil or criminal sanctions and adverse publicity.

FDA sanctions could include refusal to approve pending applications, withdrawal of an approval or license revocation, clinical hold, warning or untitled letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, refusals of government contracts, mandated corrective advertising or communications with doctors, debarment, restitution, disgorgement of profits or civil or criminal penalties.

Any agency or judicial enforcement action could have a material adverse effect.

Biological product manufacturers and other entities involved in the manufacture and distribution of approved biological products are required to register their establishments with the FDA and certain state agencies and are subject to periodic unannounced inspections by the FDA and certain state agencies for compliance with GMPs and other laws.

Accordingly, manufacturers must continue to expend time, money, and effort in the areas of production and quality control to maintain GMP compliance.

Discovery of problems with a product after approval may result in restrictions on a product, manufacturer, or holder of an approved BLA, including withdrawal of the product from the market.

In addition, changes to the manufacturing process or facility generally require prior FDA approval before being implemented, and other types of changes to the approved product, such as adding new indications and additional labeling claims, are also subject to further FDA review and approval.

Additionally, rigorous and extensive FDA regulation of new animal drugs continues after approval.

Owners of approved NADAs continue to have ongoing responsibilities under the FD&C Act, including registration and listing, recordkeeping, filing supplements, and periodic reporting.

Owners of approved NADAs continue to have ongoing responsibilities under the FDCA, including registration and listing, recordkeeping, filing supplements, and periodic reporting.

Expedited Review and Approval Programs

The FDA has various programs, including fast track designation, priority review, accelerated approval and breakthrough therapy designation, that are intended to expedite or simplify the process for the development and FDA review of biological products that are intended for the treatment of serious or life-threatening diseases or conditions and demonstrate the potential to address unmet medical needs.

The FDA has various programs, including fast track designation, priority review, accelerated approval and breakthrough therapy designation, which are intended to expedite or simplify the process for the development and FDA review of biological products that are intended for the treatment of serious or life-threatening diseases or conditions and demonstrate the potential to address unmet medical needs.

The purpose of these programs is to provide important new biological products to patients earlier than under standard FDA review procedures.

3 unchanged sentences

The FDA may give a priority review designation, such as a rare pediatric disease designation, to biological products that treat a serious condition and, if approved, would provide a significant improvement in safety or effectiveness.

A priority review means that the goal for the FDA’s review of an application is six months, rather than the standard goal of ten months under current PDUFA guidelines.

Most products that are eligible for fast-track designation may also be considered appropriate to receive a priority review.

In addition, biological products studied for their safety and effectiveness in treating serious or life-threatening illnesses and that provide meaningful therapeutic benefit over existing treatments may receive accelerated approval and may be approved on the basis of adequate and well-controlled clinical trials establishing that the biological product has an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity or prevalence of the condition and the availability or lack of alternative treatments.

As a condition of approval, the FDA may require a sponsor of a biological product receiving accelerated approval to perform post-marketing studies to verify and describe the predicted effect on irreversible morbidity or mortality or other clinical endpoints, and the biological product may be subject to accelerated withdrawal procedures.

The FDA may withdraw approval of a drug or indication approved under accelerated approval if, for example, the confirmatory trial fails to verify the predicted clinical benefit of the product.

Moreover, under the FDA Safety and Innovation Act enacted in 2012, a sponsor can request designation of a product candidate as a “breakthrough therapy.”

A breakthrough therapy is defined as a drug or biological product that is intended, alone or in combination with one or more other drugs or biologics, to treat a serious or life-threatening disease or condition and preliminary clinical evidence indicates that the drug or biological product may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development.

Breakthrough therapy designation comes with all the benefits of fast-track designation, which means that the sponsor may file sections of the BLA for review on a rolling basis if certain conditions are satisfied, including an agreement with the FDA on the proposed schedule for submission of portions of the application and the payment of applicable user fees before the FDA may initiate a review.

Under the FDA Safety and Innovation Act enacted in 2012, a sponsor can request designation of a product candidate as a “breakthrough therapy.” A breakthrough therapy is defined as a drug or biological product that is intended, alone or in combination with one or more other drugs or biologics, to treat a serious or life-threatening disease or condition and preliminary clinical evidence indicates that the drug or biological product may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development.

Breakthrough therapy designation comes with all the benefits of fast-track designation, which means that the sponsor may file sections of the BLA for review on a rolling basis if certain conditions are satisfied, including an agreement with the FDA on the proposed schedule for submission of portions of the application and the payment of applicable user fees before the FDA may initiate a review.

Drug and biological products designated as breakthrough therapies are also eligible for accelerated approval.

6 unchanged sentences

EUAs are intended to address serious or life-threatening diseases or conditions caused by a chemical, biological, radiological, or nuclear agent, including emerging infectious disease threats, such as the COVID-19 pandemic.

To receive an EUA, the product sponsor must demonstrate that the product “may be effective”

in the prevention, diagnosis, or treatment of an applicable disease or condition.

Additionally, the FDA must determine that the product’s known and potential benefits outweigh the known and potential risks.

To receive an EUA, the product sponsor must demonstrate that the product “may be effective” in the prevention, diagnosis, or treatment of an applicable disease or condition.

Additionally, the FDA must determine that the product’s known and potential benefits outweigh the known and potential risks.

Further there must be no adequate, approved, and available alternative product for the indication.

11 unchanged sentences

The orphan drug designation does not convey any advantage in, or shorten the duration of, the regulatory review or approval process.

If a product that has orphan drug designation subsequently receives the first FDA approval for the disease for which it has such designation, the product is entitled to orphan drug exclusive approval (exclusivity), which means that the FDA may not approve any other applications, including a full BLA, to market the same biologic for the same indication for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity.

Orphan drug exclusivity does not prevent FDA from approving a different drug or biologic for the same disease or condition, or the same drug or biologic for a different disease or condition.

Among the other benefits of orphan drug designation are tax credits for certain research and a waiver of the BLA application fee.

A designated orphan drug may not receive orphan drug exclusivity if it is approved for a use that is broader than the indication for which it received orphan designation.

In addition, exclusive marketing rights in the United States may be lost if the FDA later determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantities of the product to meet the needs of patients with the rare disease or condition.

Pediatric Trials

1 unchanged sentence

The FDCA requires that a sponsor who is planning to submit a marketing application for a drug or biologic product that includes a new active ingredient, new indication, new dosage form, new dosing regimen or new route of administration submit an initial Pediatric Study Plan, or PSP, within sixty days of an end-of-Phase 2 meeting or as may be agreed between the sponsor and FDA.

The initial PSP must include an outline of the pediatric study or studies that the sponsor plans to conduct, including study objectives and design, age groups, relevant endpoints and statistical approach, or a justification for not including such detailed information, and any request for a deferral of pediatric assessments or a full or partial waiver of the requirement to provide data from pediatric studies along with supporting information.

The initial PSP must include an outline of the pediatric study or studies that the sponsor plans to conduct, including study objectives and design,

age groups, relevant endpoints and statistical approach, or a justification for not including such detailed information, and any request for a deferral of pediatric assessments or a full or partial waiver of the requirement to provide data from pediatric studies along with supporting information.

The FDA and the sponsor must reach agreement on the PSP.

4 unchanged sentences

The Hatch-Waxman Amendments permit a patent restoration term of up to five years as compensation for patent term lost during product development and the FDA regulatory review process.

However, patent term restoration cannot extend the remaining term of a patent beyond a total of 14 years from the product’s approval date.

The patent term restoration period is generally one-half the time between the effective date of an IND and the submission date of a BLA plus the time between the submission date of a BLA and the approval of that application.

2 unchanged sentences

PTO, in consultation with the FDA, reviews and approves the application for any patent term extension or restoration.

The Biologics Price Competition and Innovation Act of 2009, or BPCIA, which was enacted as part of the Patient Protection and Affordable Care Act of 2010, as amended by the Health Care and Education Reconciliation Act of 2010 (ACA), created an abbreviated approval pathway for biological products that are demonstrated to be “biosimilar”

or “interchangeable”

with an FDA-licensed reference biological product via an approved BLA.

Biosimilarity to an approved reference product requires that there be no differences in conditions of use, route of administration, dosage form and strength and no clinically meaningful differences between the biological product and the reference product in terms of safety, purity, and potency.

Biosimilarity is demonstrated in steps beginning with rigorous analytical studies or “fingerprinting,”

in vitro studies, in vivo animal studies and generally at least one clinical study, absent a waiver from the Secretary of the HHS.

The biosimilarity exercise tests the hypothesis that the investigational product and the reference product are the same.

If at any point in the stepwise biosimilarity process a significant difference is observed, then the products are not biosimilar, and the development of a stand-alone BLA is necessary.

In order to meet the higher hurdle of interchangeability, a sponsor must demonstrate that the biosimilar product can be expected to produce the same clinical result as the reference product, and for a product that is administered more than once, that the risk of switching between the reference product and biosimilar product is not greater than the risk of maintaining the patient on the reference product.

Complexities associated with the larger, and often more complex, structures of biological products, as well as the process by which such products are manufactured, pose significant hurdles to implementation that are still being evaluated by the FDA.

Under the BPCIA, a reference biologic is granted 12 years of exclusivity from the time of first licensure of the reference product.

The BPCIA is complex and continues to be interpreted and implemented by the FDA.

In addition, government proposals have sought to reduce the 12-year reference product exclusivity period.

Other aspects of the BPCIA, some of which may impact the BPCIA exclusivity provisions, have also been the subject of recent litigation.

As a result, the ultimate impact, implementation, and impact of the BPCIA is subject to significant uncertainty.

In addition to exclusivity under the BPCIA, a biological product can obtain pediatric market exclusivity in the United States.

Pediatric exclusivity, if granted, adds six months to existing exclusivity periods, including some regulatory exclusivity periods tied to patent terms.

This six-month exclusivity, which runs from the end of other exclusivity protection or patent term, may be granted based on the voluntary completion of a pediatric study in accordance with an FDA-issued “Written Request”

for such a study.

The Biologics Price Competition and Innovation Act of 2009 (“BPCIA”), which was enacted as part of the Patient Protection and Affordable Care Act of 2010, as amended by the Health Care and Education Reconciliation Act of 2010 (the “ACA”), created an abbreviated approval pathway for biological products that are demonstrated to be “biosimilar” or “interchangeable” with an FDA-licensed reference biological product via an approved BLA.

Biosimilarity to an approved reference product requires that there be no differences in conditions of use, route of administration, dosage form and strength and no clinically meaningful differences between the biological product and the reference product in terms of safety, purity, and potency.

Biosimilarity is demonstrated in steps beginning with rigorous analytical studies or “fingerprinting,” in vitro studies, in vivo animal studies and generally at least one clinical study, absent a waiver from the Secretary of the U.S.

Department of Health and Human Services (“HHS”).

Additional Regulation

9 unchanged sentences

Certain countries outside of the United States have a similar process that requires the submission of a clinical study application much like the IND prior to the commencement of human clinical studies.

In the European Union, for example, a clinical trial application (CTA), must be submitted to each country’s national health authority and an independent ethics committee, much like the FDA and the IRB, respectively.

Once the CTA is approved in accordance with the applicable requirements, clinical study development may proceed.

The requirements and process governing the conduct of clinical studies are to a significant extent harmonized at the European Union level but could vary from country to country.

In all cases, the clinical studies are conducted in accordance with GCP and the applicable regulatory requirements and the ethical principles that have their origin in the Declaration of Helsinki.

On January 31, 2022, the European Union’s (EU’s) Clinical Trial Regulation (Regulation (EU) No 536/2014) became effective.

The Regulation harmonizes the assessment and supervision processes for clinical trials throughout the European Union via a Clinical Trials Information System, which contains a centralized European Union portal and database.

We expect the Regulation to have significant material changes to clinical trials conducted or proposed to be conducted in the European Union.

To obtain regulatory approval of an investigational biological product under European Union regulatory systems, we must submit a marketing authorization application.

The application used to file the BLA in the United States is similar to that required in the European Union, except for, among other things, country-specific document requirements.

Innovative products that target an unmet medical need may be eligible for several expedited development and review programs in the European Union, such as The Priority Medicines (PRIME), scheme, which provides incentives similar to the breakthrough therapy designation in the United States.

Such products are generally eligible for accelerated assessment and may also benefit from different types of fast-track approvals, such as a conditional marketing authorization or a marketing authorization under exceptional circumstances granted on the basis of less comprehensive clinical data than normally required (respectively in the likelihood that the sponsor will provide such data within an agreed timeframe or when comprehensive data cannot be obtained even after authorization).

The European Union also provides opportunities for market exclusivity.

For example, in the European Union, upon receiving marketing authorization, new chemical entities generally receive eight years of data exclusivity and an additional two years of market exclusivity.

If granted, data exclusivity prevents regulatory authorities in the European Union from referencing the innovator’s data to assess a generic or biosimilar application.

During the additional two-year period of market exclusivity, a generic or biosimilar marketing authorization can be submitted, and the innovator’s data may be referenced, but no generic or biosimilar product can be marketed until the expiration of the market exclusivity.

However, there is no guarantee that a product will be considered by the European Union’s regulatory authorities to be a new chemical entity, and products may not qualify for data exclusivity.

A Pediatric Investigation Plan (PIP), in the European Union is aimed at ensuring that the necessary data are obtained to support the authorization of a medicine for children, through studies in children.

All applications for marketing authorization for new medicines must include the results of studies as described in an agreed PIP, unless the medicine is exempt because of a deferral or waiver.

This requirement also applies when a marketing-authorization holder wants to add a new indication, pharmaceutical form, or route of administration for a medicine that is already authorized and covered by intellectual property rights.

Several rewards and incentives for the development of pediatric medicines for children are available in the European Union.

Medicines authorized with the results of studies from a PIP included in the product information are eligible for an extension of their supplementary protection certificate by six months, even when the results of the studies are negative.

Scientific advice and protocol assistance at the EMA are free of charge for questions relating to the development of pediatric medicines.

Medicines developed specifically for children that are already authorized but are not protected by a patent or supplementary protection certificate are eligible for a pediatric-use marketing authorization, which if granted, provides 10 years of market protection.

Beginning on January 1, 2021, the Medicines and Healthcare products Regulatory Agency (MHRA), became the U.K.’s standalone medicines and medical devices regulator.

As a result of the Northern Ireland protocol, different rules apply in Northern Ireland than in England, Wales, and Scotland (together Great Britain).

Northern Ireland continues to follow the European Union regulatory regime, but its national competent authority remains the MHRA.

The MHRA has published a draft guidance on how various aspects of the U.K.

regulatory regime for medicines operate in Great Britain and in Northern Ireland following the expiry of the Brexit transition period on December 31, 2020.

The guidance includes clinical trials, marketing authorizations, importing, exporting and pharmacovigilance and is relevant to any business involved in the research, development, or commercialization of medicines in the U.K.

The new guidance has been given effect via the Human Medicines Regulations (Amendment etc.) (EU Exit) Regulations 2019, or the Exit Regulations.

regulatory regime largely mirrors that of the European Union.

European Union, such as countries in Eastern Europe, Latin America or Asia, the requirements governing the conduct of clinical studies, product licensing, pricing and reimbursement vary from country to country.

In all cases, again, the clinical studies are conducted in accordance with GCP and the applicable regulatory requirements and the ethical principles that have their origin in the Declaration of Helsinki.

Authorization Procedures in the European Union

Medicines can be authorized in the European Union by using either the centralized authorization procedure or national authorization procedures.

Centralized Procedure .

Under the Centralized Procedure a so-called Community Marketing Authorization is issued by the European Commission, based on the opinion of the Committee for Medicinal Products for Human Use of the EMA.

The Community Marketing Authorization is valid throughout the entire territory of the European Economic Area (EEA) (which includes the 28 Member States of the European Union plus Norway, Liechtenstein, and Iceland).

The Centralized Procedure is mandatory for certain types of products, such as biotechnology medicinal products, orphan medicinal products, and medicinal products indicated for the treatment of AIDS, cancer, neurodegenerative disorders, diabetes, auto immune and viral diseases.

The Centralized Procedure is optional for products containing a new active substance not yet authorized in the EEA, or for products that constitute a significant therapeutic, scientific, or technical innovation or which are in the interest of public health in the European Union.

For medicines that do not fall within these categories, an applicant has the option of submitting an application for a centralized marketing authorization to the EMA, as long as the medicine concerned is a significant therapeutic, scientific, or technical innovation, or if its authorization would be in the interest of public health.

National Authorization Procedures .

There are also two other possible routes to authorize medicinal products in several countries, which are available for investigational drug products that fall outside the scope of the centralized procedure:

Decentralized Procedure.

Using the Decentralized Procedure, an applicant may apply for simultaneous authorization in more than one European Union country of medicinal products that have not yet been authorized in any European Union country and that do not fall within the mandatory scope of the centralized procedure.

Under the Decentralized Procedure the applicant chooses one country as Reference Member State.

The regulatory authority of the Reference Member State will then be in charge of leading the assessment of the marketing authorization application.

Mutual Recognition Procedure.

In the Mutual Recognition Procedure, a medicine is first authorized in one European Union Member State, in accordance with the national procedures of that country.

Following this, further marketing authorizations can be sought from other European Union countries in a procedure whereby the countries concerned agree to recognize the validity of the original, national marketing authorization.

In the European Union, upon receiving marketing authorization, new chemical entities generally receive eight years of data exclusivity and an additional two years of market exclusivity.

If granted, data exclusivity prevents regulatory authorities in the European Union from referencing the innovator’s data to assess a generic application.

During the additional two-year period of market exclusivity, a generic marketing authorization can be submitted, and the innovator’s data may be referenced, but no generic product can be marketed until the expiration of the market exclusivity.

However, there is no guarantee that a product will be considered by the European Union’s regulatory authorities to be a new chemical entity, and products may not qualify for data exclusivity.

If we fail to comply with applicable foreign regulatory requirements, we may be subject to, among other things, fines, suspension or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions, and criminal prosecution.

Pharmaceutical coverage, pricing, and reimbursement

Significant uncertainty exits as to obtaining and maintaining coverage and adequate reimbursement for our product candidates, including SAB-185 and SAB-176, and the extent to which patients will be willing to pay out-of-pocket for such products in the absence of reimbursement for all or part of the cost.

In the United States and in other countries, patients who are provided medical treatment for their conditions generally rely on third-party payors to reimburse all or part of the costs associated with their treatment.

The availability of coverage and adequacy of reimbursement for our products by third-party payors, including government healthcare programs (e.g., Medicare, Medicaid, TRICARE), managed care providers, private health insurers, health maintenance organizations and other organizations is essential for most patients to be able to afford medical services and pharmaceutical products such as our product candidates.

Third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own coverage and reimbursement policies.

However, decisions regarding the extent of coverage and amount of reimbursement to be provided are made on a payor-by-payor basis.

One payor’s determination to provide coverage for a drug product does not ensure that other payors will also provide coverage or adequate reimbursement.

The principal decisions about reimbursement for new medicines are typically made by the Centers for Medicare & Medicaid Services (CMS), an agency within HHS.

CMS decides whether and to what extent products will be covered and reimbursed under Medicare, and private payors tend to follow CMS to a substantial degree.

Third-party payors determine which products and procedures they will cover and establish reimbursement levels.

Even if a third-party payor covers a particular product or procedure, the resulting reimbursement payment rates may not be adequate.

Patients who are treated in-office for a medical condition generally rely on third-party payors to reimburse all or part of the costs associated with the procedure, including costs associated with products used during the procedure, and may be unwilling to undergo such procedures in the absence of such coverage and adequate reimbursement.

Physicians may be unlikely to offer procedures for such treatment if they are not covered by insurance and may be unlikely to purchase and use our product candidates, if approved, for our stated indications unless coverage is provided, and reimbursement is adequate.

In addition, for products administered under the supervision of a physician, obtaining coverage and adequate reimbursement may be particularly difficult because of the higher prices often associated with such drugs.

Reimbursement by a third-party payor may depend upon several factors, including the third-party payor’s determination that a procedure is safe, effective, and medically necessary;

appropriate for the specific patient;

cost-effective;

supported by peer-reviewed medical journals;

included in clinical practice guidelines;

and neither cosmetic, experimental nor investigational.

Further, increasing efforts by third-party payors in the United States and abroad to cap or reduce healthcare costs may cause such organizations to limit both coverage and the level of reimbursement for newly approved products and, as a result, they may not cover or provide adequate payment for our product candidates.

In order to secure coverage and reimbursement for any product that might be approved for sale, we may need to conduct expensive pharmacoeconomic studies in order to demonstrate the medical necessity and cost-effectiveness of our products, in addition to the costs required to obtain FDA or comparable regulatory approvals.

Additionally, we may also need to provide discounts to purchasers, private health plans or government healthcare programs.

Our product candidates may nonetheless not be considered medically necessary or cost-effective.

If third-party payors do not consider a product to be cost-effective compared to other available therapies, they may not cover the product after approval as a benefit under their plans or, if they do, the level of payment may not be sufficient to allow a company to sell its products at a profit.

There may be pricing pressures from third-party payors in connection with the potential sale of any of our product candidates.

Decreases in third- party reimbursement for any product or a decision by a third-party payor not to cover a product could reduce physician usage and patient demand for the product.

Foreign governments also have their own healthcare reimbursement systems, which vary significantly by country and region, and coverage and adequate reimbursement may not be available with respect to the treatments in which our product candidates, if approved, are used under any foreign reimbursement system.

Other Healthcare Laws and Regulations

Healthcare providers, physicians, and third-party payors will play a primary role in the recommendation and prescription of any products for which we obtain marketing approval.

Our business operations and any current or future arrangements with third-party payors, healthcare providers and physicians may expose us to broadly applicable fraud and abuse and other healthcare laws and regulations that may constrain the business or financial arrangements and relationships through which we develop, market, sell and distribute any drugs for which we obtain marketing approval.

In the United States, these laws include, without limitation, state and federal anti- kickback, false claims, physician transparency, and patient data privacy and security laws and regulations, including but not limited to those described below.

The federal Anti-Kickback Statute, which prohibits, among other things, persons and entities from knowingly and willfully soliciting, offering, paying, receiving or providing any remuneration (including any kickback, bribe, or certain rebate), directly or indirectly, overtly or covertly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made, in whole or in part, under a federal healthcare program such as Medicare and Medicaid;

a person or entity need not have actual knowledge of the federal Anti-Kickback Statute or specific intent to violate it in order to have committed a violation.

The term “remuneration” has been broadly interpreted to include anything of value;

Federal false claims and false statement laws, including the federal civil False Claims Act, prohibit individuals or entities from, among other things, knowingly presenting, or causing to be presented, to the federal government, claims for payment or approval that are false, fictitious or fraudulent;

knowingly making, using, or causing to be made or used, a false statement or record material to a false or fraudulent claim or obligation to pay or transmit money or property to the federal government;

or knowingly concealing or knowingly and improperly avoiding or decreasing an obligation to pay money to the federal government.

Manufacturers can be held liable under the FCA even when they do not submit claims directly to government payors if they are deemed to “cause” the submission of false or fraudulent claims.

In addition, the government may assert that a claim that includes items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the civil False Claims Act.

The FCA also permits a private individual acting as a “whistleblower” to bring actions on behalf of the federal government alleging violations of the FCA and to share in any monetary recovery.

When an entity is determined to have violated the federal civil False Claims Act, the government may impose civil fines and penalties for each false claim, plus treble damages, and exclude the entity from participation in Medicare, Medicaid and other federal healthcare programs;

The federal civil monetary penalties laws, which impose civil fines for, among other things, the offering or transfer or remuneration to a Medicare or state healthcare program beneficiary if the person knows or should know it is likely to influence the beneficiary’s selection of a particular provider, practitioner, or supplier of services reimbursable by Medicare or a state health care program, unless an exception applies;

The Health Insurance Portability and Accountability Act of 1996, ("HIPAA"), created additional federal criminal statutes that prohibit among other actions, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, including private third-party payors, knowingly and willfully embezzling or stealing from a healthcare benefit program, willfully obstructing a criminal investigation of a healthcare offense, or falsifying, concealing or covering up a material fact or making any false, fictitious, or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services;

HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, or HITECH, and their respective implementing regulations, impose, among other things, specified requirements on covered entities and their business associates relating to the privacy and security of individually identifiable health information including mandatory contractual terms and required implementation of technical safeguards of such information.

HITECH also created new tiers of civil monetary penalties, amended HIPAA to make civil and criminal penalties directly applicable to business associates in some cases, and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce the federal HIPAA laws and seek attorneys’ fees and costs associated with pursuing federal civil actions;

The federal Physician Payments Sunshine Act requires certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program, with specific exceptions, to report annually to CMS information related to payments or other “transfers of value” made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors) and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members.

Beginning in 2022, applicable manufacturers also will be required to report such information regarding payments and transfers of value provided during the previous year to physician assistants, nurse practitioners, clinical nurse specialists, anesthesiologist assistants, certified nurse anesthetists and certified nurse-midwives;

Federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers;

The Foreign Corrupt Practices Act, or FCPA, prohibits U.S.

businesses and their representatives from offering to pay, paying, promising to pay, or authorizing the payment of money or anything of value to a foreign official to influence any act or decision of the foreign official in his or her official capacity or to secure any other improper advantage to obtain or retain business.

Many states have similar laws and regulations, such as anti-kickback and false claims laws, that may be broader in scope and may apply regardless of payor, in addition to items and services reimbursed under Medicaid and other state programs.

Additionally, we may be subject to state laws that require pharmaceutical companies to comply with the federal government’s and/or pharmaceutical industry’s voluntary compliance guidelines and state laws that require drug and biologics manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures, as well as state and foreign laws governing the privacy and security of health information, many of which differ from each other in significant ways and often are not preempted by HIPAA.

Additionally, to the extent that any of our product candidates if approved, are sold in a foreign country, we may be subject to similar foreign laws.

The scope and enforcement of each of these laws is uncertain and subject to rapid change in the current environment of healthcare reform, especially in light of the lack of applicable precedent and regulations.

If our operations are found to be in violation of any of the federal and state healthcare laws described above or any other governmental regulations that apply to us, we may be subject to significant penalties, including without limitation, civil, criminal and/or administrative penalties, damages, fines, disgorgement, imprisonment, exclusion from participation in government programs, such as Medicare and Medicaid, injunctions, private “qui tam”

actions brought by individual whistleblowers in the name of the government, refusal to allow us to enter into government contracts, contractual damages, reputational harm, administrative burdens, diminished profits and future earnings and the curtailment or restructuring of our operations.

Healthcare Reform

The United States and many foreign jurisdictions have enacted or proposed legislative and regulatory changes affecting the healthcare system.

The United States government, state legislatures and foreign governments also have shown significant interest in implementing cost-containment programs to limit the growth of government- paid healthcare costs, including price controls, restrictions on reimbursement and requirements for substitution of generic products for branded prescription drugs and biologics.

In recent years, Congress has considered reductions in Medicare reimbursement levels for drugs and biologics administered by physicians.

CMS also has authority to revise reimbursement rates and to implement coverage restrictions for some drugs and biologics.

Cost reduction initiatives and changes in coverage implemented through legislation or regulation could decrease utilization of and reimbursement for any approved products.

While Medicare regulations apply only to drug benefits for Medicare beneficiaries, private payors often follow Medicare coverage policy and payment limitations in setting their own reimbursement rates.

Therefore, any reduction in reimbursement that results from federal legislation or regulation may result in a similar reduction in payments from private payors.

The ACA substantially changed the way healthcare is financed by both governmental and private insurers and significantly impacts the pharmaceutical industry.

The ACA was a sweeping law intended to broaden access to health insurance, reduce or constrain the growth of healthcare spending, enhance remedies against healthcare fraud and abuse, add new transparency requirements for healthcare and health insurance industries, impose new taxes and fees on pharmaceutical and medical device manufacturers and impose additional health policy reforms.

Among other things, the ACA expanded manufacturers’

rebate liability under the Medicaid Drug Rebate

Program by increasing the minimum Medicaid rebate for both branded and generic drugs and biologics, expanded the 340B program, and revised the definition of average manufacturer price (AMP), which could increase the amount of Medicaid drug rebates manufacturers are required to pay to states.

The legislation also extended Medicaid drug rebates, previously due only on fee-for-service Medicaid utilization, to include the utilization of Medicaid managed care organizations as well and created an alternative rebate formula for certain new formulations of certain existing products that is intended to increase the amount of rebates due on those drugs.

On February 1, 2016, CMS issued final regulations to implement the changes to the Medicaid Drug

Rebate program under the ACA.

These regulations became effective on April 1, 2016.

Since that time, there have been significant efforts to modify or eliminate the ACA.

For example, the Tax Cuts and Jobs Act (“Tax Act”), enacted on December 22, 2017, repealed the shared responsibility payment for individuals who fail to maintain minimum essential coverage under section 5000A of the Internal Revenue Code of 1986, as amended (“Code”), commonly referred to as the individual mandate.

Other legislative changes have been proposed and adopted since passage of the ACA.

The Budget Control Act of 2011, among other things, created the Joint Select Committee on Deficit Reduction to recommend proposals in spending reductions to Congress.

The Joint Select Committee did not achieve its targeted deficit reduction of an amount greater than $1.2 trillion for the fiscal years 2012 through 2021, triggering the legislation’s automatic reductions to several government programs.

These reductions included aggregate reductions to Medicare payments to healthcare providers of up to 2.0% per fiscal year, which went into effect in April 2013.

Subsequent litigation extended the 2% reduction, on average, to 2030 unless additional congressional action is taken.

However, pursuant to COVID-19 relief legislation, the 2% Medicare sequester reductions have been suspended from May 1, 2020, through December 31, 2021.

On January 2, 2013, the American Taxpayer Relief Act was signed into law, which, among other things, reduced Medicare payments to several types of providers, including hospitals, imaging centers and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

Since enactment of the ACA, there have been judicial and Congressional challenges to certain aspects of the ACA, and as a result certain sections of the ACA have not been fully implemented or have been effectively repealed through Executive Orders and/or executive agency actions.

However, following several years of litigation in the federal courts, in June 2021, the U.S.

Supreme Court upheld the ACA when it dismissed a legal challenge to the ACA’s constitutionality.

Further legislative and regulatory changes under the ACA remain possible, although the new federal administration under President Biden has signaled that it plans to build on the ACA and expand the number of people who are eligible for health insurance subsidies under it.

It is unknown what form any such changes or any law would take, and how or whether it may affect the biopharmaceutical industry as a whole or our business in the future.

We expect that changes or additions to the ACA, the Medicare and Medicaid programs, such as changes allowing the federal government to directly negotiate drug prices, and changes stemming from other healthcare reform measures, especially with regard to healthcare access, financing, or other legislation in individual states, could have a material adverse effect on the health care industry in the U.S.

The ACA requires pharmaceutical manufacturers of branded prescription drugs and biologics to pay a branded prescription drug fee to the federal government.

Each individual pharmaceutical manufacturer pays a prorated share of the branded prescription drug fee, based on the dollar value of its branded prescription drug sales to certain federal programs identified in the law.

Furthermore, the law requires manufacturers to provide a 50% discount off the negotiated price of prescriptions filled by beneficiaries in the Medicare Part D coverage gap, referred to as the “donut hole.”

The Bipartisan Budget Act of 2018 (BBA), among other things, amended the ACA, effective January 1, 2019, to close the coverage gap in most Medicare drug plans by increasing from 50 percent to 70 percent the point-of-sale discount that is owed by pharmaceutical manufacturers who participate in Medicare Part D.

The ACA also expanded the Public Health Service’s 340B drug pricing program.

The 340B drug pricing program requires participating manufacturers to agree to charge statutorily defined covered entities no more than the 340B “ceiling price”

for the manufacturer’s covered outpatient drugs.

The ACA expanded the 340B program to include additional types of covered entities:

certain free-standing cancer hospitals, critical access hospitals, rural referral centers and sole community hospitals, each as defined by the ACA.

Because the 340B ceiling price is determined based on AMP and Medicaid drug rebate data, revisions to the Medicaid rebate formula and AMP definition could cause the required 340B discounts to increase.

Payment methodologies may be subject to changes in healthcare legislation and regulatory initiatives as well.

For example, CMS may develop new payment and delivery models, such as bundled payment models.

Recently, there has been heightened governmental scrutiny over the way manufacturers set prices for their marketed products.

Such scrutiny has resulted in several recent congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to drug pricing, review the relationship between pricing and manufacturer patient programs, reduce the cost of drugs under Medicare and reform government program reimbursement methodologies for pharmaceutical products.

Healthcare reform proposals recently culminated in the enactment of the Inflation Reduction Act (the “IRA”), in August 2022, which, among other things, will allow HHS to negotiate the selling price of certain drugs and biologics that CMS reimburses under Medicare Part B and Part D, although this will only apply to high-expenditure single-source drugs that have been approved for at least seven years (11 years for biologics).

The negotiated prices, which will first become effective in 2026, will be capped at a statutory ceiling price representing a significant discount from average prices to wholesalers and direct purchasers.

The law will also, beginning in October 2023, penalize drug manufacturers that increase prices of Medicare Part B and Part D drugs at a rate greater than the rate of inflation.

In addition, the law eliminates certain provisions under Medicare Part D beginning in 2025 by significantly lowering the beneficiary maximum out-of-pocket cost through a newly established manufacturer discount program.

The IRA also extends enhanced subsidies for individuals purchasing health insurance coverage in ACA marketplaces through plan year 2025.

The IRA permits the Secretary of HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years.

Manufacturers that fail to comply with the IRA may be subject to various penalties, including civil monetary penalties.

These provisions will take effect progressively starting in 2023, although they may be subject to legal challenges.

Thus, it is unclear how the IRA will be implemented but will likely have a significant impact on the pharmaceutical industry.

At the state level, legislatures have increasingly passed legislation and implemented regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

We expect that additional federal, state, and foreign healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in limited coverage and reimbursement and reduced demand for our products, once approved, or additional pricing pressures.

Our Corporate History

SAB Sciences, Inc.

(formerly SAB Biotherapeutics, Inc.) was incorporated in April 2014 as a Delaware corporation (“Legacy SAB”).

We acquired all the intellectual property rights to Tc Bovine and the DiversitAb platform from Sanford Applied Biosciences, a wholly owned subsidiary of Sanford Health, to develop targeted human IgGs to specific targets and advance clinical development and commercialization.

The technology was originally contemplated in 1998 by professors at the University of Massachusetts Amherst and Amherst College who recognized a significant gap in immunotherapy applications, namely, using the natural way our bodies fight disease through a human immunoglobulin response.

(formerly SAB Biotherapeutics, Inc.) was incorporated in April 2014 as a Delaware corporation (“Legacy SAB”).

We acquired all the intellectual property rights to Tc Bovine and the DiversitAb production system from Sanford Applied Biosciences, a wholly owned subsidiary of Sanford Health, to develop targeted human IgGs to specific targets and advance clinical development and commercialization.

The technology was originally contemplated in 1998 by professors at the University of Massachusetts Amherst and Amherst College who recognized a significant gap in immunotherapy applications, namely, using the way our bodies fight disease through a human immunoglobulin response.

The technology founders established a biotech company called “Hematech” to develop the technology.

8 unchanged sentences

(“BCYP”), pursuant to which we debuted as a publicly traded company (the “Business Combination”).

BCYP was incorporated as a special purpose acquisition company in the State of Delaware on November 12, 2020.

BCYP was incorporated as a special purpose acquisition company in the State of Delaware on November 12, 2020.

On January 14, 2021, BCYP completed its initial public offering.

On October 22, 2021, BCYP consummated the Business Combination with Legacy SAB, which changed its name from SAB Biotherapeutics, Inc.

to Legacy SAB. In connection with the closing of the Business Combination, BCYP changed its name to SAB Biotherapeutics, Inc.

and Legacy SAB became a wholly-owned subsidiary of SAB Biotherapeutics, Inc.

to Legacy SAB.

In connection with the closing of the Business Combination, BCYP changed its name to SAB Biotherapeutics, Inc.

and Legacy SAB became a wholly-owned subsidiary of SAB Biotherapeutics, Inc.

Corporate Information

Our principal executive offices are located at 2100 East 54th Street North, Sioux Falls, South Dakota 57104, and our telephone number is (605)-679-6980.

Our corporate website address is www.sab.bio. Our Annual Reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and proxy statements, and all amendments thereto, are available free of charge on our website.

These reports are posted on our website as soon as reasonably practicable after they are electronically filed with the SEC.

Our corporate website address is www.sab.bio.

Our Annual Reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and proxy statements, and all amendments thereto, are available free of charge on our website.

These reports are posted on our website as soon as reasonably practicable after they are electronically filed with the U.S.

Securities and Exchange Commission (the “SEC”).

The public may read and copy any materials that we file with the SEC electronically through the SEC website (www.sec.gov).

The information contained on the SEC’s website is not incorporated by reference into this Annual Report on Form 10-K and should not be considered to be part thereof.

Human Capital

As of December 31, 2022, we had 56 full-time employees, including 8 who hold advanced degrees.

Of these employees, 35 were engaged in research and development activities, 7 were engaged in clinical activities and 14 were engaged in general and administrative activities.

As of December 31, 2023, we had 57 full-time employees, including 8 who hold advanced degrees.

Of these employees, 35 were engaged in research and development activities, 7 were engaged in clinical activities and 14 were engaged in general and administrative activities.

As of December 31, 2023, none of our employees were represented by labor unions or covered by collective bargaining agreements.

3 unchanged sentences

We also provide our employees with access to various innovative, flexible, and convenient health and wellness programs.

We designed these programs to support employees’

physical and mental health by providing tools and resources to improve or maintain their health status and encourage engagement in healthy behaviors.

We designed these programs to support employees’ physical and mental health by providing tools and resources to improve or maintain their health status and encourage engagement in healthy behaviors.

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