What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2023-11-09 compared with 2023-08-10 · 88 added, 100 removed, 281 unchanged (40% of the section changed)

125 unchanged sentences

Although we hold a broad patent portfolio, the focus of our internal efforts during the three

and six months ended June 30, 2023, was on the advancement of our DNase platform.

and nine months ended September 30, 2023, was on the advancement of our DNase platform.

Impact of the Conflict in Ukraine on Our Operations

4 unchanged sentences

RESULTS OF OPERATIONS

Comparison of Quarter Ended June 30, 2023

Comparison of Quarter Ended September 30,

2023 and 2022

The comparison of our historical results of operations

for the fiscal quarter ended June 30, 2023 to the fiscal quarter ended June 30, 2022 is as follows:

for the fiscal quarter ended September 30, 2023 to the fiscal quarter ended September 30, 2022 is as follows:

Quarter Ended

June 30, 2023

September 30,

Quarter Ended

June 30, 2022

September 30,

Royalty revenue

5 unchanged sentences

Other income (expense):

Other income (expense)

Other expense

Interest income, net

$ (1,055,555 )

$ (2,672,190 )

$ (1,621,227 )

Revenue for the three months ended June 30, 2023

Revenue for the three months ended September 30,

2023 increased by approximately $0.2 million, or 47.5%, to approximately $0.6 million from approximately $0.4 million for the three months

ended June 30, 2022.

ended September 30, 2022.

This increase represents an increase in royalty revenue related to our sublicense agreement with Takeda Pharmaceuticals

1 unchanged sentence

Research and Development Expenses

Overall, research & development (“R&D”)

expenses for the three months ended June 30, 2023 decreased by $1.2 million, or 56.5% to $0.9 million from $2.1 million in the comparable

quarter in 2022 primarily due to in-process research and development (“IPR&D”) expense of $1.3 million in the prior period.

During the three months ended June 30, 2022, the Company expensed $1.3 million of IPR&D associated with the Company’s licensing

of the DNase oncology platform.

There was no similar expense in 2023.

Excluding the $1.3 million of IPR&D expense from total R&D

expense of approximately $2.1 million for the three months ended June 30, 2022, R&D expense for the three months ended June 30, 2023

increased by approximately $0.1 million, or 16.9%, to approximately $0.9 million from approximately $0.8 million in the comparable quarter

The table below sets forth the R&D costs incurred by us by category of expense for the quarters ended June 30, 2023 and 2022:

Research & development (“R&D”)

expenses for the three months ended September 30, 2023 increased by approximately $0.6 million, or 155.9%, to approximately $1.0 million

from approximately $0.4 million in the comparable quarter in 2022.

The table below sets forth the R&D costs incurred by us by category

of expense for the quarters ended September 30, 2023 and 2022:

Quarter Ended,

Category of Expense

June 30, 2023

June 30, 2022

IPR&D expense

September 30,

Outside services and contract research organizations

10 unchanged sentences

General and administrative expenses for the three

months ended June 30, 2023 decreased by approximately $0.1 million, or 7.8%, to approximately $0.9 million from approximately $1.0 million

in the comparable quarter in 2022.

The decrease was primarily due to a decrease in legal fees and share-based expense during the three

months ended June 30, 2023 compared to the same period in 2022.

months ended September 30, 2023 decreased by approximately $0.1 million, or 14.6%, to approximately $0.7 million from approximately $0.9

million in the comparable quarter in 2022.

The decrease was primarily due to decreases in personnel costs and share-based expense during

the three months ended September 30, 2023 compared to the same period in 2022.

Other Income (Expense)

Other income was approximately $21,000 for the

three months ended June 30, 2023 compared to approximately $1,100 of other expense for the same period in 2022.

This increase in other

income was primarily related to fees associated with the Pharmsynthez Loan recognized during the three months ended June 30, 2023.

were no similar fees received in the same period in 2022.

Other expense was approximately $700 for the three

months ended September 30, 2023 compared to approximately $1,700 of other expense for the same period in 2022.

This decrease in other

expense was primarily related to favorable changes in foreign currency exchange rates during the three months ended September 30, 2023

as compared to the same period in 2022.

Interest Income

Interest income increased to approximately $92,000

during the three months ended June 30, 2023 as compared to approximately $16,000 for the same period in the prior year.

during the three months ended September 30, 2023 as compared to approximately $45,000 for the same period in the prior year.

This increase

is due to higher interest rates on invested funds during the three months ended June 30, 2023 compared to the same period in 2022 as well

as an increase in interest income on the Pharmsynthez Loan.

Comparison of Six Months Ended June 30,

is due to higher interest rates on invested funds during the three months ended September 30, 2023 compared to the same period in 2022.

Comparison of Nine Months Ended September

30, 2023 and 2022

The comparison of our historical results of operations

for the six months ended June 30, 2023 to the six months ended June 30, 2022 is as follows:

for the nine months ended September 30, 2023 to the nine months ended September 30, 2022 is as follows:

September 30,

Royalty revenue

10 unchanged sentences

$ (2,106,746 )

Revenue for the six months ended June 30, 2023

increased by $0.5 million, or 56.0%, to $1.3 million from approximately $0.8 million for the six months ended June 30, 2022.

This increase

represents an increase in royalty revenue related to our sublicense agreement with Takeda as compared to the same period in 2022.

Revenue for the nine months ended September 30,

2023 increased by $0.6 million, or 53.1%, to $1.9 million from approximately $1.2 million for the nine months ended September 30, 2022.

This increase represents an increase in royalty revenue related to our sublicense agreement with Takeda as compared to the same period

Research and Development Expenses

Overall, R&D expenses for the six months ended

June 30, 2023 decreased by $1.7 million, or 52.9% to $1.5 million from $3.2 million in the comparable period in 2022 primarily due to

IPR&D expense of $1.3 million.

During the six months ended June 30, 2022, the Company expensed $1.3 million of IPR&D associated

with the Company’s licensing of the DNase oncology platform.

There was no similar expense in 2023.

Excluding the $1.3 million of

IPR&D expense from total R&D expense of approximately $3.2 million for the six months ended June 30, 2022, R&D expenses for

the six months ended June 30, 2023 decreased approximately $0.4 million, or 20.0% to $1.5 million, from approximately $1.9 million for

the six months ended June 30, 2022.

The table below sets forth the R&D costs incurred by us, by category of expense, for the six months

ended June 30, 2023 and 2022:

Six Months Ended,

Overall, R&D expenses for the nine months

ended September 30, 2023 decreased by $1.1 million, or 29.6% to $2.5 million from $3.6 million in the comparable period in 2022 primarily

due to in-process research and development (“IPR&D”) expense of $1.3 million.

During the nine months ended September 30,

2022, the Company expensed $1.3 million of IPR&D associated with the Company’s licensing of the DNase oncology platform.

was no similar expense in 2023.

Excluding the $1.3 million of IPR&D expense from total R&D expense of approximately $3.6 million

for the nine months ended September 30, 2022, R&D expenses for the nine months ended September 30, 2023 increased approximately $0.2

million, or 10.8% to $2.5 million, from approximately $2.3 million for the nine months ended September 30, 2022.

The table below sets

forth the R&D costs incurred by us, by category of expense, for the nine months ended September 30, 2023 and 2022:

Nine Months Ended,

Category of Expense

June 30, 2023

June 30, 2022

September 30,

IPR&D expense

3 unchanged sentences

Total research and development expense

The decrease in outside

services and contract research organizations expense was primarily due to decreased spending in connection with our XCART platform technology

which was partially offset by increased costs related to our initial development efforts associated with our DNase platform.

the DNase platform in April 2022 and expect to continue to direct our efforts and resources on the development of this newly acquired

The increase in outside

services and contract research organizations expense was primarily due to increased spending in connection with our pre-clinical development

efforts associated with our DNase platform.

We licensed the DNase platform in April 2022 and expect to continue to direct our efforts

and resources on the development of this newly acquired technology.

As a result, we suspended development of our XCART technology platform.

The decrease in other expense was due to lower consulting

costs incurred in the first six months of 2023 compared to the same period in 2022.

Consulting costs during the six months ended June

30, 2022 were related to the licensing of the DNase oncology platform from CLS.

General and Administrative Expenses

General and administrative expenses for the six

months ended June 30, 2023 was $1.9 million, decreasing approximately $62,000, or 3.2%, compared to the same period in the prior year.

The decrease was primarily due to a decrease in legal costs partially offset by increases in accounting and consulting costs during the

six months ended June 30, 2023 as compared to the same period in 2022.

General and administrative expenses for the nine

months ended September 30, 2023 was $2.6 million, decreasing approximately $0.2 million, or 6.7%, compared to the same period in the prior

The decrease was primarily due to decreases in share-based expense, legal costs and personnel costs partially offset by increases

in accounting and consulting costs during the nine months ended September 30, 2023 as compared to the same period in 2022.

Other Income (Expense)

Other income was approximately $25,000 for the

six months ended June 30, 2023 compared to approximately $1,000 of other expense for the same period in 2022.

This increase in other income

was primarily related to fees associated with the Pharmsynthez Loan recognized during the six months ended June 30, 2023.

There were no

similar fees received in the same period in 2022.

nine months ended September 30, 2023 compared to approximately $2,600 of other expense for the same period in 2022.

This increase in other

income was primarily related to fees associated with the Pharmsynthez Loan recognized during the nine months ended September 30, 2023.

There were no similar fees received in the same period in 2022.

Interest Income

Interest income increased to approximately $0.3

during the six months ended June 30, 2023 as compared to approximately $42,000 for the same period in the prior year.

This increase is

due to higher interest rates on invested funds during the six months ended June 30, 2023 compared to the same period in 2022 as well as

an increase in interest income on the Pharmsynthez Loan.

million during the nine months ended September 30, 2023 as compared to approximately $0.1 million for the same period in the prior year.

This increase is due to higher interest rates on invested funds during the nine months ended September 30, 2023 compared to the same period

in 2022 as well as an increase in interest income on the Pharmsynthez Loan.

Non-GAAP Measures

8 unchanged sentences

We incurred a net loss

of approximately $1.9 million for the six months ended June 30, 2023.

We had an accumulated deficit of approximately $191.0 million at

June 30, 2023, as compared to an accumulated deficit of approximately $189.1 million at December 31, 2022.

Working capital was approximately

$11.2 million at June 30, 2023, and $12.6 million at December 31, 2022.

During the six months ended June 30, 2023, our working capital

decreased by $1.4 million primarily due to our net loss for the six months ended June 30, 2023 partially offset by proceeds from the repayment

of the Pharmsynthez Loan.

of approximately $3.0 million for the nine months ended September 30, 2023.

We had an accumulated deficit of approximately $192.1 million

at September 30, 2023, as compared to an accumulated deficit of approximately $189.1 million at December 31, 2022.

Working capital was

approximately $10.2 million at September 30, 2023, and $12.6 million at December 31, 2022.

During the nine months ended September 30,

2023, our working capital decreased by $2.4 million primarily due to our net loss for the nine months ended September 30, 2023, partially

offset by proceeds from the repayment of the Pharmsynthez Loan.

Our principal source

of liquidity consists of cash.

At June 30, 2023, we had approximately $10.7 million in cash and $0.9 million in current liabilities.

December 31, 2022, we had approximately $13.1 million in cash and $1.1 million in current liabilities.

We have historically relied upon

sales of our equity securities to fund our operations.

At September 30, 2023, we had approximately $9.8 million in cash and $1.1 million in current liabilities.

At December 31, 2022, we had approximately $13.1 million in cash and $1.1 million in current liabilities.

We have historically relied

upon sales of our equity securities to fund our operations.

We evaluate whether there

39 unchanged sentences

Cash flows used in operating activities for the

six months ended June 30, 2023 totaled approximately $2.4 million, which was primarily due to our net loss for the period as well as advance

payments made in accordance with our statement of work with Catalent, partially offset by cash received from the repayment of the Pharmsynthez

Cash flows used in operating activities for the six months ended June 30, 2022 totaled approximately $2.8 million, which was primarily

due to our net loss for the period, partially offset by non-cash charges associated with acquired IPR&D and share-based expense.

addition, current liabilities decreased during each of the six months ended June 30, 2023 and 2022.

nine months ended September 30, 2023 totaled approximately $3.3 million, which was primarily due to our net loss for the period as well

as advance payments made in accordance with our statement of work with Catalent, partially offset by cash received from the repayment

of the Pharmsynthez Loan.

Cash flows used in operating activities for the nine months ended September 30, 2022 totaled approximately $3.9

million, which was primarily due to our net loss for the period, partially offset by non-cash charges associated with acquired IPR&D

and share-based expense.

In addition, current liabilities decreased during the nine months ended September 30, 2022.

Cash Flows from Investing Activities

Cash flows used in investing activities for the

six months ended June 30, 2022 totaled $500,000, which represented cash paid to license the DNase oncology platform.

There were no cash

flows from investing activities for the six months ended June 30, 2023.

nine months ended September 30, 2022 totaled $500,000, which represented cash paid to license the DNase oncology platform.

no cash flows from investing activities for the nine months ended September 30, 2023.

Cash Flow from Financing Activities

There were no cash flows from financing activities

for the six months ended June 30, 2023 and 2022.

for the nine months ended September 30, 2023 and 2022.

Contractual Obligations and Commitments

As of June 30, 2023, there were no material changes

in our contractual obligations and commitments from those disclosed in our Annual Report on Form 10-K for the year ended December 31,

As of September 30, 2023, there were no material

changes in our contractual obligations and commitments from those disclosed in our Annual Report on Form 10-K for the year ended December

31, 2022, filed with the SEC on March 22, 2023, as amended on April 28, 2023.

29 unchanged sentences

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis