What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-03-21 compared with 2023-03-22 · 300 added, 493 removed, 1093 unchanged (42% of the section changed)

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Series A, $ 0.001 par value:

970,000 shares issued and outstanding as of December 31, 2022 and December 31, 2021

0 and 970,000 shares issued and outstanding as of December 31, 2023 and December 31, 2022, respectively

Common stock, $ 0.001 par value;

100,000,000 and 50,000,000 shares authorized as of December 31, 2022 and December 31, 2021;

10,000,000 shares authorized as of December 31, 2023 and December 31, 2022;

1,543,385 and 1,519,360 shares issued as of December 31, 2023 and December 31, 2022, respectively;

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

Preferred Stock

Value ($0.001)

Accumulated Deficit

Other Comprehensive

Treasury Stock

Stockholders' Equity

Comprehensive

Stockholders'

Balance as of January 1, 2022

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$ ( 5,281,180 )

Issuance of common stock and warrants, net of issuance costs

Exercise of pre-funded warrants

Issuance of common stock in connection with purchase of in-process research

and development

Exercise of purchase warrants

Share-based expense

Issuance of common stock to vendor

Issuance of common stock in connection with warrant buyout

( 6,552,353 )

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$ ( 5,281,180 )

Issuance of common stock in connection with purchase of in-process research and development

Exercise of purchase warrants

Issuance of common stock to adjust for reverse split rounding

Conversion of Series A preferred stock to shares of common stock

Share-based expense

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Net cash used in investing activities

CASH FLOWS FROM FINANCING ACTIVITIES:

Net proceeds from issuance of common stock and warrants

Proceeds from exercise of warrants

Net cash provided by financing activities

Net change in cash

( 4,114,219 )

( 5,146,765 )

Cash at beginning of period

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Issuance of common stock to acquire in-process research and development

Issuance of common stock to vendor

Issuance of common stock in connection with warrant buyout

Issuance of common stock from cashless exercise of purchase warrants

Issuance of common stock to adjust for Reverse Stock Split

Conversion of Series A preferred stock to common stock

The accompanying notes are an integral part of

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advanced or metastatic solid tumors.

XCART ™ is the Company’s personalized Chimeric Antigen Receptor (“CAR”)

T platform technology engineered to target patient specific tumor neoantigens with a demonstrated proof of mechanism in B-cell lymphomas.

Additionally, Xenetic has partnered with biotechnology and pharmaceutical companies to develop its proprietary drug delivery platform,

PolyXen ® , and receives royalty payments under an exclusive license arrangement in the field of blood coagulation disorders.

Additionally, Xenetic has partnered with biotechnology and pharmaceutical companies to develop its

proprietary drug delivery platform, PolyXen ® , and receives royalty payments under an exclusive license arrangement in the

field of blood coagulation disorders.

The Company, directly or indirectly, through its

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Management evaluates whether there are conditions

or events, considered in the aggregate that raise substantial doubt about the Company’s ability to continue as a going concern within

one year after the date that the financial statements are issued.

The Company has incurred substantial losses since its inception and

expects to continue to incur operating losses in the near-term.

These factors raise substantial doubt about its ability to continue as

a going concern.

The Company believes that it has access to capital resources through possible public or private equity offerings, debt

financings, corporate collaborations, related party funding, or other means to continue as a going concern.

The Company believes that

its existing resources will be adequate to fund the Company’s operations for a period of at least twelve months from the date of

these financial statements.

However, the Company anticipates it may need additional capital in the long-term to pursue its business initiatives.

The terms, timing and extent of any future financing will depend upon several factors, including the achievement of progress in its product

development programs, its ability to identify and enter into licensing or other strategic arrangements, its continued listing on the Nasdaq

Stock Market (“Nasdaq”), and factors related to financial, economic, geo-political, industry and market conditions, many of

which are beyond its control.

The capital markets for the biotech industry can be highly volatile, which make the terms, timing and extent

of any future financing uncertain.

On June 3, 2022, the Company received a written notification (the “Notice”) from the Listing

Qualifications Department of Nasdaq notifying the Company that the closing bid price for its common stock had been below $1.00 for 30

consecutive business days and that the Company therefore was not in compliance with the minimum bid price requirement for continued inclusion

on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Requirement”).

The Notice has no immediate

effect on the listing of the Company’s common stock on the Nasdaq Capital Market.

Under the Nasdaq Listing Rules, the Company had

a period of 180 calendar days from the date of the Notice to regain compliance with the Bid Price Requirement.

Accordingly, the Company

had until November 30, 2022 to regain compliance with the Bid Price Requirement and was eligible for an additional 180 calendar day compliance

period if certain other criteria were met.

On December 1, 2022, the Company received a letter from Nasdaq informing it that although the

Company’s common stock had not regained compliance with the minimum $1.00 bid price per share requirement, Nasdaq had determined

that the Company was eligible for an additional 180 calendar day period, or until May 29, 2023, to regain compliance.

Nasdaq’s determination

was based on the Company meeting the continued listing requirement for market value of publicly held shares and all other applicable requirements

for initial listing on the Nasdaq Capital Market with the exception of the bid price requirement, and the Company’s written notice

of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary.

or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern

within one year after the date that the financial statements are issued.

The Company has incurred substantial losses since its inception

and expects to continue to incur operating losses in the near-term.

These factors raise substantial doubt about its ability to continue

as a going concern.

The Company believes that it has access to capital resources through possible public or private equity offerings,

debt financings, corporate collaborations, related party funding, or other means to continue as a going concern.

The Company believes

that its existing resources will be adequate to fund the Company’s operations for a period of at least twelve months from the date

of the issuance of these financial statements.

However, the Company anticipates it may need additional capital in the long-term to pursue

its business initiatives.

The terms, timing and extent of any future financing will depend upon several factors, including the achievement

of progress in its product development programs, its ability to identify and enter into licensing or other strategic arrangements, its

continued listing on the Nasdaq Stock Market (“Nasdaq”), and factors related to financial, economic, geo-political, industry

and market conditions, many of which are beyond its control.

The capital markets for the biotech industry can be highly volatile, which

make the terms, timing and extent of any future financing uncertain.

On June 3, 2022, the Company received a written

notification (the “Notice”) from the Listing Qualifications Department of Nasdaq notifying the Company that the closing bid

price for its common stock had been below $1.00 for 30 consecutive business days and that the Company therefore was not in compliance

with the minimum bid price requirement for continued inclusion on Nasdaq under Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Requirement”).

The Notice had no immediate effect on the listing of the Company’s common stock on the Nasdaq Capital Market.

On May 15, 2023, the

Company effected a reduction, on a 1-for-10 basis, in its authorized common stock, par value $ 0.001 , along with a corresponding and proportional

decrease in the number of shares issued and outstanding (the “Reverse Stock Split”).

On May 30, 2023, the Company received

a letter from Nasdaq notifying the Company that it has regained compliance with the Bid Price Requirement as a result of the closing bid

price of the Company’s common stock being at $ 1.00 per share or greater for the 10 consecutive business days from May 15, 2023 through

May 26, 2023 and that this matter is closed.

Risks and Uncertainties

Effects of the COVID-19 Pandemic

During March 2020, a

global pandemic was declared by the World Health Organization related to the outbreak of a novel strain of coronavirus, or COVID-19.

pandemic has significantly affected economic conditions in the U.S., accelerating during the first half of March 2020 and continuing throughout

2021 and 2022, as federal, state and local governments reacted to the public health crisis with mitigation measures, creating significant

uncertainties in the U.S.

The Company continues to evaluate the effects of the COVID-19 pandemic on its business and while there

has been no significant impact to the Company’s operations to date, the Company at this time remains uncertain of the impact this

event may have on the Company’s future operations.

The extent to which the COVID-19 pandemic affects our business, operations and

financial results will depend on numerous evolving factors that we may not be able to accurately predict, and such uncertainty is expected

to continue for some time.

Impact of the conflict

in Ukraine on Operations

The short and long-term implications of Russia’s

invasion of Ukraine are difficult to predict at this time.

The imposition of sanctions and counter sanctions may have an adverse effect

on the economic markets generally and could impact our business, financial condition, and results of operations.

Global Conflicts on Operations

The short and long-term

implications of Russia’s invasion of Ukraine and conflict in the Middle East are difficult to predict at this time.

The imposition

of current and future sanctions and counter sanctions may have an adverse effect on the economic markets generally and could impact our

business, financial condition, and results of operations.

Summary of Significant Accounting Policies

Preparation of Financial Statements

On May 15, 2023, the Company effected the Reverse

On the effective date of the Reverse Stock Split, (i) every 10 shares of common stock were reduced to one share of common

stock, with any fractional amounts rounded up to one share;

(ii) the number of shares of common stock into which each outstanding warrant,

restricted stock unit, or option to purchase common stock was convertible into was proportionately reduced on the same basis as the common

(iii) the exercise price of each outstanding warrant or option to purchase common stock was proportionately increased on a 1-to-10

and (iv) the number of shares of common stock into which each share of preferred stock was convertible into was proportionately

reduced on the same basis as the common stock.

Unless otherwise indicated, all of the share numbers, share prices, and exercise prices

have been adjusted in this Annual Report, on a retroactive basis, to reflect this 1-for-10 Reverse Stock Split.

Principles of Consolidation

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Certain prior period amounts have been reclassified

to conform to the presentation for the current period.

in this Annual Report to conform to the presentation for the current period.

Use of Estimates

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Therefore, any gains and losses that were previously recorded in accumulated other comprehensive income remain unchanged.

Foreign Currency

Foreign Currency Transactions

Realized and unrealized gains and losses resulting

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of the Company’s fair value measurements.

and concentrations of credit risk

Cash and Concentrations of Credit Risk

The Company considers all highly liquid investments

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Financial instruments that potentially subject

the Company to credit risk consist primarily of cash on deposit with financial institutions, the balances of which frequently exceed federally

the Company to credit risk consist primarily of cash on deposit with financial institutions, the balances of which may exceed federally

insured limits.

On March 10, 2023, Silicon Valley Bank (“SVB”) was closed by the California Department of Financial Protection

and Innovation, which appointed the Federal Deposit Insurance Corporation (“FDIC”) as receiver.

The Company’s cash consisted

primarily of money market funds held at SVB.

On March 12, 2023, the U.S.

Treasury, Federal Reserve and FDIC rolled out emergency measures

to fully protect all depositors of SVB and, on March 13, 2023, we had full access to our cash on deposit with SVB.

As a result, the Company

does not anticipate any losses with respect to such balances.

The Company has not experienced any losses on such accounts, and does not believe it is exposed to any unusual credit

risk beyond the normal credit risk currently associated with commercial banking relationships.

The Company maintains its primary banking

relationship with one large financial institution and all cash on deposit is covered under federally insured limits.

Property and Equipment

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combinations, licensing and other transactions are generally recognized at the date of acquisition at their respective fair values.

acquisition, we generally determine the fair value of intangible assets, including in-process research and development (“IPR&D”),

acquisition, the Company generally determines the fair value of intangible assets, including in-process research and development (“IPR&D”),

using the “income method.” Acquired IPR&D intangible assets are considered indefinite-lived intangible assets and are

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IPR&D is not amortized but is reviewed for

impairment at least annually or when events or changes in the business environment indicate the carrying value may be impaired.

Company also has the option to first assess qualitative factors to determine whether the existence of events or circumstances

leads the Company to determine that it is more likely than not (that is, a likelihood of more than 50%) that the acquired IPR&D is

If the Company chooses to first assess the qualitative factors and it is determined that it is not more likely than not acquired

IPR&D is impaired, the Company is not required to take further action to test for impairment.

The Company also has the option to bypass

the qualitative assessment and perform only the quantitative impairment test, which the Company may choose to perform in some periods

but not in others.

The impairment loss, if any, is measured as the

excess of the carrying value of the intangible asset over its fair value.

impairment at least annually or when events or changes in the business environment indicate that it is more likely than not that the carrying

value may be impaired.

The Company also has the option to first assess qualitative factors to determine whether the existence of events

or circumstances leads the Company to determine that it is more likely than not (that is, a likelihood of more than 50%) that the acquired

IPR&D is impaired.

If the Company chooses to first assess the qualitative factors and it is determined that it is not more likely

than not acquired IPR&D is impaired, the Company is not required to take further action to test for impairment.

The Company also has

the option to bypass the qualitative assessment and perform only the quantitative impairment test, which the Company may choose to perform

in some periods but not in others.

The impairment loss, if any, is measured as the excess of the carrying value of the intangible asset

over its fair value.

Intangible assets are highly vulnerable to impairment

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there have not been any material adjustments to the Company’s prior estimates of accrued research and development expenses.

each of December 31, 2022 and 2021, the Company has recorded accrued program expense of approximately $ 0.1 million and $ 0.2 million as

a component of accrued expenses as of December 31, 2022 and 2021, respectively.

In addition, the Company has recorded approximately $ 0.3

million of prepayments as a component of prepaid expenses and other current assets as of December 31, 2022 and 2021, respectively.

Company has recorded approximately $ 0.5 million and $ 0.3 million of prepayments as a component of prepaid expenses and other current assets

as of December 31, 2023 and 2022, respectively.

In addition, the Company had recorded accrued program expense of approximately $ 0.1 million

as a component of accrued expenses as of each of December 31, 2023 and 2022.

Share-based Expense

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awards, prior to exercise, are considered treasury shares by the Company and thus do not impact the Company’s net loss per share

As of each of December 31, 2022 and 2021, there were approximately 27,000 JSOP awards issued.

For the years ended December 31, 2023 and 2022,

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securities have not been included in the calculations of diluted net loss per share, as their inclusion would be anti-dilutive.

December 31, 2022 and 2021, approximately 0.1 million and 0.5 million potentially dilutive securities, respectively, were deemed anti-dilutive.

December 31, 2023 and 2022, approximately 5,000 potentially dilutive securities were deemed anti-dilutive for each period.

Segment Information

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Lease agreements may include rent holidays, rent escalation clauses and tenant improvement allowances.

The Company accounts

for leases in accordance with ASU 2016-02, Leases (Topic 842) .

ASU 2016-02 requires lessees to recognize a lease liability and

a right-of-use asset for all leases, with the exception of short-term leases, at the commencement date.

See Note 14, Commitments and

Contingencies for further information.

The Company recognizes

a lease liability and a right-of-use asset for all leases, with the exception of short-term leases, at the commencement date.

13, Commitments and Contingencies for further information.

The Company has a history of engaging in acquisition

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Recent Accounting Standards

In June 2016, the FASB issued ASU 2016-13, Financial

Instruments - Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments .

The guidance modifies the measurement

and recognition of credit losses for most financial assets and certain other instruments.

The amendment updates the guidance for measuring

and recording credit losses on financial assets measured at amortized cost by replacing the “incurred loss” model with an

“expected loss” model.

This may result in earlier recognition of allowance for losses.

ASU 2016-13 is effective for smaller

reporting public entities for fiscal years beginning after December 15, 2022, but early adoption is permitted.

The Company continues to

evaluate the impact of adoption, but we do not anticipate that it will have a material effect on our consolidated financial statements.

In June 2016, the Financial Accounting Standards

Board issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments – Credit Losses (Topic 326):

of Credit Losses on Financial Instruments .

The guidance modified the measurement and recognition of credit losses for most financial

assets and certain other instruments.

The amendment updated the guidance for measuring and recording credit losses on financial assets

measured at amortized cost by replacing the “incurred loss” model with an “expected loss” model.

This may result

in earlier recognition of allowance for losses.

The Company adopted ASU 2016-13 as of January 1, 2023 and the adoption did not have a

material effect on our consolidated financial statements.

Significant Strategic Collaborations

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by the SOW and that will supersede the addendum to the SOW containing Catalent’s standard terms and conditions.

In addition, in the event

of any conflict between the project-specific terms and conditions set forth in the SOW and the MSA, the MSA terms and conditions shall

The estimated total cost of the project contemplated by the SOW is expected to be up to approximately $5 million (exclusive of

certain fees and potential alternatives) for the manufacturing services over the course of the term of the project with each phase of

the project invoiced separately in connection with the commencement of such phase.

Unless earlier amended or terminated, the manufacturing

services contemplated by the SOW are currently targeted to be completed by the first half of 2024.

The SOW is terminable by the Company

at any time with 30 days' prior written notice to Catalent.

The SOW also contains customary provisions related to, among other things,

confidentiality, warranties, intellectual property and indemnification.

During the year ended December 31, 2022, the Company paid Catalent

approximately $ 0.7 million , of which $ 0.3 million has been recognized as an advance payment and is included in prepaid expenses and other

as of December 31, 2022.

In addition, in

the event of any conflict between the project-specific terms and conditions set forth in the SOW and the MSA, the MSA terms and conditions

shall govern.

The estimated total cost of the project contemplated by the SOW was expected to be up to approximately $5 million (exclusive

of certain fees and potential alternatives) for the manufacturing services over the course of the term of the project with each phase

of the project invoiced separately in connection with the commencement of such phase.

The Company has paid Catalent approximately $ 2.5

million through December 31, 2023, of which $ 0.1 million has been recognized as an advance payment and is included in prepaid expenses

and other current assets and $ 0.3 million has been recognized within other assets as of December 31, 2023.

As of December 31, 2022, approximately

$ 0.3 million had been recorded as an advance payment and was included in prepaid expenses and other current assets.

Scripps Research

On May 15, 2020, the Company and the Scripps Research

Institute (“Scripps Research”) entered into a Research Funding and Option Agreement (the “Scripps Agreement”),

pursuant to which the Company had agreed to provide Scripps Research an aggregate of up to $3.0 million to fund research relating to advancing

the pre-clinical development of XCART.

The research funding was payable by the Company to Scripps Research on a quarterly basis in accordance

with a negotiated budget, which provided for an initial payment of approximately $300,000 on the date of the Scripps Agreement and subsequent

quarterly payments of approximately $300,000 over a 27-month period.

Under the Scripps Agreement, Scripps Research had granted the Company

a license within the Field (as defined in the Scripps Agreement) to any Patent Rights or Technology (as defined in the Scripps Agreement)

under the terms of that certain license agreement with Scripps Research, dated February 25, 2019, assigned to the Company on March 1,

Additionally, the Company had the option to acquire a worldwide exclusive license to Scripps Research’s rights in the Technology

or Patent Rights not already licensed to the Company, as well as a non-exclusive, royalty-free, non-transferrable license to make and

use Scripps Research Technology (as defined in the Scripps Agreement) solely for the Company’s internal research purposes during

the performance of the research program contemplated by the Scripps Agreement.

During the second quarter of 2022, the parties mutually

agreed to terminate additional funding under the Scripps Agreement.

As a result, Scripps Research agreed to continue to perform work under

the agreement until funding previously advanced was expended.

The Company paid $ 2.4 million to Scripps Research under this agreement through

December 31, 2022.

There were no amounts recognized as an advance payment or accrued under this agreement as of December 31, 2022.

of December 31, 2021, approximately $ 0.2 million had been recognized as an advance payment under this agreement and was included in prepaid

expenses and other.

On March 17, 2023, the Company and Scripps Research

entered into a Research Funding and Option Agreement (the “Agreement”), pursuant to which the Company has agreed to provide

Scripps Research an aggregate of up to $ 938,000 to fund research relating to advancing the pre-clinical development of the Company’s

DNase oncology platform technology.

The research funding is payable by the Company to Scripps Research on a monthly basis in accordance

with a negotiated budget, which provides for an initial payment of approximately $ 78,000 on the date of the Agreement and subsequent monthly

payments of approximately $ 78,000 over a 12-month period.

Under the Agreement, the Company has the option to acquire a worldwide exclusive

license to Scripps Research’s rights in the Technology or Patent Rights (as defined in the Agreement), as well as a non-exclusive,

royalty-free, non-transferrable license to make and use TSRI Technology (as defined in the Agreement) solely for the Company’s internal

research purposes during the performance of the research program contemplated by the Agreement.

Unless earlier terminated, the term of the Agreement

continues from the date of the Agreement for fifteen (15) months.

The Agreement may be terminated by the Company with 30 days advance

written notice to Scripps Research beginning six (6) months after the Effective Date (as defined in the Agreement) or by Scripps Research

if the Company fails to make timely payments due under the Agreement, subject to 30 days’ written notice to cure such nonpayment.

The Agreement may further be terminated by either party in the event of the other party’s uncured failure to perform any obligations

under the Agreement or the bankruptcy of the other party.

The Company has paid Scripps Research approximately

$ 0.8 million under the Agreement through December 31, 2023, of which approximately $ 0.4 million has been recognized as an advance payment

and is included in prepaid expenses and other current assets as of December 31, 2023.

University of Virginia (“UVA”)

On December 21, 2023, the Company entered into

a Research Funding and Material Transfer Agreement with UVA (the “UVA Agreement”) to advance the development of our systemic

DNase program.

Under the terms of the UVA Agreement, i n

addition to advancing our existing intellectual property, we have an option to acquire an exclusive license to any new intellectual property

arising from the DNase research program.

Allan Tsung, MD, a member of the Company’s Scientific Advisory Board and Chair of

the Department of Surgery at the UVA School of Medicine, will oversee the research conducted under

the UVA Agreement.

As a surgical oncologist and scientist, Dr.

Tsung is internationally recognized for leading substantial research on

the role of NETs in tumor growth, metastasis, and resistance to existing cancer therapies.

PJSC Pharmsynthez

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owns approximately 1.5 million shares of our outstanding Series B Preferred Stock (as defined in Note 10, Stockholders’ Equity.

and all of our issued and outstanding Series A Preferred Stock (as defined in Note 11, Stockholders’ Equity ) through SynBio.

On June 12, 2020, the Company and Pharmsynthez

entered into a Master Services Agreement (“Pharmsynthez MSA”) to advance the development of the Company’s XCART technology

for B-cell malignancies.

Under the Pharmsynthez MSA, Pharmsynthez agreed to provide services pursuant to work orders agreed upon by the

parties from time to time, which services include, but are not limited to, acting as the Company’s primary contract research organization

to assist in managing collaborations with multiple academic institutions in Russia and Belarus.

The Company was required to pay reasonable

fees, expenses and pass-through costs incurred by Pharmsynthez in providing the services in accordance with a budget and payment terms

set forth in each work order.

Additionally, in the event that a work order provided for milestone payments, the Company was required to

make such payments to Pharmsynthez, or third party service providers designated by Pharmsynthez, in accordance with the terms set forth

in the work order, which milestone payments may be made, at the sole discretion of the Company, in cash or shares of the Company’s

common stock.

The Company and Pharmsynthez executed a work order

on June 12, 2020 (the “Work Order”) under the Pharmsynthez MSA pursuant to which Pharmsynthez agreed to conduct a Stage 1

study of the Company’s XCART technology under the research program as set forth in the Work Order.

The activities to be performed

under the Work Order were expected to take approximately 20 months unless earlier terminated in accordance with the Pharmsynthez MSA.

The Work Order provided for additional pass-through costs to be invoiced by Pharmsynthez upon execution of contracts with third party

Additionally, the Work Order provided for milestone payments of up to an aggregate of $1,050,000, or, in the Company’s sole

discretion, up to an aggregate of 1,000,000 shares of the Company’s common stock, to be paid or issued, as applicable, by the Company

upon achievement of milestones associated with completion of early stages of the research program as set forth in the Work Order.

December 31, 2022, approximately $ 0.1 million of milestone payments had been made and no further milestone payments are expected.

On October 12, 2021, the Company entered into

Amendment Number One to the Pharmsynthez MSA (the “MSA Amendment”) with Pharmsynthez to, among other things, terminate all

work orders under the Pharmsynthez MSA.

As a result, no further services were to be performed under the Work Order and any additional

services will be covered by new work orders.

In exchange, the Company entered into a new work order (the “Second Work Order”)

simultaneously with the MSA Amendment.

Under the terms of the Second Work Order, Pharmsynthez shall provide certain enumerated services

to support the Company’s development of its XCART technology upon the written request of the Company, which work may be requested

by the Company from time to time.

Pursuant to the MSA Amendment and Second Work

Order, upon entry into the Second Work Order, the Company made a one-time $ 40,000

payment to Pharmsynthez, of which $21,000 was a one-time payment in full for all money and other compensation owed by the Company

under the Work Order, and the remaining $19,000 will be creditable against any out of pocket costs and expenses incurred by Pharmsynthez

on behalf of the Company pursuant to any new work orders initiated after the effective date of the MSA Amendment, including the Second

There was no work performed and expense recognized under these agreements during the year ended December 31, 2022.

expensed approximately $ 0.1 million related to work performed under these agreements during the year ended December 31, 2021.

no amounts recorded on the consolidated balance sheet as of December 31, 2022 and December 31, 2021, respectively.

In August 2011, SynBio and the Company entered

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first quarter of 2022.

Pharmsynthez has informed the Company that it had received a response letter indicating certain deficiencies in

the dossier and intends to refile the registration upon correction.

The Company did no t recognize revenue in connection with the Co-Development

Agreement during the years ended December 31, 2022 and 2021.

Pharmsynthez has informed the Company that it has received a response letter indicating certain deficiencies in

the dossier and continues to develop a gap mitigation strategy with the intent of refiling the registration upon correction.

did not recognize revenue in connection with the Co-Development Agreement during the years ended December 31, 2023 and 2022.

Serum Institute of India Limited

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Serum Institute had a share

ownership of less than 1% of the total outstanding common stock of the Company as of December 31, 2022 and 2021, respectively.

ownership of less than 1% of the total outstanding common stock of the Company as of each of December 31, 2023 and 2022.

Licensing Arrangements

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95,000 shares of the Company’s common stock to CLS based on the achievement of certain regulatory milestones.

In addition, the

Company is obligated to pay tiered royalties ranging from the mid-single to low-double digits on net sales of licensed products falling

within the scope of the license during the Royalty Term (as defined in the Sublicense Agreement), as well as pay a percentage share in

the low-to-mid teens of certain consideration received by the Company from any sublicensees.

In addition, the Company

is obligated to pay tiered royalties ranging from the mid-single to low-double digits on net sales of licensed products falling within

the scope of the license during the Royalty Term (as defined in the Sublicense Agreement), as well as pay a percentage share in the low-to-mid

teens of certain consideration received by the Company from any sublicensees.

Exclusive License Agreement

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expense during the year ended December 31, 2022.

No milestone or other contingent consideration was recognized in 2022 as there were no

development, regulatory or sales milestones that were probable of being achieved as of December 31, 2022.

No milestone or other contingent consideration was recognized in 2023 and 2022 as there

were no development, regulatory or sales milestones that were probable of being achieved as of each of December 31, 2023 and December

Patent Assignment and Volition Collaboration

On October 4, 2022, the Company completed a patent

assignment related to its collaboration with Belgian Volition SARL Limited (“Volition”) and CLS.

In connection with the patent

assignment, the Company entered into a Subscription Agreement with CLS Therapeutics, LLC, a Delaware limited liability company (“CLS

LLC ”) on October 12, 2022, pursuant to which the Company agreed to issue to CLS LLC, and CLS LLC agreed to subscribe for, 850,000

shares of the Company’s common stock (the “Shares”) as consideration for the assignment by CLS and its affiliates to

the Company of certain patent rights owned by CLS and its affiliates.

On August 2, 2022, the Company announced a research

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from commercialization or licensing of any products arising from the collaboration.

On July 10, 2023, the Company entered into the first

Collaborator Statement of Work as part of this collaboration with Volition.

Volition has funded approximately $ 0.1 million under this

research program through December 31, 2023.

The Company has recorded this funding as a reduction in research and development costs during

the year ended December 31, 2023.

On October 4, 2022, the Company completed a patent

assignment related to its collaboration with Belgian Volition SARL Limited (“Volition”) and CLS.

In connection with the patent

assignment, the Company entered into a Subscription Agreement with CLS Therapeutics, LLC, a Delaware limited liability company (“CLS

LLC ”) on October 12, 2022, pursuant to which the Company agreed to issue to CLS LLC, and CLS LLC agreed to subscribe for, 85,000

shares of the Company’s common stock (the “Shares”) as consideration for the assignment by CLS and its affiliates to

the Company of certain patent rights owned by CLS and its affiliates.

The total consideration for the patent assignment

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As there was no future alternative use for the patent rights, the Company recorded

an expense of approximately $ 0.5 million to research and development expense for the year ended December 31, 2022.

No milestone or other

contingent consideration was recognized in 2022 as there were no development, regulatory or sales milestones that were probable of being

achieved as of December 31, 2022.

The Company incurred approximately $ 0.6 million

related to consulting, transaction and development costs in connection with the DNase technology for the year ended December 31, 2022.

Property and Equipment, net

Property and equipment, net consists of the following:

Schedule of property and equipment

Office and computer equipment

Furniture and fixtures

Property and equipment – at cost

Less accumulated depreciation

Property and equipment, net

There was no depreciation expense for the years

ended December 31, 2022 and 2021, respectively.

In October 2022, the Company retired its fully depreciated assets as a result of the relocation

of its corporate office.

an expense of approximately $ 0.5

million to research and development expense for the year ended December 31, 2022.

No milestone or other contingent consideration

was recognized in 2023 and 2022 as there were no development, regulatory or sales milestones that were probable of being achieved as

of each of December 31, 2023 and 2022.

As of December 31, 2023 and 2022, CLS owned approximately

9.6 % of the Company’s common stock.

The Company incurred approximately $ 0.4 million of transaction costs in connection with the

licensing of the DNase technology for the year ended December 31, 2022.

In 2016, the Company

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Company’s common stock .

As of December 31, 2022 and 2021, the Company has classified $ 0.7 million of prepaid clinical supply

as long-term as it does not anticipate utilizing the majority of the PSA supply within the next 12 months.

No clinical supply was utilized

during the years ended December 31, 2022 and 2021.

As of each of December 31, 2023 and 2022, the Company has classified $ 0.7 million of prepaid clinical

supply as long-term as it does not anticipate utilizing the majority of the PSA supply within the next 12 months.

No clinical supply was

utilized during the years ended December 31, 2023 and 2022.

What changed 10-K

Item 8. Financial Statements and Supplementary Data