What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-05-13 compared with 2024-11-12 · 125 added, 175 removed, 134 unchanged (69% of the section changed)

ITEM 2 – MANAGEMENT’S DISCUSSION

AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

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including statements regarding our future results of operations and financial position, our business strategy and plans, future revenues,

projected costs, prospects and our objectives for future operations, are forward-looking statements.

These forward-looking statements

include, but are not limited to, statements concerning:

anticipated effects of geopolitical events, including the conflicts in the Ukraine

and the Middle East and associated sanctions imposed by the U.S.

and other countries in response;

our plans to develop our proposed drug

projected costs, prospects and our objectives for future results of operations and financial position, our business strategy and plans,

future revenues, projected costs, prospects and our objectives for future operations, are forward-looking statements.

These forward-looking statements include, but

are not limited to, statements concerning:

anticipated effects of geopolitical events, including the conflicts in the Ukraine and the

Middle East and associated sanctions imposed by the United States (“U.S.”) and other countries in response;

our plans to develop

our proposed drug candidates;

the uncertainty surrounding government actions, as well as any changes to existing or newly proposed legislation

that may affect the healthcare regulatory space;

our expectations regarding the nature, timing and extent of collaboration arrangements;

the expected results pursuant to collaboration

arrangements, including the receipts of royalty and other future payments that may arise pursuant to collaboration arrangements;

of our plans to obtain regulatory approval of our drug candidates;

the outcome of our plans for the commercialization of our drug candidates;

our plans to advance innovative immune-oncology technologies addressing hard to treat oncology indications;

expectations regarding our

Deoxyribonuclease (“DNase”) platform, such as regarding the DNase platform being in development for the treatment of solid

tumors and being aimed at improving outcomes of existing treatments, including immunotherapies, by targeting neutrophil extracellular

traps (“NETs”);

our expectations to focus our efforts and resources on advancing the DNase platform into the clinic as an

adjunctive therapy for pancreatic carcinoma and locally advanced or metastatic solid tumors;

and our expectations regarding our PolyXen ®

platform and any partnerships with respect thereto.

In some cases, these statements

may be identified by terminology such as “may,” “will,” “would,” “could,” “should,”

“expect,” “plan,” “anticipate,” “believe,” “estimate,” “seek,”

“approximately,” “intend,” “predict,” “potential,” “projects,” or “continue,”

or the negative of such terms and other comparable terminology.

Although we believe that the expectations reflected in the forward-looking

statements contained herein are reasonable, we cannot guarantee future results, the levels of activity, performance or achievements.

statements involve known and unknown risks and uncertainties that may cause our or our industry's results, levels of activity, performance

or achievements to be materially different from those expressed or implied by forward-looking statements.

the expected results pursuant to collaboration arrangements, including the receipts of royalty and other future payments that may arise

pursuant to collaboration arrangements;

the outcome of our plans to obtain regulatory approval of our drug candidates;

the outcome of

our plans for the commercialization of our drug candidates;

our plans to advance innovative immune-oncology technologies addressing difficult

to treat oncology indications;

expectations regarding our Deoxyribonuclease (“DNase”) technology, such as regarding the DNase

technology being in development for the treatment of solid tumors and being aimed at improving outcomes of existing treatments, including

immunotherapies, by targeting neutrophil extracellular traps (“NETs”);

our expectations to focus our efforts and resources

on advancing the DNase technology into the clinic as an adjunctive therapy for pancreatic carcinoma and locally advanced or metastatic

solid tumors;

and our expectations regarding our PolyXen ® platform and any partnerships with respect thereto.

In some cases, these statements may be identified

by terminology such as “may,” “will,” “would,” “could,” “should,” “expect,”

“anticipate,” “believe,”

“estimate,” “seek,” “approximately,” “intend,” “predict,” “potential,”

“projects,” “upcoming”, “opportunity”, “target” or “continue,” or the negative

of such terms and other comparable terminology.

Although we believe that the expectations reflected in the forward-looking statements

contained herein are reasonable, we cannot guarantee future results, the levels of activity, performance or achievements.

These statements

involve known and unknown risks and uncertainties that may cause our or our industry's results, levels of activity, performance or achievements

to be materially different from those expressed or implied by forward-looking statements.

The Management’s Discussion and Analysis

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uncertainty of the expected financial performance of the Company;

failure to realize the anticipated potential of the DNase or PolyXen technologies;

failure to realize the anticipated potential of the DNase technology;

our ability to implement our business strategy;

our failure to maintain compliance with the continued listing requirements of the Nasdaq Stock Market (“Nasdaq”);

our failure to maintain compliance with the continued listing requirements of the Nasdaq Stock Market;

our need to raise additional working capital in the future for the purpose of further developing our pipeline and to continue as a going concern;

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the costs inherent with complying with statutes and regulations applicable to public reporting companies, such as the Sarbanes-Oxley Act of 2002;

other new lines of business that we may enter in the future;

other new lines of business that the Company may enter in the future;

general economic and business conditions, as well as inflationary trends and financial market instability or disruptions to the banking system due to bank failures;

the impact of natural disasters or public health emergencies, such as the COVID-19 global pandemic, and geopolitical events, such as the conflicts in the Ukraine and the Middle East, and related sanctions and other economic disruptions or concerns, on our financial condition and results of operations;

the impact of natural disasters or public health emergencies, such as the COVID-19 global pandemic, and geopolitical events, such as the conflicts in Ukraine and the Middle East, and related sanctions and other economic disruptions or concerns, on our financial condition and results of operations;

other factors set forth in the Risk Factors section of our Annual Report on Form 10-K and in subsequent filings with the Securities and Exchange Commission (“SEC”).

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We are a biopharmaceutical company focused on

advancing innovative immune-oncology technologies addressing hard to treat cancers.

Our DNase platform is designed to improve outcomes

of existing treatments, including immunotherapies, by targeting NETs, which have been implicated in cancer progression and resistance

to cancer treatments.

We are currently focused on advancing our systemic DNase program into the clinic as an adjunctive therapy for pancreatic

carcinoma and locally advanced or metastatic solid tumors.

Additionally, we have partnered with biotechnology and pharmaceutical companies

to develop our proprietary drug delivery platform, PolyXen, and receive royalty payments under an exclusive license arrangement in the

field of blood coagulation disorders.

advancing innovative immune-oncology technologies addressing difficult to treat cancers.

Our proprietary DNase technology is designed

to improve outcomes of existing treatments, including immunotherapies, by targeting NETs, which are involved in cancer progression.

are currently focused on advancing our systemic DNase program into the clinic as an adjunctive therapy for pancreatic carcinoma and locally

advanced or metastatic solid tumors.

We incorporate our patented and proprietary technologies

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resulted from our research activities or that of our collaborators and are in the development stage.

As a result, we have committed a

significant amount of our resources to our research and development activities and anticipate continuing to do so for the near future.

As a result, we continue to commit

a significant amount of our resources to our research and development activities and anticipate continuing to do so for the near future.

To date, none of our drug candidates have received regulatory marketing authorization or approval in the U.S.

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We are receiving ongoing royalties pursuant to a license of our

PolyXen technology to an industry partner.

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

and nine months ended September 30, 2024, was on the advancement of our DNase technology.

Impact of the Global Conflicts on Our Operations

The short and long-term implications of conflicts

in the Ukraine and 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.

legacy PolyXen technology to an industry partner.

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

the three months ended March 31, 2025, was on the advancement of our DNase technology.

Impact of the Global Events and Conflicts on

Our Operations

The short and long-term implications of geopolitical

events and global conflicts, including those in Ukraine and 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.

RESULTS OF OPERATIONS

Comparison of Quarter Ended September 30,

2024 and 2023

Comparison of Quarter Ended March 31, 2025

The comparison of our historical results of operations

for the fiscal quarter ended September 30, 2024 to the fiscal quarter ended September 30, 2023 is as follows:

for the fiscal quarter ended March 31, 2025 to the fiscal quarter ended March 31, 2024 is as follows:

Quarter Ended

September 30, 2024

March 31, 2025

Quarter Ended

September 30, 2023

March 31, 2024

Royalty revenue

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Loss from operations

Total other income, net:

Other income (expense)

Other income:

Interest income, net

$ (1,195,113 )

Revenue for the three months ended September 30,

2024 was relatively flat with that of the three months ended September 30, 2023.

Revenue for the three months ended March 31, 2025

increased by approximately $0.1 million, or 16.1%, to approximately $0.6 million from approximately $0.5 million for the three months

ended March 31, 2024.

Royalty revenue for the three months ended March 31, 2024 was negatively impacted by the timing of rebates related

to our sublicense agreement with Takeda Pharmaceutical Co.

There was no similar impact on revenue during the three months ended

March 31, 2025.

Research and Development Expenses

Research & development (“R&D”)

expenses for the three months ended September 30, 2024 decreased by approximately $0.7 million, or 63.9%, to approximately $0.4 million

from approximately $1.0 million in the comparable quarter in 2023.

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

by category of expense for the quarters ended September 30, 2024 and 2023:

expenses for the three months ended March 31, 2025 decreased by approximately $65,000, or 6.9%, to approximately $0.9 million from approximately

$0.9 million in the comparable quarter in 2024.

The table below sets forth the R&D costs incurred by the Company by category of expense

for the quarters ended March 31, 2025 and 2024:

Quarter Ended

Category of Expense

September 30, 2024

September 30, 2023

March 31, 2025

March 31, 2024

Outside services and contract research organizations

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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 process development

efforts related to our DNase platform.

The decrease in personnel costs during the three months ended September 30, 2024 as compared to

the three months ending September 30, 2023 is due to the departure of our former Chief Scientific Officer during the second quarter of

The decrease in personnel

costs and share-based expense during the first quarter of 2025 was related to the departure of our former Chief Scientific Officer during

the second quarter of 2024.

The increase in outside services and contract research organizations expense was primarily due to increased

consulting costs and spending in connection with the commencement of exploratory studies during the three months ended March 31, 2025.

General and Administrative Expenses

General and administrative expenses for the three

months ended September 30, 2024 was relatively flat with that of the three months ended September 30, 2023.

Increases in legal fees during

the three months ended September 30, 2024 compared to the same period in 2023 were offset by decreases is personnel costs during the third

quarter of 2024 due to the departure of our former Chief Executive Officer in the second quarter of 2024.

Other Income (Expense)

Other income was approximately $1,500 for the

three months ended September 30, 2024 compared to approximately $700 of other expense for the comparable quarter in 2023.

This increase

in other income was primarily related to favorable changes in foreign currency exchange rates during the three months ended September

30, 2024 as compared to the same period in 2023.

Interest Income

Interest income, net decreased to approximately

$61,000 during the three months ended September 30, 2024 from approximately $92,000 for the same period in the prior year.

This decrease

was primarily due to lower average invested funds during the three months ended September 30, 2024 compared to the same period in 2023.

Comparison of Nine Months Ended September

30, 2024 and 2023

The comparison of our historical results of operations

for the nine months ended September 30, 2024 to the nine months ended September 30, 2023 is as follows:

September 30,

Royalty revenue

Operating costs and expenses:

Research and development

General and administrative

Total operating costs and expenses

Loss from operations

Total other income, net:

months ended March 31, 2025 decreased by approximately $178,000, or 21.4%, to approximately $0.7 million from approximately $0.8 million

in the comparable quarter in 2024.

The decrease was primarily due to a decrease in personnel costs and share-based expense related to

the departure our former Chief Executive Officer during the second quarter of 2024.

Other income was approximately $78 for the three

months ended March 31, 2025 compared to approximately $52 of other income for the comparable quarter in 2024.

This increase in other income

was primarily related to favorable changes in foreign currency exchange rates during the three months ended March 31, 2025 as compared

to the same period in 2024.

Interest Income, net

$ (2,905,754 )

$ (2,963,072 )

Revenue for the nine months ended September 30,

2024 was relatively flat with that of the nine months ended September 30, 2023.

Research and Development Expenses

R&D expenses for the nine months ended September

30, 2024 decreased by approximately $0.3 million, or 10.8%, to approximately $2.2 million from approximately $2.5 million in the comparable

period in 2023.

The table below sets forth the R&D costs incurred by the Company by category of expense for the nine months ended

September 30, 2024 and 2023:

Nine Months Ended,

Category of Expense

September 30, 2024

September 30, 2023

Outside services and contract research organizations

Personnel costs

Share-based expense

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 process development efforts, partially offset

by increased pre-clinical development efforts related to our DNase platform.

The increase in personnel costs is due to certain severance

and benefits expensed in connection with a separation agreement entered into during the second quarter of 2024 with our former Chief Scientific

General and Administrative Expenses

General and administrative expenses for the nine

months ended September 30, 2024 increased by approximately $0.1 million, or 3.9%, to approximately $2.7 million from approximately $2.6

million in the comparable period in 2023.

The increase was primarily due to certain severance and benefits expensed in connection with

a separation agreement entered into during the second quarter of 2024 with our former Chief Executive Officer.

This increase was partially

offset by general decreases in accounting fees during the nine months ended September 30, 2024 compared to the same period in 2023.

Other income was approximately $1,500 for the

nine months ended September 30, 2024 compared to approximately $25,000 of other income for the nine months ended September 30, 2023.

decrease in other income was primarily related to fees associated with the Pharmsynthez Loan recognized during the nine months ended September

30, 2023 for which there was no similar fees received in the same period in 2024.

Interest Income

Interest income decreased to approximately $198,000

during the nine months ended September 30, 2024 as compared to approximately $272,000 for the same period in the prior year.

This decrease

was primarily due to lower average invested funds during the nine months ended September 30, 2024 compared to the same period in 2023,

as well as a decrease in interest income received on the Pharmsynthez Loan.

Interest income, net decreased to approximately

$39,000 during the three months ended March 31, 2025 as compared to approximately $73,000 for the same period in the prior year.

decrease is primarily due to lower average invested funds during the three months ended March 31, 2025 as compared to the same period

Liquidity and Capital Resources

We incurred a net loss

of approximately $2.9 million for the nine months ended September 30, 2024.

of approximately $0.9 million for the three months ended March 31, 2025.

We had an accumulated deficit of approximately $198.1 million

at September 30, 2024, as compared to an accumulated deficit of approximately $193.2 million at December 31, 2023.

Working capital was

approximately $6.0 million at September 30, 2024, and approximately $8.8 million at December 31, 2023.

During the nine months ended September

30, 2024, our working capital decreased by approximately $2.8 million primarily due to our net loss for the nine months ended September

at March 31, 2025, as compared to an accumulated deficit of approximately $197.2 million at December 31, 2024.

Working capital was approximately

$4.8 million at March 31, 2025 and $5.7 million at December 31, 2024.

During the three months ended March 31, 2025, our working capital

decreased by $0.9 million primarily due to our net loss for the three months ended March 31, 2025.

Our principal source

of liquidity consists of cash.

At September 30, 2024, we had approximately $6.8 million in cash and approximately $1.0 million in current

At December 31, 2023, we had approximately $9.0 million in cash and approximately $0.8 million in current liabilities.

have historically relied upon sales of our equity securities to fund our operations.

At March 31, 2025, we had approximately $5.2 million in cash and $0.7 million in current liabilities.

December 31, 2024, we had approximately $6.2 million in cash and $0.9 million in current liabilities.

We have historically relied upon

sales of our equity securities to fund our operations.

We evaluate whether there

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

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.

we anticipate we will need additional capital in the long-term to pursue our business initiatives.

While the Company believes 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 terms, timing and extent of any future financing will depend upon several factors,

including the achievement of progress in our clinical development programs, our ability to identify and enter into licensing or other

strategic arrangements, our continued listing on Nasdaq, and factors related to financial, economic, geo-political, industry and market

conditions, many of which are beyond our control.

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

terms, timing and extent of any future financing uncertain.

We believe that our existing resources will be adequate to fund our operations

for a period of at least twelve months from the date of the issuance of these financial statements.

However, we anticipate we will need

additional capital in the long-term to pursue our business initiatives.

While we believe that we have 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 terms, timing and extent of any future financing will depend upon several factors, including the achievement of

progress in our clinical development programs, our ability to identify and enter into licensing or other strategic arrangements, our continued

listing on the Nasdaq Stock Market, and factors related to financial, economic, geo-political, industry and market conditions, many of

which are beyond our control.

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

of any future financing uncertain.

Cash Flows from Operating Activities

Cash flows used in operating activities for the

nine months ended September 30, 2024 totaled approximately $2.1 million, which was primarily due to our net loss for the period, partially

offset by non-cash charges associated with share-based expense.

In addition, prepaid expenses and other decreased approximately $0.4 million

and current liabilities increased approximately $0.2 million during the period.

Cash flows used in operating activities for the 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

three months ended March 31, 2025 totaled approximately $1.0 million, which was primarily due to our net loss for the period and, to a

lesser extent, a decrease in accounts payable, accrued expenses and other current liabilities due to payments made in accordance with

severance arrangements.

Cash flows used in operating activities for the three months ended March 31, 2024 totaled approximately $1.2 million,

which was primarily due to our net loss for the period, partially offset by non-cash charges associated with share-based expense.

Cash Flows from Investing Activities

There were no cash flows from investing activities

for the nine months ended September 30, 2024 and 2023.

Cash Flow from Financing Activities

for the three months ended March 31, 2025 and 2024.

Cash Flows from Financing Activities

There were no cash flows from financing activities

for the nine months ended September 30, 2024 and 2023.

for the three months ended March 31, 2025 and 2024.

Contractual Obligations and Commitments

As of September 30, 2024, 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

As of March 31, 2025, 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,

2024, filed with the SEC on March 18, 2025, as amended on April 29, 2025.

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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