What changed in Axe Compute Inc.'s 10-K — 2023 vs 2024

In our second business area, we provide services and research using a proprietary self-contained and automated system that conducts high-throughput, self-interaction chromatography screens using additives and excipients commonly included in protein formulations resulting in soluble and physically stable formulations of biologics.

Our third business area produces the United States Food and Drug Administration (“FDA”)-cleared STREAMWAY® System and associated products for automated medical fluid waste management and patient-to-drain medical fluid disposal. As of January 1, 2023, we changed our reportable segments to align with these business areas.

Specifically, Birmingham provides optimized FDA-approved formulations for vaccines, antibodies, and other protein therapeutics in a faster and lower cost basis to its customers, as described below. In addition, our Birmingham segment enables protein degradation studies, which based on current projections, could be a substantial line of business for the Company.

The primary asset of our Birmingham segment is our proprietary automated High Throughput Self-Interaction Chromatography (“HSC”™) platform. Our HSC platform is a self-contained, automated system that conducts high-throughput, self-interaction chromatography screens on excipients previously approved by the FDA for protein formulations.

Our technology rapidly measures the solubility of protein in different excipients and excipient combinations that promote improved protein solubility in solutions. The data generated from HSC screens are analyzed by a proprietary AI predictive algorithm to identify the optimal combination(s) of buffers, pH, and excipients, resulting in increased solubility and physical stability of proteins.

Several of our clients have seen ten-fold and hundred-fold increases in their protein’s solubility while maintaining physical stability. For biopharmaceutical clients this means faster development times and quicker progression of molecules into the clinic.

For academic collaborators, this means further progression of biochemical and biology studies necessary to advance fundamental research in areas of unmet medical need. 6 In addition, our Birmingham segment provides comprehensive protein stability analyses via time-dependent shelf-life studies and forced degradation studies designed to quickly determine which of the additives previously approved by the FDA will improve the solubility and stability of proteins in solutions.

Services include pre-formulation development, stability assessment, and biophysical characterization, which evaluate variables including pH, temperature, humidity, light, viscosity, oxidizing agents, and mechanical stress to determine the most promising additives, formulation of B22 values and validation of conformation stability.

We provide clients with a list of the most promising additives from a set of over 40 different additives that can increase the solubility and stability of protein formulations. The Birmingham segment also offers protein solubility kits that allow rapid identification of soluble formulations. We provide four different kits to fulfill customer solubility requirements.

The kits are in 96-well format and provide the tools and methods to compare relative solubility across 88 common formulations (with 8 controls). Birmingham kits utilize a simple mix and spin protocol that quickly evaluates aggregation behavior as a function of pH, salt, and additives costing significantly less than if manually determined.

In addition, our Birmingham segment supplies proprietary technologies for bacterial endotoxin detection and removal. Endotoxin is an inherent byproduct of bacterial expression of therapeutic proteins. However, therapeutic proteins are required to have extremely low endotoxin levels.

Our Birmingham segment provides a product to remove endotoxin that works through multiple molecular interactions for efficient removal over a wide range of buffer conditions with minimal product loss. The detection of endotoxin can also be adversely affected by the protein therapeutic itself. To address this, Birmingham provides sample treatment kits to minimize detection interference while using standard detection assays.

At our Birmingham facility, we can manufacture high-quality endotoxin detection and removal products to help our customers efficiently meet safety standards. We follow Good Manufacturing Practices (“GMP”), International Council for Harmonization (“ICH”) and Good Laboratory Practice (“GLP”) standards throughout to ensure consistent and standardized products and services. EAGAN STREAMWAY ® System Through our wholly owned subsidiary, Skyline Medical Inc.

Traditional, non-powered canisters and related suction and fluid disposable products are exempt and do not require FDA clearance. 8 We expect the hospital surgery market to continue to increase due to population growth, the aging of the population, and expansion of surgical procedures to new areas (for example, use of the endoscope) which requires more medical fluid management and new medical technology.

A deeper analysis of these same tumor cohorts found to be highly responsive to a particular drug candidate can be further utilized for targeted biomarker development and/or targeted assay development.

This same technology can also be used to demonstrate potential toxic drug effect on normal tissues by maintaining an accurate reconstruction of cellular and extracellular compartments of human tissues. 9 Drug Development Solutions – Formulations for Biologics Our HSC platform is a self-contained, automated system that conducts high-throughput, self-interaction chromatography screens on FDA approved excipients for protein formulations.

The HSC system provides clear competitive advantages. First, HSC measures the solubility in all FDA-approved excipients and excipient combinations rather than a limited subset of excipients. The HSC also requires smaller sample sizes and decreased time and manpower to optimize formulations.

Using data generated from HSC screens, our proprietary predictive algorithm identifies the optimal combination(s) of buffers, pH, and excipients based on more than 4,000 possible combinations, resulting in increased solubility and physical stability of proteins. The top predictive solubilities are then validated using experimental methods in combination with the HSC to produce multiple formulations to meet customer requirements.

The HSC instrument and its technology has been validated over the past twelve years via industry and academic collaborations. Several of our clients have seen ten-fold and hundred-fold increases in their protein’s solubility while maintaining physical stability. For biopharmaceutical clients this means faster development times and quicker progression of molecules into the clinic.

Our technologies and services help expedite and streamline biologics development—improving yield with expression and purification services; helping prepare for clinical trials with ICH stability profiles; meeting safety standards with endotoxin detection and removal; and manufacturing at our GMP facility.

We believe that our virtually hands free direct-to-drain technology (1) significantly reduces the risk of healthcare worker exposure to these infectious fluids by replacing canisters, (2) further reduces the risk of worker exposure when compared to powered canister technology that requires transport to and from the operating room, (3) reduces the cost per procedure for handling these fluids, and (4) enhances the surgical team’s ability to collect data to accurately assess the patient’s status during and after procedures.

In addition to the traditional canister method of waste fluid disposal, several other powered medical devices have been developed that address some of the deficiencies described above.

Most of these competing products continue to utilize some variation on the existing canister technology, and while not directly addressing the canister, most have been successful in eliminating the need for an expensive gel and its associated handling and disposal costs.

Our existing competitors with products already on the market have a clear competitive advantage over us in terms of brand recognition and market exposure. In addition, many of our competitors have extensive marketing and development budgets that could overpower an emerging growth company like ours.

Alternative suppliers are available in the market; however, we could experience delays and interruptions that might adversely affect the financial performance of our business including time for machine tooling specific to our products. 10 We have existing and good relationships with our service vendors.

We hold the following granted patents in the United States on our earlier STREAMWAY System models: US7,469,727 and US8,123,731 (collectively, the “First Generation Patents”). The First Generation Patents will begin to expire on April 17, 2024. On January 25, 2014, we filed a non-provisional Patent Cooperation Treaty (“PCT”) Application No. PCT/US2014/013081 claiming priority from the U.S.

Provisional Patent Application, number 61756763 which was filed on January 25, 2013. The PCT allows an applicant to file a single patent application to seek patent protection for an invention simultaneously in each of the 148-member countries of the PCT, including the United States. We filed both U.S. and European national stage applications from this PCT application.

We have two issued U.S. patents claiming priority from the PCT application: US10,253,792 and US10,954,975 (collectively, the “Second Generation Patents”). The Second Generation Patents will begin to expire on January 25, 2034.

As of November 22, 2017, we were informed that the European Patent Office allowed all our claims for application #14743665.3-1651 and on as of July 11, 2018, we were informed that the European Patent #EP2948200 was granted. European Patent #EP2948200 in the following countries: Belgium, Germany, Spain, France, United Kingdom, Ireland, Italy, Netherlands, Norway, Poland, and Sweden.

Further, we filed a European divisional application, which was granted as European Patent #EP3437666 on March 26, 2020. European Patent #EP3437666 was validated in the following countries: Belgium, Switzerland, Cyprus, Germany, Spain, France, United Kingdom, Hungary, Ireland, Italy, Liechtenstein, North Macedonia, Malta, Netherlands, Norway, Poland, Sweden, and Turkey.

Our PCT patent application is for an enhanced model of the surgical fluid waste management system.

FDA Clearance of STREAMWAY ® System under Section 510(k). The FDA Center for Devices and Radiological Health requires 510(k) submitters to provide information that compares its new device to a marketed device of a similar type, in order to determine whether the device is substantially equivalent.

We filed the 510(k) submission for clearance of the STREAMWAY System device on March 14, 2009, and received written confirmation on April 1, 2009 that our 510(k) has been cleared by the FDA. Our 510(k) number is K090759.

Following these 510(k) clearances by the FDA, we continue to be subject to the normal ongoing audits and reviews by the FDA and other governing agencies. These audits and reviews are standard and typical in the medical device industry, and we do not anticipate being affected by any extraordinary guidelines or regulations.

Our subsidiary, Skyline Medical, has successfully passed FDA audits in the past, with no observations or 483 warning letters issued. Application for Electrical Safety Testing and Certification for STREAMWAY System We sought and achieved testing and certification to the IEC 60606-1 and IEC 60606-1-2, two internationally recognized standards.

The 60601-1 3rd edition certification for our STREAMWAY System is valid and enables us to continue to market and sell our product domestically and internationally. 13 We have contracted with TUV, a nationally recognized testing laboratory-NRTL, to certify our STREAMWAY System to the new 60601-1 3rd Edition in late 2016.