10q10k10q10k.net

What changed in Celldex Therapeutics, Inc.'s 10-K — 2022 vs 2023

vs

Paragraph-level year-over-year comparison of Celldex Therapeutics, Inc.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+429 added−429 removedSource: 10-K (2024-02-26) vs 10-K (2023-02-28)

Top changes in Celldex Therapeutics, Inc.'s 2023 10-K

429 paragraphs added · 429 removed · 281 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

94 edited+64 added−75 removed141 unchanged
Biggest changePositive interim data from the Phase 1b study in CIndU were reported in July and September 2021 and in December 2022 in patients with cold urticaria and symptomatic dermographism; - Prurigo Nodularis (PN): In December 2021 we announced that the first patient had been dosed in a Phase 1b study in PN; enrollment was closed in February 2023 and we plan to present data from the study in the second half of 2023; - Eosinophilic Esophagitis (EoE): We plan to initiate a Phase 2 study in EoE in the first half of 2023. ● Our next generation bispecific antibody platform to support pipeline expansion with additional candidates for inflammatory diseases and oncology.
Biggest changeA Phase 2 study in chronic inducible urticaria (CIndU) is currently enrolling patients and we expect to report data from this study in the second half of 2024; - Prurigo Nodularis (PN): In November 2023, we reported positive data from a Phase 1b study in PN that supports further development of barzolvolimab in this indication and we are currently planning for the initiation of a Phase 2 study in PN in early 2024; - Eosinophilic Esophagitis (EoE): A Phase 2 study in EoE was initiated in June 2023 and enrollment is ongoing. ● Our next generation bispecific antibody platform to support pipeline expansion with additional candidates for inflammatory diseases and oncology.
The process required by the FDA before a drug or biological product may be marketed in the United States generally involves the following: ● completion of preclinical studies and formulation studies in compliance with the FDA’s good laboratory practice, or GLP, regulations; ● submission to the FDA of an investigational new drug, or IND, application which must become effective before human clinical trials may begin; ● approval by an independent institutional review board, or IRB, at each clinical site before each trial may be initiated; ● performance of adequate and well-controlled human clinical trials in accordance with good clinical practices, or GCP, to establish the safety and efficacy of the proposed drug or biological product for each indication; ● submission to the FDA of a new drug application, or NDA, or a biologics license application, or BLA, as applicable; ● satisfactory completion of an FDA advisory committee review, if applicable; 12 Table of Contents ● satisfactory completion of an FDA inspection of the manufacturing facility or facilities at which the product is produced to assess compliance with cGMP requirements and to assure that the facilities, methods and controls are adequate to preserve the drug’s identity, strength, quality and purity; and ● FDA review and approval of the NDA or BLA.
The process required by the FDA before a drug or biological product may be marketed in the United States generally involves the following: ● completion of preclinical studies and formulation studies in compliance with the FDA’s good laboratory practice, or GLP, regulations; ● submission to the FDA of an investigational new drug, or IND, application which must become effective before human clinical trials may begin; 13 Table of Contents ● approval by an independent institutional review board, or IRB, at each clinical site before each trial may be initiated; ● performance of adequate and well-controlled human clinical trials in accordance with good clinical practices, or GCP, to establish the safety and efficacy of the proposed drug or biological product for each indication; ● submission to the FDA of a new drug application, or NDA, or a biologics license application, or BLA, as applicable; ● satisfactory completion of an FDA advisory committee review, if applicable; ● satisfactory completion of an FDA inspection of the manufacturing facility or facilities at which the product is produced to assess compliance with cGMP requirements and to assure that the facilities, methods and controls are adequate to preserve the drug’s identity, strength, quality and purity; and ● FDA review and approval of the NDA or BLA.
Targets are being selected based on new science as well as their compatibility to be used in bispecific antibody formats with Celldex’s existing antibody programs. Development is focused on emerging, important pathways controlling inflammatory diseases or immunity to tumors. Our goal is to build a fully integrated, commercial-stage biopharmaceutical company that develops important therapies for patients with unmet medical needs.
Targets are being selected based on new science as well as their compatibility to be used in bispecific antibody formats with our existing antibody programs. Development is focused on emerging, important pathways controlling inflammatory diseases or immunity to tumors. Our goal is to build a fully integrated, commercial-stage biopharmaceutical company that develops important therapies for patients with unmet medical needs.
CSU is one of the most frequent dermatologic diseases with a prevalence of 0.5-1.0% of the total population or up to approximately 1 to 3 million patients in the United States (Weller et al. 2010. Hautarzt. 61(8), Bartlett et al. 2018. DermNet.Org). Approximately 50% of patients with CSU achieve symptomatic control with antihistamines.
It is one of the most frequent dermatologic diseases with a prevalence of 0.5-1.0% of the total population or up to approximately 1 to 3 million patients in the United States (Weller et al. 2010. Hautarzt. 61(8), Bartlett et al. 2018. DermNet.Org). Approximately 50% of patients with CSU achieve symptomatic control with antihistamines.
Patients will then enter a follow-up phase for an additional 24 weeks. In addition, the study includes the option for patients who have symptoms following the treatment phase, including patients who were on placebo, to enroll in an open label extension where all patients receive 300 mg every 9 weeks of barzolvolimab.
Patients will then enter a follow-up phase for an additional 24 weeks. In addition, the study includes the option for patients who have symptoms following the treatment phase, including patients who were on placebo, to enroll in an open label extension where all patients receive 300 mg of barzolvolimab every 8 weeks.
None of the information posted on our website is incorporated by reference into this Annual Report. The SEC also maintains a website at http://www.sec.gov that contains reports, proxy and information statements and other information regarding us and other companies that file materials with the SEC electronically. ​ 20 Table of Contents
None of the information posted on our website is incorporated by reference into this Annual Report. The SEC also maintains a website at http://www.sec.gov that contains reports, proxy and information statements and other information regarding us and other companies that file materials with the SEC electronically. ​ 21 Table of Contents
For example, certain EU member states may approve a specific price and volume for a drug product after which incremental revenues or profits need to be paid back by way of rebates. They may also institutionalize utilization restrictions, curb physicians’ drug budgets, provide conditional reimbursement schemes that require additional evidence to be generated post-marketing authorization, etc.
For example, certain EU member states may approve a specific price and volume for a drug product after which incremental revenues or profits need to be paid back by way of rebates. They may also institutionalize utilization restrictions, curb physicians’ drug budgets, provide conditional reimbursement schemes that 19 Table of Contents require additional evidence to be generated post-marketing authorization, etc.
Of these employees, 123 were engaged in or directly support research and development activities. We consider our relationship with our employees to be good. We believe that our success depends in large part on our ability to attract and retain experienced and skilled employees.
Of these employees, 136 were engaged in or directly support research and development activities. We consider our relationship with our employees to be good. We believe that our success depends in large part on our ability to attract and retain experienced and skilled employees.
CDX-585 CDX-585 combines our proprietary highly active PD-1 blockade and anti-ILT4 blockade to prevent immunosuppressive signals in T cells and myeloid cells, respectively. ILT4 is emerging as an important immune checkpoint on myeloid cells and is thought to contribute to resistance to PD-1 blockade.
CDX-585 CDX-585 combines our proprietary highly active PD-1 blockade and anti-ILT4 blockade to overcome immunosuppressive signals in T cells and myeloid cells, respectively. ILT4 is emerging as an important immune checkpoint on myeloid cells and is thought to contribute to resistance to PD-1 blockade.
Pediatric Information Under the Pediatric Research Equity Act of 2003, an NDA, BLA or supplement to an NDA or BLA must contain data that are adequate to assess the safety and effectiveness of the drug or biological product for the claimed indications in all relevant pediatric subpopulations, and to support dosing and administration for each pediatric subpopulation for which the product is safe and effective.
Pediatric Information Under the Pediatric Research Equity Act of 2003, an NDA, BLA or supplement to an NDA or BLA must contain data that are adequate to assess the safety and effectiveness of the drug or biological product for the claimed indications in all relevant pediatric 16 Table of Contents subpopulations, and to support dosing and administration for each pediatric subpopulation for which the product is safe and effective.
Interactions of PD-1 and ILT4 with their ligands are known to deliver immune suppressive signals that can attenuate anti-tumor immune responses. The concept behind CDX-585 is to simultaneously inhibit both T cell and myeloid suppressive signals to potentiate the anti-tumor activity of both cell types, and potentially overcome PD-1 resistance.
Interactions of PD-1 and ILT4 with their ligands are known to deliver immune suppressive signals that can attenuate anti-tumor immune responses. The concept behind CDX-585 is to simultaneously inhibit both T cell and 8 Table of Contents myeloid suppressive signals to potentiate the anti-tumor activity of both cell types, and potentially overcome PD-1 resistance.
We will also compete for the services of third parties that may have already developed or acquired internal 8 Table of Contents biotechnology capabilities or made commercial arrangements with other biopharmaceutical companies to target the diseases on which we have focused both in the U.S. and outside of the U.S.
We will also compete for the services of third parties that may have already developed or acquired internal biotechnology capabilities or made commercial arrangements with other biopharmaceutical companies to target the diseases on which we have focused both in the U.S. and outside of the U.S.
Many of the products that we are attempting to develop and commercialize will be competing with existing therapies. Other companies are pursuing the development of new therapies that target the same diseases and conditions that we are targeting and may compete directly with our drug candidates.
Many of the products that we are attempting to develop and commercialize will be competing with existing therapies. Other 9 Table of Contents companies are pursuing the development of new therapies that target the same diseases and conditions that we are targeting and may compete directly with our drug candidates.
If, when and where issued the foregoing would have estimated normal patent expiry dates ranging from 2041 to 2042. 10 Table of Contents There can be no assurance that patent applications owned by or licensed to us will result in granted patents or that, if granted, the resultant patents will afford protection against competitors with similar technology.
If, when and where issued the foregoing would have estimated normal patent expiry dates ranging from 2041 to 2042. There can be no assurance that patent applications owned by or licensed to us will result in granted patents or that, if granted, the resultant patents will afford protection against competitors with similar technology.
Products regulated by the FDA’s Center for Drug Evaluation and Research, or CDER, are eligible 14 Table of Contents for priority review if they provide a significant improvement compared to marketed products in the treatment, diagnosis or prevention of a disease.
Products regulated by the FDA’s Center for Drug Evaluation and Research, or CDER, are eligible for priority review if they provide a significant improvement compared to marketed products in the treatment, diagnosis or prevention of a disease.
Employees As a mission driven organization, we believe the engagement and dedication of our employees is central to our success and employ talented individuals who have the skills and expertise to help us achieve our goals. As of December 31, 2022, we had 148 full-time employees, 26 of whom have Ph.D. and/or M.D. degrees.
Employees As a mission driven organization, we believe the engagement and dedication of our employees is central to our success and employ talented individuals who have the skills and expertise to help us achieve our goals. As of December 31, 2023, we had 160 full-time employees, 26 of whom have Ph.D. and/or M.D. degrees.
Patents have also been issued in Europe, Japan, Canada, China, Australia, New Zealand, Israel, India,the Republic of Korea, the Russian Federation, Singapore and certain other countries. Where issued the foregoing would have estimated normal patent expiry dates ranging from 2032 to 2033.
Patents have also been issued in Europe, Japan, Canada, China, Australia, New Zealand, Israel, India, the Republic of Korea, the Russian Federation, Singapore, Brazil, Mexico, South Africa and certain other countries. Where issued the foregoing would have estimated normal patent expiry dates ranging from 2032 to 2033.
In the meantime, third-party payors are increasingly challenging the prices charged for medical products and services 18 Table of Contents and examining the medical necessity and cost-effectiveness of medical products and services, in addition to their safety and efficacy.
In the meantime, third-party payors are increasingly challenging the prices charged for medical products and services and examining the medical necessity and cost-effectiveness of medical products and services, in addition to their safety and efficacy.
If we become involved in that litigation, we could consume substantial resources. Licenses We have entered into significant license agreements relating to technologies that are being developed by us.
If we become involved in that litigation, we could consume substantial resources. 12 Table of Contents Licenses We have entered into significant license agreements relating to technologies that are being developed by us.
Our ability to conduct late-stage clinical trials, as well as manufacture and commercialize our drug candidates, depends on the ability of Contract Manufacturing Organizations (CMOs) to manufacture our drug candidates on a large scale at a competitive cost and in accordance with current Good Manufacturing Practices (cGMP) and U.S. and foreign regulatory requirements, as applicable.
To conduct late-stage clinical trials, as well as manufacture and commercialize our drug candidates, we engage Contract Manufacturing Organizations (CMOs) to manufacture our drug candidates on a large scale at a competitive cost and in accordance with current Good Manufacturing Practices (cGMP) and U.S. and foreign regulatory requirements, as applicable.
The review process may be extended by the FDA for three additional months to consider certain late-submitted information or clarification regarding information already provided in 13 Table of Contents the submission.
The review process may be extended by the FDA for three additional months to consider certain late-submitted information or clarification regarding information already provided in the submission.
In July 2022 we announced that the first patient has been dosed in a Phase 2 study in patients with CIndU who remain symptomatic despite antihistamine therapy. The study will be conducted at approximately 85 sites across approximately 12 countries.
In July 2022, we announced that the first patient had been dosed in a Phase 2 study in patients with CIndU who remain symptomatic despite antihistamine therapy. The study is being conducted at approximately 85 sites across approximately 12 countries.
Most adverse events were mild, and the most common (≥3 patients) were hair color changes (76%; n = 16/21), infusion reactions (43%; n = 9/21), taste changes (38%; n = 8/21), nasopharyngitis (24%; n = 5/21), malaise (24%; n = 5/21), and headache (19%; n = 4/21).
In the 3 mg/kg ColdU and SD cohorts, most adverse events were mild, and the most common (≥3 patients) were hair color changes (76%; n=16/21), infusion reactions (43%; n=9/21), taste changes (38%; n=8/21), nasopharyngitis (24%; n=5/21), malaise (24%; n=5/21), and headache (19%; n=4/21).
This confirmed that serum tryptase level is a robust pharmacodynamic biomarker for assessing mast cell burden and clinical activity in inducible urticaria and potentially in other diseases with mast cell driven involvement. ● Barzolvolimab was well tolerated.
This confirmed that serum tryptase level is a robust pharmacodynamic biomarker for assessing mast cell burden and clinical activity in inducible urticaria and potentially in other diseases with mast cell driven involvement. 5 Table of Contents ● Barzolvolimab was well tolerated across all cohorts.
Mild, transient, and asymptomatic decreases in hemoglobin and white blood cell parameters occurred for some patients. 4 Table of Contents In December 2022, we presented long term follow up data from the 3.0 mg/kg cohorts in cold urticaria and symptomatic dermographism at the GA²LEN Global Urticaria Forum (GUF) 2022. 14 patients consented to the optional long term follow up evaluation (6 cold, 8 symptomatic dermographism); 10 of the 14 still had complete control of their disease as assessed by provocation testing at week 12.
Mild, transient, and asymptomatic decreases in hemoglobin and white blood cell parameters occurred for some patients. ● Long term follow up data was collected from the 3.0 mg/kg cohorts in cold urticaria and symptomatic dermographism. 14 patients consented to the optional evaluation (6 cold, 8 symptomatic dermographism); 10 of the 14 still had complete control of their disease as assessed by provocation testing at week 12.
In the past, we have entered into collaborative partnership agreements with pharmaceutical and other companies and organizations that provided financial and other resources, including capabilities in research, development, manufacturing, and sales and marketing, to support our research and development programs and may enter into more of them in the future. 7 Table of Contents Partnership agreements may terminate without benefit to us if the underlying products are not fully developed.
In the past, we have entered into collaborative partnership agreements with pharmaceutical and other companies and organizations that provided financial and other resources, including capabilities in research, development, manufacturing, and sales and marketing, to support our research and development programs and may enter into more of them in the future.
Generally, we control and are responsible for the cost of defending the patent rights of the technologies that we license. 11 Table of Contents Proprietary Rights We also rely on unpatented technology, trade secrets and confidential information, and no assurance can be given that others will not independently develop substantially equivalent information and techniques or otherwise gain access to our know-how and information, or that we can meaningfully protect our rights in such unpatented technology, trade secrets and information.
Proprietary Rights We also rely on unpatented technology, trade secrets and confidential information, and no assurance can be given that others will not independently develop substantially equivalent information and techniques or otherwise gain access to our know-how and information, or that we can meaningfully protect our rights in such unpatented technology, trade secrets and information.
Marketing Approval Assuming successful completion of the required clinical testing, the results of the preclinical and clinical studies, together with detailed information relating to the product’s pharmacology, chemistry, manufacture, controls and proposed labeling, among other things, are submitted to the FDA as part of an NDA or BLA requesting approval to market the product for one or more indications.
Competitors may use this publicly available information to gain knowledge regarding the progress of clinical development programs as well as clinical trial design. 14 Table of Contents Marketing Approval Assuming successful completion of the required clinical testing, the results of the preclinical and clinical studies, together with detailed information relating to the product’s pharmacology, chemistry, manufacture, controls and proposed labeling, among other things, are submitted to the FDA as part of an NDA or BLA requesting approval to market the product for one or more indications.
A complete response was achieved in 95% (n = 19/20) of patients (n = 10/10 ColdU; n = 9/10 SD). The median duration (range) of complete response through the 12-week observation period was 77+ days (29–86; n = 10) for patients with ColdU and 57+ days (16–70; n = 9) for patients with SD.
The median duration (range) of complete response through the 12-week observation period was 77+ days (29–86; n=10) for patients with ColdU and 57+ days (16–70; n=9) for patients with SD. A UCT score of ≥12 (well controlled) was achieved by 80% (n=16/20) of the patients within week 4 post-treatment.
Moreover, any partner could breach its agreement with us or otherwise not use best efforts to promote our products. A partner may choose to pursue alternative technologies or products that compete with our technologies or drug candidates. In either case, if a partner failed to successfully develop one of our drug candidates, we would need to find another partner.
A partner may choose to pursue alternative technologies or products that compete with our technologies or drug candidates. In either case, if a partner failed to successfully develop one of our drug candidates, we would need to find another partner.
This study is an open label clinical trial designed to evaluate the safety of a single dose (3 mg/kg) of barzolvolimab in patients with cold urticaria (ColdU) or symptomatic dermographism (SD).
We completed a Phase 1b open label clinical trial in CIndU in patients refractory to antihistamines, conducted in Germany. This study was designed to evaluate the safety of a single intravenous dose (3 mg/kg) of barzolvolimab in patients with cold urticaria (ColdU) or symptomatic dermographism (SD).
We are encouraged with these findings and believe these data strongly support our Phase 2 studies in urticaria and in future indications. 6 Table of Contents Bispecific Platform Our next generation bispecific antibody platform is supporting the expansion of our pipeline with additional candidates for inflammatory diseases and oncology.
We are encouraged with these findings and believe these data strongly support continued development of barzolvolimab. Bispecific Platform Our next generation bispecific antibody platform is supporting the expansion of our pipeline with additional candidates for inflammatory diseases and oncology.
The competitors of which we are aware that have initiated a Phase 3 study or have obtained marketing approval for a potentially competitive drug to barzolvolimab for treatment of CSU, CIndU, PN and EoE include: Allakos (lirentelimab for EoE), AstraZeneca (Fasenra for CSU), Galderma/Chugai (nemolizumab for PN), Genentech (fenebrutinib for CSU), Leo Pharma (Adbry for AD), Novartis (ligelizumab for CSU, CIndU and food allergy; remibrutinib for CSU), Regeneron/Sanofi (Dupixent for CSU, CIndU, PN and EoE), and Trevi Therapeutics (nalbuphine for PN).
The competitors of which we are aware that have initiated a Phase 3 study or have obtained marketing approval for a potentially competitive drug to barzolvolimab for treatment of CSU, CIndU, PN and EoE include: Allakos (lirentelimab for EoE), Celltrion (CT-P39; omalizumab biosimilar for CSU), Galderma/Chugai (nemolizumab for PN), Novartis (remibrutinib for CSU), and Regeneron/Sanofi (Dupixent for CSU, CIndU, PN and EoE).
Whether or not we obtain FDA approval for a product, we need to obtain the necessary approvals by the comparable regulatory authorities of foreign countries before we can commence clinical trials or marketing of the product in those countries. The approval process varies from country to country and can involve additional product testing and additional administrative review periods.
Whether or not we obtain FDA approval for a product, we 18 Table of Contents need to obtain the necessary approvals by the comparable regulatory authorities of foreign countries before we can commence clinical trials or marketing of the product in those countries.
Given the lack of effective therapies for EoE and barzolvolimab’s potential as a mast cell depleting agent, we believe EoE is an important indication for future study and plan to initiate a Phase 2 multi-center, randomized, double-blind, placebo-controlled subcutaneous study designed to assess the treatment effects and safety of barzolvolimab in patients with EoE in the first half of 2023.
Given the lack of effective therapies for EoE and barzolvolimab’s potential as a mast cell depleting agent, we believe EoE is an important indication for future study. The randomized, double-blind, placebo-controlled, parallel group Phase 2 study is evaluating the efficacy and safety profile of subcutaneous barzolvolimab in patients with active EoE.
Data were collected at one or more timepoints beyond week 12 through week 36. ● Most patients had return of symptoms and/or loss of urticaria control between 12 and 36 weeks.
Data were collected at one or more timepoints beyond week 12 through week 36. Most patients had return of symptoms and/or loss of urticaria control between 12 and 36 weeks. Remarkably, two patients remained provocation negative at 36 weeks, and four had well controlled disease (UCT ≥12) 36 weeks post dosing.
In June 2022, we announced that the first patient has been dosed in a Phase 2 study in patients with CSU who remain symptomatic despite antihistamine therapy. The study is being conducted at approximately 75 sites across 9 countries.
In June 2022, we initiated dosing in a Phase 2 study in patients with CSU who remained symptomatic despite antihistamine therapy; in July 2023, we announced that enrollment was complete. The study is being conducted at approximately 75 sites across 9 countries.
We have manufactured barzolvolimab and CDX-585 drug substance in our Fall River facility for our current and planned Phase 1 and Phase 2 clinical trials. All products are then filled at CMOs. Any manufacturing failures or compliance issues at contract manufacturers could cause delays in our Phase 1 and Phase 2 clinical studies for these drug candidates.
We have manufactured barzolvolimab and CDX-585 drug substance in our Fall River facility for our current and planned Phase 1 and Phase 2 clinical trials. All products are then filled at CMOs.
Hautarzt. 61(8), Bartlett et al. 2018. DermNet.Org). There are currently no approved therapies for chronic inducible urticarias other than antihistamines and patients attempt to manage symptoms associated with their disease through avoidance of triggers. We are exploring cold-induced, dermographism (scratch-induced) and cholinergic (exercise-induced) urticarias.
There are currently no approved therapies for chronic inducible urticarias other than antihistamines and patients attempt to manage symptoms associated with their disease through avoidance of triggers. We are currently exploring cold-induced and dermographism (scratch-induced) urticarias in an ongoing Phase 2 study.
Approximately 168 patients will be randomly assigned on a 1:1:1:1 ratio to receive subcutaneous injections of barzolvolimab at 75 mg every 4 weeks, 150 mg every 4 weeks, 300 mg every 8 weeks or placebo during a 16-week placebo-controlled treatment phase.
In the revised protocol, patients will be randomly assigned on a 1:1 ratio to receive subcutaneous injections of barzolvolimab at 300 mg every 4 weeks or placebo during a 16-week placebo-controlled treatment phase. Patients then enter a 12-week active treatment phase, in which all patients will receive barzolvolimab 300 mg every 4 weeks.
Patients will then enter a 36-week active treatment phase, in which patients not already randomized to barzolvolimab at 150 mg every 4 weeks or 300 mg every 8 weeks will be randomized 1:1 to receive one of these two dose regimens; patients already randomized to these treatment arms will remain on the same regimen as during the placebo-controlled treatment phase.
After 16 weeks, patients then enter a 36-week active treatment period, in which patients receiving placebo or the 75 mg dose are randomized to receive barzolvolimab 150 mg every 4 weeks or 300 mg every 8 weeks; patients already randomized to the 150 mg and 300 mg treatment arms remain on the same regimen as during the placebo-controlled treatment period.
Special Regulatory Procedures Fast track designation — The FDA is required to facilitate the development and expedite the review of drugs and biologics that are intended for the treatment of a serious or life-threatening disease or condition and that demonstrate the potential to address unmet medical needs.
After approval, many types of changes to the approved product, such as changes in indications, manufacturing changes and labeling, are subject to further testing requirements and FDA review and approval. 15 Table of Contents Special Regulatory Procedures Fast track designation — The FDA is required to facilitate the development and expedite the review of drugs and biologics that are intended for the treatment of a serious or life-threatening disease or condition and that demonstrate the potential to address unmet medical needs.
To the extent that any of our products are sold in a foreign country, we may be subject to similar foreign laws, which may include, for instance, applicable post-marketing requirements, including safety surveillance, anti-fraud and abuse laws and implementation of corporate compliance programs and reporting of payments or transfers of value to health care professionals. 17 Table of Contents In addition, the United States Foreign Corrupt Practices Act, or FCPA, prohibits corporations and individuals from engaging in certain activities to obtain or retain business or to influence a person working in an official capacity.
To the extent that any of our products are sold in a foreign country, we may be subject to similar foreign laws, which may include, for instance, applicable post-marketing requirements, including safety surveillance, anti-fraud and abuse laws and implementation of corporate compliance programs and reporting of payments or transfers of value to health care professionals.
We operate our own cGMP manufacturing facility in Fall River, Massachusetts, to produce drug substance for our current and planned early-stage clinical trials.
We also rely on CMOs for labeling and storage for studies inside and outside the U.S. We currently operate our own cGMP manufacturing facility in Fall River, Massachusetts, to produce drug substance for our current and planned early-stage clinical trials.
In March and June 2021, respectively, we added a third cohort (single dose, 3 mg/kg) in patients with cholinergic urticaria and a fourth cohort at a lower dose (single dose, 1.5 mg/kg) in ColdU. Patient’s symptoms are induced via provocation testing that resembles real life triggering situations.
The study was expanded to include a cohort (single dose, 3 mg/kg) in patients with cholinergic urticaria (“CholU”) and a cohort at a lower dose (single dose, 1.5 mg/kg) in ColdU. Patient’s symptoms were induced via provocation testing that resembles real life triggering situations.
Regulatory approval of oncology products often requires that patients in clinical trials be followed for long periods to determine the overall survival benefit of the drug or biologic. 15 Table of Contents In addition, drug and biologic manufacturers and other entities involved in the manufacture and distribution of approved drugs and biological products are required to register their establishments with the FDA and state agencies and are subject to periodic unannounced inspections by the FDA and these state agencies for compliance with cGMP requirements.
In addition, drug and biologic manufacturers and other entities involved in the manufacture and distribution of approved drugs and biological products are required to register their establishments with the FDA and state agencies and are subject to periodic unannounced inspections by the FDA and these state agencies for compliance with cGMP requirements.
If we breach our obligations, the licensor has the right to terminate the license, and, in some cases, convert the license to a non-exclusive license.
If we breach our obligations, the licensor has the right to terminate the license, and, in some cases, convert the license to a non-exclusive license. Generally, we control and are responsible for the cost of defending the patent rights of the technologies that we license.
Omalizumab, an IgE inhibitor, provides relief for roughly half of the remaining antihistamine refractory patients. Consequently, there is a need for additional therapies. In October 2020, we announced that enrollment had opened and the first patient had been dosed in a Phase 1b multi-center study of barzolvolimab in CSU.
Omalizumab, an IgE inhibitor, provides relief for roughly half of the remaining antihistamine refractory patients. Consequently, there is a need for additional therapies. We have completed a Phase 1b randomized, double-blind, placebo-controlled multi-center study of barzolvolimab in CSU.
A proposal to allow importation of less expensive drugs from Canada to the U.S. has been under consideration in U.S. Congress. There can be no assurance that any country that has price controls or reimbursement limitations for drug products will allow favorable reimbursement and pricing arrangements for any of our drugs.
There can be no assurance that any country that has price controls or reimbursement limitations for drug products will allow favorable reimbursement and pricing arrangements for any of our drugs.
Risk Factors.” Clinical Development Programs Barzolvolimab (also referred to as CDX-0159) Barzolvolimab is a humanized monoclonal antibody that specifically binds the receptor tyrosine kinase KIT and potently inhibits its activity. KIT is expressed in a variety of cells, including mast cells, and its activation by its ligand SCF regulates mast cell growth, differentiation, survival, chemotaxis and degranulation.
Risk Factors.” 1 Table of Contents Clinical Development Programs Barzolvolimab (also referred to as CDX-0159) Barzolvolimab is a humanized monoclonal antibody that specifically binds the receptor tyrosine kinase KIT and potently inhibits its activity.
Following the treatment period, patients will enter a 24-week follow up phase. The primary endpoint of the study is mean change in baseline to week 12 in UAS7 (Urticaria Activity Score over 7 days).
After 52 weeks, patients then enter a follow-up period for an additional 24 weeks. The primary endpoint of the study is mean change in baseline to week 12 in UAS7 (weekly urticaria activity score).
Tissue KIT signaling, as approximated by SCF levels, was rapidly inhibited after dose administration and fully reactivated approximately 18 weeks after dosing. ● Tryptase levels return to pretreatment levels during follow up, while mast cells continue to recover. Drug related adverse events noted during the study all resolved.
Serum tryptase exhibits a similar rate of recovery as clinical symptoms, while skin mast cells return at a slower rate. Tissue KIT signaling, as approximated by SCF levels, was rapidly inhibited after dose administration and fully reactivated approximately 18 weeks after dosing. Tryptase levels return to pretreatment levels during follow up, while mast cells continue to recover.
Due to the very high concentrations of barzolvolimab at the end of dosing, the recovery period was approximately one year. As we expected, and consistent with previous findings with KIT blocking antibodies, we were pleased to report in December 2022, that during this recovery period spermatogenesis fully recovered in all male animals as measured by both sperm count and motility.
As we expected, and consistent with previous findings with KIT blocking antibodies, we were pleased to report in December 2022, that during this recovery period spermatogenesis fully recovered in all male animals as measured by both sperm count and motility. The final histologic analysis and study report were completed in early 2023 and were consistent with previously reported results.
This chronic inflammation can result in trouble swallowing, chest pain, vomiting and impaction of food in the esophagus, a medical emergency.
EoE, the most common type of eosinophilic gastrointestinal disease, is a chronic inflammatory disease of the esophagus characterized by the infiltration of eosinophils. This chronic inflammation can result in trouble swallowing, chest pain, vomiting and impaction of food in the esophagus, a medical emergency.
Hair color changes (generally small areas of hair color lightening) and taste disorders (generally partial changes of ability to taste salt or umami) are consistent with inhibiting KIT signaling in other cell types and completely resolved over time during follow-up. Infusion reactions, which manifested as localized hives and itching as well as erythema and feeling hot, resolved spontaneously.
Hair color changes (generally small areas of hair color lightening) and taste disorders (generally partial changes of ability to taste salt or umami) are consistent with inhibiting KIT signaling in other cell types and completely resolved over time during follow-up. One patient with a history of fainting experienced loss of consciousness during infusion. The patient rapidly recovered.
We are focusing our efforts and resources on the continued research and development of ● Barzolvolimab (also referred to as CDX-0159), a monoclonal antibody that specifically binds the KIT receptor and potently inhibits its activity, which is currently being studied across multiple mast cell driven diseases including - Chronic Urticarias: In June and July 2022 respectively, we announced that enrollment had opened and the first patients had been dosed in Phase 2 studies in chronic spontaneous urticaria (CSU) and chronic inducible urticaria (CIndU).
We are focusing our efforts and resources on the continued research and development of ● Barzolvolimab (also referred to as CDX-0159), a monoclonal antibody that specifically binds the KIT receptor and potently inhibits its activity, which is currently being studied across multiple mast cell driven diseases including - Chronic Urticarias: In November 2023, we announced that our Phase 2 study in chronic spontaneous urticaria (CSU) achieved the primary efficacy endpoint (statistically significant mean change from baseline to week 12 of urticaria activity score compared to placebo) and was well tolerated.
These data supported expansion of the barzolvolimab program into mast cell driven diseases, including initially in CSU and CIndU, diseases where mast cell degranulation plays a central role in the onset and progression of the disease. Phase 1 studies in CSU and CIndU are completing and Phase 2 studies are ongoing.
Barzolvolimab was initially studied in chronic spontaneous urticaria (CSU) and chronic inducible urticaria (CIndU), diseases where mast cell degranulation plays a central role in the onset and progression of the disease. Phase 1 studies in CSU and CIndU were successfully completed and Phase 2 studies are ongoing.
Most AEs were mild or moderate in severity and resolved while on study. The most common treatment emergent adverse events were hair color changes, COVID-19, headache, neutropenia and urinary tract infections (UTIs). UTIs and COVID-19 were reported as unrelated to treatment. There was one serious adverse event of salmonella gastroenteritis which was also not related to study therapy.
Most AEs were mild or moderate in severity and resolved while on study. The most common treatment emergent adverse events were hair color changes, COVID-19, headache, neutropenia and urinary tract infections (UTIs). UTIs and COVID-19 were reported as unrelated to treatment. Generally transient, asymptomatic and mild changes in hematologic parameters were observed, consistent with observations from prior studies.
If we fail to meet our obligations under these agreements, they could terminate, and we might need to enter into relationships with other collaborators and to spend additional time, money and other valuable resources in the process. We cannot predict whether our collaborators will continue their development efforts or, if they do, whether their efforts will achieve success.
Partnership agreements may terminate without benefit to us if the underlying products are not fully developed. If we fail to meet our obligations under these agreements, they could terminate, and we might need to enter into relationships with other collaborators and to spend additional time, money and other valuable resources in the process.
We follow federal, state and local rules and guidelines to ensure the safety of our workforce and provide resources to assist our employees in managing their overall physical and mental health. As a result of the COVID-19 pandemic, we have implemented additional safety procedures to protect our employees.
We follow federal, state and local rules and guidelines to ensure the safety of our workforce and provide resources to assist our employees in managing their overall physical and mental health. 20 Table of Contents Research and Development We have dedicated a significant portion of our resources to our efforts to develop our drug candidates.
In 2022, we initiated a transfer of our current barzolvolimab manufacturing process to a CMO to allow us to produce larger batches in support of late-stage trials and to prepare for potential commercialization. We believe that barzolvolimab can be scaled up to permit manufacturing in commercial quantities.
Additional Barzolvolimab Development Activities In 2023, we completed the transfer of our current barzolvolimab manufacturing process to a CMO and successfully scaled up the drug substance manufacturing process to produce larger cGMP batches in support of late-stage trials and to prepare for potential commercialization.
The FDA, the Office of the Inspector General of Health and Human Services and other agencies actively enforce the laws and regulations prohibiting the promotion of off label uses, and a company that is found to have improperly promoted off label uses may be subject to significant liability.
The FDA, the Office of the Inspector General of Health and Human Services and other agencies actively enforce the laws and regulations prohibiting the promotion of off label uses, and a company that is found to have improperly promoted off label uses may be subject to significant liability. 17 Table of Contents Biosimilars and Exclusivity The Biologics Price Competition and Innovation Act of 2009 (“BPCIA”) created an abbreviated approval pathway for biological products shown to be highly similar to, or interchangeable with, an FDA-licensed reference biological product.
As of the data cut-off date on November 29, 2022, enrollment was complete with 45 patients with moderate to severe CSU refractory to antihistamines enrolled and treated [35 barzolvolimab (n=9 in 0.5 mg/kg; n=8 in 1.5 mg/kg; n=9 in 3.0 mg/kg; n=9 in 4.5 mg/kg) and 10 placebo].
Barzolvolimab was administered intravenously as add on treatment to H1-antihistamines, either alone or in combination with H2-antihistamines and/or leukotriene receptor agonists. 45 patients with moderate to severe CSU refractory to antihistamines were enrolled and treated [35 barzolvolimab (n=9 in 0.5 mg/kg; n=8 in 1.5 mg/kg; n=9 in 3.0 mg/kg; n=9 in 4.5 mg/kg) and 10 placebo].
PN is a chronic skin disease characterized by the development of hard, intensely itchy (pruritic) nodules on the skin. Mast cells through their interactions with sensory neurons and other immune cells are believed to play an important role in amplifying chronic itch and neuroinflammation, both of which are a hallmark of PN.
Mast cells through their interactions with sensory neurons and other immune cells are believed to play an important role in amplifying chronic itch and neuroinflammation, both of which are a hallmark of PN. There is currently only one FDA approved therapy for PN, representing an area of significant unmet need.
For example, the FDA may require post-marketing testing, including Phase 4 clinical trials, and surveillance to further assess and monitor the product’s safety and effectiveness after commercialization.
For example, the FDA may require post-marketing testing, including Phase 4 clinical trials, and surveillance to further assess and monitor the product’s safety and effectiveness after commercialization. Regulatory approval of oncology products often requires that patients in clinical trials be followed for long periods to determine the overall survival benefit of the drug or biologic.
In November 2022, data from the ColdU and SD cohorts treated with a single intravenous infusion of barzolvolimab at 3 mg/kg were published in Allergy (Terhorst-Molawi et al Allergy. 2022 Nov 16. doi: 10.1111/all.15585). Safety results were reported for 21 patients; activity results were reported for the 20 patients who received a full dose of barzolvolimab.
At 3 mg/kg in the ColdU and SD cohorts, safety results were reported for 21 patients and activity results were reported for the 20 patients who received a full dose of barzolvolimab.
The only clinically adverse finding at the completion of dosing was a profound impact on spermatogenesis, an expected and well understood effect of KIT inhibition. As a standard part of toxicology studies, some animals from each group continued to be observed through a recovery period to understand the reversibility of any adverse findings.
As a standard part of toxicology studies, some animals from each group continued to be observed through a recovery period to understand the reversibility of any adverse findings. Due to the very high concentrations of barzolvolimab at the end of dosing, the recovery period was approximately one year.
There is currently only one FDA approved therapy for PN, representing an area of significant unmet need. Industry sources estimate there are approximately 154,000 patients in the United States with PN who have undergone treatment within the last 12 months and, of these, approximately 75,000 would be biologic-eligible.
Industry sources estimate there are approximately 154,000 patients in the United States with PN who have undergone treatment within the last 12 months and, of these, approximately 75,000 would be biologic-eligible. We have completed a Phase 1b multi-center, randomized, double-blind, placebo-controlled intravenous study in PN.
The study is a randomized, double-blind, placebo-controlled, parallel group Phase 2 study evaluating the efficacy and safety profile of multiple dose regimens of barzolvolimab to determine the optimal dosing strategy.
The study is a randomized, double-blind, placebo-controlled, parallel group Phase 2 study evaluating the efficacy and safety profile of multiple dose regimens of barzolvolimab to determine the optimal dosing strategy. 208 patients have been randomly assigned on a 1:1:1:1 ratio to receive subcutaneous injections of barzolvolimab at 75 mg every 4 weeks, 150 mg every 4 weeks, 300 mg every 8 weeks or placebo during a 16-week placebo-controlled treatment phase.
CDX-585 will initially be developed for the treatment of solid tumors either as monotherapy or in combination with other oncologic treatments and is expected to enter the clinic in 2023 in patients with advanced malignancies.
CDX-585 will initially be developed for the treatment of solid tumors either as monotherapy or in combination with other oncologic treatments. In late May 2023, we announced that the first patient had been dosed in the Phase 1 study of CDX-585.
Secondary and exploratory objectives include pharmacokinetic and pharmacodynamic assessments, including changes from baseline provocation thresholds, measurement of tryptase and stem cell factor levels, clinical activity outcomes (impact on urticaria symptoms, disease control, clinical response), quality of life assessments and measurement of tissue mast cells through skin biopsies. Barzolvolimab is administered intravenously on Day 1 as add on treatment to H1-antihistamines.
Secondary and exploratory objectives included pharmacokinetic and pharmacodynamic assessments, including changes from baseline provocation thresholds, measurement of tryptase and stem cell factor levels, clinical activity outcomes, quality of life assessments and measurement of tissue mast cells through skin biopsies. Generally patients on study had high disease activity at baseline that was poorly controlled and marked impairment in quality of life.
The FDA may prevent or limit further marketing of a product based on the results of post-market studies or surveillance programs. After approval, many types of changes to the approved product, such as changes in indications, manufacturing changes and labeling, are subject to further testing requirements and FDA review and approval.
The FDA may prevent or limit further marketing of a product based on the results of post-market studies or surveillance programs.
Research and Development We have dedicated a significant portion of our resources to our efforts to develop our drug candidates. We incurred research and development expenses of $82.3 million, $53.3 million and $42.5 million during the years ended December 31, 2022, 2021 and 2020, 19 Table of Contents respectively.
We incurred research and development expenses of $118.0 million, $82.3 million and $53.3 million during the years ended December 31, 2023, 2022 and 2021, respectively. We anticipate that a significant portion of our operating expenses will continue to be related to research and development in 2024 as we continue to advance our drug candidates through clinical development.
The primary endpoint of the study is the percentage of patients with a negative provocation test at week 12 (using TempTest(R) and FricTest(R)).
The primary endpoint of the study is the percentage of patients with a negative provocation test at week 12 (using TempTest(R) and FricTest(R)). Secondary endpoints include safety and other assessments of clinical activity including CTT (Critical Temperature Threshold), CFT (Critical Friction Threshold) and WI-NRS (Worst itch numeric rating scale).
Complete urticaria control (UCT = 16) was achieved by 35% (n = 7/20), 65% (n = 13/20), and 40% (n = 8/20) at weeks 4, 8, and 12, respectively. ● At baseline, patients in both treatment groups reported disease impact on their QoL.
Complete urticaria control (UCT=16) was achieved by 35% (n=7/20), 65% (n=13/20), and 40% (n=8/20) at weeks 4, 8, and 12, respectively. ● A complete response was achieved in 100% (n=9 of 9) patients with ColdU treated with a single dose at 1.5 mg/kg, including 4 patients with disease refractory to omalizumab.
This study is a randomized, double-blind, placebo-controlled clinical trial designed to assess the safety of multiple ascending doses of barzolvolimab in up to 40 patients with CSU who remain symptomatic despite treatment with antihistamines.
The study was designed to assess the safety of multiple ascending doses of barzolvolimab in patients with CSU who remain symptomatic despite treatment with antihistamines. Secondary and exploratory objectives included pharmacokinetic and pharmacodynamic assessments, clinical activity outcomes and quality of life assessments.
Further international patent applications relating to barzolvolimab are also pending. ● We own a pending international patent application directed to anti-ILT4 antibody sequences used in CDX-585 as compositions of matter. We also have rights in further pending international patent applications relating to the bispecific antibody CDX-585 and anti-PD-1 antibody sequences used in CDX-585 as compositions of matter.
If, when and where issued the latter would have estimated normal patent expiry dates in 2042. ● We own a family of patent applications directed to anti-ILT4 antibody sequences used in CDX-585 as compositions of matter.
Phase 1 studies of barzolvolimab have been conducted with an intravenous formulation; a subcutaneous formulation has been successfully developed and is being used in Phase 2 studies. Chronic Spontaneous Urticaria (CSU) CSU presents as itchy hives, angioedema or both for at least six weeks without a specific trigger; multiple episodes can play out over years or even decades.
We continue to assess potential opportunities for barzolvolimab in other diseases where mast cells play an important role, such as dermatologic, respiratory, allergic, gastrointestinal and ophthalmic conditions. Chronic Spontaneous Urticaria (CSU) CSU presents as itchy hives, angioedema or both for at least six weeks without a specific trigger; multiple episodes can play out over years or even decades.
Many of our collaborators face the same kinds of risks and uncertainties in their businesses that we face. A delay or setback to a partner will, at a minimum, delay the commercialization of any affected drug candidates, and may ultimately prevent it.
A delay or setback to a partner will, at a minimum, delay the commercialization of any affected drug candidates, and may ultimately prevent it. Moreover, any partner could breach its agreement with us or otherwise not use best efforts to promote our products.
Barzolvolimab is designed to block KIT activation by disrupting both SCF binding and KIT dimerization.
KIT is expressed in a variety of cells, including mast cells, and its activation by its ligand SCF regulates mast cell growth, differentiation, survival, chemotaxis and degranulation. Barzolvolimab is designed to block KIT activation by disrupting both SCF binding and KIT dimerization.

… 153 more changes not shown on this page.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

85 edited+30 added−20 removed280 unchanged
Biggest changeRisks Related to Commercialization of Our Drug Candidates We may face delays, difficulties or unanticipated costs in establishing sales, marketing and distribution capabilities or seeking a partnership for the commercialization of our drug candidates, even if regulatory approval is obtained. We may retain full economic rights to our drug candidates or seek favorable economic terms through advantageous commercial partnerships.
Biggest changeHowever, there can be no assurance that we will be able to prove these advantages or that the advantages will be sufficient to support the successful commercialization of our drug candidates. 30 Table of Contents Risks Related to Commercialization of Our Drug Candidates We may face delays, difficulties or unanticipated costs in establishing sales, marketing and distribution capabilities or seeking a partnership for the commercialization of our drug candidates, even if regulatory approval is obtained.
If any event occurred that prevented us from using all or a significant portion of our manufacturing and lab facilities, that damaged critical infrastructure, such as third-party manufacturing facilities, or that otherwise disrupted operations and travel, it may be difficult or, in certain cases, impossible for us to continue our business for a substantial period of time.
If any event occurred that prevented us from using all or a significant portion of our manufacturing and lab facilities, damaged critical infrastructure, such as third-party manufacturing facilities, or otherwise disrupted operations and travel, it may be difficult or, in certain cases, impossible for us to continue our business for a substantial period of time.
In addition to HIPAA and GDPR, numerous other federal and state laws, including, without limitation, state security breach notification laws, state health information privacy laws and federal and state consumer protection laws, govern the collection, use, disclosure and storage of personal information.
In addition to HIPAA and GDPR, numerous other federal and state laws, including, without limitation, state security breach notification laws, state health information privacy laws and federal and state consumer protection laws, govern the collection, use, disclosure, protection and storage of personal information.
The regulatory requirements and policies may change and additional government regulations may be enacted with which we may also be required to comply. We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or in other countries.
The regulatory requirements and policies may change and additional government regulations may be enacted with which we may also be required to comply. We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or in other countries.
Risks Related to Development and Regulatory Approval of Drug Candidates ● Risks related to our ability to fund and complete the research and development activities and obtain regulatory approval for our program assets. ● Risks related to the extensive regulatory scrutiny to which we are subject. ● Risks related to our ability to commence, enroll, manage and complete our clinical trials. ● Risk of serious adverse or unacceptable side effects identified related to our drug candidates. ● We may enter collaboration agreements for our lead drug candidates that may not meet our expectations.
Risks Related to Development and Regulatory Approval of Drug Candidates ● Risks related to our ability to fund and complete the research and development activities and obtain regulatory approval for our program assets. ● Risks related to the extensive and lengthy regulatory scrutiny to which we are subject. ● Risks related to our ability to commence, enroll, manage and complete our clinical trials. ● Risk of serious adverse or unacceptable side effects identified related to our drug candidates. ● We may enter collaboration agreements for our lead drug candidates that may not meet our expectations.
If we, our drug candidates or the manufacturing facilities for our drug candidates fail to comply with regulatory requirements of the FDA and/or other non-U.S. regulatory authorities, we could be subject to administrative or judicially imposed sanctions, including the following: ● warning letters; ● civil or criminal penalties and fines; ● injunctions; ● consent decrees; ● suspension or withdrawal of regulatory approval; ● suspension of any ongoing clinical studies; ● voluntary or mandatory product recalls and publicity requirements; ● refusal to accept or approve applications for marketing approval of new drugs; 42 Table of Contents ● restrictions on operations, including costly new manufacturing requirements; or ● seizure or detention of drugs or import bans.
If we, our drug candidates or the manufacturing facilities for our drug candidates fail to comply with regulatory requirements of the FDA and/or other non-U.S. regulatory authorities, we could be subject to administrative or judicially imposed sanctions, including the following: ● warning letters; ● civil or criminal penalties and fines; ● injunctions; ● consent decrees; ● suspension or withdrawal of regulatory approval; ● suspension of any ongoing clinical studies; ● voluntary or mandatory product recalls and publicity requirements; ● refusal to accept or approve applications for marketing approval of new drugs; 44 Table of Contents ● restrictions on operations, including costly new manufacturing requirements; or ● seizure or detention of drugs or import bans.
This could delay completion of clinical trials; require the conduct of bridging clinical trials or studies, or the repetition of one or more clinical trials; increase clinical trial costs; delay approval of our product candidates and jeopardize our ability to commence product sales and generate revenue.
This could delay completion of clinical trials; require the conduct of bridging clinical trials or studies, or the repetition of one or more clinical trials; increase clinical trial costs; delay or prevent approval of our product candidates and jeopardize our ability to commence product sales and generate revenue.
Risks inherent in conducting international clinical trials include, but are not limited to: ● foreign regulatory requirements that could burden or limit our ability to conduct our clinical trials; ● administrative burdens of conducting clinical trials under multiple foreign regulatory schema; ● foreign currency fluctuations which could negatively impact our financial condition since certain payments are paid in local currencies; 41 Table of Contents ● manufacturing, customs, shipment and storage requirements; ● cultural differences in medical practice and clinical research; and ● diminished protection of intellectual property in some countries.
Risks inherent in conducting international clinical trials include, but are not limited to: ● foreign regulatory requirements that could burden or limit our ability to conduct our clinical trials; ● administrative burdens of conducting clinical trials under multiple foreign regulatory schema; ● foreign currency fluctuations which could negatively impact our financial condition since certain payments are paid in local currencies; 43 Table of Contents ● manufacturing, customs, shipment and storage requirements; ● cultural differences in medical practice and clinical research; and ● diminished protection of intellectual property in some countries.
We cannot be sure whether additional legislative changes will be enacted, or whether government regulations, guidance or interpretations will be changed, or what the impact of such changes would be on the marketing approvals, sales, pricing, or reimbursement of our drug candidates or products, if any, may be. 44 Table of Contents Risks Related to Our Capital Stock Our history of losses and uncertainty of future profitability make our common stock a highly speculative investment.
We cannot be sure whether additional legislative changes will be enacted, or whether government regulations, guidance or interpretations will be changed, or what the impact of such changes would be on the marketing approvals, sales, pricing, or reimbursement of our drug candidates or products, if any, may be. 46 Table of Contents Risks Related to Our Capital Stock Our history of losses and uncertainty of future profitability make our common stock a highly speculative investment.
Physicians may elect not to prescribe our drugs, and patients may elect not to request or take them, for a variety of reasons, including: ● limitations or warnings contained in a drug’s FDA-approved labeling; ● changes in the standard of care or the availability of alternative drugs for the targeted indications for any of our drug candidates; ● limitations in the approved indications for our drug candidates; ● the approval, availability, market acceptance and reimbursement for the companion diagnostic, where applicable; ● demonstrated clinical safety and efficacy compared to other drugs; ● significant adverse side effects; ● effectiveness of education, sales, marketing and distribution support; ● timing of market introduction and perceived effectiveness of competitive drugs; 29 Table of Contents ● cost-effectiveness; ● adverse publicity about our drug candidates or favorable publicity about competitive drugs; ● convenience and ease of administration of our drug candidates; and ● willingness of third-party payors to reimburse for the cost of our drug candidates.
Physicians may elect not to prescribe our drugs, and patients may elect not to request or take them, for a variety of reasons, including: ● limitations or warnings contained in a drug’s FDA-approved labeling; ● changes in the standard of care or the availability of alternative drugs for the targeted indications for any of our drug candidates; ● limitations in the approved indications for our drug candidates; ● the approval, availability, market acceptance and reimbursement for the companion diagnostic, where applicable; ● demonstrated clinical safety and efficacy compared to other drugs; ● significant adverse side effects; ● effectiveness of education, sales, marketing and distribution support; ● timing of market introduction and perceived effectiveness of competitive drugs; ● cost-effectiveness; ● adverse publicity about our drug candidates or favorable publicity about competitive drugs; ● convenience and ease of administration of our drug candidates; and ● willingness of third-party payors to reimburse for the cost of our drug candidates.
Although we try to ensure that our employees and consultants do not use the proprietary information or know-how of others in their work for us, we may be subject to claims that we or our employees, consultants or independent contractors have inadvertently or otherwise used or disclosed intellectual property, including trade secrets or other 39 Table of Contents proprietary information, of a former employer or other third parties.
Although we try to ensure that our employees and consultants do not use the proprietary information or know-how of others in their work for us, we may be subject to claims that we or our employees, consultants or independent contractors have inadvertently or otherwise used or disclosed intellectual property, including trade secrets or other 41 Table of Contents proprietary information, of a former employer or other third parties.
Any unused annual limitation may be carried over to later years, and the amount of the limitation may, under certain circumstances, be subject to adjustment if the fair value of our net assets is determined to be below or in excess of the tax basis of such 45 Table of Contents assets at the time of the ownership change, and such unrealized loss or gain is recognized during the five-year period after the ownership change.
Any unused annual limitation may be carried over to later years, and the amount of the limitation may, under certain circumstances, be subject to adjustment if the fair value of our net assets is determined to be below or in excess of the tax basis of such 47 Table of Contents assets at the time of the ownership change, and such unrealized loss or gain is recognized during the five-year period after the ownership change.
If those licenses from third parties are necessary but we cannot acquire them, we would attempt to design around the relevant technology, which would cause higher development costs and delays and may ultimately prove impracticable. 38 Table of Contents We may need to license intellectual property from third parties, and such licenses may not be available or may not be available on commercially reasonable terms.
If those licenses from third parties are necessary but we cannot acquire them, we would attempt to design around the relevant technology, which would cause higher development costs and delays and may ultimately prove impracticable. 40 Table of Contents We may need to license intellectual property from third parties, and such licenses may not be available or may not be available on commercially reasonable terms.
Moreover, achieving and sustaining compliance with applicable federal and state privacy, security and fraud laws may prove costly. 43 Table of Contents Compliance with laws and regulations pertaining to the privacy and security of health information may be time consuming, difficult and costly, particularly in light of increased focus on privacy issues in countries around the world, including the U.S. and the EU.
Moreover, achieving and sustaining compliance with applicable federal and state privacy, security and fraud laws may prove costly. 45 Table of Contents Compliance with laws and regulations pertaining to the privacy and security of health information may be time consuming, difficult and costly, particularly in light of increased focus on privacy issues in countries around the world, including the U.S. and the EU.
If our drug candidates are approved for commercialization outside of the United States, we expect that we will be subject to additional risks related to international operations and entering into international business relationships, including: ● different regulatory requirements for drug approvals; ● reduced protection for intellectual property rights, including trade secret and patent rights; ● unexpected changes in tariffs, trade barriers and regulatory requirements; ● economic weakness, including inflation, rising interest rates or political instability in particular foreign economies and markets; ● compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; ● foreign taxes, including withholding of payroll taxes; ● foreign currency fluctuations, which could result in increased operating expenses and reduced revenues, and other obligations incident to doing business in another country; ● workforce uncertainty in countries where employment regulations are different than, and labor unrest is more common than, in the United States; ● production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; ● business interruptions resulting from geopolitical actions, including war and terrorism, or natural disasters, including earthquakes, hurricanes, floods and fires; and ● difficulty in importing and exporting clinical trial materials and study samples. 32 Table of Contents Risks Related to Reliance on Third Parties We rely on third parties to plan, conduct and monitor our clinical tests, and their failure to perform as required would interfere with our product development.
If our drug candidates are approved for commercialization outside of the United States, we expect that we will be subject to additional risks related to international operations and entering into international business relationships, including: ● different regulatory requirements for drug approvals; ● reduced protection for intellectual property rights, including trade secret and patent rights; ● unexpected changes in tariffs, trade barriers and regulatory requirements; ● economic weakness, including inflation, uncertain interest rate environments or political instability in particular foreign economies and markets; ● compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; ● foreign taxes, including withholding of payroll taxes; ● foreign currency fluctuations, which could result in increased operating expenses and reduced revenues, and other obligations incident to doing business in another country; ● workforce uncertainty in countries where employment regulations are different than, and labor unrest is more common than, in the United States; ● production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; ● business interruptions resulting from geopolitical actions, including war and terrorism, or natural disasters, including earthquakes, hurricanes, floods and fires; and ● difficulty in importing and exporting clinical trial materials and study samples. 34 Table of Contents Risks Related to Reliance on Third Parties We rely on third parties to plan, conduct and monitor our clinical tests, and their failure to perform as required would interfere with our product development.
Most biologics, including some of our drug candidates, are injected, either subcutaneously or intravenously. There are risks inherent in subcutaneous injections, such as injection-site reactions (including redness, itching, swelling, pain, and tenderness) and other side effects. In addition, there are risks inherent in intravenous administration such as infusion-related reactions (including nausea, pyrexia, rash, and dyspnea).
Most biologics, including our drug candidates, are injected, either subcutaneously or intravenously. There are risks inherent in subcutaneous injections, such as injection-site reactions (including redness, itching, swelling, pain, and tenderness) and other side effects. In addition, there are risks inherent in intravenous administration such as infusion-related reactions (including nausea, pyrexia, rash, and dyspnea).
During the twelve months ended December 31, 2022, no material adjustments were made to provision amounts recorded as a result of the enactment of the CARES Act. Refer to Note 15, “Income Taxes,” in the accompanying notes to the financial statements for additional discussion on income taxes.
During the twelve months ended December 31, 2023, no material adjustments were made to provision amounts recorded as a result of the enactment of the CARES Act. Refer to Note 15, “Income Taxes,” in the accompanying notes to the financial statements for additional discussion on income taxes.
If we are not able to maintain regulatory compliance, we may not be permitted to market our future products and our business may suffer. 30 Table of Contents Reimbursement decisions by third-party payors may have an adverse effect on pricing and market acceptance of any of our drug candidates.
If we are not able to maintain regulatory compliance, we may not be permitted to market our future products and our business may suffer. 32 Table of Contents Reimbursement decisions by third-party payors may have an adverse effect on pricing and market acceptance of any of our drug candidates.
To the extent that any disruption or security breach were to result in a loss of or damage to our data or applications or inappropriate disclosure of confidential 36 Table of Contents or proprietary information, we could incur liability and the further development or commercialization of our drug candidates could be delayed.
To the extent that any disruption or security breach were to result in a loss of or damage to our data or 38 Table of Contents applications or inappropriate disclosure of confidential or proprietary information, we could incur liability and the further development or commercialization of our drug candidates could be delayed.
To the extent that any disruption or security breach of our information technology systems were to result in a loss of or damage to data or applications, or inappropriate disclosure of confidential or proprietary information or personal health information, we could incur substantial liability under laws that protect the privacy of personal information, our reputation would be damaged, and the further development of our product candidates could be delayed, any of which could adversely affect our business.
To the extent that any disruption or security breach of our information technology systems were to result in a loss of or damage to data or applications, or inappropriate disclosure of third-party notifiable confidential or proprietary information, personal health information, personal information or personal data, we could incur substantial liability under laws that protect the privacy of personal information, our reputation would be damaged, and the further development of our product candidates could be delayed, any of which could adversely affect our business.
We or our third-party collaborators may also experience delays in developing a sustainable, reproducible and scalable manufacturing process or transferring that process to commercial partners or negotiating insurance reimbursement for such companion diagnostic, all of which may prevent us from completing our clinical trials or commercializing our drugs on a timely or profitable basis, if at all.
We or our third-party collaborators may also experience 29 Table of Contents delays in developing a sustainable, reproducible and scalable manufacturing process or transferring that process to commercial partners or negotiating insurance reimbursement for such companion diagnostic, all of which may prevent us from completing our clinical trials or commercializing our drugs on a timely or profitable basis, if at all.
If any such actions are instituted against us and we are not successful in defending ourselves or asserting our rights, those actions could have a significant effect on our business and results of operations, including the imposition of significant fines or other sanctions. 47 Table of Contents We may not be able to maintain compliance with the Listing Rules of the NASDAQ Stock Exchange.
If any such actions are instituted against us and we are not successful in defending ourselves or asserting our rights, those actions could have a significant effect on our business and results of operations, including the imposition of significant fines or other sanctions. We may not be able to maintain compliance with the Listing Rules of the NASDAQ Stock Exchange.
Drugs designated as breakthrough therapies by the FDA may also be eligible for accelerated approval if the relevant criteria are met. 40 Table of Contents Designation as a breakthrough therapy is within the discretion of the FDA.
Drugs designated as breakthrough therapies by the FDA may also be eligible for accelerated approval if the relevant criteria are met. 42 Table of Contents Designation as a breakthrough therapy is within the discretion of the FDA.
Despite the actions we have undertaken to minimize the impacts from disruptions to the global 37 Table of Contents economy, there can be no assurances that unforeseen future events in the global supply chain, and inflationary pressures, will not have a material adverse effect on our business, financial condition and results of operations.
Despite the actions we have undertaken to minimize the impacts from disruptions to the global economy, there can be no assurances that unforeseen future events in the global supply chain, and inflationary pressures, will not have a material adverse effect on our business, financial condition and results of operations.
If the results of clinical trials, the anticipated or actual timing of marketing approvals, or the market acceptance of any of our drug candidates, if approved, do not meet the expectations of investors or public market analysts, the market price of our common stock would likely decline. 24 Table of Contents Our drug candidates are subject to extensive regulatory scrutiny.
If the results of clinical trials, the anticipated or actual timing of marketing approvals, or the market acceptance of any of our drug candidates, if approved, do not meet the expectations of investors or public market analysts, the market price of our common stock would likely decline. Our drug candidates are subject to extensive regulatory scrutiny.
If our future drugs fail to achieve market acceptance, we will not be able to generate significant revenues and may never achieve profitability. Even if any of our drug candidates receive FDA approval, the terms of the approval may limit such drug’s commercial potential.
If our future drugs fail to achieve market acceptance, we will not be able to generate significant revenues and may never achieve profitability. 31 Table of Contents Even if any of our drug candidates receive FDA approval, the terms of the approval may limit such drug’s commercial potential.
Our ability to conduct late-stage clinical trials, manufacture and commercialize our drug candidates, if regulatory approval is obtained, depends on the ability of such third parties to manufacture our drug candidates on a large scale at a competitive cost and in accordance with cGMP and foreign regulatory requirements, if applicable.
Our ability to conduct late-stage clinical trials, manufacture and commercialize our drug candidates, if regulatory approval is obtained, depends on the ability of such CMOs to manufacture our drug candidates on a large scale at a competitive cost and in accordance with cGMP and foreign regulatory requirements, if applicable.
For example, our operations are located primarily on the east coast of the United States, and any adverse weather event or natural disaster, such as a hurricane or heavy snowstorm, could have a material adverse effect on a substantial portion of our operations.
For example, our operations are located primarily on the east coast 48 Table of Contents of the United States, and any adverse weather event or natural disaster, such as a hurricane or heavy snowstorm, could have a material adverse effect on a substantial portion of our operations.
Also, collaborators may 28 Table of Contents choose to devote their resources to products that compete with ours. If a collaborator does not successfully develop any one of our products, we will need to find another collaborator to do so.
Also, collaborators may choose to devote their resources to products that compete with ours. If a collaborator does not successfully develop any one of our products, we will need to find another collaborator to do so.
We or the third parties upon whom we depend may be adversely affected by natural disasters and our business continuity and disaster recovery plans may not adequately protect us from a serious disaster.
We or the third parties upon whom we depend may be adversely affected by natural disasters or other unforeseen events and our business continuity and disaster recovery plans may not adequately protect us from a serious disaster.
Any unplanned event, such as flood, fire, explosion, earthquake, extreme weather condition, medical epidemic, including the COVID-19 pandemic, power shortage, telecommunication failure or other natural or manmade accidents or incidents that result in us being unable to fully utilize our facilities, or the manufacturing facilities of our third-party CMOs, could severely disrupt our operations and have a material adverse effect on our business, results of operations, financial condition and prospects.
Any unplanned event, such as flood, fire, explosion, earthquake, extreme weather condition, power shortage, telecommunication failure or other natural or manmade accidents or incidents that result in us being unable to fully utilize our facilities, or the manufacturing facilities of our third-party CMOs, could severely disrupt our operations and have a material adverse effect on our business, results of operations, financial condition and prospects.
If we cannot enroll patients as needed, our costs may increase, or we may be forced to delay or terminate testing for a product. We may have delays in commencing, enrolling and completing our clinical trials, and we may not complete them at all.
If we cannot enroll patients as needed, our costs may increase, or we may be forced to delay or terminate testing for a product. 27 Table of Contents We may have delays in commencing, enrolling and completing our clinical trials, and we may not complete them at all.
In general, other factors that could affect the demand for and sales and profitability of our future drugs include, but are not limited to: ● the timing of regulatory approval, if any, of competitive drugs; ● our or any other of our partners’ pricing decisions, as applicable, including a decision to increase or decrease the price of a drug, and the pricing decisions of our competitors; ● government and third-party payor reimbursement and coverage decisions that affect the utilization of our future drugs and competing drugs; ● negative safety or efficacy data from new clinical studies conducted either in the U.S. or internationally by any party, which could cause the sales of our future drugs to decrease or a future drug to be recalled; ● the degree of patent protection afforded our future drugs by patents granted to or licensed by us and by the outcome of litigation involving our or any of our licensor’s patents; ● marketing exclusivity, if any, awarded by the FDA to our drugs; ● the outcome of litigation involving patents of other companies concerning our future drugs or processes related to production and formulation of those drugs or uses of those drugs; ● the increasing use and development of alternate therapies; ● the rate of market penetration by competing drugs; and ● the termination of, or change in, existing arrangements with our partners. 31 Table of Contents Any of these factors could have a material adverse effect on the sales of any drug candidates that we may commercialize in the future.
In general, other factors that could affect the demand for and sales and profitability of our future drugs include, but are not limited to: ● the timing of regulatory approval, if any, of competitive drugs; ● our or any other of our partners’ pricing decisions, as applicable, including a decision to increase or decrease the price of a drug, and the pricing decisions of our competitors; ● government and third-party payor reimbursement and coverage decisions that affect the utilization of our future drugs and competing drugs; ● negative safety or efficacy data from new clinical studies conducted either in the U.S. or internationally by any party, which could cause the sales of our future drugs to decrease or a future drug to be recalled; ● the degree of patent protection afforded our future drugs by patents granted to or licensed by us and by the outcome of litigation involving our or any of our licensor’s patents; ● marketing exclusivity, if any, awarded by the FDA to our drugs; ● the outcome of litigation involving patents of other companies concerning our future drugs or processes related to production and formulation of those drugs or uses of those drugs; ● the increasing use and development of alternate therapies; ● the rate of market penetration by competing drugs; and ● the termination of, or change in, existing arrangements with our partners.
We have had no commercial revenue to date from sales of our drug candidates. We had an accumulated deficit of $1.3 billion as of December 31, 2022. We expect to spend substantial funds to continue the research and development testing of our drug candidates.
We have had no commercial revenue to date from sales of our drug candidates. We had an accumulated deficit of $1.4 billion as of December 31, 2023. We expect to spend substantial funds to continue the research and development testing of our drug candidates.
Further, the risk of cyber-attacks or other privacy or data security incidents may be heightened due to common, external attempts to attack our information technology systems and data using means such as phishing.
Further, the risk of cyber-attacks or other privacy or data security incidents may be heightened due to common, external attempts to attack our information technology systems and data using means such as phishing, other social engineering and vulnerability exploitation.
During the years ended December 31, 2022, 2021 and 2020, we incurred $23.8 million, $8.0 million and $4.9 million in clinical trial expense and $4.5 million, $1.7 million and $1.2 million in contract manufacturing expense. Our net losses have had and will continue to have an adverse effect on, among other things, our stockholders’ equity, total assets and working capital.
During the years ended December 31, 2023, 2022 and 2021, we incurred $32.4 million, $23.8 million and $8.0 million in clinical trial expense and $24.1 million, $4.5 million and $1.7 million in contract manufacturing expense. Our net losses have had and will continue to have an adverse effect on, among other things, our stockholders’ equity, total assets and working capital.
Until, and unless, we complete clinical trials and other development activity, and receive approval from the FDA and other regulatory authorities, for our drug candidates, we cannot sell our drugs and will not have product revenue.
Until, and unless, we complete clinical trials and other development activity, and receive approval from the FDA and other regulatory authorities, for our drug candidates, we cannot sell our drugs and 23 Table of Contents will not have product revenue.
At times we 25 Table of Contents have experienced difficulty enrolling patients, and we may experience more difficulty as the scale of our clinical testing program increases.
At times we have experienced difficulty enrolling patients, and we may experience more difficulty as the scale of our clinical testing program increases.
We have incurred operating losses of $115.2 million, $71.2 million and $63.4 million during 2022, 2021 and 2020, respectively, and expect to incur an operating loss in 2023 and beyond. We believe that operating losses will continue in 2023 and beyond because we are planning to incur significant costs associated with the development of our drug candidates.
We have incurred operating losses of $154.5 million, $115.2 million and $71.2 million during 2023, 2022 and 2021, respectively, and expect to incur an operating loss in 2024 and beyond. We believe that operating losses will continue in 2024 and beyond because we are planning to incur significant costs associated with the development of our drug candidates.
In addition, when used in combination with other marketed therapies, our drug candidates may exacerbate adverse events associated with the marketed therapy. Our drug candidates, including barzolvolimab, are monoclonal antibodies, which are biologics.
In addition, when used in combination with other marketed therapies, our drug candidates may exacerbate adverse events associated with the marketed therapy. 28 Table of Contents Our drug candidates, including barzolvolimab, are monoclonal antibodies, which are biologics.
If such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our drug development programs and commercialization efforts.
If any such events were to occur and cause interruptions in our operations, it could result in a material disruption of our drug development programs and commercialization efforts.
If the labor market does not allow this 27 Table of Contents team to be recruited quickly, the sponsor is faced with a decision to delay the program or to initiate it with inadequate management resources. This may result in recruitment of inappropriate patients, inadequate monitoring of clinical investigators and inappropriate handling of data or data analysis.
If the labor market does not allow this team to be recruited quickly, we could be faced with a decision to delay the program or to initiate it with inadequate management resources. This may result in recruitment of inappropriate patients, inadequate monitoring of clinical investigators and inappropriate handling of data or data analysis.
As of December 31, 2022, we had cash, cash equivalents and marketable securities of $305.0 million. During the next twelve months and beyond, we will take further steps to raise additional capital to fund our long-term liquidity needs.
As of December 31, 2023, we had cash, cash equivalents and marketable securities of $423.6 million. During the next twelve months and beyond, we will take further steps to raise additional capital to fund our long-term liquidity needs.
In connection with the agreement pursuant to which we acquired Kolltan in 2016 (the “Merger Agreement”) as modified by the definitive settlement agreement (the “Settlement Agreement”) we entered on July 15, 2022 related to litigation arising from the Kolltan merger, in the event that certain specified milestones related to the successful completion of a Phase 2 clinical trial of CDX-0159 or regulatory approval by the United States Food and Drug Administration or European Medicines Agency of certain drug candidates are achieved, we will be required to pay to the former stockholders of Kolltan milestone payments, which milestone payments may be made, at our sole election, in cash, in shares of our common stock or a combination of both, subject to provisions of the Merger Agreement.
In connection with the agreement pursuant to which we acquired Kolltan in 2016 (the “Merger Agreement”) as modified by the definitive settlement agreement (the “Settlement Agreement”) we entered on July 15, 2022 related to litigation arising from the Kolltan merger, in the event that regulatory approval by the United States Food and Drug Administration or European Medicines Agency of certain drug candidates are achieved, we will be required to pay to the former stockholders of Kolltan a milestone payment of $52,500,000, which milestone payment may be made, at our sole election, in cash, in shares of our common stock or a combination of both, subject to provisions of the Merger Agreement.
Relying on foreign manufacturers involves peculiar and increased risks, including the risk relating to the difficulty foreign manufacturers may face in complying with cGMP requirements as a result of language barriers, lack of familiarity with cGMP or the FDA regulatory process, supply chain issues or other causes, economic or political instability in or affecting the home countries of our foreign manufacturers, shipping delays, potential changes in foreign regulatory laws governing the sales of our product supplies, fluctuations in foreign currency exchange rates and the imposition or application of trade restrictions.
Relying on foreign manufacturers involves peculiar and increased risks, including the risk relating to the difficulty foreign manufacturers may face in complying with cGMP requirements as a result of language barriers, lack of familiarity with cGMP or the FDA regulatory process, supply chain issues or other causes, economic or political instability in or affecting the home countries of our foreign manufacturers, shipping delays, potential changes in foreign regulatory laws governing the sales of our product supplies, fluctuations in foreign currency exchange rates and the imposition or application of trade restrictions. 35 Table of Contents There can be no assurances that contract manufacturers will be able to meet our timetable and requirements.
Our ability to use our net operating loss carryforwards will be subject to limitation and, under certain circumstances, may be eliminated. As of December 31, 2022, we had net operating loss carryforwards, or NOLs, of approximately $623.1 million for federal income tax purposes, and $879.9 million for state income tax purposes.
Our ability to use our net operating loss carryforwards will be subject to limitation and, under certain circumstances, may be eliminated. As of December 31, 2023, we had net operating loss carryforwards, or NOLs, of approximately $618.4 million for federal income tax purposes, and $1.0 billion for state income tax purposes.
While we have not experienced any such event to date, if such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our independent drug development programs.
While we have not experienced any material disruptions to our business, systems or operations as a result of a cybersecurity incident to date, if such an event were to occur and cause material interruptions in our operations, it could result in a material disruption of our independent drug development programs and our business overall.
Risks Related to Reliance on Third Parties ● Risks related to our reliance on third parties. 21 Table of Contents Risks Related to Business Operations ● Risks related to strategic transactions. ● Risks related to managing our growth. ● Risks related to our ability to integrate and modify our technologies to create new drugs. ● Risks related to computer systems that we and third parties use and potential security breaches. ● Risks related to hazardous materials. ● Risks related to product liability claims. ● Risks related to the global economy and supply chain disruptions.
Risks Related to Business Operations ● Risks related to strategic transactions. 22 Table of Contents ● Risks related to managing our growth. ● Risks related to our ability to integrate and modify our technologies to create new drugs. ● Risks related to computer systems that we and third parties use and potential security breaches. ● Risks related to hazardous materials. ● Risks related to product liability claims.
As a result, we may have full responsibility for commercialization of one or more of our drug candidates if and when they are approved for sale. We currently lack sufficient marketing, sales and distribution capabilities to carry out this strategy.
We may retain full economic rights to our drug candidates or seek favorable economic terms through advantageous commercial partnerships. As a result, we may have full responsibility for commercialization of one or more of our drug candidates if and when they are approved for sale. We currently lack sufficient marketing, sales and distribution capabilities to carry out this strategy.
Our employees may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could have a material adverse effect on our business. We are exposed to the risk of employee fraud or other misconduct.
We cannot predict our success in hiring or retaining the personnel we require for continued growth. Our employees may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could have a material adverse effect on our business. We are exposed to the risk of employee fraud or other misconduct.
If such third-party collaborators fail to develop, obtain regulatory approval or commercialize the companion diagnostic test, we may not be able to enter into arrangements with another diagnostic company to obtain supplies of an alternative diagnostic test for use in connection with the development and commercialization of our drug candidates or do so on commercially reasonable terms, which could adversely affect and/or delay the development or commercialization of our drug candidates. 34 Table of Contents Our reliance on third parties requires us to share our trade secrets, which increases the possibility that a competitor will discover them.
If such third-party collaborators fail to develop, obtain regulatory approval or commercialize the companion diagnostic test, we may not be able to enter into arrangements with another diagnostic company to obtain supplies of an alternative diagnostic test for use 36 Table of Contents in connection with the development and commercialization of our drug candidates or do so on commercially reasonable terms, which could adversely affect and/or delay the development or commercialization of our drug candidates.
If we are unable to raise the funds necessary to meet our liquidity needs, we may 23 Table of Contents have to delay or discontinue the development of one or more programs, discontinue or delay ongoing or anticipated clinical trials, discontinue or delay our commercial manufacturing efforts, discontinue or delay our efforts to expand into additional indications for our drug product candidates, license out programs earlier than expected, raise funds at significant discount or on other unfavorable terms, if at all, or sell all or part of our business.
If we are unable to raise the funds necessary to meet our liquidity needs, we may have to delay or discontinue the development of one or more programs, discontinue or delay ongoing or anticipated clinical trials, discontinue or delay our commercial manufacturing efforts, discontinue or delay our efforts to expand into additional indications for our drug product candidates, license out programs earlier than expected, raise funds at significant discount or on other unfavorable terms, if at all, or sell all or part of our business. 24 Table of Contents Our stockholders may be subject to substantial dilution if we elect to pay future milestone consideration to the former Kolltan stockholders in shares of common stock.
For example, these transactions may entail numerous operational and financial risks, including: ● exposure to unknown liabilities; ● disruption of our business and diversion of our management’s time and attention in order to develop acquired products, drug candidates or technologies; ● incurrence of substantial debt or dilutive issuances of equity securities to pay for acquisitions; ● higher than expected acquisition and integration costs; ● write-downs of assets or impairment charges; 35 Table of Contents ● increased amortization expenses; ● difficulty and cost in combining the operations and personnel of any acquired businesses with our operations and personnel; ● impairment of relationships with key suppliers or customers of any acquired businesses due to changes in management and ownership; and ● inability to retain key employees of any acquired businesses.
For example, these transactions may entail numerous operational and financial risks, including: ● exposure to unknown liabilities; ● disruption of our business and diversion of our management’s time and attention in order to develop acquired products, drug candidates or technologies; ● incurrence of substantial debt or dilutive issuances of equity securities to pay for acquisitions; ● higher than expected acquisition and integration costs; ● write-downs of assets or impairment charges; ● increased amortization expenses; ● difficulty and cost in combining the operations and personnel of any acquired businesses with our operations and personnel; ● impairment of relationships with key suppliers or customers of any acquired businesses due to changes in management and ownership; and ● inability to retain key employees of any acquired businesses. 37 Table of Contents Accordingly, although there can be no assurance that we will undertake or successfully complete any transactions of the nature described above, any transactions that we do complete could have a material adverse effect on our business, results of operations, financial condition and prospects.
Because we rely on third parties to develop our drug candidates, we must share trade secrets with them.We seek to protect our proprietary technology in part by entering into confidentiality agreements and, if applicable, material transfer agreements, collaborative research agreements, consulting agreements or other similar agreements with our collaborators, advisors, employees and consultants prior to beginning research or disclosing proprietary information.
We seek to protect our proprietary technology in part by entering into confidentiality agreements and, if applicable, material transfer agreements, collaborative research agreements, consulting agreements or other similar agreements with our collaborators, advisors, employees and consultants prior to beginning research or disclosing proprietary information.
These claims can arise at any point in the development, testing, manufacture, marketing or sale of our drug candidates and may be made directly by patients involved in clinical trials of our products, by consumers or health care providers or by individuals, organizations or companies selling our products.Product liability claims can be expensive to defend, even if the drug or drug candidate did not actually cause the alleged injury or harm.
These claims can arise at any point in the development, testing, manufacture, marketing or sale of our drug candidates and may be made directly by patients involved in clinical trials of our products, by consumers or health care providers or by individuals, organizations or companies selling our products.
We routinely enter into consulting agreements with our scientific and clinical collaborators and advisors, key opinion leaders and heads of academic departments in the ordinary course of our business. We also enter into contractual agreements with physicians and institutions who recruit patients into our clinical trials on our behalf in the ordinary course of our business.
We routinely enter into consulting agreements with our scientific and clinical collaborators and advisors, key opinion leaders and heads of academic departments in the ordinary course of our business.
Before granting the MA, the European Medicines Agency or the competent authorities of the member states of the EEA make an assessment of the risk-benefit balance of the product on the basis of scientific criteria concerning its quality, safety and efficacy.
Specifically, in the EEA, medicinal products can only be commercialized after obtaining a Marketing Authorization, or MA. Before granting the MA, the European Medicines Agency or the competent authorities of the member states of the EEA make an assessment of the risk-benefit balance of the product on the basis of scientific criteria concerning its quality, safety and efficacy.
The competitors of which we are aware that have initiated a Phase 3 study or have obtained marketing approval for a potentially competitive drug to barzolvolimab for treatment of CSU, CIndU, PN and EoE include: Allakos (lirentelimab for EoE), AstraZeneca (Fasenra for CSU), Galderma/Chugai (nemolizumab for PN), Genentech (fenebrutinib for CSU), Leo Pharma (Adbry for AD), Novartis (ligelizumab for CSU, CIndU and food allergy; remibrutinib for CSU), Regeneron/Sanofi (Dupixent for CSU, CIndU, PN and EoE), and Trevi Therapeutics (nalbuphine for PN).
The competitors of which we are aware that have initiated a Phase 3 study or have obtained marketing approval for a potentially competitive drug to barzolvolimab for treatment of CSU, CIndU, PN and EoE include: Allakos (lirentelimab for EoE), Celltrion (CT-P39; omalizumab biosimilar for CSU), Galderma/Chugai (nemolizumab for PN), Novartis (remibrutinib for CSU), and Regeneron/Sanofi (Dupixent for CSU, CIndU, PN and EoE).
Clinical failure can occur at any stage of clinical development. Clinical and preclinical trials may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical or preclinical trials.
Only a small minority of all research and development programs ultimately result in commercially successful drugs. Clinical failure can occur at any stage of clinical development. Clinical and preclinical trials may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical or preclinical trials.
General Risk Factors ● Risks related to internal controls over financial reporting. ● Risks that our competitors may develop technologies that make ours obsolete. ● Risks related to health epidemics and outbreaks. ● Risks related to the loss of our key executives and scientists. ● Risks that our employees may engage in misconduct or other improper activities. ● Risks related to our compliance with the Nasdaq Listing Rules. 22 Table of Contents Risks Related to Our Financial Condition and Capital Requirements We currently have no product revenue and will need to raise capital to operate our business.
General Risk Factors ● Risks related to internal controls over financial reporting. ● Risks that our competitors may develop technologies that make ours obsolete. ● Risks related to health epidemics and outbreaks. ● Risks related to the global economy and supply chain disruptions. ● Risks related to the loss of our key executives and scientists. ● Risks that our employees may engage in misconduct or other improper activities. ● Risks related to our compliance with the Nasdaq Listing Rules.
From January 2021 through December 2022, the market price of our common stock has fluctuated from a high of $57.20 per share in the fourth quarter of 2021, to a low of $15.37 per share in the first quarter of 2021.
From January 2022 through December 2023, the market price of our common stock has fluctuated from a high of $48.40 per share in the first quarter of 2023, to a low of $19.85 per share in the second quarter of 2022.
We may choose or find it necessary under our collaborative agreements to increase our insurance coverage in the future. We may not be able to secure greater or broader product liability insurance coverage on acceptable terms or at reasonable costs when needed.
We may not be able to secure greater or broader product liability insurance coverage on acceptable terms or at reasonable costs when needed.
We believe that our drug candidates can be proven to offer disease treatment with notable advantages over drugs in terms of patient compliance and effectiveness. However, there can be no assurance that we will be able to prove these advantages or that the advantages will be sufficient to support the successful commercialization of our drug candidates.
We believe that our drug candidates can be proven to offer disease treatment with notable advantages over drugs in terms of patient compliance and effectiveness.
The FDA has not approved any of our drug candidates for sale to date. Our drug candidates are in various stages of preclinical and clinical testing. Preclinical tests are performed at an early stage of a product’s development and provide information about a drug candidate’s safety and effectiveness before initiating human clinical trials. Preclinical tests can last years.
Preclinical tests are performed at an early stage of a product’s development and provide information about a drug candidate’s safety and effectiveness before initiating human clinical trials. Preclinical tests can last years.
We face risks related to health epidemics and outbreaks, including COVID-19, which could significantly disrupt our preclinical studies and clinical trials. The future progression of the COVID-19 pandemic and its effects on our business and operations are uncertain.
We face risks related to health epidemics and outbreaks, including COVID-19, which could significantly disrupt our preclinical studies and clinical trials.
Summary of Risk Factors Risks Related to Our Financial Condition and Capital Requirements ● Risks related to our need for additional capital to fund our operations. ● Risks related to the Merger Agreement and related Settlement Agreement with Kolltan. ● Risks related to U.S. federal income tax reform.
All of these could adversely affect our business, results of operations, financial condition and cash flows. Summary of Risk Factors Risks Related to Our Financial Condition and Capital Requirements ● Risks related to our need for additional capital to fund our operations. ● Risks related to the Merger Agreement and related Settlement Agreement with Kolltan.
To date, we have generated no product revenue and cannot predict when and if we will generate product revenue. We had an accumulated deficit of $1.3 billion as of December 31, 2022.
Risks Related to Our Financial Condition and Capital Requirements We currently have no product revenue and will need to raise capital to operate our business. To date, we have generated no product revenue and cannot predict when and if we will generate product revenue. We had an accumulated deficit of $1.4 billion as of December 31, 2023.
Despite the implementation of security measures, our internal computer systems and those of our CROs, CMOs, and other contractors and consultants are vulnerable to damage from cyberattacks, malicious intrusion, computer viruses, unauthorized access, loss of data privacy, natural disasters, terrorism, war and telecommunication, electrical failures or other significant disruption.
Our computer systems and those of our CROs, CMOs, and other contractors and consultants are vulnerable to damage from cyberattacks, malicious intrusion, computer viruses, unauthorized access, data breaches, phishing attacks, cybercriminals, natural disasters, terrorism, war and telecommunication, electrical failures or other significant disruption even with a cybersecurity risk mitigation program developed by our enterprise.
Failure to obtain regulatory approvals in foreign jurisdictions will prevent us from marketing our products internationally. We may seek approval for our drug candidates outside the United States and may market future products in international markets.
We may seek approval for our drug candidates outside the United States and may market future products in international markets. In order to market our future products in the European Economic Area, or EEA, and many other foreign jurisdictions, we must obtain separate regulatory approvals.
Moreover, a product recall, if required, could generate substantial negative publicity about our products and business and inhibit or prevent development of our drug candidates and, if approval is obtained, commercialization of our future drugs. Disruptions in the global economy and supply chains may have a material adverse effect on our business, financial condition and results of operations.
Moreover, a product recall, if required, could generate substantial 39 Table of Contents negative publicity about our products and business and inhibit or prevent development of our drug candidates and, if approval is obtained, commercialization of our future drugs.
We have manufactured barzolvolimab and CDX-585 drug substance in our Fall River facility for our current and planned Phase 1 and Phase 2 clinical trials. All products are then filled at CMOs.
We also currently manufacture barzolvolimab and CDX-585 drug substance in our Fall River facility for our current and planned Phase 1 and Phase 2 clinical trials. All products are then filled at CMOs. Prior to approval of any drug candidate, the FDA must review and approve validation studies for both drug substance and drug product.
In the European Union the General Data Protection Regulation, or GDPR, is even more restrictive with respect to all personal information, including information masked by a coding system.
In the European Union, the General Data Protection Regulation, or GDPR, further restricts all applicable personal data, including information masked by a coding system that is not considered deidentified data under applicable law.
Any delay or failure to commence, enroll or complete clinical trials, fulfill regulatory requirements and obtain FDA approval for our drug candidates could have a material adverse effect on our cost to develop and commercialize, and our ability to generate revenue from, a particular drug candidate. 26 Table of Contents If serious adverse or unacceptable side effects are identified during the development of our drug candidates, such events could prevent us from obtaining regulatory approval or achieving market acceptance of our drug candidates, and we may need to abandon or limit our development of some of our drug candidates.
Any delay or failure to commence, enroll or complete clinical trials, fulfill regulatory requirements and obtain FDA approval for our drug candidates could have a material adverse effect on our cost to develop and commercialize, and our ability to generate revenue from, a particular drug candidate.
We may face difficulty in securing commitments from U.S. and foreign contract manufacturers as these manufacturers could be unwilling or unable to accommodate our needs.
Failure to achieve this level of supply can jeopardize and prevent the successful commercialization of the drug. Our leading drug candidates require specialized manufacturing capabilities and processes. We may face difficulty in securing commitments from U.S. and foreign contract manufacturers as these manufacturers could be unwilling or unable to accommodate our needs.
Our stockholders may be subject to substantial dilution if we elect to pay future milestone consideration to the former Kolltan stockholders in shares of common stock. If we elect to pay future milestone consideration in cash, we would likely need to raise additional capital.
If we elect to pay future milestone consideration in cash, we would likely need to raise additional capital.
Risks Related to Development and Regulatory Approval of Drug Candidates Our long-term success depends heavily on our ability to fund and complete the research and development activities and obtain regulatory approval for our program assets. Only a small minority of all research and development programs ultimately result in commercially successful drugs.
If we elect to pay the milestone payment in shares of our common stock, our stockholders would experience substantial dilution. Risks Related to Development and Regulatory Approval of Drug Candidates Our long-term success depends heavily on our ability to fund and complete the research and development activities and obtain regulatory approval for our program assets.
We may require additional capital to fund any milestone payments in cash, depending on the facts and circumstances at the time such payments become due.
If we elect to issue shares of our common stock to make this milestone payment, you will experience further dilution. We may require additional capital to fund the milestone payment in cash, depending on the facts and circumstances at the time such payment becomes due.
The disruptions to the global economy since 2020 have impeded global supply chains, resulting in longer lead times and also increased critical component costs and freight expenses. We have taken steps to minimize the impact of these increased costs by working closely with our suppliers.
We have taken steps to minimize the impact of these increased costs by working closely with our suppliers.
Any manufacturing failures, supply chain delays or compliance issues at our Fall River facility or at our CMOs could cause delays in our Phase 1 and Phase 2 clinical studies for these drug candidates. Our barzolvolimab drug product is currently administered both intravenously and subcutaneously.
Any manufacturing failures, supply chain delays or compliance issues at our Fall River facility or at our CMOs could cause delays in our clinical studies for our drug candidates. We may need to rely on third-party collaborators to develop and commercialize companion diagnostic tests for our drug candidates.
Our dependence upon third parties for the manufacture of our products may adversely affect our profit margins and our ability to develop, manufacture, sell and deliver products on a timely and competitive basis. We may need to rely on third-party collaborators to develop and commercialize companion diagnostic tests for our drug candidates.
It may not be possible to have multiple third-party manufacturers ready to supply us with needed material at all or without incurring significant costs. Our dependence upon third parties for the manufacture of our products may adversely affect our profit margins and our ability to develop, manufacture, sell and deliver products on a timely and competitive basis.

… 55 more changes not shown on this page.

Item 2. Properties

Properties — owned and leased real estate

2 edited+0 added−0 removed0 unchanged
Biggest changePROPERTIES As of December 31, 2022, our significant leased properties are described below. ​ ​ ​ ​ ​ ​ ​ ​ Approximate ​ ​ Property Location Square Feet Use Lease Expiration Date Hampton, New Jersey 33,400 Headquarters, Office and Laboratory July 2025 (1) Fall River, Massachusetts 33,900 Manufacturing, Office and Laboratory July 2025 (2) New Haven, Connecticut 17,700 Office and Laboratory April 2025 (1) Lease includes one renewal option of two years followed by one renewal option of three years.
Biggest changePROPERTIES As of December 31, 2023, our significant leased properties are described below. ​ ​ ​ ​ ​ ​ ​ ​ Approximate ​ ​ Property Location Square Feet Use Lease Expiration Date Hampton, New Jersey 33,400 Headquarters, Office and Laboratory July 2025 (1) Fall River, Massachusetts 33,900 Manufacturing, Office and Laboratory July 2025 (2) New Haven, Connecticut 17,700 Office and Laboratory April 2025 (1) Lease includes one renewal option of two years followed by one renewal option of three years.
(2) Lease includes one renewal option of two years followed by one renewal option of three years. Item 3. LEGAL PROCEEDINGS We are not currently a party to any material legal proceedings. ​ Item 4. MINE SAFETY DISCLOSURES Not applicable. ​ 48 Table of Contents PART II
(2) Lease includes one renewal option of two years followed by one renewal option of three years. Item 3. LEGAL PROCEEDINGS We are not currently a party to any material legal proceedings. ​ Item 4. MINE SAFETY DISCLOSURES Not applicable. ​ 51 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

6 edited+0 added−0 removed0 unchanged
Biggest changeBenchmark TR Index ​ $ 100 ​ $ 95 ​ $ 124 ​ $ 150 ​ $ 189 ​ $ 152 NASDAQ Pharmaceutical (Subsector) Index ​ $ 100 ​ $ 108 ​ $ 124 ​ $ 137 ​ $ 170 ​ $ 189 ​ ​ Item 6. [Reserved] ​ 49 Table of Contents
Biggest changeBenchmark TR Index ​ $ 100 ​ $ 131 ​ $ 159 ​ $ 200 ​ $ 161 ​ $ 203 NASDAQ Pharmaceutical (Subsector) Index ​ $ 100 ​ $ 115 ​ $ 127 ​ $ 157 ​ $ 175 ​ $ 182 ​ ​ Item 6. [Reserved] ​ 52 Table of Contents
The comparison assumes investment of $100 on December 31, 2017 in our common stock and in each of the indices and, in each case, assumes reinvestment of all dividends.
The comparison assumes investment of $100 on December 31, 2018 in our common stock and in each of the indices and, in each case, assumes reinvestment of all dividends.
AND PEER GROUP INDICES The graph below compares the cumulative total stockholder return on the common stock for the period from December 31, 2017 through December 31, 2022, with the cumulative return on (i) NASDAQ U.S. Benchmark TR Index and (ii) NASDAQ Pharmaceutical (Subsector) Index.
AND PEER GROUP INDICES The graph below compares the cumulative total stockholder return on the common stock for the period from December 31, 2018 through December 31, 2023, with the cumulative return on (i) NASDAQ U.S. Benchmark TR Index and (ii) NASDAQ Pharmaceutical (Subsector) Index.
Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock currently trades on the Nasdaq Capital Market (NASDAQ) under the symbol “CLDX.” As of February 13, 2023, there were approximately 154 shareholders of record of our common stock.
Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock currently trades on the Nasdaq Capital Market (NASDAQ) under the symbol “CLDX.” As of February 14, 2024, there were approximately 133 shareholders of record of our common stock.
On February 13, 2023 the closing price of our common stock, as reported by NASDAQ, was $42.17 per share. We have not paid any dividends on our common stock since our inception and do not intend to pay any dividends in the foreseeable future. ​ CELLDEX THERAPEUTICS, INC., NASDAQ MARKET INDEX — U.S.
On February 14, 2024 the closing price of our common stock, as reported by NASDAQ, was $36.26 per share. We have not paid any dividends on our common stock since our inception and do not intend to pay any dividends in the foreseeable future. ​ CELLDEX THERAPEUTICS, INC., NASDAQ MARKET INDEX — U.S.
The points on the graph are as of December 31 of the year indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2017 2018 2019 2020 2021 2022 Celldex Therapeutics, Inc. ​ $ 100 ​ $ 7 ​ $ 5 ​ $ 41 ​ $ 91 ​ $ 105 NASDAQ U.S.
The points on the graph are as of December 31 of the year indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2018 2019 2020 2021 2022 2023 Celldex Therapeutics, Inc. ​ $ 100 ​ $ 75 ​ $ 590 ​ $ 1,302 ​ $ 1,501 ​ $ 1,336 NASDAQ U.S.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

1 edited+0 added−0 removed0 unchanged
Biggest changeItem 6. ​ [Reserved] ​ 49 Item 7. ​ Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ 50 Item 7A. ​ Quantitative and Qualitative Disclosures About Market Risk ​ 67 Item 8. ​ Financial Statements and Supplementary Data ​ 68
Biggest changeItem 6. ​ [Reserved] ​ 52 Item 7. ​ Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ 53 Item 7A. ​ Quantitative and Qualitative Disclosures About Market Risk ​ 70 Item 8. ​ Financial Statements and Supplementary Data ​ 71

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

92 edited+54 added−53 removed72 unchanged
Biggest changeGiven the lack of effective therapies for EoE and barzolvolimab’s potential as a mast cell depleting agent, we believe EoE is an important indication for future study and plan to initiate a Phase 2 multi-center, randomized, double-blind, placebo-controlled subcutaneous study designed to assess the treatment effects and safety of barzolvolimab in patients with EoE in the first half of 2023. 56 Table of Contents Additional Barzolvolimab Development Activities Manufacturing activities to support the introduction of the barzolvolimab subcutaneous formulation into the clinical program have been completed and, in September 2021, we initiated dosing in a randomized, double-blind, placebo-controlled, Phase 1 study designed to evaluate the safety of single ascending doses of the subcutaneous formulation of barzolvolimab in healthy volunteers.
Biggest changeGiven the lack of effective therapies for EoE and barzolvolimab’s potential as a mast cell depleting agent, we believe EoE is an important indication for future study. The randomized, double-blind, placebo-controlled, parallel group Phase 2 study is evaluating the efficacy and safety profile of subcutaneous barzolvolimab in patients with active EoE.
Investing Activities Net cash provided by investing activities was $89.9 million for the year ended December 31, 2022 compared to net cash used in investing activities of $216.2 million for the year ended December 31, 2021.
Net cash provided by investing activities was $89.9 million for the year ended December 31, 2022 compared to net cash used in investing activities of $216.2 million for the year ended December 31, 2021.
Financing Activities Net cash provided by financing activities was $4.1 million for the year ended December 31, 2022 compared to $272.4 million for the year ended December 31, 2021. The decrease in net cash provided by financing activities was primarily due to a decrease in net proceeds from stock issuances.
Net cash provided by financing activities was $4.1 million for the year ended December 31, 2022 compared to $272.4 million for the year ended December 31, 2021. The decrease in net cash provided by financing activities was primarily due to a decrease in net proceeds from stock issuances.
Targets are being selected based on new science as well as their compatibility to be used in bispecific antibody formats with Celldex’s existing antibody programs. Development is focused on emerging, important pathways controlling inflammatory diseases or immunity to tumors. Our goal is to build a fully integrated, commercial-stage biopharmaceutical company that develops important therapies for patients with unmet medical needs.
Targets are being selected based on new science as well as their compatibility to be used in bispecific antibody formats with our existing antibody programs. Development is focused on emerging, important pathways controlling inflammatory diseases or immunity to tumors. Our goal is to build a fully integrated, commercial-stage biopharmaceutical company that develops important therapies for patients with unmet medical needs.
CSU is one of the most frequent dermatologic diseases with a prevalence of 0.5-1.0% of the total population or up to approximately 1 to 3 million patients in the United States (Weller et al. 2010. Hautarzt. 61(8), Bartlett et al. 2018. DermNet.Org). Approximately 50% of patients with CSU achieve symptomatic control with antihistamines.
It is one of the most frequent dermatologic diseases with a prevalence of 0.5-1.0% of the total population or up to approximately 1 to 3 million patients in the United States (Weller et al. 2010. Hautarzt. 61(8), Bartlett et al. 2018. DermNet.Org). Approximately 50% of patients with CSU achieve symptomatic control with antihistamines.
We estimate that clinical trials of the type we generally conduct are typically completed over the following timelines: ​ ​ ​ ​ ​ Estimated ​ ​ Completion Clinical Phase Period Phase 1 1 – 2 Years Phase 2 1 – 5 Years Phase 3 1 – 5 Years ​ The duration and the cost of clinical trials may vary significantly over the life of a project as a result of differences arising during the clinical trial protocol, including, among others, the following: ● the number of patients that ultimately participate in the trial; 50 Table of Contents ● the duration of patient follow-up that seems appropriate in view of results; ● the number of clinical sites included in the trials; ● the length of time required to enroll suitable patient subjects; and ● the efficacy and safety profile of the drug candidate.
We estimate that clinical trials of the type we generally conduct are typically completed over the following timelines: ​ ​ ​ ​ ​ Estimated ​ ​ Completion Clinical Phase Period Phase 1 1 – 2 Years Phase 2 1 – 5 Years Phase 3 1 – 5 Years ​ 53 Table of Contents The duration and the cost of clinical trials may vary significantly over the life of a project as a result of differences arising during the clinical trial protocol, including, among others, the following: ● the number of patients that ultimately participate in the trial; ● the duration of patient follow-up that seems appropriate in view of results; ● the number of clinical sites included in the trials; ● the length of time required to enroll suitable patient subjects; and ● the efficacy and safety profile of the drug candidate.
Research and Development Expense Research and development expenses consist primarily of (i) personnel expenses, (ii) laboratory supply expenses relating to the development of our technology, (iii) facility expenses and (iv) product development expenses associated with our drug candidates as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ Increase/ ​ ​ ​ December 31, ​ (Decrease) ​ ​ 2022 2021 $ % ​ ​ ​ (In thousands) ​ ​ ​ ​ ​ ​ Personnel ​ $ 32,674 ​ $ 26,424 ​ $ 6,250 ​ 24 % Laboratory supplies ​ 6,310 ​ 5,981 ​ 329 6 % Facility ​ 4,764 ​ 4,771 ​ (7) 0 % Product development ​ 32,156 ​ 12,230 ​ 19,926 163 % ​ 61 Table of Contents Personnel expenses primarily include salary, benefits, stock-based compensation and payroll taxes.
Research and Development Expense Research and development expenses consist primarily of (i) personnel expenses, (ii) laboratory supply expenses relating to the development of our technology, (iii) facility expenses and (iv) product development expenses associated with our drug candidates as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ Increase/ ​ ​ ​ December 31, ​ (Decrease) ​ ​ 2022 2021 $ % ​ ​ ​ (In thousands) ​ ​ ​ ​ ​ ​ Personnel ​ $ 32,674 ​ $ 26,424 ​ $ 6,250 ​ 24 % Laboratory supplies ​ 6,310 ​ 5,981 ​ 329 6 % Facility ​ 4,764 ​ 4,771 ​ (7) 0 % Product development ​ 32,156 ​ 12,230 ​ 19,926 163 % ​ Personnel expenses primarily include salary, benefits, stock-based compensation and payroll taxes.
Patients will then enter a follow-up phase for an additional 24 weeks. In addition, the study includes the option for patients who have symptoms following the treatment phase, including patients who were on placebo, to enroll in an open label extension where all patients receive 300 mg every 9 weeks of barzolvolimab.
Patients will then enter a follow-up phase for an additional 24 weeks. In addition, the study includes the option for patients who have symptoms following the treatment phase, including patients who were on placebo, to enroll in an open label extension where all patients receive 300 mg of barzolvolimab every 8 weeks.
Discounted cash flow models are typically used in these tests, and the models require the use of significant estimates and assumptions including but not limited to: ● timing and costs to complete the in-process projects; 59 Table of Contents ● timing and probability of success of clinical events or regulatory approvals; ● estimated future cash flows from product sales resulting from completed products and in-process projects; and ● discount rates Each IPR&D asset is assessed for impairment at least annually or when impairment indicators are present.
Discounted cash flow models are typically used in these tests, and the models require the use of significant estimates and assumptions including but not limited to: ● timing and costs to complete the in-process projects; ● timing and probability of success of clinical events or regulatory approvals; ● estimated future cash flows from product sales resulting from completed products and in-process projects; and ● discount rates Each IPR&D asset is assessed for impairment at least annually or when impairment indicators are present.
CDX-585 CDX-585 combines our proprietary highly active PD-1 blockade and anti-ILT4 blockade to prevent immunosuppressive signals in T cells and myeloid cells, respectively. ILT4 is emerging as an important immune checkpoint on myeloid cells and is thought to contribute to resistance to PD-1 blockade.
CDX-585 CDX-585 combines our proprietary highly active PD-1 blockade and anti-ILT4 blockade to overcome immunosuppressive signals in T cells and myeloid cells, respectively. ILT4 is emerging as an important immune checkpoint on myeloid cells and is thought to contribute to resistance to PD-1 blockade.
The following table indicates the amount incurred for each of our significant research programs and for other identified research and development activities during the years ended December 31, 2022, 2021 and 2020.
The following table indicates the amount incurred for each of our significant research programs and for other identified research and development activities during the years ended December 31, 2023, 2022 and 2021.
The use of our cash flows for operations has primarily consisted of salaries and wages for our employees; facility and facility-related costs for our offices, laboratories and manufacturing facility; fees paid in connection with preclinical studies, clinical studies, contract manufacturing, laboratory supplies and services; and consulting, legal and other professional fees.
The use of our cash flows for operations has primarily consisted of salaries and wages for our employees; facility and facility-related costs for our offices, laboratories and manufacturing facility; fees paid in connection with preclinical studies, clinical studies, 68 Table of Contents contract manufacturing, laboratory supplies and services; and consulting, legal and other professional fees.
We expect personnel expenses to increase over the next twelve months as a result of additional headcount to support the expanded development of barzolvolimab. Laboratory supplies expenses include laboratory materials and supplies, services, and other related expenses incurred in the development of our technology.
We expect personnel expenses to increase over the next twelve months as a result of additional headcount to support the expanded development of barzolvolimab. 65 Table of Contents Laboratory supplies expenses include laboratory materials and supplies, services and other related expenses incurred in the development of our technology.
This confirmed that serum tryptase level is a robust pharmacodynamic biomarker for assessing mast cell burden and clinical activity in inducible urticaria and potentially in other diseases with mast cell driven involvement. ● Barzolvolimab was well tolerated.
This confirmed that serum tryptase level is a robust pharmacodynamic biomarker for assessing mast cell burden and clinical activity in inducible urticaria and potentially in other diseases with mast cell driven involvement. ● Barzolvolimab was well tolerated across all cohorts.
IPR&D assets acquired in a business combination initially are recorded at fair value and accounted for as indefinite-lived intangible assets. These assets are capitalized on our balance sheets until either the project underlying them is completed or the assets become impaired.
IPR&D assets acquired in a business combination initially are recorded at fair value and accounted for as indefinite-lived intangible assets. These assets are capitalized on our balance sheets until either the project underlying them is completed or the assets 63 Table of Contents become impaired.
Our ability to continue funding our planned operations into and beyond twelve months from the issuance date is also dependent on the timing and manner of payment of the future milestones under the Settlement Agreement with SRS, in the event that we achieve the milestones related to those payments.
Our ability to continue funding our planned operations into and beyond twelve months from the issuance date is also dependent on the timing and manner of payment of the future milestone under the Settlement Agreement with SRS, in the event that we achieve the milestone related to that payment.
Targets are being selected based on new science as well as their compatibility to be used in bispecific antibody formats with our existing antibody programs. Development is focused on emerging, important pathways controlling inflammatory diseases or immunity to tumors.
Targets are being selected based on new science as well as their compatibility to be used in 61 Table of Contents bispecific antibody formats with our existing antibody programs. Development is focused on emerging, important pathways controlling inflammatory diseases or immunity to tumors.
The timing of any new contract manufacturing and research and development agreements, collaboration agreements, government contracts or grants and any payments under these agreements, contracts or grants cannot be easily predicted and may vary significantly from quarter to quarter. At December 31, 2022, our principal sources of liquidity consisted of cash, cash equivalents and marketable securities of $305.0 million.
The timing of any new contract manufacturing and research and development agreements, collaboration agreements, government contracts or grants and any payments under these agreements, contracts or grants cannot be easily predicted and may vary significantly from quarter to quarter. At December 31, 2023, our principal sources of liquidity consisted of cash, cash equivalents and marketable securities of $423.6 million.
On a quarterly basis, we revalue these obligations and record increases or decreases in their fair value as an adjustment to operating earnings. As of December 31, 2022, the fair value of our contingent consideration was $0.0 million.
On a quarterly basis, we revalue these obligations and record increases or decreases in their fair value as an adjustment to operating earnings. As of December 31, 2023, the 62 Table of Contents fair value of our contingent consideration was $0.0 million.
In July 2022 we announced that the first patient has been dosed in a Phase 2 study in patients with CIndU who remain symptomatic despite antihistamine therapy. The study will be conducted at approximately 85 sites across approximately 12 countries.
In July 2022, we announced that the first patient had been dosed in a Phase 2 study in patients with CIndU who remain symptomatic despite antihistamine therapy. The study is being conducted at approximately 85 sites across approximately 12 countries.
The $1.6 million increase in laboratory supply expenses for the year ended December 31, 2021, as compared to the year ended December 31, 2020, was primarily due to higher laboratory materials and supplies purchases. Facility expenses include depreciation, amortization, utilities, rent, maintenance and other related expenses incurred at our facilities.
The $0.3 million increase in laboratory supply expenses for the year ended December 31, 2022, as compared to the year ended December 31, 2021, was primarily due to higher laboratory services, materials and supplies purchases. Facility expenses include depreciation, amortization, utilities, rent, maintenance and other related expenses incurred at our facilities.
The $0.3 million increase in laboratory supply expenses for the year ended December 31, 2022, as compared to the year ended December 31, 2021, was primarily due to higher laboratory services, materials and supplies purchases. We expect laboratory supplies expenses to remain relatively consistent over the next twelve months, although there may be fluctuations on a quarterly basis.
The $1.0 million decrease in laboratory supply expenses for the year ended December 31, 2023, as compared to the year ended December 31, 2022, was primarily due to lower laboratory services, materials and supplies purchases. We expect laboratory supplies expenses to remain relatively consistent over the next twelve months, although there may be fluctuations on a quarterly basis.
Most adverse events were mild, and the most common (≥3 patients) were hair color changes (76%; n = 16/21), infusion reactions (43%; n = 9/21), taste changes (38%; n = 8/21), nasopharyngitis (24%; n = 5/21), malaise (24%; n = 5/21), and headache (19%; n = 4/21).
In the 3 mg/kg ColdU and SD cohorts, most adverse events were mild, and the most common (≥3 patients) were hair color changes (76%; n=16/21), infusion reactions (43%; n=9/21), taste changes (38%; n=8/21), nasopharyngitis (24%; n=5/21), malaise (24%; n=5/21), and headache (19%; n=4/21).
We concluded that the TAM program IPR&D asset was partially impaired, and a non-cash impairment charge of $14.5 million was recorded in the fourth quarter of 2020. During the third quarter of 2021, we evaluated the TAM program IPR&D asset for potential impairment as a result of a lack of interest in the program from third parties.
Intangible Asset Impairment During the third quarter of 2021, we evaluated the TAM program IPR&D asset for potential impairment as a result of a lack of interest in the program from third parties. We concluded that the TAM program IPR&D asset was fully impaired, and a non-cash impairment charge of $3.5 million was recorded in the third quarter of 2021.
The $6.3 million increase in personnel expenses for the year ended December 31, 2022, as compared to the year ended December 31, 2021, was primarily due to higher stock-based compensation expense and an increase in employee headcount.
The $7.4 million increase in personnel expenses for the year ended December 31, 2023, as compared to the year ended December 31, 2022, was primarily due to higher stock-based compensation expense and an increase in employee headcount.
The $4.5 million increase in personnel expenses for the year ended December 31, 2021, as compared to the year ended December 31, 2020, was primarily due to higher stock-based compensation expense and an increase in employee headcount. Laboratory supplies expenses include laboratory materials and supplies, services, and other related expenses incurred in the development of our technology.
The $6.3 million increase in personnel expenses for the year ended December 31, 2022, as compared to the year ended December 31, 2021, was primarily due to higher stock-based compensation expense and an increase in employee headcount. 67 Table of Contents Laboratory supplies expenses include laboratory materials and supplies, services and other related expenses incurred in the development of our technology.
We may decide to pay those milestone payments in cash, shares of our common stock or a combination thereof.
We may decide to pay that milestone payment in cash, shares of our common stock or a combination thereof.
Equity Offerings In November 2020, we filed an automatic shelf registration statement with the SEC to register for sale any combination of the types of securities described in the shelf registration statement. In May 2016, we entered into a controlled equity offering sales agreement with Cantor Fitzgerald & Co.
Equity Offerings In November 2023, we filed an automatic shelf registration statement with the SEC to register for sale any combination of the types of securities described in the shelf registration statement. On February 26, 2024, we entered into a controlled equity offering sales agreement with Cantor Fitzgerald & Co.
Our inability to raise additional capital, or to do so on terms reasonably acceptable to us, would jeopardize the future success of our business. During the past five years through December 31, 2022, we incurred an aggregate of $287.2 million in research and development expenses.
Our inability to raise additional capital, or to do so on terms reasonably acceptable to us, would jeopardize the future success of our business. 54 Table of Contents During the past five years through December 31, 2023, we incurred an aggregate of $338.8 million in research and development expenses.
There are currently no approved therapies for chronic inducible urticarias other than antihistamines and patients attempt to manage symptoms associated with their disease through avoidance of triggers. We are exploring cold-induced, dermographism (scratch-induced) and cholinergic (exercise-induced) urticarias.
There are currently no approved therapies for chronic inducible urticarias other than antihistamines and patients attempt to manage symptoms associated with their disease through avoidance of triggers. We are currently exploring cold-induced and dermographism (scratch-induced) urticarias in an ongoing Phase 2 study.
Litigation Settlement Related Loss We recorded a loss of $15.0 million in the second quarter of 2022 related to the Initial Payment due under the binding settlement term sheet (the “Term Sheet”) entered with SRS.
Litigation Settlement Related Loss We recorded a loss of $15.0 million in the second quarter of 2022 related to the Initial Payment due under the binding settlement term sheet entered with SRS, which was subsequently memorialized in a Settlement Agreement with SRS.
Compensation expense for all stock-based awards is recognized using the straight-line method over the term of vesting or performance. 60 Table of Contents RESULTS OF OPERATIONS Year Ended December 31, 2022 compared with Year Ended December 31, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ Increase/ ​ Increase/ ​ ​ ​ December 31, ​ (Decrease) ​ (Decrease) ​ ​ 2022 2021 $ % ​ ​ ​ (In thousands) Revenues: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Product development and licensing agreements ​ $ 56 ​ $ 31 ​ $ 25 ​ 81 % Contracts and grants ​ ​ 2,301 ​ ​ 4,620 ​ ​ (2,319) ​ (50) % Total revenues ​ $ 2,357 ​ $ 4,651 ​ $ (2,294) ​ (49) % Operating expenses: ​ ​ ​ ​ ​ ​ ​ ​ Research and development ​ 82,258 ​ 53,311 ​ 28,947 54 % General and administrative ​ 27,195 ​ 20,488 ​ 6,707 33 % Intangible asset impairment ​ — ​ 3,500 ​ (3,500) (100) % Gain on fair value remeasurement of contingent consideration ​ (6,862) ​ (1,405) ​ 5,457 388 % Litigation settlement related loss ​ ​ 15,000 ​ ​ — ​ ​ 15,000 ​ n/a ​ Total operating expenses ​ 117,591 ​ 75,894 ​ 41,697 55 % Operating loss ​ (115,234) ​ (71,243) ​ 43,991 62 % Investment and other income, net ​ 2,909 ​ 505 ​ 2,404 476 % Net loss before income tax benefit ​ (112,325) ​ (70,738) ​ 41,587 59 % Income tax benefit ​ — ​ 227 ​ (227) (100) % Net loss ​ $ (112,325) ​ $ (70,511) ​ $ 41,814 59 % ​ Net Loss The $41.8 million increase in net loss for the year ended December 31, 2022, as compared to the year ended December 31, 2021, was primarily due to the $15.0 million litigation settlement related loss recorded in the second quarter of 2022 and increases in research and development and general and administrative expenses, partially offset by an increase in the gain on fair value remeasurement of contingent consideration.
We expect investment and other income to increase over the next twelve months due to higher interest rates and higher levels of cash as a result of our November 2023 underwritten public offering, although there may be fluctuations on a quarterly basis. 66 Table of Contents Year Ended December 31, 2022 compared with Year Ended December 31, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ Increase/ ​ Increase/ ​ ​ ​ December 31, ​ (Decrease) ​ (Decrease) ​ ​ 2022 2021 $ % ​ ​ ​ (In thousands) Revenues: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Product development and licensing agreements ​ $ 56 ​ $ 31 ​ $ 25 ​ 81 % Contracts and grants ​ ​ 2,301 ​ ​ 4,620 ​ ​ (2,319) ​ (50) % Total revenues ​ $ 2,357 ​ $ 4,651 ​ $ (2,294) ​ (49) % Operating expenses: ​ ​ ​ ​ ​ ​ ​ ​ Research and development ​ 82,258 ​ 53,311 ​ 28,947 54 % General and administrative ​ 27,195 ​ 20,488 ​ 6,707 33 % Intangible asset impairment ​ — ​ 3,500 ​ (3,500) (100) % Gain on fair value remeasurement of contingent consideration ​ (6,862) ​ (1,405) ​ 5,457 388 % Litigation settlement related loss ​ ​ 15,000 ​ ​ — ​ ​ 15,000 ​ n/a ​ Total operating expenses ​ 117,591 ​ 75,894 ​ 41,697 55 % Operating loss ​ (115,234) ​ (71,243) ​ 43,991 62 % Investment and other income, net ​ 2,909 ​ 505 ​ 2,404 476 % Net loss before income tax benefit ​ (112,325) ​ (70,738) ​ 41,587 59 % Income tax benefit ​ — ​ 227 ​ (227) (100) % Net loss ​ $ (112,325) ​ $ (70,511) ​ $ 41,814 59 % ​ Net Loss The $41.8 million increase in net loss for the year ended December 31, 2022, as compared to the year ended December 31, 2021, was primarily due to the $15.0 million litigation settlement related loss recorded in the second quarter of 2022 and increases in research and development and general and administrative expenses, partially offset by an increase in the gain on fair value remeasurement of contingent consideration.
We have had recurring losses and incurred a loss of $112.3 million for the year ended December 31, 2022. Net cash used in operations for the year ended December 31, 2022 was $103.7 million.
We have had recurring losses and incurred a loss of $141.4 million for the year ended December 31, 2023. Net cash used in operations for the year ended December 31, 2023 was $107.3 million.
Net cash provided by financing activities was $272.4 million for the year ended December 31, 2021 compared to $171.2 million for the year ended December 31, 2020. The increase in net cash provided by financing activities was primarily due to an increase in net proceeds from stock issuances.
Financing Activities Net cash provided by financing activities was $218.5 million for the year ended December 31, 2023 compared to $4.1 million for the year ended December 31, 2022. The increase in net cash provided by financing activities was primarily due to an increase in net proceeds from stock issuances.
If we are unable to raise the funds necessary to meet our long-term liquidity needs, we may have to delay or discontinue the development of one or more programs, discontinue or delay ongoing or anticipated clinical trials, discontinue or delay our commercial manufacturing efforts, discontinue or delay our efforts to expand into additional indications for our drug product candidates, license out programs earlier than expected, raise funds at a significant discount or on other unfavorable terms, if at all, or sell all or a part of our business. 65 Table of Contents Operating Activities Net cash used in operating activities was $103.7 million for the year ended December 31, 2022 compared to $60.9 million for the year ended December 31, 2021.
If we are unable to raise the funds necessary to meet our long-term liquidity needs, we may have to delay or discontinue the development of one or more programs, discontinue or delay ongoing or anticipated clinical trials, discontinue or delay our commercial manufacturing efforts, discontinue or delay our efforts to expand into additional indications for our drug product candidates, license out programs earlier than expected, raise funds at a significant discount or on other unfavorable terms, if at all, or sell all or a part of our business.
Prurigo Nodularis (PN) We have expanded clinical development of barzolvolimab into prurigo nodularis (PN). PN is a chronic skin disease characterized by the development of hard, intensely itchy (pruritic) nodules on the skin.
Data from this study are expected in the second half of 2024. Prurigo Nodularis (PN) We have expanded clinical development of barzolvolimab into prurigo nodularis (PN). PN is a chronic skin disease characterized by the development of hard, intensely itchy (pruritic) nodules on the skin.
A complete response was achieved in 95% (n = 19/20) of patients (n = 10/10 ColdU; n = 9/10 SD). The median duration (range) of complete response through the 12-week observation period was 77+ days (29–86; n = 10) for patients with ColdU and 57+ days (16–70; n = 9) for patients with SD.
The median duration (range) of complete response through the 12-week observation period was 77+ days (29–86; n=10) for patients with ColdU and 57+ days (16–70; n=9) for patients with SD. A UCT score of ≥12 (well controlled) was achieved by 80% (n=16/20) of the patients within week 4 post-treatment.
The $6.0 million increase in product development expenses for the year ended December 31, 2021, as compared to the year ended December 31, 2020, was primarily due to an increase in barzolvolimab clinical trial and contract research expenses.
The $27.2 million increase in product development expenses for the year ended December 31, 2023, as compared to the year ended December 31, 2022, was primarily due to an increase in barzolvolimab clinical trial and contract manufacturing expenses.
We believe that by targeting KIT, barzolvolimab may be able to inhibit mast cell activity and decrease mast cell numbers to provide potential clinical benefit in mast cell related diseases.
By targeting KIT, barzolvolimab has been shown to inhibit mast cell activity and decrease mast cell numbers, which we believe could provide potential clinical benefit in mast cell related diseases.
This study is an open label clinical trial designed to evaluate the safety of a single dose (3 mg/kg) of barzolvolimab in patients with cold urticaria (ColdU) or symptomatic dermographism (SD).
We completed a Phase 1b open label clinical trial in CIndU in patients refractory to antihistamines, conducted in Germany. This study was designed to evaluate the safety of a single intravenous dose (3 mg/kg) of barzolvolimab in patients with cold urticaria (ColdU) or symptomatic dermographism (SD).
The amounts disclosed in the following table reflect direct research and development costs, license fees associated with the underlying technology and an allocation of indirect research and development costs to each program. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended Year Ended Year Ended ​ December 31, 2022 December 31, 2021 December 31, 2020 ​ ​ (In thousands) Barzolvolimab/Anti-KIT Program ​ $ 51,220 ​ $ 24,395 ​ $ 8,444 CDX-585 ​ 9,793 ​ 7,133 ​ ​ — CDX-527 ​ 2,012 ​ 3,619 ​ 8,840 CDX-1140 and CDX-301 ​ 3,992 ​ 5,439 ​ 10,948 Other Programs ​ 15,241 ​ 12,725 ​ 14,302 Total R&D Expense ​ $ 82,258 ​ $ 53,311 ​ $ 42,534 ​ 51 Table of Contents Clinical Development Programs Barzolvolimab (also referred to as CDX-0159) Barzolvolimab is a humanized monoclonal antibody that specifically binds the receptor tyrosine kinase KIT and potently inhibits its activity.
The amounts disclosed in the following table reflect direct research and development costs, license fees associated with the underlying technology and an allocation of indirect research and development costs to each program. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended Year Ended Year Ended ​ December 31, 2023 December 31, 2022 December 31, 2021 ​ ​ (In thousands) ​ ​ ​ Barzolvolimab/Anti-KIT Program ​ $ 79,913 ​ $ 51,220 ​ $ 24,395 CDX-585 ​ 6,357 ​ ​ 9,793 ​ ​ 7,133 Other Programs ​ 31,741 ​ ​ 21,245 ​ ​ 21,783 Total R&D Expense ​ $ 118,011 ​ $ 82,258 ​ $ 53,311 ​ Clinical Development Programs Barzolvolimab (also referred to as CDX-0159) Barzolvolimab is a humanized monoclonal antibody that specifically binds the receptor tyrosine kinase KIT and potently inhibits its activity.
Data were collected at one or more timepoints beyond week 12 through week 36. ● Most patients had return of symptoms and/or loss of urticaria control between 12 and 36 weeks.
Data were collected at one or more timepoints beyond week 12 through week 36. Most patients had return of symptoms and/or loss of urticaria control between 12 and 36 weeks. Remarkably, two patients remained provocation negative at 36 weeks, and four had well controlled disease (UCT ≥12) 36 weeks post dosing.
Approximately 168 patients will be randomly assigned on a 1:1:1:1 ratio to receive subcutaneous injections of barzolvolimab at 75 mg every 4 weeks, 150 mg every 4 weeks, 300 mg every 8 weeks or placebo during a 16-week placebo-controlled treatment phase.
In the revised protocol, patients will be randomly assigned on a 1:1 ratio to receive subcutaneous injections of barzolvolimab at 300 mg every 4 weeks or placebo during a 16-week placebo-controlled treatment phase. Patients then enter a 12-week active treatment phase, in which all patients will receive barzolvolimab 300 mg every 4 weeks.
Patients will then enter a 36-week active treatment phase, in which patients not already randomized to barzolvolimab at 150 mg every 4 weeks or 300 mg every 8 weeks will be randomized 1:1 to receive one of these two dose regimens; patients already randomized to these treatment arms will remain on the same regimen as during the placebo-controlled treatment phase.
After 16 weeks, patients then enter a 36-week active treatment period, in which patients receiving placebo or the 75 mg dose are randomized to receive barzolvolimab 150 mg every 4 weeks or 300 mg every 8 weeks; patients already randomized to the 150 mg and 300 mg treatment arms remain on the same regimen as during the placebo-controlled treatment period.
In December 2022, we presented long term follow up data from the 3.0 mg/kg cohorts in cold urticaria and symptomatic dermographism at the GA²LEN Global Urticaria Forum (GUF) 2022. 14 patients consented to the optional long term follow up evaluation (6 cold, 8 symptomatic dermographism); 10 of the 14 still had complete control of their disease as assessed by provocation testing at week 12.
Mild, transient, and asymptomatic decreases in hemoglobin and white blood cell parameters occurred for some patients. ● Long term follow up data was collected from the 3.0 mg/kg cohorts in cold urticaria and symptomatic dermographism. 14 patients consented to the optional evaluation (6 cold, 8 symptomatic dermographism); 10 of the 14 still had complete control of their disease as assessed by provocation testing at week 12.
Industry sources estimate there are approximately 154,000 patients in the United States with PN who have undergone treatment within the last 12 months and, of these, approximately 75,000 would be biologic-eligible.
Industry 59 Table of Contents sources estimate there are approximately 154,000 patients in the United States with PN who have undergone treatment within the last 12 months and, of these, approximately 75,000 would be biologic-eligible. We have completed a Phase 1b multi-center, randomized, double-blind, placebo-controlled intravenous study in PN.
In March and June 2021, respectively, we added a third cohort (single dose, 3 mg/kg) in patients with cholinergic urticaria and a fourth cohort at a lower dose (single dose, 1.5 mg/kg) in ColdU. Patient’s symptoms are induced via provocation testing that resembles real life triggering situations.
The study was expanded to include a cohort (single dose, 3 mg/kg) in patients with cholinergic urticaria (“CholU”) and a cohort at a lower dose (single dose, 1.5 mg/kg) in ColdU. Patient’s symptoms were induced via provocation testing that resembles real life triggering situations.
We expect the final histologic analysis and study report in early 2023. We are encouraged with these findings and believe these data strongly support our Phase 2 studies in urticaria and in future indications. Bispecific Platform Our next generation bispecific antibody platform is supporting the expansion of our pipeline with additional candidates for inflammatory diseases and oncology.
We are encouraged with these findings and believe these data strongly support continued development of barzolvolimab. Bispecific Platform Our next generation bispecific antibody platform is supporting the expansion of our pipeline with additional candidates for inflammatory diseases and oncology.
Following the treatment period, patients will enter a 24-week follow up phase. The primary endpoint of the study is mean change in baseline to week 12 in UAS7 (Urticaria Activity Score over 7 days).
After 52 weeks, patients then enter a follow-up period for an additional 24 weeks. The primary endpoint of the study is mean change in baseline to week 12 in UAS7 (weekly urticaria activity score).
Tissue KIT signaling, as approximated by SCF levels, was rapidly inhibited after dose administration and fully reactivated approximately 18 weeks after dosing. ● Tryptase levels return to pretreatment levels during follow up, while mast cells continue to recover. Drug related adverse events noted during the study all resolved.
Serum tryptase exhibits a similar rate of recovery as clinical symptoms, while skin mast cells return at a slower rate. Tissue KIT signaling, as approximated by SCF levels, was rapidly inhibited after dose administration and fully reactivated approximately 18 weeks after dosing. Tryptase levels return to pretreatment levels during follow up, while mast cells continue to recover.
Due to the very high concentrations of barzolvolimab at the end of dosing, the recovery period was approximately one year. As we expected, and consistent with previous findings with KIT blocking antibodies, we were pleased to report in December 2022, that during this recovery period spermatogenesis fully recovered in all male animals as measured by both sperm count and motility.
As we expected, and consistent with previous findings with KIT blocking antibodies, we were pleased to report in December 2022, that during this recovery period spermatogenesis fully recovered in all male animals as measured by both sperm count and motility. The final histologic analysis and study report were completed in early 2023 and were consistent with previously reported results.
The increase in net cash used in investing activities was primarily due to net purchases of marketable securities for the year ended December 31, 2021 of $214.9 million as compared to $96.7 million for the year ended December 31, 2020.
The increase in net cash used in investing activities was primarily due to net purchases of marketable securities of $104.0 million for the year ended December 31, 2023 as compared to net 69 Table of Contents sales and maturities of marketable securities of $91.7 million for the year ended December 31, 2022.
Product development expenses include clinical investigator site fees, external trial monitoring costs, data accumulation costs, contracted research and outside clinical drug product manufacturing.
Facility expenses for the year ended December 31, 2022 were relatively consistent with the year ended December 31, 2021. Product development expenses include clinical investigator site fees, external trial monitoring costs, data accumulation costs, contracted research and outside clinical drug product manufacturing.
Hair color changes (generally small areas of hair color lightening) and taste disorders (generally partial changes of ability to taste salt or umami) are consistent with inhibiting KIT signaling in other cell types and completely resolved over time during follow-up. Infusion reactions, which manifested as localized hives and itching as well as erythema and feeling hot, resolved spontaneously.
Hair color changes (generally small areas of hair color lightening) and taste disorders (generally partial changes of ability to taste salt or umami) are consistent with inhibiting KIT signaling in other cell types and completely resolved over time during follow-up. One patient with a history of fainting experienced loss of consciousness during infusion. The patient rapidly recovered.
We are focusing our efforts and resources on the continued research and development of ● Barzolvolimab (also referred to as CDX-0159), a monoclonal antibody that specifically binds the KIT receptor and potently inhibits its activity, which is currently being studied across multiple mast cell driven diseases including - Chronic Urticarias: In June and July 2022 respectively, we announced that enrollment had opened and the first patients had been dosed in Phase 2 studies in chronic spontaneous urticaria (CSU) and chronic inducible urticaria (CIndU).
We are focusing our efforts and resources on the continued research and development of ● Barzolvolimab (also referred to as CDX-0159), a monoclonal antibody that specifically binds the KIT receptor and potently inhibits its activity, which is currently being studied across multiple mast cell driven diseases including - Chronic Urticarias: In November 2023, we announced that our Phase 2 study in chronic spontaneous urticaria (CSU) achieved the primary efficacy endpoint (statistically significant mean change from baseline to week 12 of urticaria activity score compared to placebo) and was well tolerated.
General and Administrative Expense The $6.0 million increase in general and administrative expenses for the year ended December 31, 2021, as compared to the year ended December 31, 2020, was primarily due to higher stock-based compensation and legal expenses.
General and Administrative Expense The $3.7 million increase in general and administrative expenses for the year ended December 31, 2023, as compared to the year ended December 31, 2022, was primarily due to higher stock-based compensation, recruiting and barzolvolimab commercial planning expenses, partially offset by a decrease in legal expenses.
These data supported expansion of the barzolvolimab program into mast cell driven diseases, including initially in CSU and CIndU, diseases where mast cell degranulation plays a central role in the onset and progression of the disease. Phase 1 studies in CSU and CIndU are completing and Phase 2 studies are ongoing.
Barzolvolimab was initially studied in chronic spontaneous urticaria (CSU) and chronic inducible urticaria (CIndU), diseases where mast cell degranulation plays a central role in the onset and progression of the disease. Phase 1 studies in CSU and CIndU were successfully completed and Phase 2 studies are ongoing.
Omalizumab, an IgE inhibitor, provides relief for roughly half of the remaining antihistamine refractory patients. Consequently, there is a need for additional therapies. In October 2020, we announced that enrollment had opened and the first patient had been dosed in a Phase 1b multi-center study of barzolvolimab in CSU.
Omalizumab, an IgE inhibitor, provides relief for roughly half of the remaining antihistamine refractory patients. Consequently, there is a need for additional therapies. 55 Table of Contents We have completed a Phase 1b randomized, double-blind, placebo-controlled multi-center study of barzolvolimab in CSU.
Most AEs were mild or moderate in severity and resolved while on study. The most common treatment emergent adverse events were hair color changes, COVID-19, headache, neutropenia and urinary tract infections (UTIs). UTIs and COVID-19 were reported as unrelated to treatment. There was one serious adverse event of salmonella gastroenteritis which was also not related to study therapy.
Most AEs were mild or moderate in severity and resolved while on study. The most common treatment emergent adverse events were hair color changes, COVID-19, headache, neutropenia and urinary tract infections (UTIs). UTIs and COVID-19 were reported as unrelated to treatment. Generally transient, asymptomatic and mild changes in hematologic parameters were observed, consistent with observations from prior studies.
Eosinophilic Esophagitis (EoE) In February 2022, we announced that we will be expanding clinical development of barzolvolimab into eosinophilic esophagitis (EoE), the most common type of eosinophilic gastrointestinal disease. EoE is a chronic inflammatory disease of the esophagus characterized by the infiltration of eosinophils.
Eosinophilic Esophagitis (EoE) In July of 2023, we announced that the first patient had been dosed in a Phase 2 study of eosinophilic esophagitis (EoE). EoE, the most common type of eosinophilic gastrointestinal disease, is a chronic inflammatory disease of the esophagus characterized by the infiltration of eosinophils.
As of the data cut-off date on November 29, 2022, enrollment was complete with 45 patients with moderate to severe CSU refractory to antihistamines enrolled and treated [35 barzolvolimab (n=9 in 0.5 mg/kg; n=8 in 1.5 mg/kg; n=9 in 3.0 mg/kg; n=9 in 4.5 mg/kg) and 10 placebo].
Barzolvolimab was administered intravenously as add on treatment to H1-antihistamines, either alone or in combination with H2-antihistamines and/or leukotriene receptor agonists. 45 patients with moderate to severe CSU refractory to antihistamines were enrolled and treated [35 barzolvolimab (n=9 in 0.5 mg/kg; n=8 in 1.5 mg/kg; n=9 in 3.0 mg/kg; n=9 in 4.5 mg/kg) and 10 placebo].
In November 2022, data from the ColdU and SD cohorts treated with a single intravenous infusion of barzolvolimab at 3 mg/kg were published in Allergy (Terhorst-Molawi et al Allergy. 2022 Nov 16. doi: 10.1111/all.15585). Safety results were reported for 21 patients; activity results were reported for the 20 patients who received a full dose of barzolvolimab.
At 3 mg/kg in the ColdU and SD cohorts, safety results were reported for 21 patients and activity results were reported for the 20 patients who received a full dose of barzolvolimab.
Net cash used in investing activities was $216.2 million for the year ended December 31, 2021 compared to $98.2 million for the year ended December 31, 2020.
Operating Activities Net cash used in operating activities was $107.3 million for the year ended December 31, 2023 compared to $103.7 million for the year ended December 31, 2022.
The only clinically adverse finding at the completion of dosing was a profound impact on spermatogenesis, an expected and well understood effect of KIT inhibition. As a standard part of toxicology studies, some animals from each group continued to be observed through a recovery period to understand the reversibility of any adverse findings.
As a standard part of toxicology studies, some animals from each group continued to be observed through a recovery period to understand the reversibility of any adverse findings. Due to the very high concentrations of barzolvolimab at the end of dosing, the recovery period was approximately one year.
We expect that cash used in operating activities (not including the $15.0 million Initial Payment made to SRS) will increase over the next twelve months as a result of the expanded development of barzolvolimab.
We expect that cash used in operating activities will increase over the next twelve months as a result of the expanded development of barzolvolimab. Net cash used in operating activities was $103.7 million for the year ended December 31, 2022 compared to $60.9 million for the year ended December 31, 2021.
The assumptions related to determining the value of contingent consideration include a significant amount of judgment, and any changes in the underlying estimates could have a material impact on the amount of contingent consideration adjustment recorded in any given period. 58 Table of Contents Revenue Recognition Revenues are recognized when performance obligations under agreements or contracts are satisfied, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services.
The assumptions related to determining the value of contingent consideration include a significant amount of judgment, and any changes in the underlying estimates could have a material impact on the amount of contingent consideration adjustment recorded in any given period.
Positive interim data from the Phase 1b study in CIndU were reported in July and September 2021 and in December 2022 in patients with cold urticaria and symptomatic dermographism; - Prurigo Nodularis (PN): In December 2021 we announced that the first patient had been dosed in a Phase 1b study in PN; enrollment was closed in February 2023 and we plan to present data from the study in the second half of 2023; - Eosinophilic Esophagitis (EoE): We plan to initiate a Phase 2 study in EoE in the first half of 2023. ● Our next generation bispecific antibody platform to support pipeline expansion with additional candidates for inflammatory diseases and oncology.
A Phase 2 study in chronic inducible urticaria (CIndU) is currently enrolling patients and we expect to report data from this study in the second half of 2024; - Prurigo Nodularis (PN): In November 2023, we reported positive data from a Phase 1b study in PN that supports further development of barzolvolimab in this indication and we are currently planning for the initiation of a Phase 2 study in PN in early 2024; - Eosinophilic Esophagitis (EoE): A Phase 2 study in EoE was initiated in June 2023 and enrollment is ongoing. ● Our next generation bispecific antibody platform to support pipeline expansion with additional candidates for inflammatory diseases and oncology.
CDX-585 will initially be developed for the treatment of solid tumors either as monotherapy or in combination with other oncologic treatments and is expected to enter the clinic in 2023 in patients with advanced malignancies.
CDX-585 will initially be developed for the treatment of solid tumors either as monotherapy or in combination with other oncologic treatments. In late May 2023, we announced that the first patient had been dosed in the Phase 1 study of CDX-585.
Secondary and exploratory objectives include pharmacokinetic and pharmacodynamic assessments, including changes from baseline provocation thresholds, measurement of tryptase and stem cell factor levels, clinical activity outcomes (impact on urticaria symptoms, disease control, clinical response), quality of life assessments and measurement of tissue mast cells through skin biopsies. Barzolvolimab is administered intravenously on Day 1 as add on treatment to H1-antihistamines.
Secondary and exploratory objectives included pharmacokinetic and pharmacodynamic assessments, including changes from baseline provocation thresholds, measurement of tryptase and stem cell factor levels, clinical activity outcomes, quality of life assessments and measurement of tissue mast cells through skin biopsies. Generally patients on study had high disease activity at baseline that was poorly controlled and marked impairment in quality of life.
We expect product development expenses to increase over the next twelve months as a result of further increases in barzolvolimab clinical trial and contract manufacturing expenses.
We expect product development expenses to increase over the next twelve months as a result of the expanded development of barzolvolimab, although there may be fluctuations on a quarterly basis.
The study is being conducted at approximately 75 sites across 9 countries. The study is a randomized, double-blind, placebo-controlled, parallel group Phase 2 study evaluating the efficacy and safety profile of multiple dose regimens of barzolvolimab to determine the optimal dosing strategy.
The study is a randomized, double-blind, placebo-controlled, parallel group Phase 2 study evaluating the efficacy and safety profile of multiple dose regimens of barzolvolimab to determine the optimal dosing strategy. 208 patients have been randomly assigned on a 1:1:1:1 ratio to receive subcutaneous injections of barzolvolimab at 75 mg every 4 weeks, 150 mg every 4 weeks, 300 mg every 8 weeks or placebo during a 16-week placebo-controlled treatment phase.
Product development expenses include clinical investigator site fees, external trial monitoring costs, data accumulation costs, contracted research and outside clinical drug product manufacturing.
We expect facility expenses to remain relatively consistent over the next twelve months, although there may be fluctuations on a quarterly basis. Product development expenses include clinical investigator site fees, external trial monitoring costs, data accumulation costs, contracted research and outside clinical drug product manufacturing.
This study is a randomized, double-blind, placebo- controlled clinical trial designed to assess the safety of multiple ascending doses of barzolvolimab in up to 40 patients with CSU who remain symptomatic despite treatment with antihistamines.
The study was designed to assess the safety of multiple ascending doses of barzolvolimab in patients with CSU who remain symptomatic despite treatment with antihistamines. Secondary and exploratory objectives included pharmacokinetic and pharmacodynamic assessments, clinical activity outcomes and quality of life assessments.
Net cash used in operating activities was $60.9 million for the year ended December 31, 2021 compared to $40.4 million for the year ended December 31, 2020. The increase in net cash used in operating activities was primarily due to increases in research and development and general and administrative expenses and a decrease in revenue.
The increase in net cash used in operating activities was primarily due to increases in research and development and general and administrative expenses, partially offset by an increase in revenue and a decrease in payments made under the Settlement Agreement with SRS.
Complete urticaria control (UCT = 16) was achieved by 35% (n = 7/20), 65% (n = 13/20), and 40% (n = 8/20) at weeks 4, 8, and 12, respectively. 54 Table of Contents ● At baseline, patients in both treatment groups reported disease impact on their QoL.
Complete urticaria control (UCT=16) was achieved by 35% (n=7/20), 65% (n=13/20), and 40% (n=8/20) at weeks 4, 8, and 12, respectively. ● A complete response was achieved in 100% (n=9 of 9) patients with ColdU treated with a single dose at 1.5 mg/kg, including 4 patients with disease refractory to omalizumab.
We expect investment and other income to increase over the next twelve months primarily due to higher interest rates and higher other income related to our sale of New Jersey tax benefits. 62 Table of Contents Income Tax Benefit A $0.2 million non-cash income tax benefit was recorded for the year ended December 31, 2021 related to the impairment of the TAM program IPR&D asset in the third quarter of 2021.
Investment and Other Income, Net The $10.2 million increase in investment and other income, net for the year ended December 31, 2023, as compared to the year ended December 31, 2022, was primarily due to higher interest rates on fixed income investments and higher other income related to our sale of New Jersey tax benefits.
Phase 1 studies of barzolvolimab have been conducted with an intravenous formulation; a subcutaneous formulation has been successfully developed and is being used in Phase 2 studies. Chronic Spontaneous Urticaria (CSU) CSU presents as itchy hives, angioedema or both for at least six weeks without a specific trigger; multiple episodes can play out over years or even decades.
We continue to assess potential opportunities for barzolvolimab in other diseases where mast cells play an important role, such as dermatologic, respiratory, allergic, gastrointestinal and ophthalmic conditions. Chronic Spontaneous Urticaria (CSU) CSU presents as itchy hives, angioedema or both for at least six weeks without a specific trigger; multiple episodes can play out over years or even decades.
We expect general and administrative expenses to remain relatively consistent over the next twelve months, although there may be fluctuations on a quarterly basis. Intangible Asset Impairment During the third quarter of 2021, we evaluated the TAM program IPR&D asset for potential impairment as a result of a lack of interest in the program from third parties.
We expect general and administrative expenses to increase over the next twelve months as a result of the expanded development of barzolvolimab and an increase in commercial planning efforts, although there may be fluctuations on a quarterly basis.
Facility expenses include depreciation, amortization, utilities, rent, maintenance and other related expenses incurred at our facilities. Facility expenses for the year ended December 31, 2022 were relatively consistent with the year ended December 31, 2021. We expect facility expenses to remain relatively consistent over the next twelve months, although there may be fluctuations on a quarterly basis.
We expect revenue to remain relatively consistent over the next twelve months, although there may be fluctuations on a quarterly basis.
This could be impacted if we elect to pay the future milestones under the Settlement Agreement with SRS, if any, in cash.
We believe that the cash, cash equivalents and marketable securities at December 31, 2023 are sufficient to meet estimated working capital requirements and fund current planned operations into 2026. This could be impacted if we elect to pay the future milestone under the Settlement Agreement with SRS, if any, in cash.

… 119 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

1 edited+0 added−0 removed3 unchanged
Biggest changeWe do not utilize derivative financial instruments. The carrying amounts reflected in the balance sheet of cash and cash equivalents, accounts receivables and accounts payable approximates fair value at December 31, 2022 due to the short-term maturities of these instruments. ​ 67 Table of Contents
Biggest changeWe do not utilize derivative financial instruments. The carrying amounts reflected in the balance sheet of cash and cash equivalents, accounts receivables and accounts payable approximates fair value at December 31, 2023 due to the short-term maturities of these instruments. ​ 70 Table of Contents

Other CLDX 10-K year-over-year comparisons