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What changed in Cardiff Oncology, Inc.'s 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of Cardiff Oncology, 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.

+217 added−198 removedSource: 10-K (2024-02-29) vs 10-K (2023-03-02)

Top changes in Cardiff Oncology, Inc.'s 2023 10-K

217 paragraphs added · 198 removed · 131 edited across 4 sections

Item 1. Business

Business — how the company describes what it does

58 edited+47 added−29 removed70 unchanged
Biggest changeHITECH also created new tiers of civil monetary penalties, amended HIPAA to make civil and criminal penalties directly applicable to business associates, and gave state attorneys general new authority to file civil actions for damages or injunctions in U.S. federal courts to enforce the federal HIPAA laws and seek attorneys’ fees and costs associated with pursuing federal civil actions. 13 Table of Contents The federal physician payment transparency requirements, sometimes referred to as the “Physician Payments Sunshine Act,” and its implementing regulations, which require certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to the United States Department of Health and Human Services (“HHS”) information related to payments or other transfers of value made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors) and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members.
Biggest changeThe federal physician payment transparency requirements, sometimes referred to as the “Physician Payments Sunshine Act,” and its implementing regulations, which require certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to the United States Department of Health and Human Services (“HHS”) information related to payments or other transfers of value made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors) and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members.
ITEM 1. BUSINESS We are a clinical-stage biotechnology company leveraging PLK1 inhibition, a well-validated oncology drug target, to develop novel therapies across a range of cancers with the greatest unmet medical need. Our goal is to target tumor vulnerabilities with treatment combinations of onvansertib, our oral and highly selective PLK1 inhibitor, and standard of care ("SoC") therapeutics.
ITEM 1. BUSINESS We are a clinical-stage biotechnology company leveraging PLK1 inhibition, a well-validated oncology drug target, to develop novel therapies across a range of cancers with the greatest unmet medical need. Our goal is to target tumor vulnerabilities with treatment combinations of onvansertib, our oral and highly selective PLK1 inhibitor, and standard-of-care therapeutics.
If business operations are found to be in violation of any of the laws described above or any other applicable governmental regulations a pharmaceutical manufacturer may be subject to penalties, including civil, criminal and administrative penalties, damages, fines, disgorgement, individual imprisonment, exclusion from governmental funded healthcare programs, such as Medicare and Medicaid, contractual damages, reputational harm, diminished profits and future earnings, additional reporting obligations and oversight if subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws, and curtailment or restructuring of operations, any of which could adversely affect a pharmaceutical manufacturer’s ability to operate its business and the results of its operations.
If business operations are found to be in violation of any of the laws described above or any other applicable governmental regulations a pharmaceutical manufacturer may be subject to penalties, including civil, criminal and administrative penalties, damages, fines, disgorgement, individual imprisonment, exclusion from governmental funded 15 Table of Contents healthcare programs, such as Medicare and Medicaid, contractual damages, reputational harm, diminished profits and future earnings, additional reporting obligations and oversight if subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws, and curtailment or restructuring of operations, any of which could adversely affect a pharmaceutical manufacturer’s ability to operate its business and the results of its operations.
Collaborative Relationship Pfizer Breakthrough Growth Initiative In November 2021, we entered into a Securities Purchase Agreement (the “SPA”) with Pfizer Inc., as part of the Pfizer Breakthrough Growth Initiative, pursuant to which Pfizer purchased 2.4 million shares of our common stock at a purchase price per share of $6.22 for gross proceeds of approximately $15.0 million.
In November 2021, we entered into a Securities Purchase Agreement (the “SPA”) with Pfizer Inc., as part of the Pfizer Breakthrough Growth Initiative, pursuant to which Pfizer purchased 2.4 million shares of our common stock at a purchase price per share of $6.22 for gross proceeds of approximately $15.0 million.
Despite significant progress in the treatment of mCRC, the majority of patients with mCRC succumb to the disease. RAS mutations in the CRC population are common, with greater than 50% of tumors from CRC patients harboring a RAS mutation (43% KRAS, 9% NRAS). The efficacy of second-line therapy in terms of response and survival prolongation remains limited.
Despite significant progress in the treatment of mCRC, the majority of patients with mCRC succumb to the disease. RAS mutations in the CRC population are common, with greater than 50% of tumors from CRC patients harboring a RAS mutation (43% KRAS, 9% NRAS). The efficacy of first-line therapy in terms of response and survival prolongation remains limited.
Patent No. 9,566,280, by expanding the use of onvansertib to encompass combination therapies with any anti-androgen and androgen antagonist drug, such as Zytiga ® , Xtandi ® and Erleada ® for the treatment of metastatic and non-metastatic castrate-resistant prostate cancer. Our owned intellectual property includes eighteen patent families related to onvansertib.
Patent No. 9,566,280, by expanding the use of onvansertib to encompass combination therapies with any anti-androgen and androgen antagonist drug, such as Zytiga ® , Xtandi ® and Erleada ® for the treatment of metastatic and non-metastatic castrate-resistant prostate cancer. Our owned intellectual property includes twenty patent families related to onvansertib.
We are focusing our clinical program in indications such as KRAS/NRAS-mutated metastatic colorectal cancer ("mCRC") and metastatic pancreatic ductal adenocarcinoma ("mPDAC"), as well as in investigator-initiated trials in triple negative breast cancer ("TNBC") and small cell lung cancer ("SCLC"). Our clinical development programs incorporate tumor genomics and biomarker assays to refine assessment of patient response to treatment.
We are focusing our clinical program in indications such as RAS-mutated metastatic colorectal cancer ("mCRC"), as well as in investigator-initiated trials in metastatic pancreatic ductal adenocarcinoma ("mPDAC"), small cell lung cancer ("SCLC"), and triple negative breast cancer ("TNBC"). Our clinical development programs incorporate tumor genomics and biomarker assays to refine assessment of patient response to treatment.
Phase 2 Investigator-Initiated Clinical Trial in SCLC A single-arm, two-stage, Phase 2 trial of onvansertib monotherapy in patients with relapsed SCLC is open for enrollment at the University of Pittsburgh Medical Center ("UPMC").
Other Clinical Programs: Phase 2 Investigator-Initiated Clinical Trial in SCLC A single-arm, two-stage, Phase 2 trial of onvansertib monotherapy in patients with relapsed SCLC is open for enrollment at the University of Pittsburgh Medical Center ("UPMC").
The federal false claims and civil monetary penalty laws, including the Federal False Claims Act, which imposes significant penalties and can be enforced by private citizens through civil qui tam actions, prohibits any person or entity from, among other things, knowingly presenting, or causing to be presented, a false, fictitious or fraudulent claim for payment to the federal government, or knowingly making, using or causing to be made, a false statement or record material to a false or fraudulent claim to avoid, decrease or conceal an obligation to pay money to the federal government.
The federal false claims and civil monetary penalty laws, including the Federal False Claims Act, which imposes significant penalties and can be enforced by private citizens through civil qui tam actions, prohibits any person or entity from, among other things, knowingly presenting, or causing to be presented, a false, fictitious or fraudulent claim for payment to the 14 Table of Contents federal government, or knowingly making, using or causing to be made, a false statement or record material to a false or fraudulent claim to avoid, decrease or conceal an obligation to pay money to the federal government.
The FDA has agreed to certain performance goals in the 11 Table of Contents review of marketing applications. Most such applications for non-priority drug products are reviewed within ten months. The review process may be extended by the FDA for three additional months to consider new information submitted during the review or clarification regarding information already provided in the submission.
The FDA has agreed to certain performance goals in the review of marketing applications. Most such applications for non-priority drug products are reviewed within ten months. The review process may be extended by the FDA for three additional months to consider new information submitted during the review or clarification regarding information already provided in the submission.
Our planned or potential products may be covered by third-party patents or other intellectual property rights, in which case continued development and marketing of our products would require a license. Required licenses may not be available to us on commercially acceptable terms, if at all.
Our planned or potential products may be covered by third-party patents or other intellectual property rights, in which case continued development and marketing of our products would require a license. Required licenses may not be available to us on 11 Table of Contents commercially acceptable terms, if at all.
We do not assess the performance of geographic regions on measures of revenue or comprehensive income or expense. In addition, all of our principal operations, assets and decision-making functions are located in the U.S. We do not produce reports for, or measure the 8 Table of Contents performance of, geographic regions on any asset-based metrics.
We do not assess the performance of geographic regions on measures of revenue or comprehensive income or expense. In addition, all of our principal operations, assets and decision-making functions are located in the U.S. We do not produce reports for, or measure the performance of, geographic regions on any asset-based metrics.
Patent No. 9,566,280 encompasses using abiraterone in combination with onvansertib to treat cancer. U.S. Patent Nos. 10,155,006 and 10,772,898 broaden previously issued U.S.
Patent No. 9,566,280 encompasses using abiraterone in combination with onvansertib to treat cancer. U.S. Patent Nos. 10,155,006 and 10,772,898 broaden earlier issued U.S.
Additionally, some biomarkers can be used as a surrogate endpoint for efficacy and/or toxicity, as well as identifying certain patient populations that are more likely to respond to the drug therapy. In our ongoing clinical trial in KRAS-mutated mCRC, we are quantitatively assessing changes in the KRAS mutational burden with a blood test based on ctDNA.
Additionally, some biomarkers can be used as a surrogate endpoint for efficacy and/or toxicity, as well as identifying certain patient populations that are more likely to respond to the drug therapy. In our ongoing CRDF-004 clinical trial in RAS-mutated mCRC, we are quantitatively assessing changes in the RAS mutational burden with a blood test based on ctDNA.
Phase 2 Randomized Clinical Trial in KRAS-mutated mCRC (the ONSEMBLE trial) The ONSEMBLE trial (CRDF-003), is a Phase 2 open-label, randomized multi-center clinical trial of onvansertib in combination with standard of care FOLFIRI and bevacizumab for the second line treatment of patients with KRAS/NRAS-mutated mCRC.
Phase 2 Clinical Trial in Second-Line RAS-mutated mCRC The ONSEMBLE trial (CRDF-003) is a Phase 2 randomized, open-label multi-center clinical trial of onvansertib in combination with standard-of-care FOLFIRI and bevacizumab for the second-line treatment of patients with RAS-mutated mCRC.
Phase 2 Clinical Trial in mPDAC CRDF-001 is a Phase 2 open-label multi-center clinical trial of onvansertib in combination with nanoliposomal irinotecan (Onivyde ® ), leucovorin, and fluorouracil for second line treatment of patients with mPDAC, which is being conducted at six clinical trial sites across the U.S. – The Mayo Clinic Cancer Centers (Arizona, Minnesota, and Florida), Kansas University Medical Center, Inova Schar Cancer Institute, and the University of Nebraska Medical Center.
Phase 2 Clinical Trial in mPDAC 8 Table of Contents CRDF-001 is a Phase 2 open-label multi-center clinical trial of onvansertib in combination with nanoliposomal irinotecan (Onivyde ® ), leucovorin, and fluorouracil for 2 nd line treatment of patients with mPDAC, which is being conducted at six clinical trial sites across the U.S. – The Mayo Clinic Cancer Centers (Arizona, Minnesota, and Florida), Kansas University Medical Center, Inova Schar Cancer Institute, and the University of Nebraska Medical Center.
Foreign Corrupt Practices Act, to which we are subject, prohibits corporations and individuals from engaging in certain activities to obtain or retain business or to influence a person working in an official capacity.
Foreign Corrupt Practices Act The U.S. Foreign Corrupt Practices Act, to which we are subject, prohibits corporations and individuals from engaging in certain activities to obtain or retain business or to influence a person working in an official capacity.
We believe the attributes of onvansertib described below, as well as clinical evidence of favorable safety and efficacy, with expected on-target, easy to manage and reversible side effects, may prove beneficial in addressing clinical therapeutic needs across a variety of cancers: • Onvansertib is highly potent and highly selective against the PLK1 enzyme (IC 50 = 2nM; IC 50 is the concentration for 50% inhibition), compared to prior PLK1 inhibitors that were pan-inhibitors of several PLK targets.
We believe the attributes of onvansertib described below, as well as early clinical evidence of favorable safety and efficacy, with expected on-target, manageable and transient side effects, may prove beneficial in addressing clinical therapeutic needs across a variety of cancers: • Onvansertib is highly potent and highly selective against the PLK1 enzyme (IC 50 = 2nM; IC 50 is the concentration for 50% inhibition), compared to prior PLK1 inhibitors that were pan-inhibitors of several PLK targets.
In Phase 1b, approximately 14-16 patients will be treated with different doses of onvansertib in combination with a fixed dose of paclitaxel to determine the maximum tolerated dose and RP2D of onvansertib. In Phase 2, approximately 34 patients will be treated with the selected onvansertib RP2D in combination with paclitaxel.
In Phase 1b, approximately 14-16 patients will be treated with different doses of onvansertib in combination with a fixed dose of paclitaxel to determine the maximum tolerated dose and RP2D of onvansertib.
Once granted, product approvals may be withdrawn if compliance with regulatory standards is not maintained, or problems are identified following initial marketing. Other Regulatory Requirements Once a NDA or BLA is approved, a product will be subject to certain post-approval requirements.
Once granted, product approvals may be withdrawn if compliance with regulatory standards is not maintained, or problems are identified following initial marketing. 13 Table of Contents Other Regulatory Requirements Once a NDA or BLA is approved, a product will be subject to certain post-approval requirements.
Any patents issued in these families will expire between 2039 and 2043. One of the patent families includes patent applications directed to selecting and treating cancers with combination therapies of PLK1 inhibitors. MIT and we co-own this family. On November 17, 2021, we amended the Exclusive Patent License Agreement with MIT to include this patent family.
Any patents issued in these families will expire between 2039 and 2044. One of the patent families includes a patent application directed to selecting and treating cancers with combination therapies of PLK1 inhibitors. MIT and we co-own this family. On November 17, 2021, we amended the Exclusive Patent License Agreement with MIT to include this patent family.
Therefore, improving the treatment options and effectiveness of treatment is critical to changing the outcomes for the KRAS-mutated patient population. Additional Cancer Indications We and certain investigators are currently conducting signal-finding clinical trials to explore the treatment opportunity for onvansertib in mPDAC, SCLC and TNBC.
Therefore, improving the treatment options and effectiveness of treatment is critical to changing the outcomes for the RAS-mutated patient population. Additional Cancer Indications We and certain investigators are currently conducting signal-finding clinical trials to explore the treatment opportunity for onvansertib in mPDAC, SCLC and TNBC. Collaborative Relationship Pfizer, Inc.
Based on self-identification data 50% of our employees identify as women and 38% of our employees identify as a racial or ethnic minority. None of our employees are covered by a collective bargaining agreement, and we consider our relations with our employees to be good.
Based on self-identification data, 47% of our employees identify as female and 47% of our employees identify as a racial or ethnic minority. None of our employees are covered by a collective bargaining agreement, and we consider our relations with our employees to be good.
Historical control trials of different drug combinations, including the standard of care ("SOC") of FOLFIRI with bevacizumab, in similar patient populations have shown ORR and mPFS of 5 – 13% and ~4.5 – 5.7 months, respectively. • A subgroup analysis of patients who were bevacizumab naïve when they entered 2 nd line therapy vs patients who had received prior bevacizumab in 1st line therapy showed that patients who were bevacizumab naïve (n=13) had an ORR of 69% and mPFS of 13.5 months, which is well above historical controls.
Historical control trials of different drug combinations, including the standard-of-care of FOLFIRI with bevacizumab, in similar patient populations have shown ORR and mPFS of 5 – 13% and ~4.5 – 6.7 months, respectively. • A subgroup analysis of patients who were bevacizumab naïve when they entered second-line therapy vs. patients who had received prior bevacizumab in first-line therapy showed that patients who were bevacizumab naïve (n=15) had an ORR of 73% and mPFS of 15 months, which is well above historical controls.
These families include patent applications directed to treating cancer using PLK1 inhibitors and determining efficacy of the treatment, treating benign prostatic hyperplasia using onvansertib, treating prostate cancer using PLK1 inhibitors, determining or predicting efficacies or responsiveness of PLK1 inhibitor treatments based on biomarkers, and treating cancers with combination therapies of PLK1 inhibitors (including combination therapies of PLK1 inhibitors with B-cell lymphoma 2 inhibitors or poly ADP ribose polymerase inhibitors).
These families include patent applications directed to treating cancer using PLK1 inhibitors and determining efficacy of the treatment, treating benign prostatic hyperplasia using onvansertib, treating prostate cancer using PLK1 inhibitors, determining or predicting efficacies or responsiveness of PLK1 inhibitor treatments based on biomarkers, and treating cancers with combination therapies of PLK1 inhibitors (including combination therapies of PLK1 inhibitors with B-cell lymphoma 2 inhibitors, poly ADP ribose polymerase inhibitors, fibroblast growth factor receptor inhibitors, lysine-specific demethylase 1 inhibitors, or irinotecan).
Responses have been observed across multiple KRAS variants; • Median duration of response ("mDoR") across all evaluable patients was 11.7 months (95% confidence interval ("CI"): 8.9 – not reached); • Median progression free survival ("mPFS") across all evaluable patients was 9.3 months (95% CI: 7.6 – 13.5).
Responses have been observed across multiple KRAS variants; • Median duration of response ("mDoR") across all evaluable patients was 12.0 months (95% confidence interval ("CI"): 8.9 – not reached); • Median progression free survival ("mPFS") across all evaluable patients was 9.3 months (95% CI: 7.8 – 14).
Individual states have become increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access, and marketing cost disclosure and transparency measures, and to encourage importation from other countries and bulk purchasing.
Individual states in the United States have also become increasingly active in implementing regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and other transparency measures, and, in some cases, measures designed to encourage importation from other countries and bulk purchasing.
The American Cancer Society's estimates for the number of CRC diagnoses expected in the US in 2023 are 106,970 new cases of colon cancer and 46,050 new cases of rectal cancer, with an estimated 52,550 deaths predicted during 2023. Cancer‑specific mortality of CRC is predominantly due to metastatic disease.
The American Cancer Society's estimates for the number of CRC diagnoses expected in the US in 2024 are 106,590 new cases of colon cancer and 46,220 new cases of rectal cancer, with an estimated 53,010 deaths predicted during 2024. Cancer‑specific mortality of CRC is predominantly due to metastatic disease.
In connection with the stock purchase, we and Pfizer entered into an Information Rights Agreement pursuant to which Adam Schayowitz, Ph.D., MBA, Vice President & Medicine Team Group Lead for Breast Cancer, Colorectal Cancer and Melanoma at Pfizer will join our Scientific Advisory Board, and until May 17, 2024 we agreed to provide Pfizer with rights of first access to any pre-clinical or final clinical data and results generated as part of the onvansertib development program at least two business days prior to us providing such data to a third party.
In connection with the stock purchase, we and Pfizer entered into an Information Rights Agreement pursuant to which Adam Schayowitz, Ph.D., MBA, Vice President & Medicine Team Group Lead for Breast Cancer, Colorectal Cancer and Melanoma at Pfizer joined our Scientific Advisory Board, and until May 17, 2024 we agreed to provide Pfizer with rights of first access to any pre-clinical or final clinical data and results generated as part of the onvansertib development program at least two business days prior to us providing such data to a third party. 10 Table of Contents In August 2023, we announced that Pfizer Ignite, a new end-to-end service for biotech companies, will be responsible for the clinical activities of our new CRDF-004 trial in first-line RAS-mutated mCRC.
Phase 1b/2 Investigator-Initiated Clinical Trial in TNBC A single-arm, Phase 1b/2 trial of onvansertib in combination with paclitaxel in patients with unresectable locally advanced or metastatic TNBC is open for enrollment at Dana Farber Cancer Institute ("DFCI").
The disease control rate (“DCR”), including PR and SD, is 57% (4 of 7 patients). Phase 1b/2 Investigator-Initiated Clinical Trial in TNBC A single-arm, Phase 1b/2 trial of onvansertib in combination with paclitaxel in patients with unresectable locally advanced or metastatic TNBC is open for enrollment at Dana Farber Cancer Institute ("DFCI").
We provide competitive compensation and benefits to attract and retain key personnel, while also providing a safe, inclusive and respectful workplace. 16 Table of Contents As of February 23, 2023, we had a total of 26 employees, 25 of whom were full-time.
We provide competitive compensation and benefits to attract and retain key personnel, while also providing a safe, inclusive and respectful workplace. As of February 22, 2024, we had a total of 32 employees, 31 of whom were full-time.
As of December 31, 2022, our owned and licensed intellectual property included 52 issued patents and 37 pending patent applications in the U.S. and abroad, some of which are related to our legacy patent portfolio.
As of December 31, 2023, our owned and licensed intellectual property included 53 issued patents and 43 pending patent applications (one U.S. patent application was recently allowed) in the U.S. and abroad, some of which are related to our legacy patent portfolio.
Regulation in the European Union Biologics are also subject to extensive regulation outside of the United States. In the European Union, for example, there is a centralized approval procedure that authorizes marketing of a product in all countries of the European Union, which includes most major countries in Europe.
In the European Union, for example, there is a centralized approval procedure that authorizes marketing of a product in all countries of the European Union, which includes most major countries in Europe.
In the clinical development of our lead drug candidate, onvansertib, correlative biomarker analyses are being used to help inform decisions in the evaluation of dose-response and optimal regimen for desired pharmacologic effect and safety.
Identifying Biomarkers that Predict Patient Benefit Our laboratory in San Diego, California, enables us to optimize drug development and patient care. In the clinical development of our lead drug candidate, onvansertib, correlative biomarker analyses are being used to help inform decisions in the evaluation of dose-response and optimal regimen for desired pharmacologic effect and safety.
In addition, in vivo combination studies have confirmed the positive results obtained in vitro and synergistic effects have been observed in xenograft models of onvansertib in combination with irinotecan, 5-fluorouracil ("5-FU"), abiraterone, PARP inhibitors, venetoclax, and paclitaxel, while additive effects in combination with cytarabine or bevacizumab have been demonstrated.
In addition, in vivo combination studies have confirmed the positive results obtained in vitro and additive or synergistic effects on efficacy have been observed in xenograft models of onvansertib in combination with irinotecan, 5-fluorouracil ("5-FU"), abiraterone, PARP inhibitors, venetoclax, paclitaxel, or bevacizumab. Combining onvansertib with standard-of-care cancer agents provides opportunities for synergy with many cancer therapies.
The FDC Act and other federal and state statutes and regulations, govern, among other things, the research, development, testing, manufacturing, storage, record keeping, approval, labeling, promotion and marketing, distribution, post-approval monitoring 10 Table of Contents and reporting, sampling, and import and export of pharmaceutical products.
FDA Approval Process In the United States, pharmaceutical products, including biologics, are subject to extensive regulation by the FDA. The FDC Act and other federal and state statutes and regulations, govern, among other things, the research, development, testing, manufacturing, storage, record keeping, approval, labeling, promotion and marketing, distribution, post-approval monitoring and reporting, sampling, and import and export of pharmaceutical products.
Low or no activity of onvansertib was observed on a panel of 63 kinases (IC50>500 nM), including the PLK members PLK2 and PLK3 (IC 50 >10,000 nM); • Onvansertib has a relatively short drug half-life of 24 hours, allowing for flexible dosing and scheduling which has shown favorable safety and tolerability across multiple clinical trials; • Onvansertib is orally bioavailable, allowing for relative ease and flexibility of dosing.
Low or no activity of onvansertib was observed on a panel of 63 kinases (IC50>500 nM), including the PLK members PLK2 and PLK3 (IC 50 >10,000 nM); • Onvansertib is orally bioavailable, allowing for relative ease and flexibility of dosing; • Onvansertib has a relatively short drug half-life of 24 hours, allowing for flexible dosing and scheduling which has shown favorable safety and tolerability across multiple clinical trials; In vitro studies have shown synergistic effects when onvansertib was administered in combination with different cytotoxic agents including microtubule-targeting agents, topoisomerase 1 inhibitors, antimetabolites, alkylating agents, proteasome inhibitors, kinase inhibitors, PARP inhibitors, BCL-2 inhibitors, and androgen biosynthesis inhibitors.
The FDA may order the temporary or permanent discontinuation of a clinical trial at any time or impose other sanctions if it believes that the clinical trial is not being conducted in accordance with FDA requirements or presents an unacceptable risk to the clinical trial patients.
Each protocol involving testing on U.S. patients and subsequent protocol amendments must be submitted to the FDA as part of the IND. 12 Table of Contents The FDA may order the temporary or permanent discontinuation of a clinical trial at any time or impose other sanctions if it believes that the clinical trial is not being conducted in accordance with FDA requirements or presents an unacceptable risk to the clinical trial patients.
As a result, the development of orphan drugs continues to grow at a faster rate than the development of traditional pharmaceuticals. Competition Onvansertib is not the first PLK inhibitor that has entered clinical development; however, we believe it currently is the only oral PLK1 inhibitor in active clinical development that delivers highly selective PLK1 inhibition.
Competition Onvansertib is not the first PLK inhibitor that has entered clinical development; however, we believe it currently is the only oral PLK1 inhibitor in active clinical development that delivers highly selective PLK1 inhibition.
We believe our management team has the experience necessary to effectively implement our growth strategy and continue to drive shareholder value.
Our employees are critical to the success of our organization and we are committed to supporting our employees’ professional development. We believe our management team has the experience necessary to effectively implement our growth strategy and continue to drive shareholder value.
After receiving regulatory approval through any of the European registration procedures, pricing and reimbursement approvals are also required in most countries. Other Regulations We are also subject to numerous federal, state and local laws relating to such matters as safe working conditions, manufacturing practices, environmental protection, fire hazard control, and disposal of hazardous or potentially hazardous substances and biological materials.
Other Regulations We are also subject to numerous federal, state and local laws relating to such matters as safe working conditions, manufacturing practices, environmental protection, fire hazard control, and disposal of hazardous or potentially hazardous substances and biological materials. We may incur significant costs to comply with such laws and regulations now or in the future.
The license agreement covers the rights to develop combination therapies and identified predictive clinical biomarkers across cancer types, expanding potential indications for onvansertib. Under the 9 Table of Contents agreement, we have exclusive rights to develop, make, use, and sell combination therapies that include an anti-androgen or androgen antagonist and a PLK inhibitor for the treatment of cancer.
Under the agreement, we have exclusive rights to develop, make, use, and sell combination therapies that include a PLK inhibitor in combination with an anti-androgen or androgen antagonist, or in combination with a microtubule polymerization inhibitor, for the treatment of cancer.
Data presented on September 12, 2022 provided an update of the ongoing TROV-054 phase 1b/2 single arm clinical trial in KRAS-mutated metastatic colorectal cancer: • Objective response rate ("ORR") across all evaluable patients was 35%, with 17 of 48 evaluable patients achieving an objective response.
For more information, please visit NCT03829410 at www.clinicialtrials.gov . Data presented on August 7, 2023, provided an update of the ongoing TROV-054 Phase 1b/2 single arm clinical trial in KRAS-mutated metastatic colorectal cancer: • ORR across all evaluable patients was 29%, with 19 of 66 evaluable patients achieving an objective response.
The primary objectives of this trial are to evaluate the Dose-Limiting Toxicities ("DLTs"), maximum tolerated dose ("MTD") and recommended Phase 2 dose ("RP2D") of onvansertib in combination with FOLFIRI and bevacizumab (Phase 1b) and to continue to assess the safety and preliminary efficacy of onvansertib in combination with FOLFIRI and bevacizumab patients with KRAS-mutated mCRC (Phase 2). 6 Table of Contents The scientific rationale for this clinical trial is based on the two key principles of synthetic lethality and synergy, with the objective of demonstrating a proof-of-concept of clinical benefit within this phase 1b/2 trial.
The primary objectives of this trial were to evaluate the Dose-Limiting Toxicities ("DLTs"), maximum tolerated dose ("MTD") and recommended Phase 2 dose ("RP2D") of onvansertib in combination with FOLFIRI and bevacizumab (Phase 1b) and to continue to assess the safety and preliminary efficacy of onvansertib in combination with FOLFIRI and bevacizumab patients with KRAS-mutated mCRC (Phase 2).
Regulatory authorities may withdraw product approvals or request product recalls if a company fails to comply with regulatory standards, if it encounters problems following initial marketing, or if previously unrecognized problems are subsequently discovered. 12 Table of Contents U.S. Foreign Corrupt Practices Act The U.S.
Accordingly, manufacturers must continue to expend time, money, and effort in the areas of production and quality control to maintain compliance with CGMPs. Regulatory authorities may withdraw product approvals or request product recalls if a company fails to comply with regulatory standards, if it encounters problems following initial marketing, or if previously unrecognized problems are subsequently discovered. U.S.
There are five ongoing clinical trials of onvansertib: two trials (TROV-054 and ONSEMBLE) in second line treatment in patients with KRAS-mutated Metastatic Colorectal Cancer ("mCRC"), one trial in second line treatment in patients with Metastatic Pancreatic Ductal Adenocarcinoma ("mPDAC"), and two investigator-initiated trials in patients with unresectable locally advanced or metastatic Triple Negative Breast Cancer ("TNBC") and relapsed Small Cell Lung Cancer ("SCLC").
There are five ongoing and planned clinical trials of onvansertib: one trial (CRDF-004) in first-line treatment in patients with RAS-mutated mCRC, one trial (CRDF-001) in second-line treatment in patients with mPDAC, and three investigator-initiated trials in first-line mPDAC, relapsed SCLC and unresectable locally advanced or metastatic TNBC.
Onvansertib is also synergistic in combination with numerous chemotherapies and targeted therapeutics and may enhance and/or extend response to treatment across a number of solid tumor cancers and hematologic malignancies. In five clinical trials with over 200 patients, onvansertib was shown to be well-tolerated when dosed as a single agent or in combination with other therapies.
Onvansertib is also synergistic in combination with numerous chemotherapies and targeted therapeutics and may enhance and/or extend response to treatment across a number of solid tumor cancers.
The first patient was dosed in June 2021. 7 Table of Contents The objective of this trial is to assess the safety and preliminary efficacy of onvansertib in combination with nanoliposomal irinotecan (Onyvide ® ), 5-FU and leucovorin as a second-line treatment in patients with mPDAC who have failed 1 st line gemcitabine-based therapy.
Enrollment for this trial closed in October 2023. The objective of this trial is to assess the safety and preliminary efficacy of onvansertib in combination with nanoliposomal irinotecan (Onyvide ® ), 5-FU and leucovorin as a 2 nd line treatment in patients with mPDAC who have failed first-line gemcitabine-based therapy. For more information, please visit NCT04752696 at www.clinicialtrials.gov .
Plogosertib has primary selectivity for PLK1 and secondary selectivity for PLK2 and PLK3. Human Capital The human capital objectives we focus on in managing our business include attracting, developing, and retaining key personnel. Our employees are critical to the success of our organization and we are committed to supporting our employees’ professional development.
One additional PLK1 inhibitor in early-stage clinical development is plogosertib, which is being developed by Cyclacel. Plogosertib has primary selectivity for PLK1 and secondary selectivity for PLK2 and PLK3. Human Capital The human capital objectives we focus on in managing our business include attracting, developing, and retaining key personnel.
The primary endpoint of Phase 2 of the trial is ORR, with PFS included as a secondary endpoint. Preliminary data from the trial are expected in Q4 2023 or Q1 2024. For more information, please visit NCT05383196 at www.clinicialtrials.gov .
In Phase 2, approximately 34 patients will be treated with the selected onvansertib RP2D in combination with paclitaxel. 9 Table of Contents The primary endpoint of Phase 2 of the trial is ORR, with PFS included as a secondary endpoint. For more information, please visit NCT05383196 at www.clinicialtrials.gov .
By contrast, onvansertib is able to deliver much more selective inhibition of PLK1 than volasertib. Onvansertib also has a half-life of 24 hours vs. volasertib's 135 hours and it is orally administered. One additional PLK1 inhibitor in early-stage clinical development is plogosertib, which is being developed by Cyclacel.
Volasertib's safety profile may have resulted from the fact that its inhibition of PLK1 is not highly selective and it also inhibits PLK2 and PLK3. By contrast, onvansertib is able to deliver much more selective inhibition of PLK1 than volasertib. Onvansertib also has a half-life of 24 hours vs. volasertib's 135 hours and it is orally administered.
Phase 1b/2 Clinical Trial in KRAS-mutated mCRC TROV-054 is a Phase 1b/2 open-label multi-center clinical trial of onvansertib in combination with standard of care FOLFIRI and bevacizumab for the second line treatment of patients with KRAS-mutated mCRC, which is being conducted at seven clinical trial sites across the U.S. - USC Norris Comprehensive Cancer Center, The Mayo Clinic Cancer Centers (Arizona, Minnesota, and Florida), Kansas University Medical Center, Inova Schar Cancer Institute and CARTI Cancer Center.
Phase 1b/2 Clinical Trial in Second-Line KRAS-mutated mCRC TROV-054, a Phase 1b/2 open-label multi-center clinical trial of onvansertib in combination with standard-of-care FOLFIRI and bevacizumab for the second-line treatment of patients with KRAS-mutated mCRC, completed enrollment in October 2022.
Incentives for the development of orphan drugs include quicker approval time and potential financial assistance, including waiver of the Prescription Drug User Fee Act (“PDUFA”). Companies are often permitted to charge substantial prices for orphan drugs, making them more profitable than they would be without government intervention.
Companies are often permitted to charge substantial prices for orphan drugs, making them more profitable than they would be without government intervention. As a result, the development of orphan drugs continues to grow at a faster rate than the development of traditional pharmaceuticals.
We may incur significant costs to comply with such laws and regulations now or in the future. Some drugs benefit from additional government incentives. Orphan drugs receive special consideration from the FDA in order to encourage pharmaceutical companies to develop treatments for rare diseases.
Some drugs benefit from additional government incentives. Orphan drugs receive special consideration from the FDA in order to encourage pharmaceutical companies to develop treatments for rare diseases. Incentives for the development of orphan drugs include quicker approval time and potential financial assistance, including waiver of the Prescription Drug User Fee Act (“PDUFA”).
In contrast, patients previously treated with bevacizumab (n=35) had an ORR of 23% and mPFS of 7.8 months.
In contrast, patients previously treated with bevacizumab (n=51) had an ORR of 16% and mPFS of 7.8 months. • Data on Treatment Emergent Adverse Events ("TEAEs") on the trial showed that onvansertib is well-tolerated when used in combination with FOLFIRI and bevacizumab.
The PLK inhibitor that reached the latest stage of clinical development (Phase 3), is volasertib, a pan-PLK inhibitor developed by Boehringer Ingelheim. Boehringer Ingelheim was developing volasertib plus LDAC for the treatment of AML which did not meet the primary endpoint of ORR (EHA 2016).
Boehringer Ingelheim was developing volasertib plus LDAC for the treatment of AML which did not meet the primary endpoint of ORR (EHA 2016). The data showed an unfavorable overall survival trend with the safety profile of volasertib plus LDAC considered as the main reason.
Legally mandated price controls on payment amounts by third-party payors or other restrictions could harm a pharmaceutical manufacturer’s business, results of operations, financial condition and prospects. In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs.
In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine which drugs and suppliers will be included in their healthcare programs.
In particular, there have been and continue to be a number of initiatives at the federal and state levels that seek to reduce healthcare costs. The Patient Protection and Affordable Care Act (“PPACA”) was enacted in March 2010, which includes measures to significantly change the way healthcare is financed by both governmental and private insurers.
In March 2010, the Patient Protection and Affordable Care Act (“ACA”), which substantially changed the way healthcare is financed by both governmental and private insurers in the United States, was signed into law and significantly affected the pharmaceutical industry.
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In vitro studies have shown synergistic effects when onvansertib was administered in combination with different cytotoxic agents including microtubule-targeting agents, topoisomerase 1 inhibitors, antimetabolites, alkylating agents, proteasome inhibitors, kinase inhibitors, PARP inhibitors, BCL-2 inhibitors, and androgen biosynthesis inhibitors.
Added
Previously we reported data from two additional trials: one trial (TROV-054) in second-line treatment in patients with KRAS-mutated mCRC, and one trial (CRDF-003), which we refer to as the ONSEMBLE trial, in second-line treatment in patients with RAS-mutated mCRC.
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Combining onvansertib with standard of care cancer agents provides opportunities for synergy with many cancer therapies.
Added
RAS-mutated mCRC Program: CRDF-004 Randomized Clinical Trial in First-Line RAS-mutated mCRC CRDF-004 is a Phase 2 open-label, randomized multi-center clinical trial of onvansertib in combination with standard-of-care FOLFIRI and bevacizumab or FOLFOX and bevacizumab for the first-line treatment of patients with RAS-mutated mCRC.
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Synthetic lethality refers to a critical vulnerability to tumor cell death by way of PLK1 inhibition within CRC tumor cells harboring KRAS mutations versus KRAS wild-type isogenic cells. Synergy occurs when the combination of multiple drugs results in an unexpected greater activity than an expected additive effect of the individual drugs.
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The primary objectives of the CRDF-004 trial are to evaluate onvansertib’s safety and efficacy in combination with the standard-of-care, as well as to evaluate two doses of onvansertib, 20mg and 30mg, given in combination with standard-of-care, against standard-of-care alone. The primary endpoint of the trial is objective response rate ("ORR"). Progression-free survival and duration of response will be secondary endpoints.
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Onvansertib in combination with two DNA-damaging agents, irinotecan and 5-FU (two components of FOLFIRI), demonstrated synergy in colorectal cancer cell lines and both combinations have demonstrated significantly greater tumor growth inhibition than either drug alone in CRC in vivo models.
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We anticipate interim data in mid-2024. Pfizer Ignite is responsible for 6 Table of Contents the clinical execution of the trial and it is expected to enroll approximately 90 evaluable patients. For more information, please visit NCT06106308 at www.clinicialtrials.gov . Contingent upon the results of CRDF-004, we plan to initiate CRDF-005, a Phase 3, randomized trial with registrational intent.
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We believe this synergy occurs because PLK1 can promote the repair of DNA damage caused by chemotherapeutic agents and by inhibiting PLK1, onvansertib leaves damaged tumor cells unable to repair DNA damage from chemotherapy and then replicate. For more information, please visit NCT03829410 at www.clinicialtrials.gov .
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The FDA has agreed that a seamless trial with ORR at an interim point is an acceptable endpoint to pursue accelerated approval, with progression-free survival and trend in overall survival being the endpoints for full approval.
Removed
The trial is currently open for enrollment and will be conducted at approximately 40 clinical trial sites across the U.S. The primary objective of the ONSEMBLE trial is to evaluate onvansertib’s safety and efficacy in combination with the standard-of-care FOLFIRI/bevacizumab regimen in patients with second-line KRAS/NRAS-mutated mCRC.
Added
The more severe, grade 4 TEAEs are either neutropenia or leukopenia, which are common events in patients treated with FOLFIRI and bevacizumab. None of the patients with grade 4 TEAEs discontinued treatment due to their condition and all resolved without issue. There were no major or unexpected toxicities seen in the trial.
Removed
The trial is expected to enroll approximately 150 patients who will be randomized 1:1:1 to receive standard of care alone, standard of care plus 20 mg onvansertib, or standard of care plus 30 mg onvansertib, with onvansertib administered on days 1-5 and 15-19 of 28-day treatment cycles. The primary endpoint of the trial is objective response rate.
Added
Based on the interim results of the TROV-054 trial, we previously designed the ONSEMBLE trial (CRDF-003) as the next phase of our mCRC program.
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Progression-free survival and duration of response will be key secondary endpoints. The trial was activated during Q4 2022, with topline data anticipated in 2H 2024. For more information, please visit NCT05593328 at www.clinicialtrials.gov .
Added
Upon further review of the clinical data from the bevacizumab naïve subgroup (those patients who did not receive bevacizumab in their first-line therapy), the preclinical data on the mechanism of action and the feedback from the FDA on our clinical development strategy, we made the decision to discontinue enrollment in the ONSEMBLE trial and to initiate the CRDF-004 clinical trial.
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The trial is expected to enroll approximately 45 patients. For more information, please visit NCT04752696 at www.clinicialtrials.gov .
Added
The primary objectives of the ONSEMBLE trial are to evaluate onvansertib’s safety and efficacy in combination with FOLFIRI and bevacizumab, as well as to evaluate two doses of onvansertib, 20mg and 30mg, given in combination with FOLFIRI and bevacizumab, against FOLFIRI and bevacizumab alone. The primary endpoint of the trial is ORR.
Removed
Preliminary data presented on September 12, 2022 provided an update of the ongoing CRDF-001 phase 2 open label clinical trial in mPDAC: • Preliminary data from 5 evaluable patients showed 1 patient achieving an initial partial response ("PR") and 3 patients achieving stable disease ("SD"); • The 4 patients achieving SD or PR remain on study; the fifth evaluable patient discontinued treatment due to disease progression and an additional 3 patients remain on study awaiting their first post-baseline scan; • Additional data is anticipated in mid 2023.
Added
For more information, please visit NCT05593328 at www.clinicialtrials.gov . 7 Table of Contents The ONSEMBLE trial was discontinued in August 2023 as part of the company’s shift to a first-line mCRC program, and the 23 patients enrolled continued treatment per protocol.
Removed
Preliminary data from the trial are expected in mid-2023. For more information, please visit NCT05450965 at www.clinicialtrials.gov . Identifying Biomarkers that Predict Patient Benefit Our laboratory in San Diego, California, enables us to optimize drug development and patient care.
Added
Data presented on February 29, 2024, provided the first update of the ongoing ONSEMBLE Phase 2 randomized clinical trial in RAS-mutated mCRC: • ORR data for each arm of the trial and for the two experimental arms combined are shown in the table below.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeEven if the data collected from preclinical studies or clinical trials involving our product candidates demonstrate a favorable safety and efficacy profile, such results may not be sufficient to support the submission of a NDA or BLA to obtain regulatory approval from the FDA in the U.S., or other similar foreign regulatory authorities in foreign jurisdictions, which is required to market and sell the product. 19 Table of Contents If third party vendors upon whom we intend to rely on to conduct our preclinical studies or clinical trials do not perform or fail to comply with strict regulations, these studies or trials of our product candidate may be delayed, terminated, or fail, or we could incur significant additional expenses, which could materially harm our business.
Biggest changeEven if the data collected from preclinical studies or clinical trials involving our product candidates demonstrate a favorable safety and efficacy profile, such results may not be sufficient to support the submission of a NDA or BLA to obtain regulatory approval from the FDA in the U.S., or other similar foreign regulatory authorities in foreign jurisdictions, which is required to market and sell the product.
In addition, we may experience numerous unforeseen events during, or as a result of, preclinical studies and the clinical trial process, which could delay or impede our ability to advance the development of, receive regulatory approval for, or commercialize our product candidate, including, but not limited to: • communications with the FDA, or similar regulatory authorities in different countries, regarding the scope or design of a trial or trials; • regulatory authorities, including an IRB or Ethical Committee (“EC”), not authorizing us to commence or conduct a clinical trial at a prospective trial site; • enrollment in our clinical trials being delayed, or proceeding at a slower pace than we expected, because we have difficulty recruiting patients or participants dropping out of our clinical trials at a higher rate than we anticipated; • our third party contractors, upon whom we rely for conducting preclinical studies, clinical trials and manufacturing of our trial materials, may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner; • having to suspend or ultimately terminate our clinical trials if participants are being exposed to unacceptable health or safety risks; • IRBs, ECs or regulators requiring that we hold, suspend or terminate our preclinical studies and clinical trials for various reasons, including non-compliance with regulatory requirements; and • the supply or quality of drug material necessary to conduct our preclinical studies or clinical trials being insufficient, inadequate or unavailable.
In addition, we may experience numerous unforeseen events during, or as a result of, preclinical studies and the clinical trial process, which could delay or impede our ability to advance the development of, receive regulatory approval for, or commercialize our product candidate, including, but not limited to: • communications with the FDA, or similar regulatory authorities in different countries, regarding the scope or design of a trial or trials; • regulatory authorities, including an IRB or Ethical Committee (“EC”), not authorizing us to commence or conduct a clinical trial at a prospective trial site; • enrollment in our clinical trials being delayed, or proceeding at a slower pace than we expected, because we have difficulty recruiting patients or participants dropping out of our clinical trials at a higher rate than we anticipated; 20 Table of Contents • our third party contractors, upon whom we rely for conducting preclinical studies, clinical trials and manufacturing of our trial materials, may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner; • having to suspend or ultimately terminate our clinical trials if participants are being exposed to unacceptable health or safety risks; • IRBs, ECs or regulators requiring that we hold, suspend or terminate our preclinical studies and clinical trials for various reasons, including non-compliance with regulatory requirements; and • the supply or quality of drug material necessary to conduct our preclinical studies or clinical trials being insufficient, inadequate or unavailable.
Risks Related to Ownership of Our Common Stock Our ability to use our net operating loss carryforwards and certain other tax attributes is limited by Sections 382 and 383 of the Internal Revenue Code. Net operating loss carryforwards allow companies to use past year net operating losses to offset against future years’ profits, if any, to reduce future tax liabilities.
Risks Related to Ownership of Our Common Stock Our ability to use our net operating loss carryforwards and certain other tax attributes is limited by Sections 382 and 383 of the Internal Revenue Code. Net operating loss carryforwards allow companies to use past years' net operating losses to offset against future years’ profits, if any, to reduce future tax liabilities.
These fluctuations may be due to various factors, many of which are beyond our control, including: • technological innovations or new products and services introduced by us or our competitors; • clinical trial results relating to our tests or those of our competitors; • announcements or press releases relating to the industry or to our own business or prospects; • coverage and reimbursement decisions by third party payors, such as Medicare and other managed care organizations; • regulation and oversight of our product candidates and services, including by the FDA, Centers for Medicare & Medicaid Services and comparable foreign agencies; • healthcare legislation; • intellectual property disputes; • additions or departures of key personnel; • sales of our common stock; • our ability to integrate operations, technology, products and services; • our ability to execute our business plan; • operating results below expectations; • loss of any strategic relationship; • industry developments; 36 Table of Contents • economic and other external factors; • catastrophic weather and/or global disease outbreaks, such as the recent COVID-19 pandemic; and • period-to-period fluctuations in our financial results.
These fluctuations may be due to various factors, many of which are beyond our control, including: • technological innovations or new products and services introduced by us or our competitors; • clinical trial results relating to our tests or those of our competitors; • announcements or press releases relating to the industry or to our own business or prospects; • coverage and reimbursement decisions by third party payors, such as Medicare and other managed care organizations; • regulation and oversight of our product candidates and services, including by the FDA, Centers for Medicare & Medicaid Services and comparable foreign agencies; • healthcare legislation; • intellectual property disputes; • additions or departures of key personnel; • sales of our common stock; • our ability to integrate operations, technology, products and services; • our ability to execute our business plan; • operating results below expectations; 37 Table of Contents • loss of any strategic relationship; • industry developments; • economic and other external factors; • catastrophic weather and/or global disease outbreaks, such as the COVID-19 pandemic; and • period-to-period fluctuations in our financial results.
If our product candidate is approved for commercial sale by the FDA or other regulatory authorities, the degree of market acceptance of any approved product by physicians, healthcare professionals and third-party payors and our profitability and growth will depend on a number of factors, including: • demonstration of safety and efficacy; • changes in the practice guidelines and the standard of care for the targeted indication; • relative convenience and ease of administration; • the prevalence and severity of any adverse side effects; • budget impact of adoption of our product on relevant drug formularies and the availability, cost and potential advantages of alternative treatments, including less expensive generic drugs; • pricing, reimbursement and cost effectiveness, which may be subject to regulatory control; • effectiveness of our or any of our partners’ sales and marketing strategies; • the product labeling or product insert required by the FDA or regulatory authority in other countries; and • the availability of adequate third-party insurance coverage or reimbursement.
If our product candidate is approved for commercial sale by the FDA or other regulatory authorities, the degree of market acceptance of any approved product by physicians, healthcare professionals and third-party payors and our profitability and growth will depend on a number of factors, including: • demonstration of safety and efficacy; • changes in the practice guidelines and the standard of care for the targeted indication; • relative convenience and ease of administration; • the prevalence and severity of any adverse side effects; • budget impact of adoption of our product on relevant drug formularies and the availability, cost and potential advantages of alternative treatments, including less expensive generic drugs; • pricing, reimbursement and cost effectiveness, which may be subject to regulatory control; • effectiveness of our or any of our partners’ sales and marketing strategies; 28 Table of Contents • the product labeling or product insert required by the FDA or regulatory authority in other countries; and • the availability of adequate third-party insurance coverage or reimbursement.
Our product candidate could fail to receive regulatory approval for many reasons, including the following: • the FDA or comparable foreign regulatory authorities may disagree with the design or implementation of our clinical trials; • we may be unable to demonstrate to the satisfaction of the FDA or comparable foreign regulatory authorities that a product candidate is safe and effective for its proposed indication; • the results of clinical trials may not meet the level of statistical significance required by the FDA or comparable foreign regulatory authorities for approval; 22 Table of Contents • the FDA or comparable foreign regulatory authorities may disagree with our interpretation of data from preclinical studies or clinical trials; • the data collected from clinical trials of our product candidates may not be sufficient to support the submission of an NDA or other submission or to obtain regulatory approval in the United States or elsewhere; • the FDA or comparable foreign regulatory authorities may fail to approve the manufacturing processes or facilities of third-party manufacturers with which we contract for clinical and commercial supplies; • the FDA or comparable foreign regulatory authorities may fail to approve the companion diagnostics we contemplate developing with partners; and • the approval policies or regulations of the FDA or comparable foreign regulatory authorities may significantly change in a manner rendering our clinical data insufficient for approval.
Our product candidate could fail to receive regulatory approval for many reasons, including the following: • the FDA or comparable foreign regulatory authorities may disagree with the design or implementation of our clinical trials; • we may be unable to demonstrate to the satisfaction of the FDA or comparable foreign regulatory authorities that a product candidate is safe and effective for its proposed indication; • the results of clinical trials may not meet the level of statistical significance required by the FDA or comparable foreign regulatory authorities for approval; • the FDA or comparable foreign regulatory authorities may disagree with our interpretation of data from preclinical studies or clinical trials; • the data collected from clinical trials of our product candidates may not be sufficient to support the submission of an NDA or other submission or to obtain regulatory approval in the United States or elsewhere; • the FDA or comparable foreign regulatory authorities may fail to approve the manufacturing processes or facilities of third-party manufacturers with which we contract for clinical and commercial supplies; • the FDA or comparable foreign regulatory authorities may fail to approve the companion diagnostics we contemplate developing with partners; and • the approval policies or regulations of the FDA or comparable foreign regulatory authorities may significantly change in a manner rendering our clinical data insufficient for approval.
In addition, market fluctuations, as well as general political and economic conditions, could materially adversely affect the market price of our securities. Because we are a development stage company with no revenue from operations to date, other than licensing, milestone and royalty income, you should consider any one of these factors to be material.
In addition, market fluctuations, as well as general political and economic conditions, could materially adversely affect the market price of our securities. Because we are a development stage company with no revenue from operations to date, other than licensing, milestone and royalty income unrelated to onvansertib, you should consider any one of these factors to be material.
The United States and other key international economies have experienced significant economic and market downturns in the past, and are likely to experience additional cyclical downturns from time to time in which economic activity is impacted by falling demand for a 33 Table of Contents variety of goods and services, restricted credit, poor liquidity, reduced corporate profitability, volatility in credit, equity, and foreign exchange markets, inflation, bankruptcies, and overall uncertainty with respect to the economy.
The United States and other key international economies have experienced significant economic and market downturns in the past, and are likely to experience additional cyclical downturns from time to time in which economic activity is impacted by falling demand for a variety of goods and services, restricted credit, poor liquidity, reduced corporate profitability, volatility in credit, equity, and foreign exchange markets, inflation, bankruptcies, and overall uncertainty with respect to the economy.
Our management and other personnel devote a substantial amount of time to these compliance programs and monitoring of public company reporting obligations and, as a result of the new corporate governance and executive 38 Table of Contents compensation related rules, regulations and guidelines prompted by the Dodd-Frank Act and further regulations and disclosure obligations expected in the future, we will likely need to devote additional time and costs to comply with such compliance programs and rules.
Our management and other personnel devote a substantial amount of time to these compliance programs and monitoring of public company reporting obligations and, as a result of the new corporate governance and executive compensation related rules, regulations and guidelines prompted by the Dodd-Frank Act and further regulations and disclosure obligations expected in the future, we will likely need to devote additional time and costs to comply with such compliance programs and rules.
Delays or failures in obtaining regulatory approval to advance our product candidate through clinical development, and ultimately commercialize them, may: • adversely impact our ability to raise sufficient capital to fund the development of our product candidate; • adversely affect our ability to further develop or commercialize our product candidate; • diminish any competitive advantages that we or our collaborators may have or attain; and 20 Table of Contents • adversely affect the receipt of potential milestone payments and royalties from the sale of our products or product revenues.
Delays or failures in obtaining regulatory approval to advance our product candidate through clinical development, and ultimately commercialize them, may: • adversely impact our ability to raise sufficient capital to fund the development of our product candidate; • adversely affect our ability to further develop or commercialize our product candidate; • diminish any competitive advantages that we or our collaborators may have or attain; and • adversely affect the receipt of potential milestone payments and royalties from the sale of our products or product revenues.
In the U.S., the FDA regulates, among other things, the development, testing, manufacture, safety, efficacy, record-keeping, labeling, storage, approval, advertising, promotion, sale and distribution of pharmaceutical and biopharmaceutical products. Our product candidate is also subject to similar regulation by foreign governments to the extent we seek to develop or market it in those countries.
In the U.S., the FDA regulates, among other things, the development, testing, manufacture, safety, efficacy, record-keeping, labeling, storage, approval, advertising, promotion, sale and distribution of pharmaceutical and 21 Table of Contents biopharmaceutical products. Our product candidate is also subject to similar regulation by foreign governments to the extent we seek to develop or market it in those countries.
Our failure to achieve and maintain these high-quality manufacturing standards in collaboration with our third-party manufacturers, including the incidence of manufacturing errors, could result in patient injury 26 Table of Contents or death, product recalls or withdrawals, delays or failures in product testing or delivery, cost overruns or other problems that could harm our business, financial condition, and results of operations.
Our failure to achieve and maintain these high-quality manufacturing standards in collaboration with our third-party manufacturers, including the incidence of manufacturing errors, could result in patient injury or death, product recalls or withdrawals, delays or failures in product testing or delivery, cost overruns or other problems that could harm our business, financial condition, and results of operations.
While we are obligated to audit their performance, we do not have control over our third-party contract manufacturers’ compliance with these regulations and standards. Failure by our third-party manufacturers, or us, to comply with applicable regulations could result in sanctions being imposed on us or the drug manufacturer from the production of other third-party products.
While we are obligated to audit their performance, we do not have control over our third-party contract manufacturers’ compliance with these regulations and standards. Failure by 29 Table of Contents our third-party manufacturers, or us, to comply with applicable regulations could result in sanctions being imposed on us or the drug manufacturer from the production of other third-party products.
Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses and divert management’s attention from the operation of our business. Moreover, achieving and sustaining compliance with applicable federal and state privacy, security and fraud laws may prove costly.
Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses and divert 25 Table of Contents management’s attention from the operation of our business. Moreover, achieving and sustaining compliance with applicable federal and state privacy, security and fraud laws may prove costly.
Our operations, and those of our CROs, Contract Manufacturing Organizations ("CMOs"), and other contractors, consultants and third parties could be subject to pandemics (including the COVID-19 pandemic), earthquakes, power shortages, telecommunications failures, water shortages, floods, hurricanes, typhoons, fires, extreme weather conditions, medical epidemics and other natural or man-made disasters or business interruptions, for which we are predominantly self-insured.
Our operations, and those of our Contract Research Organizations ("CROs"), Contract Manufacturing Organizations ("CMOs"), and other contractors, consultants and third parties could be subject to pandemics (including the COVID-19 pandemic), earthquakes, power shortages, telecommunications failures, water shortages, floods, hurricanes, typhoons, fires, 33 Table of Contents extreme weather conditions, medical epidemics and other natural or man-made disasters or business interruptions, for which we are predominantly self-insured.
Therefore, our success depends in part on our ability to retain highly qualified key management, personnel, and directors to develop, implement and execute our business strategy, operate the company and oversee the activities of our consultants and contractors, as well as academic and corporate advisors or consultants to assist us in this regard.
Therefore, our success depends in part on our ability to retain highly qualified key management, personnel, and directors to develop, implement and execute our business strategy, operate the company and 22 Table of Contents oversee the activities of our consultants and contractors, as well as academic and corporate advisors or consultants to assist us in this regard.
If we are unable to raise additional capital when required or on acceptable terms, we may have to significantly delay, scale back or discontinue the development and/or commercialization of our product 17 Table of Contents candidate, restrict our operations or obtain funds by entering into agreements on unfavorable terms.
If we are unable to raise additional capital when required or on acceptable terms, we may have to significantly delay, scale back or discontinue the development and/or commercialization of our product candidate, restrict our operations or obtain funds by entering into agreements on unfavorable terms.
Moreover, in the event of an accident or if we otherwise fail to comply with applicable regulations, we could lose our permits or approvals or be held liable for damages or penalized with fines. Healthcare reform measures could adversely affect our business.
Moreover, in the event of an accident or if we otherwise fail to comply with applicable regulations, we could lose our permits or approvals or be held liable for damages or penalized with fines. 32 Table of Contents Healthcare reform measures could adversely affect our business.
We cannot predict the extent of these future net losses, or when we may attain profitability, if at all. If we are unable to generate significant revenue from onvansertib or attain profitability, we will not be able to sustain operations.
We cannot predict the extent of these future net losses, or when we may attain profitability, if at all. 18 Table of Contents If we are unable to generate significant revenue from onvansertib or attain profitability, we will not be able to sustain operations.
If we lose any key managers or employees, or are unable to attract and retain 21 Table of Contents qualified key personnel, directors, advisors or consultants, the development of our product candidate could be delayed or terminated and our business may be harmed.
If we lose any key managers or employees, or are unable to attract and retain qualified key personnel, directors, advisors or consultants, the development of our product candidate could be delayed or terminated and our business may be harmed.
In 34 Table of Contents addition, the type and extent of any patent claims that may be issued to us in the future are uncertain. Any patents that are issued may not contain claims that will permit us to stop competitors from using similar technology.
In addition, the type and extent of any patent claims that may be issued to us in the future are uncertain. Any patents that are issued may not contain claims that will permit us to stop competitors from using similar technology.
Volatile and significantly weakened global economic conditions have in the past and may in the future adversely affect our industry, business, and results of operations. Our overall performance depends in part on worldwide economic and geopolitical conditions.
Volatile and significantly weakened global economic conditions have in the past and may in the future adversely affect our industry, business, and results of operations. 34 Table of Contents Our overall performance depends in part on worldwide economic and geopolitical conditions.
The SEC and other regulators have continued to adopt new rules and regulations and make additional changes to existing regulations that require our compliance. For example, in July 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”) was enacted.
The SEC and other regulators have continued to adopt new rules 39 Table of Contents and regulations and make additional changes to existing regulations that require our compliance. For example, in July 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”) was enacted.
We plan to seek regulatory approval and to commercialize our product candidate, directly or with a collaborator, worldwide including the United States, the European Union and other additional foreign countries which we have not yet identified.
We plan to seek regulatory approval and to commercialize our product candidate, directly or with a collaborator, worldwide including the United States, the European Union and other additional foreign countries which we have not yet 24 Table of Contents identified.
A failure to comply with these requirements may result in fines and civil penalties, suspension of production, suspension or delay in product approval, product seizure or recall, or withdrawal of product approval.
A failure to comply with these requirements may result in fines and civil penalties, suspension of production, suspension or delay in product approval, product seizure or recall, or 27 Table of Contents withdrawal of product approval.
We do not currently possess internal manufacturing capacity. We plan to utilize the services of GMP, FDA validated contract manufacturers to manufacture our clinical supplies. Any curtailment in the availability of onvansertib, however, could result in production or other delays with consequent adverse effects on us.
We plan to utilize the services of GMP, FDA validated contract manufacturers to manufacture our clinical supplies. Any curtailment in the availability of onvansertib, however, could result in production or other delays with consequent adverse effects on us.
We are a clinical stage company and have incurred losses since our formation. As of December 31, 2022, we have an accumulated total deficit of approximately $298.1 million. For the fiscal years ended December 31, 2022 and 2021, we had a net loss attributable to common stockholders of approximately $38.7 million and $28.3 million, respectively.
We are a clinical stage company and have incurred losses since our formation. As of December 31, 2023, we have an accumulated total deficit of approximately $339.5 million. For the fiscal years ended December 31, 2023 and 2022, we had a net loss attributable to common stockholders of approximately $41.5 million and $38.7 million, respectively.
This provision may prohibit or restrict large stockholders, in particular those owning 15% or more of our outstanding voting stock, from merging or combining with us, which could discourage potential takeover attempts, reduce the price that investors may be willing to pay for shares of our common stock in the future and result in our market price being lower than it would without these provisions.
This provision may prohibit or restrict large stockholders, in particular those owning 15% or more of our outstanding voting stock, from merging or combining with us, which could discourage potential takeover attempts, reduce the price that investors may be willing to pay for shares of our common stock in the future and result in our market price being lower than it would without these provisions. 38 Table of Contents A sale of a substantial number of shares of our common stock may cause the price of our common stock to decline and may impair our ability to raise capital in the future.
Individual states have become increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access, and marketing cost disclosure and transparency measures, and to encourage importation from other countries and bulk purchasing.
Individual states in the United States have also become increasingly active in implementing regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and other transparency measures, and, in some cases, measures designed to encourage importation from other countries and bulk purchasing.
Despite these efforts, our product candidate may not: • offer therapeutic or other medical benefits over existing drugs or other product candidates in development to treat the same patient population; • be proven to be safe and effective in current and future preclinical studies or clinical trials; • have the desired effects; • be free from undesirable or unexpected effects; • meet applicable regulatory standards; • be capable of being formulated and manufactured in commercially suitable quantities and at an acceptable cost; or • be successfully commercialized by us or by collaborators.
Despite these efforts, our product candidate may not: • offer therapeutic or other medical benefits over existing drugs or other product candidates in development to treat the same patient population; • be proven to be safe and effective in current and future preclinical studies or clinical trials; • have the desired effects; • be free from undesirable or unexpected effects; • meet applicable regulatory standards; • be capable of being formulated and manufactured in commercially suitable quantities and at an acceptable cost; or • be successfully commercialized by us or by collaborators. 19 Table of Contents Even if we demonstrate favorable results in preclinical studies and early-stage clinical trials, we cannot assure you that the results of late-stage clinical trials will be favorable enough to support the continued development of our product candidate.
We expect that our ability to compete effectively will depend upon our ability to: • successfully identify and develop key points of product differentiations from currently available therapies; • successfully and rapidly complete clinical trials and submit for and obtain all requisite regulatory approvals in a cost-effective manner; • maintain a proprietary position for our products and manufacturing processes and other related product technology; • attract and retain key personnel; • develop relationships with physicians prescribing these products; and • build an adequate sales and marketing infrastructure for our product candidates.
If potential competitors are successful in completing drug development for their product candidates and obtain approval from the FDA, they could limit the demand for onvansertib. 26 Table of Contents We expect that our ability to compete effectively will depend upon our ability to: • successfully identify and develop key points of product differentiations from currently available therapies; • successfully and rapidly complete clinical trials and submit for and obtain all requisite regulatory approvals in a cost-effective manner; • maintain a proprietary position for our products and manufacturing processes and other related product technology; • attract and retain key personnel; • develop relationships with physicians prescribing these products; and • build an adequate sales and marketing infrastructure for our product candidates.
In addition, manufacturing interruptions or failure to comply with regulatory requirements by any of these manufacturers could significantly delay clinical development of potential products and reduce third-party or clinical researcher interest and support of proposed trials. These interruptions or failures could also impede commercialization of our product candidate and impair our competitive position.
In addition, manufacturing interruptions or failure to comply with regulatory requirements by any of these manufacturers could significantly delay clinical development of potential products and reduce third-party or clinical researcher interest and support of proposed trials.
Because we will be competing against significantly larger companies with established track records, we will have to demonstrate that, based on experience, clinical data, side-effect profiles and other factors, our products, if approved, are competitive with other products.
Because we will be competing against significantly larger companies with established track records, we will have to demonstrate that, based on experience, clinical data, side-effect profiles and other factors, our products, if approved, are competitive with other products. If we are unable to compete effectively and differentiate our products from other marketed drugs, we may never generate meaningful revenue.
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 personal, confidential or proprietary information, we could incur liability and the further development of any product candidate could be delayed. . 30 Table of Contents Additionally, there are a number of state, federal and international laws protecting the privacy and security of health information and personal data.
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 personal, confidential or proprietary information, we could incur liability and the further development of any product candidate could be delayed.
In addition, the Nerviano Agreement requires us to make certain payments, including license fees, milestone payments, royalties, and other such terms typically required under licensing agreements and these types of technology in-licenses generally could make it difficult for us to find corporate partners and less profitable for us to develop product candidates utilizing these existing product candidates and technologies.
In addition, our failure to comply with obligations under other material in-licenses we may enter into may cause us to become subject to litigation or other potential disputes under any such license agreements. 30 Table of Contents In addition, the Nerviano Agreement requires us to make certain payments, including license fees, milestone payments, royalties, and other such terms typically required under licensing agreements and these types of technology in-licenses generally could make it difficult for us to find corporate partners and less profitable for us to develop product candidates utilizing these existing product candidates and technologies.
If approved and commercialized, onvansertib would compete with the prescription therapies already approved for treatment within the targeted therapeutic area. To our knowledge, other potential competitors are in earlier stages of development. If potential competitors are successful in completing drug development for their product candidates and obtain approval from the FDA, they could limit the demand for onvansertib.
If approved and commercialized, onvansertib would compete with the prescription therapies already approved for treatment within the targeted therapeutic area. To our knowledge, other potential competitors are in earlier stages of development.
Our future financial performance and our ability to commercialize our product candidate and to compete effectively will depend, in part, on our ability to manage any future growth effectively.
We may increase the number of employees in the future depending on the progress of our development of our product candidate. Our future financial performance and our ability to commercialize our product candidate and to compete effectively will depend, in part, on our ability to manage any future growth effectively.
For example, during the year ended December 31, 2022, the closing price of our common stock ranged from a low of $1.17 to a high of $7.25.
For example, during the year ended December 31, 2023, the closing price of our common stock ranged from a low of $0.96 to a high of $2.18.
We cannot be certain of the level of protection, if any, that will be provided by our patents if they are challenged in court, where our competitors may raise defenses such as invalidity, unenforceability or possession of a valid license.
In some instances, patents have been issued in the U.S. while substantially less or no protection has been obtained in Europe or other countries. 35 Table of Contents We cannot be certain of the level of protection, if any, that will be provided by our patents if they are challenged in court, where our competitors may raise defenses such as invalidity, unenforceability or possession of a valid license.
As of December 31, 2022, our cash, cash equivalents and short-term investments balance was approximately $105.3 million and our working capital was approximately $103.5 million.
As of December 31, 2023, our cash, cash equivalents and short-term investments balance was approximately $74.8 million and our working capital was approximately $67.0 million.
State net operating loss carryforwards (and certain other tax attributes) may be similarly limited. An ownership change can therefore result in significantly greater tax liabilities than a corporation would incur in the absence of such a change and any increased liabilities could adversely affect the corporation’s business, results of operations, financial condition and cash flow.
An ownership change can therefore result in significantly greater tax liabilities than a corporation would incur in the absence of such a change and any increased liabilities could adversely affect the corporation’s business, results of operations, financial condition and cash flow. 36 Table of Contents U.S. federal income tax reform could adversely affect us.
U.S. federal income tax reform could adversely affect us. 35 Table of Contents On December 22, 2017, President Trump signed into law the TCJA that significantly reforms the Internal Revenue Code of 1986, as amended.
On December 22, 2017, President Trump signed into law the TCJA that significantly reforms the Internal Revenue Code of 1986, as amended.
In addition, the lack of a robust resale market may require a stockholder who desires to sell a large number of shares of common stock to sell the shares in increments over time to mitigate any adverse impact of the sales on the market price of our stock. 37 Table of Contents If our stockholders sell, or the market perceives that our stockholders may sell for various reasons, including the ending of restriction on resale, substantial amounts of our common stock in the public market, including shares issued upon the exercise of outstanding options or warrants, the market price of our common stock could fall.
If our stockholders sell, or the market perceives that our stockholders may sell for various reasons, including the ending of restriction on resale, substantial amounts of our common stock in the public market, including shares issued upon the exercise of outstanding options or warrants, the market price of our common stock could fall.
The regulatory approval processes of the FDA and comparable foreign authorities are lengthy, time consuming and inherently unpredictable, and if we are ultimately unable to obtain regulatory approval for our product candidate, our business will be substantially harmed.
Any delays in completing our clinical trials will increase our costs, slow down our product development, timeliness and approval process and delay our ability to generate revenue. 23 Table of Contents The regulatory approval processes of the FDA and comparable foreign authorities are lengthy, time consuming and inherently unpredictable, and if we are ultimately unable to obtain regulatory approval for our product candidate, our business will be substantially harmed.
Future growth of our company will impose significant additional responsibilities on members of management, including the need to identify, attract, retain, motivate and integrate highly skilled personnel. We may increase the number of employees in the future depending on the progress of our development of our product candidate.
We will need to increase the size of our organization, and we may experience difficulties in managing growth. We are a small company with 32 employees as of December 31, 2023. Future growth of our company will impose significant additional responsibilities on members of management, including the need to identify, attract, retain, motivate and integrate highly skilled personnel.
To the extent that the pandemic harms our business and results of operations, many of the other risks described in this Part I, Item 1A of this report may be heightened. Geopolitical risks associated with Russia’s invasion of Ukraine could result in increased market volatility and uncertainty, which could negatively impact our business, financial condition, and results of operations.
To the extent that the pandemic harms our business and results of operations, many of the other risks described in this Part I, Item 1A of this report may be heightened.
If we are unable to compete effectively and differentiate our products from other marketed drugs, we may never generate meaningful revenue. 25 Table of Contents If the manufacturers upon whom we rely fail to produce our product candidate, in the volumes that we require on a timely basis, or fail to comply with stringent regulations applicable to pharmaceutical drug manufacturers, we may face delays in the development and commercialization of our product candidate.
If the manufacturers upon whom we rely fail to produce our product candidate, in the volumes that we require on a timely basis, or fail to comply with stringent regulations applicable to pharmaceutical drug manufacturers, we may face delays in the development and commercialization of our product candidate. We do not currently possess internal manufacturing capacity.
As such, the degree of patent protection obtained in the U.S. may differ substantially from that obtained in various foreign countries. In some instances, patents have been issued in the U.S. while substantially less or no protection has been obtained in Europe or other countries.
As such, the degree of patent protection obtained in the U.S. may differ substantially from that obtained in various foreign countries.
The FDA has substantial discretion in the NDA review process and may either refuse to file our NDA for substantive review or may decide that our data is insufficient to support approval of our product candidate for the claimed intended uses. 24 Table of Contents Following any regulatory approval of our product candidate, we will be subject to continuing regulatory obligations such as safety reporting, required and additional post marketing obligations, and regulatory oversight of promotion and marketing.
The FDA has substantial discretion in the NDA review process and may either refuse to file our NDA for substantive review or may decide that our data is insufficient to support approval of our product candidate for the claimed intended uses.
Security threats to our information technology infrastructure and/or our physical buildings could expose us to liability and damage our reputation and business. It is essential to our business strategy that our technology and network infrastructure and our physical buildings remain secure and are perceived by our customers and corporate partners to be secure.
It is essential to our business strategy that our technology and network infrastructure and our physical buildings remain secure and are perceived by our customers and corporate partners to be secure. Despite security measures, however, any network infrastructure may be vulnerable to cyber-attacks by hackers and other security threats.
Further, in order to maintain our development time lines in the event of a change in our third-party contract manufacturer, we may incur significantly higher costs to manufacture our product candidate. 28 Table of Contents We do not currently have any internal drug discovery capabilities, and therefore we are dependent on in-licensing or acquiring development programs from third parties in order to obtain additional product candidates.
We do not currently have any internal drug discovery capabilities, and therefore we are dependent on in-licensing or acquiring development programs from third parties in order to obtain additional product candidates.
In addition, professional societies, practice management groups, private health and science foundations and organizations involved in various diseases from time to time may also publish guidelines or recommendations to the healthcare and patient communities. 27 Table of Contents Recommendations of government agencies or these other groups or organizations may relate to such matters as usage, dosage, route of administration and use of concomitant therapies.
Government agencies promulgate regulations and guidelines directly applicable to us and to our product. In addition, professional societies, practice management groups, private health and science foundations and organizations involved in various diseases from time to time may also publish guidelines or recommendations to the healthcare and patient communities.
Our product candidate may exhibit undesirable side effects when used alone or in combination with other approved pharmaceutical products or investigational new drugs, which may delay or preclude further development or regulatory approval, or limit their use if approved. 18 Table of Contents Throughout the drug development process, we must continually demonstrate the safety and tolerability of our product candidate to obtain regulatory approval to further advance clinical development or to market it.
We do not expect our product candidate to be commercialized by us or collaborators for at least several years. Our product candidate may exhibit undesirable side effects when used alone or in combination with other approved pharmaceutical products or investigational new drugs, which may delay or preclude further development or regulatory approval, or limit their use if approved.
Moreover, we could be subject to significant liability if any volunteer or patient suffers, or appears to suffer, adverse health effects as a result of participating in our clinical trials. 23 Table of Contents If we fail to comply with healthcare regulations, we could face substantial enforcement actions, including civil and criminal penalties and our business, operations and financial condition could be adversely affected.
If we fail to comply with healthcare regulations, we could face substantial enforcement actions, including civil and criminal penalties and our business, operations and financial condition could be adversely affected.
Legally mandated price controls on payment amounts by third-party payors or other restrictions could harm our business, results of operations, financial condition and prospects. In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs.
In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine which drugs and suppliers will be included in their healthcare programs. Furthermore, there has been increased interest by third party payors and governmental authorities in reference pricing systems and publication of discounts and list prices.
In particular, there have been and continue to be a number of initiatives at the U.S. federal and state levels that seek to reduce healthcare costs. In 2010, the Patient Protection and Affordable Care Act ("PPACA") was enacted, which includes measures to significantly change the way healthcare is financed by both governmental and private insurers.
In March 2010, the Patient Protection and Affordable Care Act, or ACA, which substantially changed the way healthcare is financed by both governmental and private insurers in the United States, was signed into law and significantly affected the pharmaceutical industry.
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Even if we demonstrate favorable results in preclinical studies and early-stage clinical trials, we cannot assure you that the results of late-stage clinical trials will be favorable enough to support the continued development of our product candidate.
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Throughout the drug development process, we must continually demonstrate the safety and tolerability of our product candidate to obtain regulatory approval to further advance clinical development or to market it.
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We do not expect our product candidate to be commercialized by us or collaborators for at least several years.
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If third party vendors upon whom we intend to rely on to conduct our preclinical studies or clinical trials do not perform or fail to comply with strict regulations, these studies or trials of our product candidate may be delayed, terminated, or fail, or we could incur significant additional expenses, which could materially harm our business.
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Any delays in completing our clinical trials will increase our costs, slow down our product development, timeliness and approval process and delay our ability to generate revenue.
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Ultimately, our product candidate may prove to be unsafe for human use. Moreover, we could be subject to significant liability if any volunteer or patient suffers, or appears to suffer, adverse health effects as a result of participating in our clinical trials.
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Ultimately, our product candidate may prove to be unsafe for human use.
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Following any regulatory approval of our product candidate, we will be subject to continuing regulatory obligations such as safety reporting, required and additional post marketing obligations, and regulatory oversight of promotion and marketing.
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Government agencies promulgate regulations and guidelines directly applicable to us and to our product.
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Recommendations of government agencies or these other groups or organizations may relate to such matters as usage, dosage, route of administration and use of concomitant therapies.
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In addition, our failure to comply with obligations under other material in-licenses we may enter into may cause us to become subject to litigation or other potential disputes under any such license agreements.
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Further, in order to maintain our development time lines in the event of a change in our third-party contract manufacturer, we may incur significantly higher costs to manufacture our product candidate.
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We will need to increase the size of our organization, and we may experience difficulties in managing growth. 29 Table of Contents We are a small company with 24 employees as of December 31, 2022.
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These interruptions or failures could also impede commercialization of our product candidate and impair our competitive position. 31 Table of Contents Security threats to our information technology infrastructure and/or our physical buildings could expose us to liability and damage our reputation and business.
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Despite security measures, however, any network infrastructure may be vulnerable to cyber-attacks by hackers and other security threats.
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While we maintain insurance to cover operational risks, such as cyber risk and technology outages, our insurance may not be sufficient to cover all liability described herein. These risks will likely increase as we store and process more data.
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In the United States and foreign jurisdictions, there have been, and continue to be, a number of legislative and regulatory changes and proposed changes to the healthcare system that could affect our future results of operations.
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Additionally, there are a number of state, federal and international laws protecting the privacy and security of health information and personal data.
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Among the provisions of the PPACA of greatest importance to the pharmaceutical and biotechnology industry are the following: • an annual, nondeductible fee on any entity that manufactures or imports certain branded prescription drugs and biologic agents, apportioned among these entities according to their market share in certain government healthcare programs; • implementation of the federal physician payment transparency requirements, sometimes referred to as the “Physician Payments Sunshine Act”; • a licensure framework for follow-on biologic products; 31 Table of Contents • a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research; • establishment of a Center for Medicare Innovation at the Centers for Medicare & Medicaid Services to test innovative payment and service delivery models to lower Medicare and Medicaid spending, potentially including prescription drug spending; • an increase in the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program, to 23.1% and 13% of the average manufacturer price for most branded and generic drugs, respectively and capped the total rebate amount for innovator drugs at 100% of the Average Manufacturer Price; • a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for certain drugs and biologics, including our product candidates, that are inhaled, infused, instilled, implanted or injected; • extension of manufacturers’ Medicaid rebate liability to covered drugs dispensed to individuals who are enrolled in Medicaid managed care organizations; • expansion of eligibility criteria for Medicaid programs by, among other things, allowing states to offer Medicaid coverage to additional individuals and by adding new mandatory eligibility categories for individuals with income at or below 133% of the federal poverty level, thereby potentially increasing manufacturers’ Medicaid rebate liability; • a new Medicare Part D coverage gap discount program, in which manufacturers must agree to offer 50% point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered under Medicare Part D; and • expansion of the entities eligible for discounts under the Public Health program.
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Among policy makers and payors in the United States, there is significant interest in promoting changes in healthcare systems with the stated goals of containing healthcare costs, improving quality and/or expanding access. In the United States, the pharmaceutical industry has been a particular focus of these efforts and has been significantly affected by major legislative initiatives.
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Some of the provisions of the PPACA have yet to be implemented, and there have been legal and political challenges to certain aspects of the PPACA. During President Trump's administration, he signed two executive orders and other directives designed to delay, circumvent, or loosen certain requirements mandated by the PPACA.
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The ACA contains a number of provisions, including those governing enrollment in federal healthcare programs, reimbursement adjustments and fraud and abuse changes.
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Concurrently, Congress has considered legislation that would repeal or repeal and replace all or part of the PPACA.
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Additionally, the ACA increases the minimum level of Medicaid rebates payable by manufacturers of brand name drugs from 15.1% to 23.1%; expanded manufacturer Medicaid rebate liability to include utilization by beneficiaries enrolled in Medicaid managed care organizations; imposed a non-deductible annual fee on pharmaceutical manufacturers or importers who sell “branded prescription drugs” to specified federal government programs; modified the AMP definition under the MDRP for drugs that are inhaled, infused, instilled, implanted or injected; increased the number of entities eligible for discounts under the 340B program; and included a discount on brand name drugs for Medicare Part D beneficiaries in the coverage gap, or “donut hole.” Since its enactment, there have been judicial, executive and Congressional challenges to certain aspects of the ACA.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

1 edited+0 added−0 removed4 unchanged
Biggest changeNumber of Stockholders As of February 23, 2023, we had approximately 58 stockholders of record of our common stock.
Biggest changeNumber of Stockholders As of February 22, 2024, we had approximately 58 stockholders of record of our common stock.

Item 7. Management's Discussion & Analysis

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

16 edited+6 added−13 removed8 unchanged
Biggest changeOur lead asset is onvansertib, a PLK1 inhibitor that is being evaluated in combination with standard of care therapies in clinical programs targeting indications such as KRAS/NRAS-mutated metastatic colorectal cancer, metastatic pancreatic cancer, as well as investigator-initiated trials in triple negative breast cancer and small cell lung cancer.
Biggest changeOur goal is to target tumor vulnerabilities with treatment combinations of onvansertib, our oral and highly selective PLK1 inhibitor, and standard-of-care therapeutics. We are focusing our clinical program in indications such as RAS-mutated metastatic colorectal cancer ("mCRC"), as well as in investigator-initiated trials in metastatic pancreatic ductal adenocarcinoma ("mPDAC"), and small cell lung cancer ("SCLC").
Our drug development efforts are in their early stages, and we cannot make estimates of the costs or the time that our development efforts will take to complete, or the timing and amount of revenues related to the sale of our drugs.
Our drug development efforts are in their early stages, and we cannot make estimates of the costs or the time that our development efforts will take to complete, or the timing and amount of revenues related to the sale of our drug.
We have incurred net losses since our inception and have negative operating cash flows. As of December 31, 2022, we had $105.3 million in cash, cash equivalents and short-term investments and we believe we have sufficient cash to meet our funding requirements for at least the next 12 months following the issuance date of these financial statements.
We have incurred net losses since our inception and have negative operating cash flows. As of December 31, 2023, we had $74.8 million in cash, cash equivalents and short-term investments and we believe we have sufficient cash to meet our funding requirements for at least the next 12 months following the issuance date of these financial statements.
The risk of completion of any program is high because of the many uncertainties involved in developing new drug candidates to market, including the long duration of clinical testing, the specific performance of proposed products under stringent clinical trial protocols, extended regulatory approval and review cycles, our ability to raise additional capital, the nature and timing of 40 Table of Contents research and development expenses, and competing technologies being developed by organizations with significantly greater resources.
The risk of completion of any program is high because of the many uncertainties involved in developing new drug candidates to market, including the long duration of clinical testing, the specific performance of proposed products under stringent clinical trial protocols, extended regulatory approval and review cycles, our ability to raise additional capital, the nature and timing of research and development expenses, and competing technologies being developed by organizations with significantly greater resources. 42 Table of Contents Critical Accounting Estimate Our accounting policies are described in Part II, Item 8.
The overall increase in expenses was primarily related to CMC, clinical pharmacology and for studies to support the development of our lead drug candidate, onvansertib. Salaries and staff costs increased primarily due to additional hires in senior management and our clinical operations team (research and development average headcount grew by 93% over the comparative period).
The overall increase in expenses was primarily due to costs associated with clinical programs and outside service costs related to the development of our lead drug candidate, onvansertib. Salaries and staff costs increased primarily from additional hires in senior management and our clinical operations team (research and development average headcount grew by 39% over the comparative period).
To date, our sources of cash have been primarily limited to the sale of equity securities. We cannot be certain that additional funding will be available on acceptable terms, or at all. To the extent that we raise additional funds by issuing equity securities, our stockholders may experience significant dilution.
We cannot be certain that additional funding will be available on acceptable terms, or at all. To the extent that we can raise additional funds by issuing equity securities, our stockholders may experience additional dilution.
Net cash provided by investing activities was $38.1 million primarily related to sales and maturities in excess of purchases of marketable securities, partially offset by purchases of capital equipment during the year ended December 31, 2022, 42 Table of Contents compared to net cash used in investing activities of $131.4 million for net purchases of marketable securities during the same period in 2021.
Net cash provided by investing activities was $36.2 million primarily related to sales and maturities in excess of purchases of marketable securities during the year ended December 31, 2023, compared to net cash used in investing activities of $38.1 million primarily related to sales and maturities in excess of purchases of marketable securities during the same period in 2022.
Critical Accounting Estimate Our accounting policies are described in Part II, Item 8. Financial Statements—Note 2 Basis of Presentation and Summary of Significant Accounting Policies in this Annual Report on Form 10-K .
Financial Statements—Note 2 Basis of Presentation and Summary of Significant Accounting Policies in this Annual Report on Form 10-K .
Results of Operations Years Ended December 31, 2022 and 2021 Revenues Our total revenues were $386,000 and $359,000 for the years ended December 31, 2022 and 2021, respectively. Revenues are from our annual minimum or sales-based royalties on other intellectual property licenses, unrelated to onvansertib.
Results of Operations Years Ended December 31, 2023 and 2022 Revenues Our total revenues were $488,000 and $386,000 for the years ended December 31, 2023 and 2022, respectively. Revenues are from our sales-based or usage-based royalties on other intellectual property licenses, unrelated to onvansertib. Revenue recognition of the royalty depends on the timing and overall sales activities of the licensees.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Company Overview We are a clinical-stage biotechnology company, headquartered in San Diego, CA, leveraging Polo-like Kinase 1 (“PLK1”) inhibition to develop novel therapies across a range of cancers.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Company Overview We are a clinical-stage biotechnology company, headquartered in San Diego, CA, leveraging PLK1 inhibition, a well-validated oncology drug target, to develop novel therapies across a range of cancers with the greatest unmet medical need.
Research and Development Expenses Research and development expenses consisted of the following: For the years ended December 31, (in thousands) 2022 2021 Increase/(Decrease) Salaries and staff costs $ 4,031 $ 1,745 $ 2,286 Stock-based compensation 1,035 491 544 Clinical trials, outside services, and lab supplies 20,556 14,174 6,382 Facilities and Other 1,485 966 519 Total research and development expenses $ 27,107 $ 17,376 $ 9,731 Research and development expenses increased by $9.7 million to $27.1 million for the year ended December 31, 2022 from $17.4 million for the year ended December 31, 2021.
Research and Development Expenses Research and development expenses consisted of the following: For the years ended December 31, (in thousands) 2023 2022 Increase/(Decrease) Salaries and staff costs $ 5,930 $ 4,031 $ 1,899 Stock-based compensation 1,279 1,035 244 Clinical trials, outside services, and lab supplies 23,686 20,556 3,130 Facilities and Other 1,962 1,485 477 Total research and development expenses $ 32,857 $ 27,107 $ 5,750 Research and development expenses increased by $5.8 million to $32.9 million for the year ended December 31, 2023 from $27.1 million for the year ended December 31, 2022.
Liquidity and Capital Resources As of December 31, 2022, we had $16.3 million in cash and cash equivalents and $88.9 million in short-term investments. Net cash used in operating activities for the year ended December 31, 2022 was $33.8 million, compared to $23.0 million for the year ended December 31, 2021.
Liquidity and Capital Resources Net cash used in operating activities for the year ended December 31, 2023 was $30.9 million, compared to $33.8 million for the year ended December 31, 2022.
To date, we have generated minimal revenues and expect to incur additional losses to perform further research and development activities.
Our accumulated deficit through December 31, 2023 is $339.5 million. To date, we have generated minimal revenues, unrelated to onvansertib, and expect to incur additional losses to perform further research and development activities.
Net cash provided by financing activities was $0.1 million from the exercise of stock options during the year ended December 31, 2022, compared to $35.5 million of proceeds from the sale of common stock and proceeds from warrant exercises for the same period in 2021.
Net cash provided by financing activities was $0.0 million during the year ended December 31, 2023, compared to net cash provided by financing activities of $0.1 million for the same period in 2022. As of December 31, 2023 and 2022, we had working capital of $67.0 million and $103.5 million, respectively.
The increase in stock-based compensation is primarily due to additional stock option grants to employees granted subsequent to the prior period. 41 Table of Contents Selling, General and Administrative Expenses Selling, general and administrative expenses consisted of the following: For the years ended December 31, (in thousands) 2022 2021 Increase/(Decrease) Salaries and staff costs $ 3,134 $ 2,491 $ 643 Stock-based compensation 3,221 2,743 478 Outside services and professional fees 4,192 4,439 (247) Facilities and other 2,634 2,165 469 Total selling, general and administrative $ 13,181 $ 11,838 $ 1,343 Selling, general and administrative expenses increased by $1.3 million to $13.2 million for the year ended December 31, 2022, from $11.8 million for the year ended December 31, 2021.
The increase in facilities and other costs is primarily due to increased allocation of facilities cost resulting from headcount growth compared to the prior period. 43 Table of Contents Selling, General and Administrative Expenses Selling, general and administrative expenses consisted of the following: For the years ended December 31, (in thousands) 2023 2022 Increase/(Decrease) Salaries and staff costs $ 3,531 $ 3,134 $ 397 Stock-based compensation 3,230 3,221 9 Outside services and professional fees 4,133 4,192 (59) Facilities and other 2,149 2,634 (485) Total selling, general and administrative $ 13,043 $ 13,181 $ (138) Selling, general and administrative expenses decreased by $138,000 to $13.0 million for the year ended December 31, 2023, from $13.2 million for the year ended December 31, 2022.
Based on our current projections we expect that our capital resources are sufficient to fund our operations into 2025. For the foreseeable future, we expect to continue to incur losses and require additional capital to further advance our clinical trial programs and support our other operations.
Based on our current projections we expect that our capital resources are sufficient to fund our operations into the third quarter of 2025.
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These programs and our broader development strategy are designed to target tumor vulnerabilities in order to overcome treatment resistance and deliver superior clinical benefit compared to the standard of care alone. Our common stock is listed on the Nasdaq Capital Market under the ticker symbol "CRDF".
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Our clinical development programs incorporate tumor genomics and biomarker assays to refine assessment of patient response to treatment. Our common stock is listed on the Nasdaq Capital Market under the ticker symbol "CRDF". Company Updates On February 2, 2023 we announced the appointment of Fairooz Kabbinavar, M.D., FACP, as Chief Medical Officer.
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Company Updates On February 2, 2023 we announced the appointment of Fairooz Kabbinavar, M.D., FACP, as Chief Medical Officer. On January 11, 2022 we announced the appointment of Tod Smeal, Ph.D., as Chief Scientific Officer and Charles Monahan, R.Ph., as Senior Vice President, Regulatory Affairs. Our accumulated deficit through December 31, 2022 is $298.1 million.
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Salaries and staff costs increased due to an employee severance agreement. The decrease in facilities and other costs was primarily due to reduced insurance costs compared to the prior period. Interest Income, Net Interest income, net was $4.1 million for the year ended December 31, 2023 as compared to $1.6 million for the year ended December 31, 2022.
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Revenue recognition of the royalty depends on the timing and overall sales activities of the licensees.
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The increase in interest income was primarily due to higher interest rates on our short-term investments portfolio for the year ended December 31, 2023 as compared to the same period of 2022.
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Salaries and staff costs increased due to merit increases and higher headcount (average headcount grew by 30% over the comparative period). The increase in stock-based compensation is primarily due to additional stock option grants to employees granted subsequent to the prior period. Facilities and other costs increased due to higher insurance costs and the amending of our operating lease.
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Our use of cash was primarily a result of the net loss of $41.4 million for the year ended December 31, 2023, adjusted for non-cash items related to stock-based compensation of $4.5 million. The net change in our operating assets and liabilities was $6.6 million decreasing cash used in operations.
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The decrease in outside services is primarily related to strategic valuation consulting related to our lead drug candidate, onvansertib performed during the prior period.
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Our drug development efforts are in their early stages, and we cannot make estimates of the costs or the time that our development efforts will take to complete, or the timing and amount of revenues related to the sale of our drug candidates.
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Net Loss Net loss and per share amounts were as follows: For the years ended December 31, (in thousands) 2022 2021 Increase/(Decrease) Net loss $ (38,704) $ (28,291) $ 10,413 Preferred stock dividend (24) (24) — Net loss attributable to common stockholders $ (38,728) $ (28,315) $ 10,413 Net loss per common share — basic and diluted $ (0.89) $ (0.73) $ 0.16 Weighted-average shares outstanding — basic and diluted 43,600 39,030 4,570 The increase of $10.4 million in net loss attributable to common shareholders was primarily the result of an increase in operating expenses for the year ended December 31, 2022 compared to the same period in the prior year.
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The risk of completion of any program is high because of the many uncertainties involved in developing new drug candidates to market, including the long duration of clinical testing, the specific performance of proposed products under stringent clinical trial protocols, extended regulatory approval and review cycles, our ability to raise additional capital, the nature and timing of research and development expenses, and competing technologies being developed by organizations with significantly greater resources. 44 Table of Contents For the foreseeable future, we expect to continue to incur losses and require additional capital to further advance our clinical trial programs and support our other operations.
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The $0.16 increase in basic and diluted net loss per share was impacted by the increase in net loss attributable to shareholders and was partially offset by the increase in weighted average shares outstanding resulting primarily from the issuance of approximately 2.7 million shares of common stock primarily from the conversion of Series E Convertible Preferred Stock during the twelve months ended December 31, 2022.
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As of December 31, 2022 and 2021, we had working capital of $103.5 million and $139.6 million, respectively. The decrease in working capital is primarily due to the net loss partially offset by the increase in cash and cash equivalents from financing activities during the year ended December 31, 2022.
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We cannot be certain that additional funding will be available on acceptable terms, or at all. To the extent that we can raise additional funds by issuing equity securities, our stockholders may experience additional dilution. Our working capital requirements will depend upon numerous factors including but not limited to the nature, cost and timing of our research and development programs.
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If we are unable to raise additional capital when required or on acceptable terms, we may have to significantly delay, scale back or discontinue the development and/or commercialization of one or more product candidates, all of which may have a material adverse impact on our operations.
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We may also be required to (i) seek collaborators for product candidates at an earlier stage than otherwise would be desirable and on terms that are less favorable than might otherwise be available; or (ii) relinquish or otherwise dispose of rights to technologies, product candidates or products that we would otherwise seek to develop or commercialize ourselves on unfavorable terms.
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We are evaluating all options to raise additional capital, increase revenue, as well as reduce costs, in an effort to strengthen our liquidity position, which may include the following: (1) Raising capital through public and private equity offerings; (2) Introducing operation and business development initiatives to bring in new revenue streams; (3) Reducing operating costs by identifying internal synergies; and (4) Engaging in strategic partnerships.
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We continually assess our spending plans to effectively and efficiently address our liquidity needs.

Other CRDF 10-K year-over-year comparisons