What changed in Altimmune, Inc.'s 10-K — 2022 vs 2023
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Paragraph-level year-over-year comparison of Altimmune, 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.
+422 added−470 removedSource: 10-K (2024-03-27) vs 10-K (2023-02-28)
Top changes in Altimmune, Inc.'s 2023 10-K
422 paragraphs added · 470 removed · 318 edited across 7 sections
- Item 1A. Risk Factors+190 / −201 · 147 edited
- Item 1. Business+156 / −173 · 128 edited
- Item 7. Management's Discussion & Analysis+70 / −87 · 39 edited
- Item 3. Legal Proceedings+2 / −5
- Item 5. Market for Registrant's Common Equity+2 / −2 · 2 edited
Item 1. Business
Business — how the company describes what it does
128 edited+28 added−45 removed276 unchanged
Item 1. Business
Business — how the company describes what it does
128 edited+28 added−45 removed276 unchanged
2022 filing
2023 filing
Biggest changeNo significant ALT elevations were reported. *p 14 Table of Contents As detailed in the table below, glycemic control was maintained in subjects with diabetes, all pemvidutide groups demonstrating trends toward improvements in fasting glucose and either maintaining or demonstrating trends toward improvement in HbA1c over the 24 weeks of treatment: Characteristic Treatment Placebo 1.2 mg 1.8 mg 2.4 mg Non-diabetes n = 14 n = 13 n = 9 n = 11 Fasting glucose Baseline, mg/dL, mean (SD) 96.2 (12.4) 99.4 (11.9) 96.0 (12.4) 99.3 (13.6) Week 24, mg/dL, mean (SD) 93.3 (12.1) 99.1 (13.1) 96.9 (12.5) 98.4 (24.5) HbA1c Baseline, %, mean (SD) 5.8 (0.2) 5.7 (0.3) 5.7 (0.2) 5.5 (0.4) Week 24, %, mean (SD) 5.7 (0.3) 5.8 (0.3) 5.8 (0.3) 5.6 (0.3) Diabetes n = 5 n = 3 n = 6 n = 3 Fasting glucose Baseline, mg/dL, mean (SD) 111.5 (19.2) 132.1 (28.2) 120.2 (37.1) 147.4 (40.4) Week 24, mg/dL, mean (SD) 109.4 (14.8) 123.4 (50.8) 109.0 (13.1) 75.5 (29.0) HbA1c Baseline, %, mean (SD) 6.1 (0.6) 7.8 (1.4 6.4 (0.5) 6.8 (1.3) Week 24, %, mean (SD) 6.4 (1.1) 7.4 (2.3 6.4 (0.3) 6.3 (1.3) Clinical Development Plan We initiated a 48-week Phase 2 MOMENTUM obesity trial in the first half of 2022.
Biggest changeBelow is a summary of the safety findings: Characteristic Treatment Placebo (n = 19) 1.2 mg (n=16) 1.8 mg (n=15) 2.4 mg (n=14) Serious or severe AEs n (%) 1 (5.3%) 1 (6.3%) 1 (6.7%) 0 (0.0 %) AEs leading to treatment discontinuation n (%) 0 (0.0%) 2 (12.5%) 1 (6.7%) 0 (0.0 %) Nausea Mild, n (%) 0 (0.0%) 0 (0.0%) 0 (0.0%) 1 (7.1%) Moderate, n (%) 0 (0.0%) 0 (0.0%) 3 (20.0%) 0 (0.0%) Vomiting Mild, n (%) 0 (0.0%) 0 (0.0%) 0 (0.0%) 0 (0.0%) Moderate, n (%) 0 (0.0%) 0 (0.0%) 0 (0.0%) 0 (0.0%) Diarrhea Mild, n (%) 1 (5.3%) 0 (0.0%) 1 (6.7%) 0 (0.0%) Moderate, n (%) 0 (0.0%) 1 (6.3%) 0 (0.0%) 0 (0.0%) Constipation Mild, n (%) 0 (0.0%) 0 (0.0%) 1 (6.7%) 0 (0.0%) Moderate, n (%) 1 (5.3%) 1 (6.3%) 0 (0.0%) 0 (0.0%) Systolic Blood Pressure, mm Hg, LSM (SE) -2.3 (2.8) -10.1 (4.2) * -5.5 (3.7) -12.0 (3.5) * Diastolic Blood Pressure, mm Hg, LSM (SE) -2.5 (1.5) -2.9 (2.6) -4.0 (3.7) -3.8 (2.8) Heart Rate, mmHg, LSM (SE) -1.0 (1.7) 3.7 (1.8) 0.5 (2.8) -0.1 (1.8) *p 15 Table of Contents As detailed in the table below, glycemic control was maintained in subjects with diabetes, all pemvidutide groups demonstrating trends toward improvements in fasting glucose and either maintaining or demonstrating trends toward improvement in HbA1c over the 24 weeks of treatment: Characteristic Treatment Placebo 1.2 mg 1.8 mg 2.4 mg Non-diabetes n = 14 n = 13 n = 9 n = 11 Fasting glucose Baseline, mg/dL, mean (SD) 96.2 (12.4) 99.4 (11.9) 96.0 (12.4) 99.3 (13.6) Week 24, mg/dL, mean (SD) 93.3 (12.1) 99.1 (13.1) 96.9 (12.5) 98.4 (24.5) HbA1c Baseline, %, mean (SD) 5.8 (0.2) 5.7 (0.3) 5.7 (0.2) 5.5 (0.4) Week 24, %, mean (SD) 5.7 (0.3) 5.8 (0.3) 5.8 (0.3) 5.6 (0.3) Diabetes n = 5 n = 3 n = 6 n = 3 Fasting glucose Baseline, mg/dL, mean (SD) 111.5 (19.2) 132.1 (28.2) 120.2 (37.1) 147.4 (40.4) Week 24, mg/dL, mean (SD) 109.4 (14.8) 123.4 (50.8) 109.0 (13.1) 75.5 (29.0) HbA1c Baseline, %, mean (SD) 6.1 (0.6) 7.8 (1.4 6.4 (0.5) 6.8 (1.3) Week 24, %, mean (SD) 6.4 (1.1) 7.4 (2.3 6.4 (0.3) 6.3 (1.3) Phase 1b Trial – 12-Week Type 2 Diabetes Safety Trial In March 2023, we announced topline results from a 12-week Phase 1b safety trial of pemvidutide, which evaluated the safety profile of pemvidutide in subjects with overweight or obesity and type 2 diabetes.
A summary of the key primary and secondary efficacy findings is below: Endpoint Treatment Placebo 1.2 mg 1.8 mg 2.4 mg Primary Endpoint—Liver Fat Content n = 18 n = 14 n = 13 n = 11 Liver fat reduction, absolute, % change, LSM (SE) 1.6 (0.8) 11.2 (2.3) *** 17.0 (2.4) *** 15.6 (2.1) *** Liver fat reduction, relative, % change, LSM (SE) 14.0 (3.8) 56.3 (11.6) *** 75.2 (8.1) *** 76.4 (5.9) *** Proportion of subjects with 30% reduction, (%) 5.6 76.9 **** 92.3 **** 100.0 **** Proportion of subjects with 50% reduction, (%) 0.0 61.5 *** 84.6 **** 72.7 **** Proportion of subjects with normalization, (%) 0.0 30.8 * 53.8 *** 45.5 ** Secondary Endpoint—Markers of Inflammation ALT, change from baseline, IU/L, LSM (SE) n = 19 n = 16 n = 15 n = 14 -2.2 (2.5) -13.3 (3.7) ** -13.7 (5.1) ** -15.2 (5.8) ** ALT, change from baseline, IU/L, LSM (SE), baseline ≥ 30 IU/ n = 13 n = 7 n = 10 n = 9 -3.1 (3.5) -17.0 (7.6) * -17.7 (7.2) * -20.6 (9.8) * Proportion of subjects with cT1 response, (%) n = 6 n = 7 n = 4 n = 2 0.0 85.7 ** 75.0 * 100.0 * Secondary Endpoint—Weight Loss Weight loss, no diabetes, (% change), LSM (SE) n = 14 n = 13 n = 9 n = 11 1.2 (0.7) 5.2 (1.7) ** 7.2 (1.1) *** 5.8 (1.6) ** Weight loss, diabetes, (% change), LSM (SE) † n = 5 n = 3 n = 6 n = 3 3.4 (2.1) 4.3 (1.9) 5.3 (2.7) 3.5 (2.5) Weight loss, all subjects, (% change), LSM (SE n = 19 n = 16 n = 15 n = 14 1.4 (0.7) 5.1 (1.4) ** 6.2 (1.3) *** 5.2 (1.4) ** Normalization of liver fat defined as ≤ 5%; cT1 response define as an 80 ms change from baseline; LSM, least square mean † High variability due to the small numbers of diabetic subjects (n = 5, 3, 6, 3 in respective treatment groups) * p 13 Table of Contents Pemvidutide was generally well tolerated.
A summary of the key primary and secondary efficacy findings is below: Endpoint Treatment Placebo 1.2 mg 1.8 mg 2.4 mg Primary Endpoint—Liver Fat Content n = 18 n = 14 n = 13 n = 11 Liver fat reduction, absolute, % change, LSM (SE) 1.6 (0.8) 11.2 (2.3) *** 17.0 (2.4) *** 15.6 (2.1) *** Liver fat reduction, relative, % change, LSM (SE) 14.0 (3.8) 56.3 (11.6) *** 75.2 (8.1) *** 76.4 (5.9) *** Proportion of subjects with 30% reduction, (%) 5.6 76.9 **** 92.3 **** 100.0 **** Proportion of subjects with 50% reduction, (%) 0.0 61.5 *** 84.6 **** 72.7 **** Proportion of subjects with normalization, (%) 0.0 30.8 * 53.8 *** 45.5 ** Secondary Endpoint—Markers of Inflammation ALT, change from baseline, IU/L, LSM (SE) n = 19 n = 16 n = 15 n = 14 -2.2 (2.5) -13.3 (3.7) ** -13.7 (5.1) ** -15.2 (5.8) ** ALT, change from baseline, IU/L, LSM (SE), baseline ≥ 30 IU/ n = 13 n = 7 n = 10 n = 9 -3.1 (3.5) -17.0 (7.6) * -17.7 (7.2) * -20.6 (9.8) * Proportion of subjects with cT1 response, (%) n = 6 n = 7 n = 4 n = 2 0.0 85.7 ** 75.0 * 100.0 * Secondary Endpoint—Weight Loss Weight loss, no diabetes, (% change), LSM (SE) n = 14 n = 13 n = 9 n = 11 1.2 (0.7) 5.2 (1.7) ** 7.2 (1.1) *** 5.8 (1.6) ** Weight loss, diabetes, (% change), LSM (SE) † n = 5 n = 3 n = 6 n = 3 3.4 (2.1) 4.3 (1.9) 5.3 (2.7) 3.5 (2.5) Weight loss, all subjects, (% change), LSM (SE n = 19 n = 16 n = 15 n = 14 1.4 (0.7) 5.1 (1.4) ** 6.2 (1.3) *** 5.2 (1.4) ** Normalization of liver fat defined as ≤ 5%; cT1 response define as an 80 ms change from baseline; LSM, least square mean † High variability due to the small numbers of diabetic subjects (n = 5, 3, 6, 3 in respective treatment groups) * p 14 Table of Contents Pemvidutide was generally well tolerated.
United States Government Regulation The FDA regulates drugs and biological products under the Federal Food, Drug, and Cosmetic Act (“FD&C Act”), the Public Health Service Act (“PHS Act”), the FDA regulations under Titles 21 and 42 of the Code of Federal Regulations (21 CFR and 42 CFR), as well as other federal, state and local statutes and regulations.
United States Government Regulation The FDA regulates drugs and biological products under the Federal Food, Drug, and Cosmetic Act (“FD&C Act”), the Public Health Service Act (“PHS Act”), the regulations under Titles 21 and 42 of the Code of Federal Regulations (21 CFR and 42 CFR), as well as other federal, state and local statutes and regulations.
Under the Prescription Drug User Fee Act (“PDUFA”), as amended, each NDA or BLA must be accompanied by a significant user fee. PDUFA also imposes an annual prescription drug product program fee for biologics. Fee waivers or reductions are available in certain circumstances, including a waiver of the application fee for the first application filed by a small business.
Under the Prescription Drug User Fee Act (“PDUFA”), as amended, each NDA or BLA must be accompanied by a significant application fee. PDUFA also imposes an annual prescription drug product program fee for biologics. Fee waivers or reductions are available in certain circumstances, including a waiver of the application fee for the first application filed by a small business.
Drug and Biological Products Development Process The process required by the FDA before a drug or biological product may be marketed in the United States generally involves the following: ● completion of preclinical laboratory tests and animal studies according to applicable good laboratory practices (“GLP”), applicable requirements for the humane use of laboratory animals, such as the Animal Welfare Act or other applicable regulations; ● submission to the FDA of an application for an IND which must become effective before human clinical trials may begin; ● obtaining approval by an independent Institutional Review Board (“IRB”) at each clinical site before a clinical trial may be initiated at that site; ● performance of adequate and well-controlled human clinical trials according to the FDA’s regulations commonly referred to as good clinical practices (“GCP”) and any additional requirements for the protection of human research subjects and their health information, to establish the safety and efficacy of the proposed product for its intended use; 23 Table of Contents ● submission to the FDA of a new drug application (“NDA”) or biologics license application (“BLA”) for marketing approval that includes substantial evidence of safety, purity and potency from results of clinical trials, as well as the results of preclinical testing, detailed information about the chemistry, manufacturing and controls, and proposed labeling and packaging for the product candidate; ● review of the product candidate by an FDA advisory committee, if applicable; ● satisfactory completion of an FDA inspection of the manufacturing facility or facilities where the product candidate is produced to assess compliance with cGMP and to confirm that the facilities, methods and controls are adequate to assure the product candidate’s identity, strength, quality and purity; ● satisfactory completion of potential FDA audits of the preclinical study and clinical trial sites that generated the data in support of the NDA or BLA; and ● FDA review and approval, or licensure, of the NDA or BLA, including agreement on post-marketing commitments, if applicable.
Drug and Biological Products Development Process The process required by the FDA before a drug or biological product may be marketed in the United States generally involves the following: ● completion of preclinical laboratory tests and animal studies according to applicable good laboratory practices (“GLP”), applicable requirements for the humane use of laboratory animals, such as the Animal Welfare Act or other applicable regulations; ● submission to the FDA of an application for an IND which must become effective before human clinical trials may begin; ● obtaining approval by an independent Institutional Review Board (“IRB”) at each clinical site before a clinical trial may be initiated at that site; ● performance of adequate and well-controlled human clinical trials according to the FDA’s regulations commonly referred to as good clinical practices (“GCP”) and any additional requirements for the protection of human research subjects and their health information, to establish the safety and efficacy of the proposed product for its intended use; ● submission to the FDA of a new drug application (“NDA”) or biologics license application (“BLA”) for marketing approval that includes substantial evidence of safety, purity and potency from results of clinical trials, as well as the results of preclinical testing, detailed information about the chemistry, manufacturing and controls, and proposed labeling and packaging for the product candidate; 25 Table of Contents ● review of the product candidate by an FDA advisory committee, if applicable; ● satisfactory completion of an FDA inspection of the manufacturing facility or facilities where the product candidate is produced to assess compliance with cGMP and to confirm that the facilities, methods and controls are adequate to assure the product candidate’s identity, strength, quality and purity; ● satisfactory completion of potential FDA audits of the preclinical study and clinical trial sites that generated the data in support of the NDA or BLA; and ● FDA review and approval, or licensure, of the NDA or BLA, including agreement on post-marketing commitments, if applicable.
In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical trial can begin. Even after the IND has gone into effect and clinical testing has begun, the FDA may also impose a partial or complete clinical hold on clinical trials due to safety concerns or non-compliance.
In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical trial can begin. Even after the IND has gone into effect and clinical testing has begun, the FDA may impose a partial or complete clinical hold on clinical trials due to safety concerns or non-compliance.
HepTcell HepTcell is an immunotherapeutic product candidate for patients chronically infected with the hepatitis B virus (“HBV”). Approximately 300 million people worldwide live with chronic HBV infection, including approximately 2.2 million in the United States. Chronic HBV infection can lead to serious complications, including cirrhosis and liver cancer.
HepTcell HepTcell is an immunotherapeutic product candidate for patients chronically infected with the hepatitis B virus (“HBV”). Approximately 300 million people worldwide live with chronic HBV infection, including approximately 2.4 million in the United States. Chronic HBV infection can lead to serious complications, including cirrhosis and liver cancer.
Summary of 12-week MAD safety findings Characteristic Treatment 1.2mg (n=7) 1.8mg (n=9) 2.4mg (n=11) Pooled Placebo (n=7) Discontinuations due to adverse events (n) 0 0 0 0 Early withdrawal (n) 1 0 2 2 Gastrointestinal adverse events Nausea Mild 14.3% 55.6% 45.5% 14.3% Moderate 14.3% 11.1% 45.5% 0% Vomiting Mild 14.3% 11.1% 45.5% 14.3% Moderate 0% 11.1% 27.3% 0% Diarrhea Mild 0% 0% 18.2% 0% Moderate 0% 0% 0% 0% Constipation Mild 0% 11.1% 18.2% 0% Moderate 0% 11.1% 9.1% 0% Other adverse events (n) 0 2 1 0 7 Table of Contents Unlike the majority of other clinical trials with agents within the GLP-1 class, including dual agonists and tri-agonists, dose titration, a gradual increasing of dose within a subject over a period of weeks to months to improve tolerability, was not used in the pemvidutide trial.
Summary of 12-week MAD safety findings Characteristic Treatment 1.2mg (n=7) 1.8mg (n=9) 2.4mg (n=11) Pooled Placebo (n=7) Discontinuations due to adverse events (n) 0 0 0 0 Early withdrawal (n) 1 0 2 2 Gastrointestinal adverse events Nausea Mild 14.3% 55.6% 45.5% 14.3% Moderate 14.3% 11.1% 45.5% 0% Vomiting Mild 14.3% 11.1% 45.5% 14.3% Moderate 0% 11.1% 27.3% 0% Diarrhea Mild 0% 0% 18.2% 0% Moderate 0% 0% 0% 0% Constipation Mild 0% 11.1% 18.2% 0% Moderate 0% 11.1% 9.1% 0% Other adverse events (n) 0 2 1 0 Unlike the majority of other clinical trials with agents within the GLP-1 class, including dual agonists and tri-agonists, dose titration, a gradual increasing of dose within a subject over a period of weeks to months to improve tolerability, was not used in the pemvidutide trial.
Endpoint Treatment Placebo (n = 24) 1.2 mg (n=20) 1.8 mg (n=18) 2.4 mg (n=20) Absolute reduction, % Mean (SE) 0.2 (1.7) 8.9 (1.8)** 14.7 (1.7)** 11.3 (2.0)** Relative reduction, % Mean (SE) 4.4 (8.7) 46.6 (8.1)** 68.5 (9.7)** 57.1 (8.0)** 30% reduction n (%) 1 (4.2%) 13 (65.0%)** 17 (94.4%)** 17 (85.0%)** 50% reduction n (%) 0 (0.0%) 8 (40.0%)** 13 (72.2%)** 14 (70.0%)** Normalization (≤ 5% LFC) n (%) 0 (0.0%) 4 (20.0%)* 10 (55.6%)** 10 (50.0%)** *p 10 Table of Contents In addition, as shown in the below table, mean serum ALT levels declined in all subjects, and in subjects with baseline serum ALT above 30 IU/L, levels declined more than 17 IU/L at all dose levels and 27.0 IU/L in the 2.4 mg dose cohort.
Endpoint Treatment Placebo (n = 24) 1.2 mg (n=20) 1.8 mg (n=18) 2.4 mg (n=20) Absolute reduction, % Mean (SE) 0.2 (1.7) 8.9 (1.8)** 14.7 (1.7)** 11.3 (2.0)** Relative reduction, % Mean (SE) 4.4 (8.7) 46.6 (8.1)** 68.5 (9.7)** 57.1 (8.0)** 30% reduction n (%) 1 (4.2%) 13 (65.0%)** 17 (94.4%)** 17 (85.0%)** 50% reduction n (%) 0 (0.0%) 8 (40.0%)** 13 (72.2%)** 14 (70.0%)** Normalization (≤ 5% LFC) n (%) 0 (0.0%) 4 (20.0%)* 10 (55.6%)** 10 (50.0%)** *p In addition, as shown in the below table, mean serum ALT levels declined in all subjects, and in subjects with baseline serum ALT above 30 IU/L, levels declined more than 17 IU/L at all dose levels and 27.0 IU/L in the 2.4 mg dose cohort.
For example, the applicant must thoroughly describe the manufacturing process and must: (i) provide information on the origin and history of the starting materials; (ii) demonstrate that the active substance complies with specific measures for preventing the transmission of animal and human spongiform encephalopathies; (iii) if cell banks are used, demonstrate that cell characteristics remain unchanged at the passage level for production (and beyond); (iv) provide information as to whether there are adventitious agents in seed materials, cell banks, pools of serum or plasma, and all other materials of biological origin, and, if it is not possible to avoid the presence of potentially pathogenic adventitious agents, show that further processing ensures elimination or inactivation of the agents; (v) if possible, base vaccine production on a seed lot system and established cell banks; (vi) in case of medicines derived from human blood or plasma, describe the origin, criteria and procedures for the collection, transportation and storage of the starting material; 37 Table of Contents and (vii) describe the manufacturing facilities and equipment.
For example, the applicant must thoroughly describe the manufacturing process and must: (i) provide information on the origin and history of the starting materials; (ii) demonstrate that the active substance complies with specific measures for preventing the transmission of animal and human spongiform encephalopathies; (iii) if cell banks are used, demonstrate that cell characteristics remain unchanged at the passage level for production (and beyond); (iv) provide information as to whether there are adventitious agents in seed materials, cell banks, pools of serum or plasma, and all other materials of biological origin, and, if it is not possible to avoid the presence of potentially pathogenic adventitious agents, show that further processing ensures elimination or inactivation of the agents; (v) if possible, base vaccine production on a seed lot system and established cell banks; (vi) in case of medicines derived from human blood or plasma, describe the origin, criteria and procedures for the collection, transportation and storage of the starting material; and (vii) describe the manufacturing facilities and equipment.
While we would expect to be granted this 12-year period of exclusivity for our applicable product candidates, if approved, this period of reference product market exclusivity applies only to the biosimilar pathway and will not, for example, provide protection against any biological product for a similar indication that achieves FDA approval under a traditional NDA or BLA based on the sponsor’s own research data.
Although we would expect to be granted this 12-year period of exclusivity for our applicable product candidates, if approved, this period of reference product market exclusivity applies only to the biosimilar pathway and will not, for example, provide protection against any biological product for a similar indication that achieves FDA approval under a traditional NDA or BLA based on the sponsor’s own research data.
Spitfire was a privately held, preclinical pharmaceutical company with the primary asset being pemvidutide, a novel peptide-based GLP-1/glucagon dual receptor agonist product candidate designed to treat obesity and the metabolic dysfunction that causes NASH. Obesity is a significant burden to the global healthcare systems and is implicated in two-thirds of the leading causes of death from non-communicable diseases worldwide.
Spitfire was a privately held, preclinical pharmaceutical company with the primary asset being pemvidutide, a novel peptide-based GLP-1/glucagon dual receptor agonist product candidate designed to treat obesity and the metabolic dysfunction that causes MASH. Obesity is a significant burden to the global healthcare systems and is implicated in two-thirds of the leading causes of death from non-communicable diseases worldwide.
The IRA includes several provisions that will impact our business to varying degrees, including provisions that create a $2,000 out-of-pocket cap for Medicare Part D beneficiaries, impose new mandatory discounts from manufacturers under Medicare Part D, allow the U.S. government to negotiate Medicare Part B and Part D pricing for certain high-cost single-source drugs and biologics without generic or biosimilar competition, and require companies to pay rebates to Medicare for drug prices that increase faster than inflation.
The IRA includes several provisions that will impact our business to varying degrees, including provisions that create a $2,000 out-of-pocket cap for Medicare Part D beneficiaries, impose new mandatory discounts from manufacturers under Medicare Part D, allow the U.S. 34 Table of Contents government to negotiate Medicare Part B and Part D pricing for certain high-cost single-source drugs and biologics without generic or biosimilar competition, and require companies to pay rebates to Medicare for drug prices that increase faster than inflation.
Approximately 780,000 people die per year worldwide due to cirrhosis and liver cancer. Current antivirals prevent disease progression but rarely clear chronic infection. HepTcell is designed to drive CD4+ and CD8+ T-cell responses against all HBV genotypes in patients of all ethnic backgrounds.
Approximately 820,000 people die per year worldwide due to cirrhosis and liver cancer. Current antivirals prevent disease progression but rarely clear chronic infection. HepTcell is designed to drive CD4+ and CD8+ T-cell responses against all HBV genotypes in patients of all ethnic backgrounds.
The Health Care Reform Law contains provisions that may reduce the profitability of drug products, including, for example, by increasing the minimum rebates owed by manufacturers under the Medicaid Drug Rebate Program, extending the rebate program to individuals enrolled in Medicaid managed care plans, addressing a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected, and imposing certain annual fees based on pharmaceutical companies’ share of sales to federal health care programs.
The Health Care Reform Law contains provisions that may reduce the profitability of drug products, including, for example, by increasing the minimum rebates owed by manufacturers under the Medicaid Drug Rebate Program, extending the rebate program to individuals enrolled in Medicaid managed care plans, addressing 33 Table of Contents a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected, and imposing certain annual fees based on pharmaceutical companies’ share of sales to federal health care programs.
Patents subject to the Mederis IP License Agreement have also been granted in the United States, Australia, Israel and Japan, and applications are pending in the United States, Europe, Japan, China and other commercially relevant jurisdictions, wherein the claims are directed to specific GLP-1 and/or glucagon peptides conjugated to the EuPort domain.
Patents subject to the Mederis IP License Agreement have also been granted in the United States, Canada, Europe, Korea, Australia, Israel and Japan, and applications are pending in the United States, Europe, Japan, China and other commercially relevant jurisdictions, wherein the claims are directed to specific GLP-1 and/or glucagon peptides conjugated to the EuPort domain.
Phase 1 Clinical Trial Results – Liver Fat Content While the trial inclusion criteria for the MAD study did not pre-specify a minimum liver fat content (“LFC”), the trial did enroll a number of subjects with measurable LFC as determined by magnetic resonance imaging – proton density fat fraction (“MRI-PDFF”).
Phase 1 Clinical Trial Results – Liver Fat Content Although the trial inclusion criteria for the MAD study did not pre-specify a minimum liver fat content (“LFC”), the trial did enroll a number of subjects with measurable LFC as determined by magnetic resonance imaging – proton density fat fraction (“MRI-PDFF”).
LFC fell below the limit of detection (“LOD”), or less than 1.5%, within 6 weeks of treatment in all subjects with steatosis receiving the 1.8 mg or 2.4 mg dose of pemvidutide, representing a greater than 90% reduction in the liver fat content (see chart below).
LFC fell below the limit of detection (“LOD”), or less than 1.5%, within 6 weeks of treatment in all subjects with steatosis receiving the 1.8 mg or 2.4 mg dose of pemvidutide, representing on average a greater than 90% reduction in the liver fat content (see chart below).
At the 1.8 mg and 2.4 mg doses, subjects receiving pemvidutide achieved mean relative reductions of liver fat content of 75.2% and 76.4%, respectively; 92.3% and 100% of subjects, respectively, achieved a 30% reduction in liver fat, 84.6% and 72.7% of subjects, respectively, achieved a 50% reduction in liver fat, and 53.8% and 45.5% of subjects, respectively, achieved normalization of liver fat.
At the 1.8 mg and 2.4 mg doses, subjects receiving pemvidutide achieved mean relative reductions of liver fat content of 75.2% and 76.4%, respectively; 92.3% and 100% of subjects at the 1.8 mg and 2.4 mg doses, respectively, achieved a 30% reduction in liver fat, 84.6% and 72.7% of subjects, respectively, achieved a 50% reduction in liver fat, and 53.8% and 45.5% of subjects, respectively, achieved normalization of liver fat content to below 5%.
The main characteristics of the new Regulation include: a streamlined application procedure via a single-entry point through the Clinical Trials Information System, or CTIS; a single set of documents to be prepared and submitted for the application as well as simplified reporting procedures for clinical trial sponsors; and a harmonized procedure for the assessment of applications for clinical trials, which is divided in two parts (Part I contains scientific and medicinal product documentation and Part II contains the national and patient-level documentation).
The main characteristics of the new Regulation include: a streamlined application procedure via a single-entry point through the Clinical Trials 36 Table of Contents Information System, or CTIS; a single set of documents to be prepared and submitted for the application as well as simplified reporting procedures for clinical trial sponsors; and a harmonized procedure for the assessment of applications for clinical trials, which is divided in two parts (Part I contains scientific and medicinal product documentation and Part II contains the national and patient-level documentation).
The same endpoints as the 12-week parent NAFLD trial were employed, with a primary efficacy endpoint of percent (%) reduction in liver fat content; key secondary endpoints were reduction in liver inflammation, as measured by serum ALT levels and corrected T1 (“cT1”), and percent weight loss.
The same endpoints as the 12-week parent MASLD trial were employed, with a primary efficacy endpoint of percent (%) reduction in liver fat content; key secondary endpoints were reduction in liver inflammation, as measured by serum ALT levels and corrected T1 (“cT1”), and percent weight loss.
The population of the 12-week extension trial had similar baseline characteristics as the population of the parent, 12-week Phase 1b NAFLD trial. At baseline, across all treatment groups, mean BMI was 36.7 kg/m 2 and mean LFC, as measured by MRI-PDFF, was 22.2%.
The population of the 12-week extension trial had similar baseline characteristics as the population of the parent, 12-week Phase 1b MASLD trial. At baseline, across all treatment groups, mean BMI was 36.7 kg/m 2 and mean LFC, as measured by MRI-PDFF, was 22.2%.
Other government regulation in the European Union and United Kingdom The EU and the EU member states and the U.K. have extensive laws and regulations relating to a variety of other topics that would be of relevance for us if we are active in the EU and U.K., including but not limited to laws and 38 Table of Contents regulations regarding data privacy, drug pricing and reimbursement, advertising and interactions with healthcare professionals.
Other government regulation in the European Union and United Kingdom The EU and the EU member states and the U.K. have extensive laws and regulations relating to a variety of other topics that would be of relevance for us if we are active in the EU and U.K., including but not limited to laws and regulations regarding data privacy, drug pricing and reimbursement, advertising and interactions with healthcare professionals.
Moreover, there are no safe harbors for many common practices, such as educational and research grants, charitable donations, product support and patient assistance programs. Violations of the Anti-Kickback Law may be punished by civil and criminal penalties, damages, fines, or exclusion from participation in 29 Table of Contents federal health care programs like Medicare and Medicaid.
Moreover, there are no safe harbors for many common practices, such as educational and research grants, charitable donations, product support and patient assistance programs. Violations of the Anti-Kickback Law may be punished by civil and criminal penalties, damages, fines, or exclusion from participation in federal health care programs like Medicare and Medicaid.
In addition, a rise in serum ketone bodies and a fall in serum tripalmitin was observed, consistent with the stimulatory effects of glucagon on hepatic beta-oxidation of lipids and suppressive effects of pemvidutide on triglyceride synthesis, respectively. Side effects in this trial were mild to moderate, with no serious or severe treatment-emergent adverse events reported.
In addition, a rise in serum ketone bodies and a fall in serum tripalmitin was observed, consistent with the stimulatory effects of glucagon on hepatic beta-oxidation of lipids and suppressive effects of pemvidutide on triglyceride synthesis, respectively. 7 Table of Contents Side effects in this trial were mild to moderate, with no serious or severe treatment-emergent adverse events reported.
Use of HepTcell for treating patients with chronic HBV infection is further covered by a pending United States provisional patent application, from which we expect to file United States and international (PCT) patent applications. The claims are directed to treating patients with chronic HBV infection characterized with low hepatitis B surface antigen (“HBsAg”).
Use of HepTcell for treating patients with chronic HBV infection is further covered by a pending United States provisional patent application, from which we expect to file United States and international (PCT) patent applications. The claims are directed to treating patients with chronic HBV infection characterized with low hepatitis B surface antigen 24 Table of Contents (“HBsAg”).
Government authorities and third-party payers, such as private health insurers and health maintenance organizations, decide which medications they will pay for and establish reimbursement levels. The availability of coverage and extent of reimbursement by governmental and private payers is essential for most patients to be able to afford treatments such as gene therapy products.
Government authorities and third-party payers, such as private health insurers and health maintenance organizations, decide which medications they will pay for and establish reimbursement levels. The availability of coverage and extent of reimbursement by governmental and private payers is 35 Table of Contents essential for most patients to be able to afford treatments such as gene therapy products.
The centralized procedure is mandatory for certain types of drugs, such as medicinal products derived from biotechnology processes (such as genetic engineering), orphan medicinal products, advanced-therapy medicinal products and medicinal products containing new active substances indicated for the treatment of HIV, AIDS, cancer, neurodegenerative disorders, diabetes, auto-immune and other immune dysfunctions and viral diseases. .
The centralized procedure is mandatory for certain types of drugs, such as medicinal products 38 Table of Contents derived from biotechnology processes (such as genetic engineering), orphan medicinal products, advanced-therapy medicinal products and medicinal products containing new active substances indicated for the treatment of HIV, AIDS, cancer, neurodegenerative disorders, diabetes, auto-immune and other immune dysfunctions and viral diseases. .
The IRB also approves the form and content of the informed consent that must be signed by each clinical trial subject or his or her legal representative and must monitor the clinical trial until completed. 24 Table of Contents Human clinical trials are typically conducted in three sequential phases that may overlap or be combined: ● Phase 1 .
The IRB also approves the form and content of the informed consent that must be signed by each clinical trial subject or his or her legal representative and must monitor the clinical trial until completed. Human clinical trials are typically conducted in three sequential phases that may overlap or be combined: ● Phase 1 .
As another example, for calendar quarters beginning January 1, 2022, manufacturers will be 32 Table of Contents required to report the average sales price for certain drugs under the Medicare program regardless of whether we participate in the Medicaid Drug Rebate Program. Previously, such reporting was only required for manufacturers that participated in that program.
As another example, for calendar quarters beginning January 1, 2022, manufacturers will be required to report the average sales price for certain drugs under the Medicare program regardless of whether we participate in the Medicaid Drug Rebate Program. Previously, such reporting was only required for manufacturers that participated in that program.
Before approving an NDA or BLA, the FDA will inspect the facilities at which the product is manufactured. The FDA will not approve the NDA or BLA unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications.
Before approving an NDA or BLA, the FDA will inspect the facilities at which the product is manufactured. The FDA will not approve the NDA or BLA unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required 28 Table of Contents specifications.
We operate in a highly regulated industry and new laws, regulations, or judicial decisions, or new interpretations 31 Table of Contents of existing laws, regulations, or decisions, related to, among other things, health care availability, or the method of delivery of or payment for health care products and services could negatively impact our business, operations and financial condition.
We operate in a highly regulated industry and new laws, regulations, or judicial decisions, or new interpretations of existing laws, regulations, or decisions, related to, among other things, health care availability, or the method of delivery of or payment for health care products and services could negatively impact our business, operations and financial condition.
Our Strategy Key elements of our strategy include the following: ● Strategically partner or out-license certain product candidates at later stages of development to focus our efforts on early to mid-stage product development; 16 Table of Contents ● In-license or acquire complementary metabolic or immunotherapeutic technologies and product candidates that are either synergistic or complementary to our capabilities to expand our pipeline; and ● Apply our EuPort platform technologies to design and develop treatments for obesity, NASH and other metabolic diseases.
Our Strategy Key elements of our strategy include the following: ● Strategically partner or out-license certain product candidates at later stages of development to focus our efforts on early to mid-stage product development; ● In-license or acquire complementary metabolic or immunotherapeutic technologies and product candidates that are either synergistic or complementary to our capabilities to expand our pipeline; and 20 Table of Contents ● Apply our EuPort platform technologies to design and develop treatments for obesity, MASH and other metabolic diseases.
Our competitive position also depends upon our ability to show differentiation with a product that is either more efficacious, 17 Table of Contents particularly in the relevant target populations, offers a better safety or tolerability profile, is less expensive or quicker to manufacture, or represents a combination of these advantages.
Our competitive position also depends upon our ability to show differentiation with a product that is either more efficacious, particularly in the relevant target populations, offers a better safety or tolerability profile, is less expensive or quicker to manufacture, or represents a combination of these advantages.
In a subset of subjects evaluated for cT1 response, 75.0% and 100% of subjects receiving 1.8 mg or 2.4 mg pemvidutide, respectively, achieved an 80 millisecond (ms) decrease in cT1. cT1 value is an MRI-based quantitative metric for assessing a composite of liver inflammation and fibrosis.
In a subset of subjects evaluated for cT1 response, 75.0% and 100% of subjects receiving 1.8 mg or 2.4 mg pemvidutide, respectively, achieved an 80 millisecond (ms) decrease in cT1 relaxation time. cT1 is an MRI-based quantitative metric for assessing a composite of liver inflammation and fibrosis.
Finally, with 35 Table of Contents regard to characterization, the guideline requires details on the biological activity to be provided, recognizing that the extent of characterization data will further increase in later phases. Study Design Considerations General regulatory guidance on study design applies to biologics as well as small molecule medicines.
Finally, with regard to characterization, the guideline requires details on the biological activity to be provided, recognizing that the extent of characterization data will further increase in later phases. Study Design Considerations General regulatory guidance on study design applies to biologics as well as small molecule medicines.
To date, we have obtained materials for clinical trials and non-clinical studies from third-party manufacturers who are suppliers to us. For our product candidates, we intend to identify and qualify additional contract manufacturers to provide commercial scale manufacturing prior to submission of an NDA or BLA to the FDA.
To date, we have obtained materials for clinical trials and non-clinical studies from third-party manufacturers who are suppliers to us. We intend to identify and qualify additional contract manufacturers to provide commercial scale manufacturing prior to submission of an NDA or BLA to the FDA.
We may in the future 18 Table of Contents use license agreements to access external products and technologies as well as to convey our own intellectual property to others.
We may in the future 22 Table of Contents use license agreements to access external products and technologies as well as to convey our own intellectual property to others.
The claims are directed to the use of pemvidutide in methods for reducing the risk of cardiovascular (CV) disease in a human with or without also having type II diabetes.
The claims are directed to the use of pemvidutide in methods for reducing the risk of cardiovascular (CV) disease in a human with or without also having type 2 diabetes.
These expedited programs include fast 25 Table of Contents track designation, breakthrough therapy designation, priority review and accelerated approval. Each of these programs has its own features and qualifying criteria. A sponsor must submit a request for fast track designation, breakthrough therapy designation, or priority review, which may or may not be granted by the FDA.
These expedited programs include fast track designation, breakthrough therapy designation, priority review and accelerated approval. Each of these programs has its own features and qualifying criteria. A sponsor must submit a request for fast track designation, breakthrough therapy designation, or priority review, which may or may not be granted by the FDA.
“False claims” can result not only from non-compliance with the express requirements of applicable governmental reimbursement programs, such as Medicaid or Medicare, but also from non-compliance with other laws, such as the Anti-Kickback Law or laws that require quality care in service delivery.
“False claims” can result not only from non-compliance with the express requirements of applicable governmental reimbursement programs, such as Medicaid or Medicare, but also from non-compliance with other laws, such as the Anti-Kickback Law or laws that require 31 Table of Contents quality care in service delivery.
Data and Market Exclusivity in the European Union In the EU, new chemical entities (including both small molecules and biological medicinal products), sometimes referred to as new active substances, qualify for eight years of data exclusivity upon marketing authorization and an additional two years of market exclusivity.
Data and Market Exclusivity in the European Union In the EU, new chemical entities (including both small molecules and biological medicinal products), sometimes referred to as new active substances, qualify for eight years of data exclusivity upon marketing authorization and an 39 Table of Contents additional two years of market exclusivity.
The SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at www.sec.gov. 40 Table of Contents
The SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at www.sec.gov. 42 Table of Contents
The amounts of weight loss at the 1.8 mg and 2.4 mg 6 Table of Contents doses were similar given the sample size and overlapping confidence intervals. No correlation was found between the magnitude of weight loss and either age or baseline body mass index (“BMI”).
The amounts of weight loss at the 1.8 mg and 2.4 mg doses were similar given the sample size and overlapping confidence intervals. No correlation was found between the magnitude of weight loss and either age or baseline body mass index (“BMI”).
The patents and, if issued, the patent(s) resulting from the 20 Table of Contents pending application(s) have an expiration date of no earlier than May 2032 and extending to May 2035, not giving effect to any potential extensions and assuming payment of all associated fees.
The patents and, if issued, the patent(s) resulting from the pending application(s) have an expiration date of no earlier than May 2032 and extending to May 2035, not giving effect to any potential extensions and assuming payment of all associated fees.
Numerous federal and state laws and regulations, including state data breach notification laws, health information and/or genetic privacy laws and federal and state consumer protection laws (e.g., Section 5 of the FTC Act, HIPPA and the California Consumer Privacy Act (“CCPA”)), govern the collection, use, disclosure, and protection of health-related 30 Table of Contents and other personal information.
Numerous federal and state laws and regulations, including state data breach notification laws, health information and/or genetic privacy laws and federal and state consumer protection laws (e.g., Section 5 of the FTC Act, HIPPA and the California Consumer Privacy Act (“CCPA”)), govern the collection, use, disclosure, and protection of health-related and other personal information.
In the case of some products for severe or life-threatening diseases, especially when the product may be too inherently toxic to ethically administer to healthy volunteers, the initial human testing is often conducted in patients. ● Phase 2 .
In the case of some products for severe or life-threatening diseases, especially when the product may be too inherently toxic to ethically administer to healthy volunteers, the initial human testing is often conducted in patients. 26 Table of Contents ● Phase 2 .
Pemvidutide incorporates a proprietary side chain, referred to as the EuPort domain, which is designed to enhance pharmacokinetics for tolerability in the gastrointestinal tract and permit weekly dosing. As observed in a well-established preclinical model of the disease, pemvidutide is capable of inducing significant weight loss with concomitant decreases in liver fat content, inflammation and fibrosis.
Pemvidutide incorporates a proprietary side chain, referred to as the EuPort domain, which is designed to enhance pharmacokinetics for gastrointestinal tolerability and permit weekly dosing. As observed in a well-established preclinical model of obesity and MASH, pemvidutide is capable of inducing significant weight loss with concomitant decreases in liver fat content, inflammation and fibrosis.
Stimulating T-cell responses in chronically infected HBV patients 15 Table of Contents has been challenging because chronic infection with HBV strongly suppresses T-cell immunity directed against the virus. HepTcell focuses the T cell response on discrete, highly conserved regions of the HBV proteome.
Stimulating T-cell responses in chronically infected HBV patients has been challenging because chronic infection with HBV strongly suppresses T-cell immunity directed against the virus. HepTcell focuses the T cell response on discrete, highly conserved regions of the HBV proteome.
Characteristic Treatment Placebo (n = 24) 1.2 mg (n=23) 1.8 mg (n=23) 2.4 mg (n=24) Severe AEs n (%) 0 (0.0%) 0 (0.0%) 0 (0.0%) 0 (0.0%) SAEs n (%) 0 (0.0%) 0 (0.0%) 0 (0.0%) 0 (0.0%) AEs leading to treatment discontinuation n (%) 0 (0.0%) 0 (0.0%) 1 (4.3%) 1 (4.2%) Nausea Mild, n (%) 3 (12.5%) 3 (13.0%) 6 (26.1%) 6 (25.0%) Mod, n (%) 0 (0.0%) 1 (4.3%) 6 (26.1%) 3 (12.5%) Vomiting Mild, n (%) 0 (0.0%) 3 (13.0%) 2 (8.7%) 2 (8.3%) Mod, n (%) 0 (0.0%) 0 (0.0%) 0 (0.0%) 0 (0.0%) Diarrhea Mild, n (%) 4 (16.7%) 3 (13.0%) 5 (21.7%) 1 (4.2%) Mod, n (%) 0 (0.0%) 0 (0.0%) 0 (0.0%) 0 (0.0%) Constipation Mild, n (%) 0 (0.0%) 3 (13.0%) 4 (17.4%) 1 (4.2%) Mod, n (%) 0 (0.0%) 1 (4.3%) 0 (0.0%) 0 (0.0%) Clinical Trial Results – 24-week Phase 1b (NAFLD) In December 2022, we announced the topline results from our 24-week (12-week extension) Phase 1b clinical trial of pemvidutide in subjects with NAFLD.
Characteristic Treatment Placebo (n = 24) 1.2 mg (n=23) 1.8 mg (n=23) 2.4 mg (n=24) Severe AEs n (%) 0 (0.0%) 0 (0.0%) 0 (0.0%) 0 (0.0%) Serious AEs (“SAE”s) n (%) 0 (0.0%) 0 (0.0%) 0 (0.0%) 0 (0.0%) AEs leading to treatment discontinuation n (%) 0 (0.0%) 0 (0.0%) 1 (4.3%) 1 (4.2%) Nausea Mild, n (%) 3 (12.5%) 3 (13.0%) 6 (26.1%) 6 (25.0%) Mod, n (%) 0 (0.0%) 1 (4.3%) 6 (26.1%) 3 (12.5%) Vomiting Mild, n (%) 0 (0.0%) 3 (13.0%) 2 (8.7%) 2 (8.3%) Mod, n (%) 0 (0.0%) 0 (0.0%) 0 (0.0%) 0 (0.0%) Diarrhea Mild, n (%) 4 (16.7%) 3 (13.0%) 5 (21.7%) 1 (4.2%) Mod, n (%) 0 (0.0%) 0 (0.0%) 0 (0.0%) 0 (0.0%) Constipation Mild, n (%) 0 (0.0%) 3 (13.0%) 4 (17.4%) 1 (4.2%) Mod, n (%) 0 (0.0%) 1 (4.3%) 0 (0.0%) 0 (0.0%) Clinical Trial Results – 24-week Phase 1b extension (MASLD) In December 2022, we announced the topline results from our 24-week (12-week extension) Phase 1b clinical trial of pemvidutide in subjects with MASLD.
Compensation and Benefits Program Our compensation program is designed to attract and reward talented individuals who possess the skills necessary to support our business objectives, assist in the achievement of our strategic goals and create long-term value for our stockholders.
Compensation and Benefits Program Our compensation program is designed to attract and reward talented individuals who possess the skills necessary to support our business objectives, assist in the achievement of our strategic goals and create long-term value for our 41 Table of Contents stockholders.
In 2018, we completed a Phase 1 trial in the United Kingdom and South Korea in adult patients with chronic HBV. The HepTcell Phase 1 trial was a double-blinded, placebo-controlled, randomized, dose-escalation study that enrolled 61 subjects with chronic HBV who were HBeAg-negative and well-controlled on licensed antivirals.
In 2018, we completed a Phase 1 trial in the United Kingdom and South Korea in adult patients with chronic HBV. The HepTcell Phase 1 trial was a double-blinded, placebo-controlled, randomized, dose-escalation 19 Table of Contents study that enrolled 61 subjects with chronic HBV who were HBeAg-negative and well-controlled on licensed antivirals.
Characteristic Treatment Placebo (n = 24) 1.2 mg (n=23) 1.8 mg (n=23) 2.4 mg (n=24) Age, years Mean (SD) 47.9 (14) 48.6 (11) 50.3 (9) 48.8 (8) Sex Female, n (%) 14 (58.3%) 9 (39.1%) 12 (52.2%) 15 (62.5%) Race White, n (%) 21 (87.5%) 21 (91.3%) 20 (87.0%) 24 (100%) Other, n (%) 3 (12.5%) 2 (8.7%) 3 (13.0%) 0 (0.0%) Ethnicity Hispanic, n (%) 14 (58.3%) 20 (87.0%) 19 (82.6%) 18 (75.0%) Non-Hispanic, n (%) 10 (41.7%) 3 (13.0%) 4 (17.4%) 6 (25.0%) BMI, kg/m 2 Mean (SD) 36.9 (4.7) 36.3 (5.6) 35.4 (3.9) 35.3 (5.0) Body weight, kg Mean (SD) 105.1 (20.8) 102.4 (14.6) 98.9 (19.7) 98.2 (18.9) Diabetes status T2D, n (%) 6 (25.0%) 7 (30.4%) 7 (30.4%) 7 (33.3%) LFC, % Mean (SD) 23.8 (9.2) 21.6 (7.3) 21.8 (8.0) 20.2 (7.0) The trial met its primary endpoint in all pemvidutide treatment groups.
The table below details the baseline study demographics. 10 Table of Contents Characteristic Treatment Placebo (n = 24) 1.2 mg (n=23) 1.8 mg (n=23) 2.4 mg (n=24) Age, years Mean (SD) 47.9 (14) 48.6 (11) 50.3 (9) 48.8 (8) Sex Female, n (%) 14 (58.3%) 9 (39.1%) 12 (52.2%) 15 (62.5%) Race White, n (%) 21 (87.5%) 21 (91.3%) 20 (87.0%) 24 (100%) Other, n (%) 3 (12.5%) 2 (8.7%) 3 (13.0%) 0 (0.0%) Ethnicity Hispanic, n (%) 14 (58.3%) 20 (87.0%) 19 (82.6%) 18 (75.0%) Non-Hispanic, n (%) 10 (41.7%) 3 (13.0%) 4 (17.4%) 6 (25.0%) BMI, kg/m 2 Mean (SD) 36.9 (4.7) 36.3 (5.6) 35.4 (3.9) 35.3 (5.0) Body weight, kg Mean (SD) 105.1 (20.8) 102.4 (14.6) 98.9 (19.7) 98.2 (18.9) Diabetes status T2D, n (%) 6 (25.0%) 7 (30.4%) 7 (30.4%) 7 (33.3%) LFC, % Mean (SD) 23.8 (9.2) 21.6 (7.3) 21.8 (8.0) 20.2 (7.0) The trial met its primary endpoint in all pemvidutide treatment groups.
The approval process and requirements governing the conduct of clinical trials, product licensing, pricing and reimbursement vary greatly from place to place, and the time may be longer or shorter than that required for FDA approval.
The approval process and requirements governing the conduct of clinical 40 Table of Contents trials, product licensing, pricing and reimbursement vary greatly from place to place, and the time may be longer or shorter than that required for FDA approval.
In addition, clinical evidence from recent trials of potential NASH products indicates that reduction in liver fat may play an important role in the resolution of inflammation and fibrosis. We believe that combining a reduction in liver fat content with weight loss could be the optimal approach for NASH resolution.
In addition, clinical evidence from recent trials of potential MASH products indicates that reduction in liver fat may play an important role in the resolution of liver inflammation and improvement in liver fibrosis. We believe that combining a reduction in liver fat content with weight loss could be the optimal approach for treating MASH.
As in the United States, medicinal products can only be marketed if a marketing authorization from the competent regulatory agencies has been obtained. See “European Marketing Authorization” below. 34 Table of Contents In the EU, the new Clinical Trials Regulation 536/2014 has been applicable since January 31. 2022.
As in the United States, medicinal products can only be marketed if a marketing authorization from the competent regulatory agencies has been obtained. See “European Marketing Authorization” below. In the EU, the new Clinical Trials Regulation 536/2014 has been applicable since January 31. 2022.
In this trial, no perturbations of glucose control, as assessed by fasting glucose and hemoglobin A1c, were observed in subjects with obesity/overweight with pre-diabetes; in fact, a reduction of insulin resistance was observed, as expected when significant weight loss is experienced.
In this trial, no perturbations of glucose control, as assessed by fasting glucose 8 Table of Contents and hemoglobin A1c (“HbA1c”), were observed in subjects with obesity/overweight with pre-diabetes; in fact, a reduction of insulin resistance was observed, as expected when significant weight loss is experienced.
We face competition for pemvidutide, our dual GLP-1/glucagon dual agonist for the treatment of obesity and NASH. For obesity, we face competition from companies such as Novo Nordisk, whose GLP-1 agonist, brand named Wegovy, or compound name semaglutide, was approved for weight loss in June 2020.
We face competition for pemvidutide, our dual GLP-1/glucagon dual agonist for the treatment of obesity and MASH. For obesity, we face competition from companies such as Novo Nordisk, whose GLP-1 agonist, brand named Wegovy, or compound name semaglutide, was approved for weight loss in June 2021.
Population Treatment Placebo (n = 24) 1.2 mg (n=23) 1.8 mg (n=23) 2.4 mg (n=24) No diabetes, (% change) LSM (SE) -0.2 (0.7) -3.4 ** (0.8) -4.9 ** (0.8) -3.5 ** (0.8) Diabetes, (% change) LSM (SE) -0.5 (1.3) -3.3* (1.1) -3.8* (1.2) -4.4* (1.3) All subjects (% change) LSM (SE) -0.2 (0.7) -3.4** (0.7) -4.3** (0.7) -3.7** (0.7) LSM least square mean; *p 11 Table of Contents Pemvidutide was reported to be generally well tolerated.
Population Treatment Placebo (n = 24) 1.2 mg (n=23) 1.8 mg (n=23) 2.4 mg (n=24) No diabetes, (% change) LSM (SE) -0.2 (0.7) -3.4 ** (0.8) -4.9 ** (0.8) -3.5 ** (0.8) Diabetes, (% change) LSM (SE) -0.5 (1.3) -3.3* (1.1) -3.8* (1.2) -4.4* (1.3) All subjects (% change) LSM (SE) -0.2 (0.7) -3.4** (0.7) -4.3** (0.7) -3.7** (0.7) LSM least square mean; *p Pemvidutide was reported to be generally well tolerated.
We also depend upon our ability to attract and retain qualified personnel, obtain patent protection or otherwise develop proprietary products or processes and secure sufficient capital resources for the often substantial period between technological conception and commercial sale.
We also depend upon our ability to attract and retain 21 Table of Contents qualified personnel, obtain patent protection or otherwise develop proprietary products or processes and secure sufficient capital resources for the often substantial period between technological conception and commercial sale.
The USPTO, in consultation with the FDA, reviews and approves the application for patent term restoration. Pediatric Exclusivity Drugs and biological products, such as our product candidates, may be eligible for pediatric exclusivity, an incentive intended to encourage medical product research for children.
The USPTO, in consultation with the FDA, reviews and approves the application for patent term restoration. 30 Table of Contents Pediatric Exclusivity Drugs and biological products, such as our product candidates, may be eligible for pediatric exclusivity, an incentive intended to encourage medical product research for children.
Newly discovered or developed safety or efficacy data may require changes to a product’s approved labeling, including the addition of new warnings and contraindications. Certain U.S.
Newly discovered or developed safety or efficacy data may require changes to a product’s approved labeling, including the addition of new warnings and contraindications. 29 Table of Contents Certain U.S.
Endpoint Treatment Placebo 1.2 mg 1.8 mg 2.4 mg ALT, change from baseline, IU/L, LSM (SE) n = 24 n = 23 n = 23 n = 24 -6.2 (2.8) -11.2 (3.1) -13.8 (3.0)* -13.6 (3.2)* ALT, change from baseline, IU/L, LSM (SE), baseline ≥ 30 IU/L n = 15 n = 10 n = 15 n = 12 -12.6 (4.1) -17.8 (4.8) -20.8 (4.2) -27.0 (4.8)* *p The trial also met its key secondary endpoint in all pemvidutide treatment groups.
Endpoint Treatment Placebo 1.2 mg 1.8 mg 2.4 mg ALT, change from baseline, IU/L, LSM (SE) n = 24 n = 23 n = 23 n = 24 -6.2 (2.8) -11.2 (3.1) -13.8 (3.0)* -13.6 (3.2)* ALT, change from baseline, IU/L, LSM (SE), baseline ≥ 30 IU/L n = 15 n = 10 n = 15 n = 12 -12.6 (4.1) -17.8 (4.8) -20.8 (4.2) -27.0 (4.8)* *p 11 Table of Contents The trial also met its key secondary endpoint of weight loss in all pemvidutide treatment groups.
A partial clinical hold would limit a trial, for example, to certain doses or for a certain length of time or to a certain number of subjects.
A partial clinical hold can limit a trial, for example, to certain doses or for a certain length of time or to a certain number of subjects.
A complete clinical hold order issued by the FDA would delay a proposed clinical study or cause suspension of an ongoing study until all outstanding concerns have been adequately addressed and the FDA has notified the company that investigations may proceed or resume.
A complete clinical hold order issued by the FDA would delay a proposed clinical study or suspend an ongoing study until all outstanding concerns have been adequately addressed and the FDA has notified the company that clinical investigations may proceed or resume.
On September 28, 2021, we announced that we received clearance of our Investigational New Drug (“IND”) Application in NASH from the U.S. Food and Drug Administration (“FDA”) prior to commencing our Phase 1b trial of pemvidutide in NAFLD.
On September 28, 2021, we announced that we received clearance of our Investigational New Drug (“IND”) Application in MASH from the U.S. Food and Drug Administration (“FDA”) prior to commencing our Phase 1b trial of pemvidutide in MASLD.
Three AEs led to treatment discontinuation, one being the Salmonella infection, and two gastrointestinal AEs, one (6.3%) at the 1.2 mg dose and one (6.7%) at the 1.8 mg dose. As expected, gastrointestinal events comprised the majority of AEs and were predominantly mild in nature. No clinically significant ALT elevations were observed.
Three AEs led to treatment discontinuation, one being the Salmonella infection, and mild (Grade 1) instances of abdominal pain AEs in two subjects, one (6.3%) at the 1.2 mg dose and one (6.7%) at the 1.8 mg dose. As expected, gastrointestinal events comprised the majority of AEs and were predominantly mild in nature. No clinically significant ALT elevations were observed.
Clinically meaningful reductions in systolic blood pressure were observed, along with the two to three beats per minute increase in heart rate typical for GLP-1 class of drugs. The table below summarizes the safety findings.
Clinically meaningful reductions in systolic blood pressure were observed, along with the 2 to 3 beats per minute increase in heart rate typical for GLP-1 class of drugs. The table below summarizes the safety findings.
HepTcell is being administered in 6 doses at the low dose level of HepTcell plus IC31 ® at 4-week intervals for 24 weeks, and patients will be followed for one year to evaluate safety and durability of response.
HepTcell was being administered in six doses at the low dose level of HepTcell plus IC31 ® at 4-week intervals for 24 weeks, and patients will be followed for one year to evaluate safety and durability of response.
Item 1. Business Overview Altimmune, Inc. is a clinical stage biopharmaceutical company focused on developing treatments for obesity and liver diseases. Our lead product candidate, pemvidutide (formerly known as ALT-801), is a GLP-1/glucagon dual receptor agonist that is being developed for the treatment of obesity and non-alcoholic steatohepatitis (“NASH”).
Item 1. Business Overview Altimmune, Inc. is a clinical stage biopharmaceutical company focused on developing treatments for obesity and liver diseases. Our lead product candidate, pemvidutide (formerly known as ALT-801), is a GLP-1/glucagon dual receptor agonist that is being developed for the treatment of obesity and metabolic dysfunction-associated steatohepatitis (“MASH”), previously termed non-alcoholic steatohepatitis (“NASH”).
Corporate Culture 39 Table of Contents Our values – compliance, collaboration, integrity and high performance – are built on the foundation that the employees we hire and the way we treat one another promote creativity, innovation and productivity, which spur our success.
Corporate Culture Our values – compliance, collaboration, integrity and high performance – are built on the foundation that the employees we hire and the way we treat one another promote creativity, innovation and productivity, which spur our success.
If the FDA concludes a REMS is 26 Table of Contents needed, the sponsor of the NDA or BLA must submit a proposed REMS; the FDA will not approve the NDA or BLA without a REMS, if required.
If the FDA concludes a REMS is needed, the sponsor of the NDA or BLA must submit a proposed REMS; the FDA will not approve the NDA or BLA without a REMS, if required.
We believe these findings support the potential combined beneficial effects of weight loss and glucagon agonism on liver fat content. Images of Representative MRI-PDFF Images at Baseline and Week 6 8 Table of Contents The table below displays the changes in liver fat content at Week 6 compared to baseline in the 8 subjects with steatosis at baseline: Treatment Group Weight Loss (%) at Week 6 MRI-PDFF Baseline Week 6 Absolute ∆ at Week 6 (%) Relative ∆ at Week 6 (%) Individual Mean Individual Mean Placebo 0.5 5.2 3.7 1.5 1.5 28.8 28.8 pemvidutide 1.2 mg 1.0 19.1 14.0 5.10 6.50 26.7 48.2 5.1 11.2 3.4 7.80 69.6 pemvidutide 1.8 mg 4.4 12.4 11.65 11.65 94.0 94.0 pemvidutide 2.4 mg 3.7 17.0 16.25 11.50 95.6 91.9 4.9 5.5 4.75 86.4 3.1 7.0 6.25 89.3 4.7 19.5 18.75 96.2 LOD (limit of detection) = 1.5%; for absolute and relative ∆, values Clinical Trial Results – 12-week Phase 1b (NAFLD) In September 2022, we announced the topline results from our 12-week Phase 1b clinical trial of pemvidutide in subjects with NAFLD.
Images of Representative MRI-PDFF Images at Baseline and Week 6 9 Table of Contents The table below displays the changes in liver fat content at Week 6 compared to baseline in the 8 subjects with steatosis at baseline: Treatment Group Weight Loss (%) at Week 6 MRI-PDFF Baseline Week 6 Absolute ∆ at Week 6 (%) Relative ∆ at Week 6 (%) Individual Mean Individual Mean Placebo 0.5 5.2 3.7 1.5 1.5 28.8 28.8 pemvidutide 1.2 mg 1.0 19.1 14.0 5.10 6.50 26.7 48.2 5.1 11.2 3.4 7.80 69.6 pemvidutide 1.8 mg 4.4 12.4 11.65 11.65 94.0 94.0 pemvidutide 2.4 mg 3.7 17.0 16.25 11.50 95.6 91.9 4.9 5.5 4.75 86.4 3.1 7.0 6.25 89.3 4.7 19.5 18.75 96.2 LOD (limit of detection) = 1.5%; for absolute and relative ∆, values Clinical Trial Results – 12-week Phase 1b (MASLD) In September 2022, we announced the topline results from our 12-week Phase 1b clinical trial of pemvidutide in subjects with MASLD.
Meaningful reductions in systolic blood pressure were observed, and increases in heart rate, typical of the incretin class of agents, were minimal at zero to four beats per minute and independent of dose.
Meaningful reductions in systolic blood pressure were observed, and increases in heart rate, typical of the incretin class of agents, were minimal at 0 to 4 beats per minute and independent of dose.
As in the 12-week Phase 1b NAFLD trial, statistically significant declines in mean serum ALT levels were observed in all pemvidutide-treated subjects, and in subjects with baseline serum ALT ≥30 IU/L, ALT levels declined at least 17 IU/L at 12 Table of Contents all pemvidutide dose levels.
As in the 12-week Phase 1b MASLD trial, statistically significant declines in mean serum ALT levels were observed in all pemvidutide-treated subjects, and in subjects with baseline serum ALT ≥30 IU/L, ALT levels declined at least 17 IU/L at all pemvidutide dose levels.
The amendments introduced by the CPRA became effective on January 1, 2023, and it is not yet fully clear how the CCPA and CPRA will be enforced and interpreted.
The amendments introduced 32 Table of Contents by the CPRA became effective on January 1, 2023, and it is not yet fully clear how the CCPA and CPRA will be enforced and interpreted.
In the second quarter of 2020, we made the decision to move to a hybrid workplace model, which means that certain of our employees will have the option to be 100% remote, work full-time in our office, or have the flexibility to work between office and remotely until the pandemic is resolved.
Hybrid Culture In the second quarter of 2020, we made the decision to move to a hybrid workplace model, which means that certain of our employees have the option to be 100% remote, work full-time in our office, or have the flexibility to work between office and remotely.
Use of pemvidutide for treating NASH is further covered by, and subject to the Mederis IP License Agreement, with a granted patent in the United States, and pending applications in the United States, Europe, Japan and other commercially relevant jurisdictions.
Use of pemvidutide for treating MASH or MASLD (referred to as NASH or NAFLD in the patent and patent applications) is further covered by, and subject to the Mederis IP License Agreement, with a granted patent in the United States, and pending applications in the United States, Europe, Japan and other commercially relevant jurisdictions.
Use of pemvidutide in methods for inducing weight loss is further covered in a United States patent application and corresponding international (PCT) patent application owned by us and not subject to the Mederis IP License Agreement, and from which we expect to file National Phase patent applications in commercially relevant jurisdictions.
Use of pemvidutide in methods for reducing the risk of cardiovascular (CV) disease is further covered in a United States patent application and corresponding international (PCT) patent application owned by us and not subject to the Mederis IP License Agreement, and from which we expect to file National Phase patent applications in commercially relevant jurisdictions.
Use of pemvidutide in methods for reducing body weight in a human with fatty liver disease is further covered in provisional United States patent applications owned by us and not subject to the Mederis IP License Agreement, and from which we expect to file a United States non-provisional patent application and an international (PCT) patent application.
Use of pemvidutide in methods for reducing body weight in a human with fatty liver disease is further covered in United States patent application and corresponding international (PCT) patent application owned by us and not subject to the Mederis IP License Agreement, and from which we expect to file National Phase patent applications in commercially relevant jurisdictions.
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Item 1A. Risk Factors
Risk Factors — what could go wrong, per management
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Item 1A. Risk Factors
Risk Factors — what could go wrong, per management
147 edited+43 added−54 removed386 unchanged
2022 filing
2023 filing
Biggest changeEvents that may prevent successful or timely completion of clinical development include: ● delays or failure in reaching a consensus with regulatory agencies on trial design; ● delays or failure in reaching agreement on acceptable terms with prospective contract research organizations (“CROs”) and clinical trial sites; ● delays or failure in obtaining required approvals from the IRB or other similar committees or bodies at each clinical trial site; ● imposition of a clinical hold by regulatory agencies for any reason, including safety concerns raised by other clinical trials of similar product candidates that may reflect an unacceptable risk with the patient population, technology platform, product stability or after an inspection of clinical operations or trial sites; ● failure to perform clinical trials in accordance with the FDA’s GCP or applicable regulatory guidelines in other countries, including the United Kingdom, Canada, Germany, Italy, Spain, Thailand and Australia; ● delays or failure in the testing, validation, manufacturing and delivery of the product candidates to the clinical sites, including as a result of supply chain delays in obtaining materials for the manufacture of our clinical trial materials; ● delays in testing, analysis and other activities by our third-party contractors required in conducting and analyzing our clinical trials as a result of the ongoing COVID-19 pandemic; ● any shelter-in-place orders from local, state or federal governments or clinical trial site policies resulting from the ongoing COVID-19 pandemic that determine essential and non-essential functions and staff, which may impact the ability of site staff to conduct assessments, or result in delays to the conduct of the assessments, as part of our clinical trial protocols, or the ability to enter assessment results into clinical trial databases in a timely manner; ● the number of patients required for our clinical trials may be larger than we anticipate, enrollment in our clinical trials may be slower than we anticipate or participants may, including as a result of the ongoing COVID-19 pandemic, withdraw from our clinical trials, fail to complete dosing or fail to return for post-treatment follow-up at higher rates than we anticipate, any of which could result in significant delay; ● withdrawal of clinical trial sites from our clinical trials, including as a result of changing standards of care or the ineligibility of a site to participate; ● occurrence of serious adverse events in clinical trials that are associated with the product candidate that are viewed to outweigh its potential benefits; 46 Table of Contents ● our preclinical tests or clinical trials may produce negative or inconclusive results, and we may decide, or regulators or funders may require us, to conduct additional preclinical testing or clinical trials or to abandon projects that we expected to be promising; ● our third-party contractors (such as CROs, product manufacturers, or investigators) may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner; ● fraudulent activity by a clinical researcher, if discovered, could preclude the submission of clinical data prepared by that researcher, lead to the suspension or substantive scientific review or one or more of our marketing applications by regulatory agencies; ● the cost of our clinical trials may be greater than we anticipate; ● additional trials may be necessary, including trials to analyze different dose strengths or dosing schemes; ● the regulatory requirements for product approval may not be explicit, may evolve over time and may diverge by jurisdiction; ● evolution in the standard of care that require amendments to ongoing clinical trials and/or the conduct of additional preclinical studies or clinical trials; or ● changes in regulatory requirements and guidance that require amending or submitting new clinical protocols.
Biggest changeEvents that may prevent successful or timely completion of clinical development include: ● delays or failure in reaching a consensus with regulatory agencies on trial design; ● delays or failure in reaching agreement on acceptable terms with prospective contract research organizations (“CROs”) and clinical trial sites; ● delays or failure in obtaining required approvals from the IRB or other similar committees or bodies at each clinical trial site; ● imposition of a clinical hold by regulatory agencies for any reason, including safety concerns raised by other clinical trials of similar product candidates that may reflect an unacceptable risk with the patient population, technology platform, product stability or after an inspection of clinical operations or trial sites; ● failure to perform clinical trials in accordance with the FDA’s GCP or applicable regulatory guidelines in other relevant countries; ● delays or failure in the testing, validation, manufacturing and delivery of the product candidates to the clinical sites, including as a result of supply chain delays in obtaining materials for the manufacture of our clinical trial materials; ● the number of patients required for our clinical trials may be larger than we anticipate, enrollment in our clinical trials may be slower than we anticipate or participants may withdraw from our clinical trials, fail to complete dosing or fail to return for post-treatment follow-up at higher rates than we anticipate, any of which could result in significant delay; ● withdrawal of clinical trial sites from our clinical trials, including as a result of changing standards of care or the ineligibility of a site to participate; ● occurrence of serious adverse events in clinical trials that are associated with the product candidate that are viewed to outweigh its potential benefits; ● our preclinical tests or clinical trials may produce negative or inconclusive results, and we may decide, or regulators or funders may require us, to conduct additional preclinical testing or clinical trials or to abandon projects that we expected to be promising; ● our third-party contractors (such as CROs, product manufacturers, or investigators) may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner; ● fraudulent activity by a clinical researcher, if discovered, could preclude the submission of clinical data prepared by that researcher, lead to the suspension or substantive scientific review or one or more of our marketing applications by regulatory agencies; ● the cost of our clinical trials may be greater than we anticipate; ● additional trials may be necessary, including trials to analyze different dose strengths or dosing schemes; 48 Table of Contents ● the regulatory requirements for product approval may not be explicit, may evolve over time and may diverge by jurisdiction; ● evolution in the standard of care that require amendments to ongoing clinical trials and/or the conduct of additional preclinical studies or clinical trials; or ● changes in regulatory requirements and guidance that require amending or submitting new clinical protocols.
From time to time, we may publish interim data, including interim top-line results or preliminary results from our clinical trials. Any interim data and other results from our clinical trials may materially change as more patient data become available.
From time to time, we publish interim data, including interim top-line results or preliminary results from our clinical trials. Any interim data and other results from our clinical trials may materially change as more patient data become available.
While we expect to have substantially compliant programs and controls in place to comply with the GDPR requirements, our compliance with the new regulation is likely to impose additional costs on us and we cannot predict whether the interpretations of the requirements, or changes in our practices in response to new requirements or interpretations of the requirements could have a material adverse effect on our business.
While we expect to have substantially compliant programs and controls in place to comply with the GDPR requirements , our compliance with the regulation is likely to impose additional costs on us and we cannot predict whether the interpretations of the requirements, or changes in our practices in response to new requirements or interpretations of the requirements could have a material adverse effect on our business.
Similar to the Anti-Kickback Statute, a person or entity can be found guilty of violating HIPAA without actual knowledge of the statute or specific intent to violate it. 73 Table of Contents ● federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers; ● federal government price reporting laws that require the calculation and reporting of complex pricing metrics to government programs, where such reported prices may be used in the calculation of reimbursement and/or discounts, on any of our product candidates that may be approved for marketing (participation in these programs and compliance with the applicable requirements may also subject us to potentially significant discounts on our products and increased infrastructure costs, and potentially limit our ability to offer certain marketplace discounts); ● the FCPA, which regulates certain financial relationships with foreign government officials (which could include, for example, certain medical professionals), and anti-bribery laws and related laws, and laws pertaining to the accuracy of our internal books and records, which have been the focus of increasing enforcement activity in recent years; and ● state law equivalents of each of the above federal laws, such as anti-kickback, false claims, consumer protection and unfair competition laws, which may apply to our business practices, including but not limited to, research, distribution, sales-and-marketing arrangements as well as submitting claims involving health care items or services reimbursed by any third-party payer, including commercial insurers; state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government that otherwise restricts payments that may be made to health care providers; state laws that require drug manufacturers to file reports with states regarding marketing information, such as the tracking and reporting of gifts, compensations and other remuneration and items of value provided to health care professionals and entities (compliance with such requirements may require investment in infrastructure to ensure that tracking is performed properly, and some of these laws result in the public disclosure of various types of payments and relationships, which could potentially have a negative effect on our business and/or increase enforcement scrutiny of the Company’s activities); and state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways, with differing effects.
Similar to the Anti-Kickback Statute, a person or entity can be found guilty of violating HIPAA without actual knowledge of the statute or specific intent to violate it. ● federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers; ● federal government price reporting laws that require the calculation and reporting of complex pricing metrics to government programs, where such reported prices may be used in the calculation of reimbursement and/or discounts, on any of our product candidates that may be approved for marketing (participation in these programs and compliance with the applicable requirements may also subject us to potentially significant discounts on our products and increased infrastructure costs, and potentially limit our ability to offer certain marketplace discounts); ● the FCPA, which regulates certain financial relationships with foreign government officials (which could include, for example, certain medical professionals), and anti-bribery laws and related laws, and laws pertaining to the accuracy of our internal books and records, which have been the focus of increasing enforcement activity in recent years; and ● state law equivalents of each of the above federal laws, such as anti-kickback, false claims, consumer protection and unfair competition laws, which may apply to our business practices, including but not limited 74 Table of Contents to, research, distribution, sales-and-marketing arrangements as well as submitting claims involving health care items or services reimbursed by any third-party payer, including commercial insurers; state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government that otherwise restricts payments that may be made to health care providers; state laws that require drug manufacturers to file reports with states regarding marketing information, such as the tracking and reporting of gifts, compensations and other remuneration and items of value provided to health care professionals and entities (compliance with such requirements may require investment in infrastructure to ensure that tracking is performed properly, and some of these laws result in the public disclosure of various types of payments and relationships, which could potentially have a negative effect on our business and/or increase enforcement scrutiny of the Company’s activities); and state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways, with differing effects.
The market price for our common stock may be influenced by many factors, including: ● announcements relating to development, regulatory approvals or commercialization of our product candidates or those of competitors; ● results of clinical trials of our product candidates or those of our competitors; ● announcements by us or our competitors of significant strategic partnerships or collaborations or terminations of such arrangements; ● actual or anticipated variations in our operating results and whether we have achieved key business targets; ● sales of our common stock, including sales by our directors and officers or specific stockholders; ● changes in, or our failure to meet, financial estimates by us or by any securities analysts who might cover our stock; ● changes in securities analysts’ buy and/or sell recommendations; ● general economic, political, or stock market conditions; ● conditions or trends in our industry; ● changes in laws or other regulatory actions affecting us or our industry; ● stock market price and volume fluctuations of comparable companies and, in particular, those that operate in the biopharmaceutical industry; 81 Table of Contents ● announcements of investigations or regulatory scrutiny of our operations or lawsuits filed against us; ● capital commitments; ● investors’ general perception of our company, our business, and our prospects; ● disputes concerning our intellectual property or other proprietary rights; and ● recruitment or departure of key personnel.
The market price for our common stock may be influenced by many factors, including: ● announcements relating to development, regulatory approvals or commercialization of our product candidates or those of competitors; ● results of clinical trials of our product candidates or those of our competitors; ● announcements by us or our competitors of significant strategic partnerships or collaborations or terminations of such arrangements; ● actual or anticipated variations in our operating results and whether we have achieved key business targets; ● sales of our common stock, including sales by our directors and officers or specific stockholders; ● changes in, or our failure to meet, financial estimates by us or by any securities analysts who might cover our stock; ● changes in securities analysts’ buy and/or sell recommendations; ● general economic, political, or stock market conditions; ● conditions or trends in our industry; ● changes in laws or other regulatory actions affecting us or our industry; ● stock market price and volume fluctuations of comparable companies and, in particular, those that operate in the biopharmaceutical industry; ● announcements of investigations or regulatory scrutiny of our operations or lawsuits filed against us; ● capital commitments; ● investors’ general perception of our company, our business, and our prospects; 82 Table of Contents ● disputes concerning our intellectual property or other proprietary rights; and ● recruitment or departure of key personnel.
Other consequences include the issuance of fines, warning letters, untitled letters or holds on clinical trials, product seizure or detention or refusal to permit the import or export of our product candidates, and permanent injunctions and consent decrees, including the imposition of civil or criminal penalties, among other consequences, that could significantly impair our ability to successfully commercialize a given product. 58 Table of Contents Later discovery of previously unknown problems with an approved product, including adverse events of unanticipated severity or frequency, or with manufacturing operations or processes, may result in, among other things: ● restrictions on the marketing or manufacturing of the product, withdrawal of the product from the market or voluntary or mandatory product recalls; ● fines or warning letters, or clinical holds on clinical trials involving related product candidates; ● refusal by the FDA or other regulatory authorities to approve pending applications or supplements to approved applications submitted by us or suspension or revocation of product license approvals; ● product seizure or detention or refusal to permit the import or export of products; and ● injunctions or the imposition of civil, criminal and/or administrative penalties, damages, monetary fines, disgorgement, exclusion from participation in governmental reimbursement programs, such as Medicare, Medicaid and other federal health care programs and curtailment or restructuring of our operations.
Other consequences include the issuance of fines, warning letters, untitled letters or holds on clinical trials, product seizure or detention or refusal to permit the import or export of our product candidates, and permanent injunctions and consent decrees, including the imposition of civil or criminal penalties, among other consequences, that could significantly impair our ability to successfully commercialize a given product. 59 Table of Contents Later discovery of previously unknown problems with an approved product, including adverse events of unanticipated severity or frequency, or with manufacturing operations or processes, may result in, among other things: ● restrictions on the marketing or manufacturing of the product, withdrawal of the product from the market or voluntary or mandatory product recalls; ● fines or warning letters, or clinical holds on clinical trials involving related product candidates; ● refusal by the FDA or other regulatory authorities to approve pending applications or supplements to approved applications submitted by us or suspension or revocation of product license approvals; ● product seizure or detention or refusal to permit the import or export of products; and ● injunctions or the imposition of civil, criminal and/or administrative penalties, damages, monetary fines, disgorgement, exclusion from participation in governmental reimbursement programs, such as Medicare, Medicaid and other federal health care programs and curtailment or restructuring of our operations.
The degree of market acceptance of any product candidate, if approved for commercial sale, will depend on a number of factors, including: ● efficacy and potential advantages compared to alternative treatments; 51 Table of Contents ● the ability to offer our products, if approved, for sale at competitive prices; ● convenience and ease of administration compared to alternative treatments; ● the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies; ● the strength of marketing and distribution support; ● the ability to obtain sufficient third-party coverage and adequate reimbursement, including with respect to the use of the approved product as a combination therapy; ● the cost of treatment in relation to alternative treatments, including generic products; ● the extent and strength of our third-party manufacturer and supplier support; ● the extent and strength of marketing and distribution support; ● the limitations or warnings contained in a product’s approved labeling; ● distribution and use restrictions imposed by the FDA or other regulatory authorities outside the United States or that are part of a REMS or voluntary risk management plan; and ● the prevalence and severity of any side effects, including the tolerability and effect on comorbidities relative to alternative treatments.
The degree of market acceptance of any product candidate, if approved for commercial sale, will depend on a number of factors, including: ● efficacy and potential advantages compared to alternative treatments; ● the ability to offer our products, if approved, for sale at competitive prices; ● convenience and ease of administration compared to alternative treatments; ● the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies; ● the ability to obtain sufficient third-party coverage and adequate reimbursement, including with respect to the use of the approved product as a combination therapy; ● the cost of treatment in relation to alternative treatments, including generic products; 53 Table of Contents ● the extent and strength of our third-party manufacturer and supplier support; ● the extent and strength of marketing and distribution support; ● any limitations or warnings contained in a product’s approved labeling; ● any distribution and use restrictions imposed by the FDA or other regulatory authorities outside the United States or that are part of a REMS or voluntary risk management plan; and ● the prevalence and severity of any side effects, including the tolerability and effect on comorbidities relative to alternative treatments.
The rules dealing with U.S. federal, state, and local income taxation are constantly under review by persons involved in the legislative process and by the Internal Revenue Service and the U.S. Treasury Department. Changes to tax laws (which changes may have retroactive application) could adversely affect us or holders of our common stock.
Tax laws could change. The rules dealing with U.S. federal, state, and local income taxation are constantly under review by persons involved in the legislative process and by the Internal Revenue Service and the U.S. Treasury Department. Changes to tax laws (which changes may have retroactive application) could adversely affect us or holders of our common stock.
We do not have control over third party manufacturers’ compliance with these regulations and standards, but we may ultimately be responsible for any of their failures; ● delays as a result of manufacturing problems or re-prioritization of projects at a third-party manufacturer; ● our third-party manufacturers might be unable to formulate and manufacture our product candidates in the volume and of the quality required to meet our clinical and commercial needs, if any; ● termination or non-renewal of manufacturing agreements with third parties in a manner or at a time that is costly or damaging to us; ● the possible misappropriation of our proprietary information, including our trade secrets and know-how or infringement of third-party intellectual property rights by our contract manufacturers; and ● disruptions to the operations of our third-party manufacturers or suppliers caused by conditions unrelated to our business or operations, including the bankruptcy of the manufacturer or supplier.
We do not have control over third party manufacturers’ compliance with these regulations and standards, but we may ultimately be responsible for any of their failures; ● delays as a result of manufacturing problems or re-prioritization of projects at a third-party manufacturer; ● our third-party manufacturers might be unable to formulate and manufacture our product candidates in the volume and of the quality required to meet our clinical and commercial needs, if any; ● termination or non-renewal of manufacturing agreements with third parties in a manner or at a time that is costly or damaging to us; ● the possible misappropriation of our proprietary information, including our trade secrets and know-how or infringement of third-party intellectual property rights by our contract manufacturers; and ● disruptions to the operations of our third-party manufacturers or suppliers caused by conditions unrelated to our business or operations, including the bankruptcy or change in ownership of the manufacturer or supplier.
We anticipate that our expenses will increase significantly if and as we: ● continue our clinical trials for our product candidates; ● initiate additional preclinical studies, clinical trials or other studies or trials for our other product candidates; ● manufacture material for clinical trials and, if any product candidate is approved for marketing, for commercial sale; 41 Table of Contents ● seek regulatory approvals for our product candidates that successfully complete clinical trials; ● establish a sales, marketing and distribution infrastructure to commercialize any products for which we may obtain marketing approval; ● seek to discover and develop additional product candidates; ● acquire or in-license other product candidates and technologies; ● make royalty, milestone or other payments under any in-license agreements; ● form strategic partnerships and/or make additional acquisitions; ● maintain, protect and expand our intellectual property portfolio; ● attract and retain skilled personnel; and ● create additional infrastructure to support our operations as a public company and our product development and planned future commercialization efforts.
We anticipate that our expenses will increase significantly if and as we: ● continue our clinical trials for our product candidates; ● initiate additional preclinical studies, clinical trials or other studies or trials for our other product candidates; ● manufacture material for clinical trials and, if any product candidate is approved for marketing, for commercial sale; 43 Table of Contents ● seek regulatory approvals for our product candidates that successfully complete clinical trials; ● establish a sales, marketing and distribution infrastructure to commercialize any products for which we may obtain marketing approval; ● seek to discover and develop additional product candidates; ● acquire or in-license other product candidates and technologies; ● make royalty, milestone or other payments under any in-license agreements; ● form strategic partnerships and/or make additional acquisitions; ● maintain, protect and expand our intellectual property portfolio; ● attract and retain skilled personnel; and ● create additional infrastructure to support our operations as a public company and our product development and planned future commercialization efforts.
We are a party to a number of license agreements that are important to our business, and we may enter into additional license agreements in the future. Certain of our in-licensed intellectual property covers, or may cover, RespirVec technology, EuPort technology, and certain of our product candidates including pemvidutide.
We are a party to a number of license agreements that are important to our business, and we may enter into additional license agreements in the future. Certain of our in-licensed intellectual property covers, or may cover, EuPort technology, and certain of our product candidates including pemvidutide.
Our product candidates could fail to 56 Table of Contents receive regulatory approval from the FDA or comparable regulatory authorities outside the United States for several reasons, including: ● disagreement with the design or implementation of our clinical trials ; ● failure to demonstrate that our candidate is safe and effective for the proposed indication; ● failure of clinical trial results to meet the level of statistical significance required for approval; ● failure to demonstrate that the product candidate’s benefits outweigh its risks; ● disagreement with our interpretation of preclinical or clinical data; and ● inadequacies in the manufacturing facilities or processes of third-party manufacturers.
Our product candidates could fail to receive regulatory approval from the FDA or comparable regulatory authorities outside the United States for several reasons, including: ● disagreement with the design or implementation of our clinical trials ; ● failure to demonstrate that our candidate is safe and effective for the proposed indication; ● failure of clinical trial results to meet the level of statistical significance required for approval; ● failure to demonstrate that the product candidate’s benefits outweigh its risks; 57 Table of Contents ● disagreement with our interpretation of preclinical or clinical data; and ● inadequacies in the manufacturing facilities or processes of third-party manufacturers.
If there is any conflict, dispute, disagreement or issue of non-performance between 64 Table of Contents the Company and our licensing partners regarding our rights or obligations under the license agreements, including any such conflict, dispute or disagreement arising from our failure to satisfy payment obligations under any such agreement, we may owe damages, our licensor may have a right to terminate the affected license, and our ability to utilize the affected intellectual property in our product discovery and development efforts and our ability to enter into collaboration or marketing agreements for an affected product candidate may be adversely affected.
If there is any conflict, dispute, disagreement or issue of non-performance between the Company and our licensing partners regarding our rights or obligations under the license agreements, including any such conflict, dispute or disagreement arising from our failure to satisfy payment obligations under any such agreement, we may owe damages, our licensor may have a right to terminate the affected license, and our ability to utilize the affected intellectual property in 65 Table of Contents our product discovery and development efforts and our ability to enter into collaboration or marketing agreements for an affected product candidate may be adversely affected.
If we are unable to establish long-term name recognition based on our trademarks and trade names, then we may not be able to compete effectively, and our business may be adversely affected. 65 Table of Contents Risks Related to Commercialization of the Company’s Product Candidates Our future commercial success depends upon attaining significant market acceptance of our product candidates, if approved, among physicians, patients, third-party payers and others in the medical community.
If we are unable to establish long-term name recognition based on our trademarks and trade names, then we may not be able to compete effectively, and our business may be adversely affected. 66 Table of Contents Risks Related to Commercialization of the Company’s Product Candidates Our future commercial success depends upon attaining significant market acceptance of our product candidates, if approved, among physicians, patients, third-party payers and others in the medical community.
If our 43 Table of Contents ability to utilize a Form S-3 registration statement for a primary offering of our securities is limited to one-third of our public float, we may conduct such an offering pursuant to an exemption from registration under the Securities Act or under a Form S-1 registration statement, and we would expect either of those alternatives to increase the cost of raising additional capital relative to utilizing a Form S-3 registration statement.
If our 45 Table of Contents ability to utilize a Form S-3 registration statement for a primary offering of our securities is limited to one-third of our public float, we may conduct such an offering pursuant to an exemption from registration under the Securities Act or under a Form S-1 registration statement, and we would expect either of those alternatives to increase the cost of raising additional capital relative to utilizing a Form S-3 registration statement.
However, we do not expect that these funds will be sufficient to enable us to complete the clinical trials needed to seek marketing approval or commercialize any of our product candidates. 42 Table of Contents Furthermore, our operating plan may change as a result of many factors currently unknown to us, and we may need additional funds sooner than planned.
However, we do not expect that these funds will be sufficient to enable us to complete the clinical trials needed to seek marketing approval or commercialize any of our product candidates. 44 Table of Contents Furthermore, our operating plan may change as a result of many factors currently unknown to us, and we may need additional funds sooner than planned.
In addition, if a product that has an orphan drug designation subsequently receives FDA approval for the indication for which it has such designation, the product may be entitled to orphan drug exclusivity, which means the FDA would not approve any other application to 60 Table of Contents market the same drug for a period of seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan exclusivity.
In addition, if a product that has an orphan drug designation subsequently receives FDA approval for the indication for which it has such designation, the 61 Table of Contents product may be entitled to orphan drug exclusivity, which means the FDA would not approve any other application to market the same drug for a period of seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan exclusivity.
If this occurs, our competitors may be able to take advantage of our investment in development and clinical trials by referencing our clinical and preclinical data, and then may be able to launch their product earlier than might otherwise be the case. 62 Table of Contents We may become involved in lawsuits to protect or enforce our intellectual property, which could be expensive, time consuming and unsuccessful.
If this occurs, our competitors may be able to take advantage of our investment in development and clinical trials by referencing our clinical and preclinical data, and then may be able to launch their product earlier than might otherwise be the case. 63 Table of Contents We may become involved in lawsuits to protect or enforce our intellectual property, which could be expensive, time consuming and unsuccessful.
If we or others identify undesirable side effects caused by our product candidates either before or after receipt of marketing approval, a number of potentially significant negative consequences could result, including: ● our clinical trials may be put on hold; ● we may be unable to obtain regulatory approval for our product candidates; ● regulatory authorities may withdraw approvals of our products; ● regulatory authorities may require additional warnings on the label; ● a medication guide outlining the risks of such side effects for distribution to patients may be required; 57 Table of Contents ● we could be sued and held liable for harm caused to patients; and ● our reputation may suffer.
If we or others identify undesirable side effects caused by our product candidates either before or after receipt of marketing approval, a number of potentially significant negative consequences could result, including: ● our clinical trials may be put on hold; ● we may be unable to obtain regulatory approval for our product candidates; ● regulatory authorities may withdraw approvals of our products; ● regulatory authorities may require additional warnings on the label; ● a medication guide outlining the risks of such side effects for distribution to patients may be required; ● we could be sued and held liable for harm caused to patients; and ● our reputation may suffer.
In addition, varying interpretations of the data obtained from preclinical and clinical testing could delay, limit, or prevent marketing approval of a product candidate. Any marketing approval we ultimately 59 Table of Contents obtain may be limited or subject to restrictions or post-approval commitments that render the approved product not commercially viable.
In addition, varying interpretations of the data obtained from preclinical and clinical testing could delay, limit, or prevent marketing approval of a product candidate. Any marketing approval we ultimately 60 Table of Contents obtain may be limited or subject to restrictions or post-approval commitments that render the approved product not commercially viable.
Further, the Bipartisan Budget Act of 2018 among other things, amended the Medicare statute, effective January 1, 2019, to reduce the coverage gap in most Medicare prescription drug plans, commonly known as the “donut hole,” by raising the manufacturer discount under the Medicare Part D coverage gap discount program to 70%.
Further, the Bipartisan Budget Act of 2018 among other things, amended the Medicare statute, effective January 1, 2019, to reduce the coverage gap in most Medicare prescription drug plans, commonly known as the “donut hole,” by raising the manufacturer discount under the Medicare Part D coverage gap discount program from 50% to 70%.
If we fail to establish and maintain strategic partnerships related to our product candidates, we will bear all of the risk and costs related to the development of any such product candidate, and we may need to seek additional financing, hire additional employees and otherwise develop expertise which we do not have and for which we have not budgeted.
If we fail to establish and maintain strategic partnerships related to our product candidates, including pemvidutide, we will bear all of the risk and costs related to the development of any such product candidate, and we may need to seek additional financing, hire additional employees and otherwise develop expertise which we do not have and for which we have not budgeted.
Based on our current operating plan, we believe that our existing cash will be sufficient to fund our projected operating expenses and capital expenditure requirements for at least a twelve-month period from the issuance date of our December 31, 2022 financial statements.
Based on our current operating plan, we believe that our existing cash will be sufficient to fund our projected operating expenses and capital expenditure requirements for at least a twelve-month period from the issuance date of our December 31, 2023 financial statements.
Any successful challenge to our patents or patent applications, or to any other patents or patent applications owned by or licensed to us, could deprive us of the rights necessary to prevent competition from third parties, which may impair the 61 Table of Contents commercial success of any product candidate that we may develop.
Any successful challenge to our patents or patent applications, or to any other patents or patent applications owned by or 62 Table of Contents licensed to us, could deprive us of the rights necessary to prevent competition from third parties, which may impair the commercial success of any product candidate that we may develop.
The volatility of our stock price has increased since we effected the Reverse Stock Split. Since our common stock began trading on a post-Reverse Stock Split basis on September 14, 2018 and through December 31, 2022, our stock has traded in a range with a low of $1.51 and a high of $36.25.
The volatility of our stock price has increased since we effected the Reverse Stock Split. Since our common stock began trading on a post-Reverse Stock Split basis on September 14, 2018 and through December 31, 2023, our stock has traded in a range with a low of $1.51 and a high of $36.25.
As a result, although it is anticipated that HepTcell is intended for the treatment of patients suffering from a disease, regulatory agencies such as the FDA may nevertheless require us to conduct extensive safety testing prior to approval to demonstrate a low risk of rare and severe adverse events caused by our product candidates that include novel vaccine adjuvants.
As a result, although it is anticipated that HepTcell is intended 50 Table of Contents for the treatment of patients suffering from a disease, regulatory agencies such as the FDA may nevertheless require us to conduct extensive safety testing prior to approval to demonstrate a low risk of rare and severe adverse events caused by our product candidates that include novel vaccine adjuvants.
In the U.S., we may be subject to data privacy and security laws and regulations by both the federal government and the states in which we conduct our business, including, for example, state data breach notification laws, state health information and/or genetic privacy laws and federal and state consumer protection laws (e.g., Section 5 of the FTC Act and the CCPA), govern the collection, use, disclosure, and protection of health-related and other personal information.
In the U.S., we may be subject to data privacy and security laws and regulations by both the federal government and the states in which we conduct our business, including, for example, state data breach notification laws, state health information and/or genetic privacy laws and federal and state consumer protection laws (e.g., Section 5 of the FTC Act and the California Consumer Privacy Act (“CCPA”)), which, govern the collection, use, disclosure, and protection of health-related and other personal information.
Moreover, there are no safe harbors for many common practices, such as educational and research grants, charitable donations, product support and patient assistance programs. Violations of the Anti-Kickback Statute may be punished by civil and criminal penalties, damages, fines, or exclusion from participation in federal health care programs like Medicare and Medicaid.
Moreover, there are 77 Table of Contents no safe harbors for many common practices, such as educational and research grants, charitable donations, product support and patient assistance programs. Violations of the Anti-Kickback Statute may be punished by civil and criminal penalties, damages, fines, or exclusion from participation in federal health care programs like Medicare and Medicaid.
Any such significant write-downs of our long-lived assets in the future could adversely affect our balance sheet and results of operations. We will require substantial additional financing to achieve our goals, and a failure to obtain this necessary capital when needed would force us to delay, limit, reduce or terminate our product development or commercialization efforts.
This and other significant write-downs of our long-lived assets in the future could adversely affect our balance sheet and results of operations. We will require substantial additional financing to achieve our goals, and a failure to obtain this necessary capital when needed would force us to delay, limit, reduce or terminate our product development or commercialization efforts.
As a result, obtaining coverage and reimbursement approval for any approved product from each government and other third-party payer may require us to provide supporting scientific, clinical and cost-effectiveness data for the use of such products to each payer separately, with no assurance that we will be able to provide data sufficient to gain acceptance 72 Table of Contents with respect to coverage and reimbursement.
As a result, obtaining coverage and reimbursement approval for any approved product from each government and other third-party payer may require us to provide supporting scientific, clinical and cost-effectiveness data for the use of such products to each payer separately, with no assurance that we will be able to provide data sufficient to gain acceptance with respect to coverage and reimbursement.
Clinical trials with this product candidate showed that it was generally well-tolerated and able to induce robust T-cell responses against the viral sequences represented, but a comparison of the entire study population in later-stage clinical trials showed no statistical differences between the vaccinated and placebo groups for several measures of protection.
Clinical trials with this product candidate showed that it was generally well-tolerated and able to induce robust T-cell responses 46 Table of Contents against the viral sequences represented, but a comparison of the entire study population in later-stage clinical trials showed no statistical differences between the vaccinated and placebo groups for several measures of protection.
If we or our manufacturing partners are unable to scale the manufacturing process to produce commercial quantities of our product candidates, or our manufacturing partners do not pass required regulatory pre-approval inspections, our commercialization efforts may be adversely affected. 68 Table of Contents Our reliance on contract manufacturers may adversely affect our operations or result in unforeseen delays or other problems beyond our control.
If we or our manufacturing partners are unable to scale the manufacturing process to produce commercial quantities of our product candidates, or our manufacturing partners do not pass required regulatory pre-approval inspections, our commercialization efforts may be adversely affected. Our reliance on contract manufacturers may adversely affect our operations or result in unforeseen delays or other problems beyond our control.
These problems may include: ● difficulties with production costs, scale-up and yields; ● unavailability of raw materials and supplies; ● insufficient quality control and assurance; ● shortages of qualified personnel; ● failure to comply with strictly enforced federal, state and foreign regulations that vary in each country where product might be sold; and ● lack of capital funding.
These problems may include: ● difficulties with production costs, scale-up and yields; ● unavailability of raw materials and supplies; ● insufficient quality control and assurance; 69 Table of Contents ● shortages of qualified personnel; ● failure to comply with strictly enforced federal, state and foreign regulations that vary in each country where product might be sold; and ● lack of capital funding.
To date, many biosimilar products have been authorized by the European Commission, after application at EMA for a centralized marketing authorization. As in the United States the regulatory approval pathway for biosimilar products in Europe is abbreviated.
To date, many biosimilar products have been authorized by the European Commission, after application at EMA for a centralized marketing authorization. As in the United States the regulatory approval pathway for biosimilar products in the EU is abbreviated.
Failure to submit required annual information may result in civil monetary penalties, which may increase significantly for “knowing failures.” 77 Table of Contents ● Analogous state laws and regulations, including anti-kickback and false claims laws, which apply to items and services reimbursed under Medicaid or, in several states, regardless of the payer, including private payers.
Failure to submit required annual information may result in civil monetary penalties, which may increase significantly for “knowing failures.” ● Analogous state laws and regulations, including anti-kickback and false claims laws, which apply to items and services reimbursed under Medicaid or, in several states, regardless of the payer, including private payers.
Competition to hire from this limited pool is intense, and we may be unable to hire, train, retain or motivate these key personnel on acceptable terms given the competition among numerous pharmaceutical and biotechnology companies for similar personnel. We also experience competition for the hiring of scientific and clinical personnel from universities and research institutions.
Competition to hire from this limited pool is intense, and we may be unable to hire, train, retain or motivate these key personnel on acceptable terms given the competition among numerous pharmaceutical and biotechnology companies for similar personnel. We also experience competition for the hiring of scientific and clinical personnel from universities 54 Table of Contents and research institutions.
This means, for example, that we may not make claims about the use of our products, should they be approved for sale, outside of their approved indications, and we may not proactively discuss or provide information regarding any of their off-label uses subject to very specific and limited exceptions.
This means, for example, that we may not make claims about the use of our products, should they be approved for sale, 78 Table of Contents outside of their approved indications, and we may not proactively discuss or provide information regarding any of their off-label uses subject to very specific and limited exceptions.
In these countries, pricing negotiations with governmental authorities can take considerable time after receipt of marketing approval for a product. In addition, there can be considerable pressure by governments and other stakeholders on coverage, prices and reimbursement levels, including as part of cost containment measures.
In these countries, pricing negotiations with governmental authorities can take considerable time after receipt of marketing approval for a 73 Table of Contents product. In addition, there can be considerable pressure by governments and other stakeholders on coverage, prices and reimbursement levels, including as part of cost containment measures.
There can be no assurance that our activities will not come under the scrutiny of regulators and other government authorities or that our practices will not be found to violate applicable laws, rules and 76 Table of Contents regulations or prompt lawsuits by private citizen “relators” under federal or state false claims laws.
There can be no assurance that our activities will not come under the scrutiny of regulators and other government authorities or that our practices will not be found to violate applicable laws, rules and regulations or prompt lawsuits by private citizen “relators” under federal or state false claims laws.
Ultimately, we could be forced to redesign an infringing product, prevented from commercializing a product, or forced to cease some aspect of our business operations, if, as a result of actual or threatened patent infringement claims, we are unable to enter into licenses on acceptable terms.
Ultimately, we could be forced to redesign an infringing product, prevented from commercializing a product, or 64 Table of Contents forced to cease some aspect of our business operations, if, as a result of actual or threatened patent infringement claims, we are unable to enter into licenses on acceptable terms.
Integration of an acquired company also may disrupt ongoing operations and require management resources that we would 70 Table of Contents otherwise focus on developing our existing business. We may experience losses related to investments in other companies, which could harm our financial condition and results of operations.
Integration of an acquired company also may disrupt ongoing operations and require management resources that we would otherwise focus on developing our existing business. We may experience losses related to investments in other companies, which could harm our financial condition and results of operations.
Under current law, the remaining federal amount of $127.2 million has an indefinite life and generally may not be carried back to prior taxable years. For net operating losses arising in taxable years beginning after December 31, 2017, we are permitted a net operating loss deduction that is limited to 80% of our taxable income in such year.
Under current law, the remaining federal amount of $145.6 million has an indefinite life and generally may not be carried back to prior taxable years. For net operating losses arising in taxable years beginning after December 31, 2017, we are permitted a net operating loss deduction that is limited to 80% of our taxable income in such year.
A data security breach could lead to the loss of trade secrets or other intellectual property, the value of which may be contingent upon maintaining our confidentiality, or could lead to the public exposure of personal information (including sensitive personal medical information) of clinical trial participants, our employees and others, or adversely impact the conduct of scientific research and clinical trials, including the submission of research results to support marketing authorizations.
A data security breach or compromise could lead to the loss of trade secrets or other intellectual property, the value of which may be contingent upon maintaining our confidentiality, or could lead to 72 Table of Contents the public exposure of personal information (including sensitive personal medical information) of clinical trial participants, our employees and others, or adversely impact the conduct of scientific research and clinical trials, including the submission of research results to support marketing authorizations.
In the event of contamination or injury, or failure to comply with environmental, occupational health and safety and export control laws and regulations, we could be held liable for any resulting damages and any such liability could exceed our assets and resources.
In the event of contamination 81 Table of Contents or injury, or failure to comply with environmental, occupational health and safety and export control laws and regulations, we could be held liable for any resulting damages and any such liability could exceed our assets and resources.
While the stated intent of comparative effectiveness research is to develop information to guide providers to the most efficacious therapies, outcomes of comparative effectiveness research could influence the reimbursement or coverage for therapies that are determined to be less cost effective than others.
While the stated intent of comparative 75 Table of Contents effectiveness research is to develop information to guide providers to the most efficacious therapies, outcomes of comparative effectiveness research could influence the reimbursement or coverage for therapies that are determined to be less cost effective than others.
Therefore, we will use our existing cash resources, and will require additional funds to maintain our operations, continue our research and development programs, commence future preclinical studies and clinical trials, seek regulatory approvals and manufacture and market our products. As of December 31, 2022, our cash, cash equivalents, restricted cash and short-term investments were $184.9 million.
Therefore, we will use our existing cash resources, and will require additional funds to maintain our operations, continue our research and development programs, commence future preclinical studies and clinical trials, seek regulatory approvals and manufacture and market our products. As of December 31, 2023, our cash, cash equivalents, restricted cash and short-term investments were $197.9 million.
Certain ANDAs, and certain biosimilar products that are deemed under applicable laws to be “interchangeable with” our biological product, once approved, may be substituted for our product candidates, subject to applicable state laws. We may also be subject to competition from biosimilar products in Europe.
Certain ANDAs, and certain biosimilar products that are deemed under applicable laws to be “interchangeable with” our biological product, once approved, may be substituted for our product candidates, subject to applicable state laws. We may also be subject to competition from biosimilar products in the EU.
Subject enrollment is affected by several factors, including: ● severity of the disease under investigation; ● design of the trial protocol; ● size of the patient population; ● eligibility criteria for the trial in question; ● perceived risks and benefits of the product candidate being tested; ● willingness or availability of subjects to participate in our clinical trials (including due to the COVID-19 pandemic); ● proximity and availability of clinical trial sites for prospective subjects; ● our ability to recruit clinical trial investigators with appropriate competencies and experience; ● availability of competing vaccines and/or therapies and related clinical trials; ● efforts to facilitate timely enrollment in clinical trials; ● our ability to obtain and maintain subject consents; ● patient referral practices of physicians; and ● ability to monitor subjects adequately during and after treatment.
Subject enrollment is affected by several factors, including: ● severity of the disease under investigation; ● design of the trial protocol; ● size of the patient population; ● eligibility criteria for the trial in question; 49 Table of Contents ● perceived risks and benefits of the product candidate being tested; ● willingness or availability of subjects to participate in our clinical trials; ● proximity and availability of clinical trial sites for prospective subjects; ● our ability to recruit clinical trial investigators with appropriate competencies and experience; ● availability of competing vaccines and/or therapies and related clinical trials; ● efforts to facilitate timely enrollment in clinical trials; ● our ability to obtain and maintain subject consents; ● patient referral practices of physicians; and ● ability to monitor subjects adequately during and after treatment.
For example, the Tax Cuts and Jobs Act enacted on December 22, 2017, eliminated the tax-based payment for individuals who fail to maintain minimum essential coverage under section 5000A of the Internal Revenue Code of 1986, as amended, commonly referred to as the “individual mandate,” effective January 1, 2019.
For example, the Tax Cuts and Jobs Act of 2017, eliminated the tax-based payment for individuals who fail to maintain minimum essential coverage under section 5000A of the Internal Revenue Code of 1986, as amended, commonly referred to as the “individual mandate,” effective January 1, 2019.
If these third parties do not successfully carry out their contractual duties or obligations or meet expected deadlines, if they cannot perform their contractual duties or obligations due to the impacts of the ongoing COVID-19 pandemic on their operations or at the sites they are overseeing, if they need to be replaced or if the quality or accuracy of the preclinical or clinical data they obtain is compromised due to the failure to adhere to our protocols or regulatory requirements or for other reasons, our development timelines, including clinical development timelines, may be extended, delayed or terminated and we may not be able to complete development of, receive regulatory approval of or successfully commercialize our product candidates.
If these third parties do not successfully carry out their contractual duties or obligations or meet expected deadlines, if they cannot perform their contractual duties or obligations due to the impacts of public health crises on their operations or at the sites they are overseeing, if they need to be replaced or if the quality or accuracy of the preclinical or clinical data they obtain is compromised due to the failure to adhere to our protocols or regulatory requirements or for other reasons, our development timelines, including clinical development timelines, may be extended, delayed or terminated and we may not be able to complete development of, receive regulatory approval of or successfully commercialize our product candidates.
We cannot assure that any manufactured product or 45 Table of Contents product candidate will not suffer a loss in stability or that other issues relating to the manufacture of our product candidates will not occur in the future.
We cannot assure that any manufactured product or product candidate will not suffer a loss in stability or that other issues relating to the manufacture of our product candidates will not occur in the future.
We face competition for pemvidutide, our dual GLP 1/glucagon dual agonist for the treatment of obesity and NASH. For obesity, we face competition from companies such as Novo Nordisk, whose GLP-1 agonist, brand named Wegovy, or compound name semaglutide, was approved in June 2021.
We face competition for pemvidutide, our dual GLP-1/glucagon dual agonist for the treatment of obesity and MASH. For obesity, we face competition from companies such as Novo Nordisk, whose GLP-1 agonist, brand named Wegovy, or compound name semaglutide, was approved for weight loss in June 2021.
A significant outbreak of coronavirus and other infectious diseases could result in a widespread health crisis that could adversely affect the economies and financial markets worldwide, resulting in an economic downturn that could impact our business, financial condition and results of operations. Labor shortages and constraints in the supply chain could adversely affect our results of operations.
A significant outbreak of infectious disease could result in a widespread health crisis that could adversely affect the economies and financial markets worldwide, resulting in an economic downturn that could impact our business, financial condition and results of operations. Labor shortages and constraints in the supply chain could adversely affect our results of operations.
In addition, recent developments in the national and worldwide supply chain slowdown, including as a result of the conflict in Ukraine, have resulted in increased cost and reduced supply for supplies and materials.
In addition, recent developments in the national and worldwide supply chain slowdown, including as a result of the conflict in Israel and the Gaza Strip, and the conflict in Ukraine, have resulted in increased cost and reduced supply for supplies and materials.
If we do not establish sales, marketing 69 Table of Contents and distribution capabilities successfully, either on our own or in collaboration with third parties, we will not be successful in commercializing our product candidates. We may encounter difficulties in managing our growth and expanding our operations successfully.
If we do not establish sales, marketing and distribution capabilities successfully, either on our own or in collaboration with third parties, we will not be successful in commercializing our product candidates. We may encounter difficulties in managing our growth and expanding our operations successfully.
This could negatively affect the development of any unpartnered product candidate. We may acquire other businesses, form joint ventures or make investments in other companies or technologies that could negatively affect our operating results, dilute our stockholders’ ownership, increase our debt or cause us to incur significant expense.
This could negatively affect the development of any unpartnered product candidate and materially affect our business and financial condition. We may acquire other businesses, form joint ventures or make investments in other companies or technologies that could negatively affect our operating results, dilute our stockholders’ ownership, increase our debt or cause us to incur significant expense.
For these purposes, an ownership change generally occurs in the event of a 55 Table of Contents cumulative change in ownership of the Company of more than 50% within any three-year period.
For these purposes, an ownership change generally occurs in the event of a cumulative change in ownership of the Company of more than 50% within any three-year period.
We can give no assurances that we will ever again pay dividends. Altimmune has never paid any dividends on our common stock. While subject to periodic review, our current policy is to retain all earnings, if any, primarily to finance our future growth or ability to consummate strategic transactions, such as a merger or other business combination.
Altimmune has never paid any dividends on our common stock. While subject to periodic review, our current policy is to retain all earnings, if any, primarily to finance our future growth or ability to consummate strategic transactions, such as a merger or other business combination. We make no assurances that we will ever pay future dividends, cash or otherwise.
We had U.S. federal and state net operating loss carryforwards of approximately $134.3 million and $103.7 million, respectively, as of December 31, 2022, of which a portion of the federal and state amount of $7.1 million and $103.7 million, respectively, has a 20-year carry forward period that will expire at various dates beginning in 2024.
We had U.S. federal and state net operating loss carryforwards of approximately $152.7 million and $143.3 million, respectively, as of December 31, 2023, of which a portion of the federal and state amount of $7.1 million and $143.3 million, respectively, has a 20-year carry forward period that will expire at various dates beginning in 2024.
However, the applicable authorities, including the USPTO and FDA in the United States, and any equivalent regulatory authority in other countries, may not agree with our assessment of whether such extensions are available or whether any of our products qualify as a first licensure, and may refuse to grant extensions to our patents, or may grant more limited extensions than we request, or may not grant regulatory exclusivity.
However, the applicable authorities, including the USPTO and FDA in the United States, and any equivalent regulatory authority in other countries, may not agree with our assessment of whether such extensions are available and may refuse to grant extensions to our patents, or may grant more limited extensions than we request, or may not grant regulatory exclusivity.
If we are required by the FDA or other regulatory authorities to perform studies in addition to those currently expected, or if there are any delays in completing our clinical trials or the development of any of our product candidates, our expenses could increase.
If we are required by the FDA or other regulatory authorities to perform studies in addition to those currently expected, if there are any delays in completing our clinical trials or the development of any of our product candidates, or if we choose to perform additional studies for marketing purposes our expenses could increase.
Where an application for a marketing authorization is submitted in respect of a medicinal product that is not designated as an orphan medicinal product and that application contains the results of the PIP studies, it may be possible to obtain a 6-month extension of a supplementary protection certificate extending patent protection for a medicinal product.
Where an application for a marketing authorization is submitted in respect of a medicinal product that is not designated as an orphan medicinal product and that application contains the results of studies conducted in compliance with an approved PIP, it may be possible to obtain a six month extension of a supplementary protection certificate extending patent protection for a medicinal product.
If subjects are unwilling to participate in our trials because of the ongoing COVID-19 pandemic and restrictions on travel or healthcare institution policies, negative publicity from adverse events in the biotechnology industries, public perception of vaccine safety issues or for other reasons, including competitive clinical trials for similar patient populations, the timeline for recruiting subjects, conducting studies and obtaining regulatory approval of potential 47 Table of Contents products may be delayed.
If subjects are unwilling to participate in our trials due to restrictions on travel or healthcare institution policies, negative publicity from adverse events in the biotechnology industries, public perception of vaccine safety issues or for other reasons, including competitive clinical trials for similar patient populations, the timeline for recruiting subjects, conducting studies and obtaining regulatory approval of potential products may be delayed.
For example, the ongoing COVID-19 pandemic (including the Delta and Omicron variants and any future variants that may emerge) may delay preclinical testing and enrollment in our clinical trials due to prioritization of laboratory and hospital resources toward the outbreak or other factors, and some patients may be unwilling to enroll in our trials or be unable to comply with clinical trial protocols if quarantines impede patient movement or interrupt healthcare services, which would delay our ability to conduct clinical trials or release clinical trial results and could delay our ability to obtain regulatory approval and commercialize our product candidates.
For example, future outbreaks of infectious disease, such as COVID 19, and any future variants or subvariants that may emerge, may delay preclinical testing and enrollment in our clinical trials due to prioritization of laboratory and hospital resources toward the outbreak or other factors, and some patients may be unwilling to enroll in our trials or be unable to comply with clinical trial protocols if quarantines impede patient movement or interrupt healthcare services, which would delay our ability to conduct clinical trials or release clinical trial results and could delay our ability to obtain regulatory approval and commercialize our product candidates.
If any such actions are instituted against the Company, and in some cases regardless of the merits of those actions, those actions could have a significant impact on our business, including the costs of investigation, settlement arrangements, imposition of civil, criminal and administrative penalties (such as additional reporting requirements and oversight if we become subject to Corporate Integrity Agreements and other arrangements, damages, monetary fines, disgorgement, imprisonment, and possible exclusion from participation in Medicare, Medicaid and other federal health care programs), contractual damages, reputational harm, diminished profits and future earnings, and curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and our results of operations. 80 Table of Contents We must comply with environmental laws and regulations, and failure to comply with these laws and regulations could expose us to significant liabilities.
If any such actions are instituted against the Company, and in some cases regardless of the merits of those actions, those actions could have a significant impact on our business, including the costs of investigation, settlement arrangements, imposition of civil, criminal and administrative penalties (such as additional reporting requirements and oversight if we become subject to Corporate Integrity Agreements and other arrangements, damages, monetary fines, disgorgement, imprisonment, and possible exclusion from participation in Medicare, Medicaid and other federal health care programs), contractual damages, reputational harm, diminished profits and future earnings, and curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and our results of operations.
As of December 31, 2022, we have an accumulated deficit of $377.9 million. To date, we have not received regulatory approvals for any products or generated any revenues from the sale of products, and we do not expect to generate any product revenues in the foreseeable future.
As of December 31, 2023, we have an accumulated deficit of $466.3 million. To date, we have not received regulatory approvals for any products or generated any revenues from the sale of products, and we do not expect to generate any product revenues in the foreseeable future.
Shares that we may issue in the future in connection with certain capital-raising transactions and shares available for future issuance upon exercise of warrants and options could dilute our stockholders and depress the market price of our common stock and result in the adjustment of the conversion terms of our existing securities.
Shares that we may issue in the future in connection with certain capital-raising transactions and shares available for future issuance upon exercise of warrants and options could dilute our stockholders and depress the market price of our common stock.
Where an application for a marketing authorization is submitted in respect of a medicinal product designated as an orphan medicinal product and that application contains the results of the PIP studies, market exclusivity for that orphan medicinal product is extended by two years.
Where an application for a marketing authorization is submitted in respect of a medicinal product designated as an orphan medicinal product and that application contains the results of studies conducted in compliance with an approved PIP, market exclusivity for that orphan medicinal product may be extended by two years.
We rely on, and expect to continue to rely on, third parties to manufacture our product candidates and related materials for our clinical trials and preclinical studies, and these third parties may not perform satisfactorily.
We rely on, and expect to continue to rely on, third parties to manufacture our product candidates and related materials for our products, if approved, as well as for our clinical trials and preclinical studies, and these third parties may not perform satisfactorily.
As of December 31, 2022, we have recorded a valuation allowance of $57.2 million against our net deferred tax asset. Risks Related to the Regulatory Approval Process We cannot guarantee how long it will take regulatory agencies to review our applications for product candidates, and we may fail to obtain the necessary regulatory approvals to market our product candidates.
As of December 31, 2023, we have recorded a valuation allowance of $83.0 million against our net deferred tax asset. 56 Table of Contents Risks Related to the Regulatory Approval Process We cannot guarantee how long it will take regulatory agencies to review our applications for product candidates, and we may fail to obtain the necessary regulatory approvals to market our product candidates.
If we have difficulty enrolling and maintaining the enrollment of a sufficient number of subjects to conduct our clinical trials as planned, we may need to delay, limit or terminate ongoing or planned clinical trials, any of which would have an adverse effect on our business. It may be difficult to predict the time and cost of product development.
If we have difficulty enrolling and maintaining the enrollment of a sufficient number of subjects to conduct our clinical trials as planned, we may need to delay, limit or terminate ongoing or planned clinical trials, any of which would have an adverse effect on our business.
We are heavily dependent on the success of our leading product candidate, pemvidutide. If we ultimately are unable to develop, obtain regulatory approval for or commercialize pemvidutide, or any other product candidate, our business will be substantially harmed. We currently have no products approved for commercial distribution.
If we ultimately are unable to develop, obtain regulatory approval for or commercialize pemvidutide, or any other product candidate, our business will be substantially harmed. We currently have no products approved for commercial distribution.
The GDPR also confers a private right of action on data subjects and consumer associations to lodge complaints with supervisory authorities, seek judicial remedies, and obtain compensation for damages resulting from violations of the GDPR. In addition, the GDPR includes restrictions on cross-border data transfers.
The GDPR also confers a private right of action on data subjects and consumer associations to lodge complaints with supervisory authorities, seek judicial remedies, and obtain compensation for damages resulting from violations of the GDPR.
Large and established companies such as Eli Lilly, Roche, Novo Nordisk and Pfizer, among others, compete in the same market as our product candidates.
Large and established companies such as Eli Lilly, Roche, Novo Nordisk, Pfizer, AstraZeneca, Amgen, Boehringer Ingelheim and Merck, among others, compete in the same market as our product candidates.
We must operate in compliance with various data privacy and security regulations in the United States by both the federal government and the states in which we conduct our business, as well as in other jurisdictions outside of the United States, such as the United Kingdom, the EU and Asia, where we conduct clinical trials.
We must operate in compliance with various data privacy and security regulations in the United States by both the federal government and the states in which we conduct our business, as well as in other jurisdictions outside of the United States, such as the U.K., the European Economic Area (“EEA”) and Asia, where we conduct clinical trials.
If our operations are found to be in violation of any of the laws described above or any other governmental regulations that apply to the Company, we may be subject to penalties, including, without limitation, civil, criminal and administrative penalties, damages, monetary fines, disgorgement, possible exclusion from participation in Medicare, Medicaid and other federal and state health care programs, individual imprisonment, contractual damages, reputational harm, diminished profits and future earnings, and curtailment or restructuring of our operations as well as additional reporting obligations and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws. 74 Table of Contents The impact of recent health care reform legislation and other changes in the health care industry and in health care spending on the Company is currently unknown and may adversely affect our business model.
If our operations are found to be in violation of any of the laws described above or any other governmental regulations that apply to the Company, we may be subject to penalties, including, without limitation, civil, criminal and administrative penalties, damages, monetary fines, disgorgement, possible exclusion from participation in Medicare, Medicaid and other federal and state health care programs, individual imprisonment, contractual damages, reputational harm, diminished profits and future earnings, and curtailment or restructuring of our operations as well as additional reporting obligations and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws.
We make no assurances that we will ever pay future dividends, cash or otherwise. Whether we pay any dividends in the future will depend on our financial condition, results of operations, and other factors that we will consider. Item 1B. Unresolved Staff Comments None.
Whether we pay any dividends in the future will depend on our financial condition, results of operations, and other factors that we will consider. Item 1B. Unresolved Staff Comments None.
A sustained labor shortage, lack of skilled labor, or increased turnover within our employee base, caused by COVID-19 or as a result of general macroeconomic factors, could have a material adverse impact on our business and operating results.
A sustained labor shortage, lack of skilled labor, or increased turnover within our employee base, caused by a pandemic, epidemic or the spread of infectious disease or as a result of general macroeconomic factors, could have a material adverse impact on our business and operating results.
Because we have acquired all the outstanding shares of most of our acquired companies, our investment in those companies are or will be subject to all of their liabilities other than their respective debts which we paid or will pay at the time of the acquisitions. If there are unknown liabilities or other obligations, our business could be materially affected.
Because we have historically acquired all the outstanding shares of most of our acquired companies, our investment in those companies are or will be subject to all of their liabilities other than their respective debts which we paid or will pay at the time of the acquisitions.
In addition, changes in manufacturers often involve changes in manufacturing procedures and processes, which could require that we conduct bridging studies between our prior clinical supply used in our clinical trials and that of any new manufacturer. We may be unsuccessful in demonstrating the comparability of clinical supplies which could require the conduct of additional clinical trials.
In addition, changes in manufacturers often involve changes in manufacturing procedures and processes, which could require that we conduct bridging studies between our prior clinical supply used in our clinical trials and that of any new manufacturer.
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Item 2. Properties
Properties — owned and leased real estate
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Item 2. Properties
Properties — owned and leased real estate
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Biggest changeItem 2. Properties Our principal executive offices are located in Gaithersburg, Maryland, where we occupy approximately 19,699 square feet of laboratory and office space. For additional information, see Note 6 to our consolidated financial statements. Management believes that these facilities are suitable and adequate to meet our anticipated needs.
Biggest changeItem 2. Properties Our principal executive offices are located in Gaithersburg, Maryland, where we occupy approximately 19,699 square feet of laboratory and office space. For additional information, see Note 5 to our consolidated financial statements. Management believes that these facilities are suitable and adequate to meet our anticipated needs.
Item 3. Legal Proceedings
Legal Proceedings — active lawsuits and investigations
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Item 3. Legal Proceedings
Legal Proceedings — active lawsuits and investigations
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Item 3. Legal Proceedings In December 2019, a complaint was filed by Dr. De-chu Christopher Tang (“Plaintiff”) against us, which we removed to the United States District Court for the Eastern District of Texas. The Plaintiff amended the complaint in February 2020 to include Vipin K. Garg and David J. Drutz as defendants, in addition to the Company (Dr.
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Item 3. Legal Proceedings We are not currently subject to any material legal proceedings. From time to time, we may be involved in various legal proceedings or investigations, which could be costly and impose a significant burden on management and employees.
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Garg, Dr. Drutz, and the Company are collectively referred to as “Defendants”). In March 2020 the Defendants filed a motion to dismiss the complaint. On March 25, 2021, the court granted the motion and dismissed the action for lack of personal jurisdiction.
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The results of any current or future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors. Item 4. Mine Safety Disclosures Not applicable. 85 Table of Contents PART II
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In December 2021, the Plaintiff refiled the case in the United States District Court for the District of Maryland, captioned Tang v. Altimmune, Inc., et al ., Case No. 8:21-cv-03283 (D. Md.).
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Plaintiff, who is representing himself, asserts two causes of action: (1) breach of a prior settlement agreement by “robbing Plaintiff’s properties”; and (2) use by the Company of the “AdHigh system,” which Plaintiff claims is “proprietary.” On April 4, 2022, Defendants filed a motion to dismiss all claims in Plaintiff’s operative complaint, which motion is pending.
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We believe the allegations in the operative complaint are without merit and intend to vigorously defend the litigation. Item 4. Mine Safety Disclosures Not applicable. 83 Table of Contents PART II
Item 5. Market for Registrant's Common Equity
Market for Common Equity — stock, dividends, buybacks
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Item 5. Market for Registrant's Common Equity
Market for Common Equity — stock, dividends, buybacks
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Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock trades on the NASDAQ Global Market under the symbol “ALT”. Holders As of February 24, 2023, we had 178 record holders of our common stock.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock trades on the NASDAQ Global Market under the symbol “ALT”. Holders As of March 22, 2024, we had 181 record holders of our common stock.
Purchases of Equity Securities by the Issuer and Affiliated Purchases None. Item 6. [Reserved] 84 Table of Contents
Purchases of Equity Securities by the Issuer and Affiliated Purchases None. Item 6. [Reserved] 86 Table of Contents
Item 6. [Reserved]
Selected Financial Data — reserved (removed by SEC in 2021)
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Item 6. [Reserved]
Selected Financial Data — reserved (removed by SEC in 2021)
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Biggest changeItem 6. [ Reserved ] 84 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 85 Item 7A. Quantitative and Qualitative Disclosures about Market Risk 93 Item 8. Financial Statements and Supplementary Data 94
Biggest changeItem 6. [ Reserved ] 86 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 87 Item 7A. Quantitative and Qualitative Disclosures about Market Risk 95 Item 8. Financial Statements and Supplementary Data 96
Item 7. Management's Discussion & Analysis
Management's Discussion & Analysis (MD&A) — revenue / margin commentary
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Item 7. Management's Discussion & Analysis
Management's Discussion & Analysis (MD&A) — revenue / margin commentary
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Biggest changeResults of Operations Comparison of years ended December 31, 2022 and December 31, 2021: Year Ended December 31, (in thousands) 2022 2021 Increase (Decrease) Revenue $ (68) $ 4,410 $ (4,478) (102) % Operating expenses: Research and development 70,538 74,541 (4,003) (5) % General and administrative 17,134 15,413 1,721 11 % Impairment loss on construction-in-progress — 11,370 (11,370) 100 % Total operating expenses 87,672 101,324 (13,652) (13) % Loss from operations (87,740) (96,914) 9,174 9 % Other income (expense): Interest expense (8) (5) (3) (60) % Interest income 2,870 203 2,667 1,314 % Other income (expense), net (32) (374) 342 91 % Total other income (expense), net 2,830 (176) 3,006 1,708 % Net loss before income taxes (84,910) (97,090) 12,180 13 % Income tax expense (benefit) (197) — (197) Net loss $ (84,713) $ (97,090) $ 12,377 13 % Revenue For the year ended December 31, 2021, revenue consisted primarily of research grants in the United States from Medical Technology Enterprise Consortium (“MTEC”) for our T-COVID product candidate and Biomedical Advanced Research and Development Authority (“BARDA”) for our NasoShield vaccine product candidate.
Biggest changeAdditionally, if and when we believe a regulatory approval of the first product candidate appears likely, we anticipate an increase in staffing and related expenses as a result of our preparation for commercial operations, especially as it relates to the sales and marketing of our product candidates. 89 Table of Contents Results of Operations Comparison of years ended December 31, 2023 and December 31, 2022 (in thousands): Year Ended December 31, 2023 2022 Increase (Decrease) Revenue $ 426 $ (68) $ 494 726 % Operating expenses: Research and development 65,799 70,538 (4,739) (7) % General and administrative 18,137 17,134 1,003 6 % Impairment loss on intangible asset 12,419 — 12,419 100 % Total operating expenses 96,355 87,672 8,683 10 % Loss from operations (95,929) (87,740) (8,189) 9 % Other income (expense): Interest expense (35) (8) (27) 338 % Interest income 7,351 2,870 4,481 156 % Other income (expense), net 166 (32) 198 619 % Total other income (expense), net 7,482 2,830 4,652 164 % Net loss before income taxes (88,447) (84,910) (3,537) 4 % Income tax expense (benefit) — (197) 197 (100) % Net loss $ (88,447) $ (84,713) $ (3,734) 4 % Revenue We have not generated any revenues from the sale of any products to date.
Research and development costs consist of payroll and personnel expense, consulting costs, external contract research and development expenses, which includes fees paid to other entities that conduct certain research and development activities on our behalf, such as clinical research organizations (“CROs”) and contract manufacturing organizations (“CMOs”), raw materials, drug product manufacturing costs, laboratory supplies and allocated overhead, including depreciation and amortization, rent and utilities.
Research and development costs consist of payroll and personnel expense, consulting costs, external contract research and development expenses, which includes fees paid 93 Table of Contents to other entities that conduct certain research and development activities on our behalf, such as clinical research organizations (“CROs”) and contract manufacturing organizations (“CMOs”), raw materials, drug product manufacturing costs, laboratory supplies and allocated overhead, including depreciation and amortization, rent and utilities.
The duration, costs and timing of clinical trials and development of our product candidates will depend on a variety of factors, including: ● scope, rate of enrollment and expense of our ongoing, as well as any additional, clinical trials, and other research and development activities; ● significant and potentially changing government regulation; and ● the timing and receipt of regulatory approvals, if any.
The duration, costs and timing of clinical trials and development of our product candidates will depend on a variety of factors, including: ● scope, rate of enrollment and expense of our ongoing, as well as any additional, clinical trials, and other research and development activities; ● significant and potentially changing government regulation; and 88 Table of Contents ● the timing and receipt of regulatory approvals, if any.
However, in order to address our capital needs in the long-term, including our planned clinical trials, 91 Table of Contents we must continue to actively pursue additional equity or debt financing, government funding and monetization of our existing programs through partnership arrangements or sales to third parties.
However, in order to address our capital needs in the long-term, including our planned clinical trials, we must continue to actively pursue additional equity or debt financing, government funding and monetization of our existing programs through partnership arrangements or sales to third parties.
Income tax benefit Income tax benefit of $0.2 million related to interest received and receivable on income tax refunds was recorded during the year ended December 31, 2022.
Income tax benefit We recorded an income tax benefit of $0.2 million related to interest received and receivable on income tax refunds during the year ended December 31, 2022.
Overview Altimmune, Inc. is a clinical stage biopharmaceutical company focused on developing treatments for obesity and liver diseases. Our lead product candidate, pemvidutide (formerly known as ALT-801), is a GLP-1/glucagon dual receptor agonist that is being developed for the treatment of obesity and non-alcoholic steatohepatitis (“NASH”).
Overview Altimmune, Inc. is a clinical stage biopharmaceutical company focused on developing treatments for obesity and liver diseases. Our lead product candidate, pemvidutide (formerly known as ALT-801), is a GLP-1/glucagon dual receptor agonist that is being developed for the treatment of obesity and metabolic dysfunction-associated steatohepatitis (“MASH”), previously termed non-alcoholic steatohepatitis (“NASH”).
We believe, based on the operating cash requirements and capital expenditures expected for 2023 and 2024, our cash on hand at December 31, 2022, together with expected cash receipts from our income tax refunds and R&D incentives, are sufficient to fund operations for at least a twelve-month period from issuance date of our December 31, 2022 consolidated financial statements.
We believe, based on the operating cash requirements and capital expenditures expected for 2024 and 2025, our cash on hand as of December 31, 2023, together with expected cash receipts from our income tax refunds and research and development incentives, are sufficient to fund operations for at least a twelve-month period from the issuance date of our December 31, 2023 consolidated financial statements.
Our current active and planned research and development activities include the following: ● completion of a Phase 2 clinical trial for pemvidutide in obesity; ● initiation of a Phase 2 clinical trial for pemvidutide in NASH; ● conduct of clinical trials and nonclinical safety studies for pemvidutide; ● completion a Phase 2 clinical trial for HepTcell; and ● manufacture of clinical trial materials in support of our clinical trials.
Our current active and planned research and development activities include the following: ● completion of data analysis of a Phase 2 clinical trial for pemvidutide in obesity; ● conduct of a Phase 2 clinical trial for pemvidutide in MASH; ● conduct of clinical trials and nonclinical safety studies for pemvidutide; ● completion of a Phase 2 clinical trial for HepTcell; and ● manufacture of clinical trial materials in support of our clinical trials.
Our sources of cash provided by operations during the year ended December 31, 2022 was primarily cash receipts of R&D incentive credits and income tax refunds. The primary uses of cash from our operating activities include payments for labor and labor-related costs, professional fees, research and development costs associated with our clinical trials and other general corporate expenditures.
Our sources of cash provided by operations during the year ended December 31, 2023 was primarily cash receipts of research and development incentive credits. The primary uses of cash from our operating activities include payments for labor and labor-related costs, professional fees, research and development costs associated with our clinical trials and other general corporate expenditures.
General and administrative expenses General and administrative expenses increased by $1.7 million, or 11%, during the year ended December 31, 2022 as compared to the year ended December 31, 2021. The increased expense is primarily due to a $1.7 million increase in stock compensation and other labor-related expenses.
General and administrative expenses General and administrative expenses increased by $1.0 million, or 6%, during the year ended December 31, 2023 as compared to the year ended December 31, 2022. The increased expense is primarily due to a $0.6 million increase in stock compensation and $0.3 million increase in other labor-related expenses.
Total other income (expense), net Total other income (expense), net increased by $3.0 million during the year ended December 31, 2022 as compared to the year ended December 31, 2021, primarily due to $2.7 million increase in interest income earned on our cash equivalents and short-term investments and $0.3 million decrease in loss from foreign currency exchange.
Total other income (expense), net Total other income (expense), net increased by $4.7 million during the year ended December 31, 2023 as compared to the year ended December 31, 2022, primarily due to a $4.5 million increase in interest income earned on our cash equivalents and short-term investments and $0.2 million increase in gain from foreign currency exchange.
We are closing out one of the remaining such contracts and any revenue reported during the year ended December 31, 2022 was for indirect rate adjustments. 86 Table of Contents Research and development expenses Research and development expenses consist primarily of costs incurred for the development of our product candidates, which include: ● expenses incurred under agreements with contract research organizations (“CROs”) and investigative sites that conduct our clinical trials; ● employee-related expenses, including salaries, benefits, travel and stock-based compensation expense; ● costs associated with preclinical and clinical activities and regulatory operations, including the cost of acquiring, developing and manufacturing clinical trial materials; and ● depreciation and other expenses, which include direct and allocated expenses for insurance, consultants, legal fees and other supplies.
Research and development expenses Research and development expenses consist primarily of costs incurred for the development of our product candidates, which include: ● expenses incurred under agreements with contract research organizations (“CROs”) and investigative sites that conduct our clinical trials; ● employee-related expenses, including salaries, benefits, travel and stock-based compensation expense; ● costs associated with preclinical and clinical activities and regulatory operations, including the cost of acquiring, developing and manufacturing clinical trial materials; and ● depreciation and other expenses, which include direct and allocated expenses for insurance, consultants, legal fees and other supplies.
At December 31, 2022, we had $184.9 million of cash, cash equivalents, restricted cash and short-term investments. Accordingly, management believes that we have sufficient capital to fund our plan of operations for at least a twelve-month period from the issuance date of our December 31, 2022 consolidated financial statements.
Accordingly, management believes that we have sufficient capital to fund our plan of operations for at least a twelve-month period from the issuance date of our December 31, 2023 consolidated financial statements.
We plan to increase our research and development expenses for the foreseeable future as we continue the development of clinical and preclinical candidates.
Additionally, we may conduct additional trials in support of sales and marketing of our product candidates. We plan to increase our research and development expenses for the foreseeable future as we continue the development of clinical and preclinical candidates.
Investing Activities Net cash used in investing activities was $73.4 million for the year ended December 31, 2022 compared to $87.5 million during the year ended December 31, 2021. The net cash used in investing activities during 2022 was primarily due to purchase of short-term investments, net of maturities.
The net cash used in investing activities during the year ended December 31, 2022 was primarily due to $73.3 million purchase of short-term investments. Financing Activities Net cash provided by financing activities was $86.1 million for the year ended December 31, 2023 compared to $56.8 million during the year ended December 31, 2022.
We do not allocate personnel-related costs, costs associated with our general research platform improvements, depreciation or other indirect costs to specific programs. General and Administrative Expenses General and administrative expenses consist primarily of salaries and related costs for personnel, including stock-based compensation and travel expenses for our employees in executive, operational, finance and human resource functions.
General and Administrative Expenses General and administrative expenses consist primarily of salaries and related costs for personnel, including stock-based compensation and travel expenses for our employees in executive, operational, finance and human resource functions.
Cash Flows The following table provides information regarding our cash flows for the years ended December 31, 2022 and 2021: Year Ended December 31, (in thousands) 2022 2021 Increase (Decrease) Net cash (used in) provided by: Operating activities $ (62,586) $ (78,238) $ 15,652 Investing activities (73,399) 87,523 (160,922) Financing activities 56,781 65,098 (8,317) Net (decrease) increase in cash and cash equivalents and restricted cash $ (79,204) $ 74,383 $ (153,587) Operating Activities Net cash used in operating activities was $62.6 million for the year ended December 31, 2022 compared to $78.2 million during the year ended December 31, 2021.
Cash Flows The following table provides information regarding our cash flows for the years ended December 31, 2023 and 2022: Year Ended December 31, (in thousands) 2023 2022 Increase (Decrease) Net cash provided by (used in): Operating activities $ (75,810) $ (62,586) $ (13,224) Investing activities 13,732 (73,399) 87,131 Financing activities 86,105 56,781 29,324 Net increase (decrease) in cash and cash equivalents and restricted cash $ 24,027 $ (79,204) $ 103,231 Operating Activities Net cash used in operating activities was $75.8 million for the year ended December 31, 2023 compared to $62.6 million during the year ended December 31, 2022.
In order to address our capital needs, including our planned clinical trials, we must continue to actively pursue additional equity or debt financing, government funding, and monetization of our existing programs through partnership arrangements or sales to third parties.
In order to address our capital needs, including our planned clinical trials, we must continue to actively pursue additional equity or debt financing, government funding, and monetization of our existing programs through partnership arrangements or sales to third parties. 91 Table of Contents Sources of Liquidity Shelf Registrations On February 28, 2023, we filed a shelf registration statement on Form S-3ASR, which was declared effective immediately.
The trial was a double-blind, placebo-controlled study. Subjects were randomized 1:1:1:1 to 1.2 mg, 1.8 mg, 2.4 mg pemvidutide or placebo administered weekly for 12 weeks. No dose titration was used with 1.2 mg or 1.8 mg dose, while a short 4-week dose titration was employed at the 2.4 mg dose.
Subjects were randomized 1:1:1:1 to 1.2 mg, 1.8 mg, 2.4 mg pemvidutide or placebo administered weekly for 48 weeks in conjunction with diet and exercise. The 1.2 mg and 1.8 mg doses were administered without dose titration, while a short 4-week titration period was employed for the 2.4 mg dose.
The net cash provided by investing activities during the year ended December 31, 2021 was primarily due to net proceeds from short-term investments activities of $99.8 million, partially offset by purchases of property and equipment of $12.1 million related to Lonza.
The net cash provided by investing activities during the year ended December 31, 2023 was primarily due to $102.4 million proceeds from sale and maturities of short-term investments, partially offset by $88.6 million purchase of short-term investments.
These grants and contracts generally provided for reimbursement of approved costs as those costs were incurred by us. Research grants and contracts and the related accounts receivable were recognized as earned when reimbursable expenses are incurred and the performance obligation was complete. Payments received in advance of services being provided were recorded as deferred revenue.
Research grants and contracts and the related accounts receivable were recognized as earned when reimbursable expenses were incurred and the performance obligation was complete. Payments received in advance of services being provided were recorded as deferred revenue. We are closing out one such contract and any revenue reported during the year ended December 31, 2023 was for indirect rate adjustments.
Financing Activities Net cash provided by financing activities was $56.8 million for the year ended December 31, 2022 compared to $65.1 million during the year ended December 31, 2021.
Investing Activities Net cash provided by investing activities was $13.7 million for the year ended December 31, 2023 compared to $73.4 million net cash used during the year ended December 31, 2022.
The decrease in cash used in operating activities of $15.7 million is due to a decrease in net loss as adjusted for noncash items of $1.3 million and changes in working capital accounts of $14.4 million.
The increase in cash used in operating activities of $13.2 million was due to a $22.4 million change in working capital accounts, partially offset by a $9.2 million decrease in net loss as adjusted for noncash items.
At-the-Market Offering On February 25, 2021, we entered into an Equity Distribution Agreement (the “2021 Agreement”) with Piper Sandler & Co., Evercore Group L.L.C. and B.
At-the-Market Offerings On February 28, 2023, we entered an Equity Distribution Agreement (the “2023 Agreement”) with Evercore Group L.L.C., JMP Securities LLC and B.
Other than the income tax benefit related to interest, we did not record an income tax benefit in the year ended December 31, 2022 and 2021 due to a full valuation allowance. 89 Table of Contents Liquidity and Capital Resources Overview Our primary sources of cash for the year ended December 31, 2022 were from equity transactions.
Other than the income tax benefit related to interest, we did not record an income tax benefit in the years ended December 31, 2023 and 2022 due to a full valuation allowance.
Impairment of long-lived assets We evaluate our long-lived tangible and intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable.
Impairment of Indefinite-lived Intangible Assets We evaluate our indefinite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of such assets may not be recoverable in accordance with the guidance in Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 350, Intangibles—Goodwill and Other (“ASC 350”).
The decrease was primarily the result of the discontinuation of development work on both T-COVID and NasoShield programs as described above. Research and development expenses Research and development expenses for the years ended December 31, 2022 and 2021 consisted primarily of expenses related to product candidate development.
Research and development expenses Research and development expenses for the years ended December 31, 2023 and 2022 consisted primarily of expenses related to product candidate development.
The net cash provided by financing activities during 2022 was primarily the result of the receipt of $56.2 million in net proceeds from the issuance of common stock from our at-the-market offerings program.
The net cash provided by financing activities during the year ended December 31, 2022 was primarily the result of the receipt of $56.2 million in proceeds from the issuance of common stock from our at-the-market offerings program, $0.9 million in proceeds from exercise of stock options and $0.2 million in proceeds from employee stock purchase plan, partially offset by $0.5 million payment for tax withholding obligations related to share-based compensation.
We have not generated any revenues from the sale of any products to date, and there is no assurance of any future revenues from product sales.
We have not generated any revenues from the sale of any products to date, and there is no assurance of any future revenues from product sales. We have incurred significant losses since we commenced operations. As of December 31, 2023, we had an accumulated deficit of $466.3 million. In addition, we have not generated positive cash flows from operations.
The net cash provided by financing activities during 2021 was primarily the result of the receipt of $64.7 million in net proceeds from the issuance of common stock from our at-the-market offerings program. Capital Resources We have financed our operations to date principally through our equity offerings and proceeds from issuances of our preferred stock, common stock and warrants.
Capital Resources We have financed our operations to date principally through our equity offerings and proceeds from issuances of our preferred stock, common stock and warrants. As of December 31, 2023, we had $197.9 million of cash, cash equivalents, restricted cash and short-term investments.
The randomized, placebo-controlled trial enrolled approximately 320 non-diabetic subjects randomized 1:1:1:1 to receive either 1.2 mg, 1.8 mg, 2.4 mg pemvidutide or placebo weekly for 48 weeks. No dose titration is being used with the 1.2 mg or 1.8 mg dose, while a short 4-week dose titration is being employed at the 2.4 mg dose.
The biopsy-driven trial is expected to enroll approximately 190 subjects with and without diabetes randomized 1:2:2 to receive 1.2 mg, 1.8 mg pemvidutide or placebo weekly for 48 weeks.
Riley Securities, Inc., serving as sales agents (the “Sales Agents”) with respect to an at-the-market offerings program under which we offered and sold shares of our common stock, par value $0.0001 per share (the “Common Stock”), having an aggregate offering price of up to $125.0 million through the Sale Agents from the 2021 Shelf. 90 Table of Contents During the year ended December 31, 2022, we sold 5,204,415 shares of Common Stock under the 2021 Agreement resulting in approximately $56.2 million in net proceeds.
Riley Securities, Inc., serving as sales agents, with respect to an at-the-market offerings program under which we may offer and sell, from time to time at our sole discretion, shares of our common stock, having an aggregate offering price of up to $150.0 million.
Impairment loss on construction-in-progress Impairment loss on construction-in-progress of $11.4 million reported during the year ended December 31, 2021 represents non-cash impairment charges recorded for assets that were previously capitalized in connection with the construction of the Lonza facility and subsequent discontinuation of AdCOVID. There were no impairment charges reported during the year ended December 31, 2022.
Impairment loss on intangible asset Impairment loss on intangible asset of $12.4 million reported during the year ended December 31, 2023 represents a non-cash impairment charge recorded for the in-process research and development (“IPR&D”) asset associated with HepTcell (See Note 2. Summary of Significant Accounting Policies ). There were no impairment charges reported during the year ended December 31, 2022.
As of December 31, 2022, we sold 10,004,869 shares of Common Stock under the 2021 Agreement resulting in approximately $121.0 million in net proceeds. As of December 31, 2022, there were no remaining shares available for issuance under the 2021 Agreement.
During the year ended December 31, 2023, we sold 20,454,516 shares of common stock under the 2023 Agreement resulting in approximately $86.6 million in net proceeds, and as of December 31, 2023, $60.6 million remained available to be sold under the 2023 Shelf.
All intercompany accounts and transactions have been eliminated in consolidation. Revenue We have not generated any revenues from the sale of any products to date. Our revenue in previous years consisted primarily of government and foundation grants and contracts that support our efforts on specific research projects.
Financial Operations Overview The consolidated financial information presented below includes the accounts of Altimmune, Inc., Altimmune UK, Ltd, Spitfire Pharma, LLC. and Altimmune AU Pty, Ltd. All intercompany accounts and transactions have been eliminated in consolidation. Revenue We have not generated any revenue from the sale of any products to date.
In April 2022, we announced that we had enrolled the first subject in the 48-week Phase 2 MOMENTUM trial evaluating the safety and efficacy of pemvidutide in subjects with obesity or overweight. The trial is being conducted at approximately 30 sites in the U.S.
Pemvidutide – MOMENTUM trial 48-Week Analysis On November 30, 2023, we announced topline results from our 48-week MOMENTUM Phase 2 obesity trial of pemvidutide. The trial enrolled 391 subjects with obesity or overweight with at least one co-morbidity and without diabetes.
Our cash, cash equivalents, restricted cash and short-term investments were $184.9 million as of December 31, 2022.
Liquidity and Capital Resources Overview Our primary sources of cash for the year ended December 31, 2023 were from equity transactions, interest and dividends from our money market funds and short-term investments, and proceeds from maturity of our short-term investments. Our cash, cash equivalents, restricted cash and short-term investments were $197.9 million as of December 31, 2023.
Impairment of long-lived assets other than indefinite lived intangibles is assessed by comparing the undiscounted cash flows expected to be generated by the asset group to its carrying value. We have one in-process research and development (“IPR&D”) asset, HepTcell, that was acquired in 2015. This candidate is a viral pathogen immunotherapy product for the treatment of chronic HBV.
We had one IPR&D asset, HepTcell, that we acquired in 2015. This candidate was a viral pathogen immunotherapy product for the treatment of chronic HBV. Since 2020, we have been conducting a Phase 2 clinical trial.
In addition, we are developing HepTcell, an immunotherapeutic agent designed to achieve a functional cure for chronic hepatitis B. Except where the context indicates otherwise, references to “we,” “us,” “our,” “Altimmune” or the “Company” refer to the company and its subsidiaries.
Except where the context indicates otherwise, references to “we,” “us,” “our,” “Altimmune” or the “Company” refer to the company and its subsidiaries. Fiscal Year 2023 Business Update On October 24, 2023, the U.S. Food and Drug Administration (“FDA”) granted fast track designation pemvidutide for the treatment of MASH.
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Fiscal Year 2022 Business Update In December 2021, an Investigational New Drug application for obesity was submitted to the U.S. Food and Drug Administration (“FDA”) and on January 31, 2022 we received FDA clearance for a Phase 2 trial in this indication.
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Pemvidutide – IMPACT trial On August 1, 2023 we announced that we enrolled the first subject in the Phase 2b trial, IMPACT, to evaluate the safety and efficacy of pemvidutide in subjects with MASH.
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The primary endpoint of the trial is the relative (percent) change in body weight at 48 weeks compared to baseline, with additional readouts including metabolic and lipid profiles, cardiovascular measures and glucose homeostasis. The trial is being conducted with adjunctive diet and exercise interventions that is typical in weight loss studies.
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The key efficacy endpoints are MASH resolution and fibrosis improvement after 24 weeks of treatment, with subjects to be followed for an additional 24 weeks to a total of 48 weeks for assessment of safety and additional biomarker responses. Top-line 24-week results from this trial are expected in the first quarter of 2025.
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In August 2022, we announced that 167 subjects had been randomized and we further announced on September 28, 2022 the first dosing of all subjects in the MOMENTUM trial. In September 2022, we announced the topline results from our 12-week Phase 1b clinical trial of pemvidutide in subjects with non-alcoholic fatty liver disease (“NAFLD”).
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Unlike other obesity studies with GLP-1 based agents, dose-reduction was not allowed. At baseline, subjects had a mean age of approximately 50 years, mean body mass index (“BMI”) of approximately 37 kg/m 2 and mean body weight of approximately 104 kg. Approximately 75% of subjects were female. See Item 1.
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The primary efficacy endpoint was the percent (%) reduction in liver fat content (“LFC”) from baseline, and the key secondary efficacy endpoint was the % weight loss from baseline, both at 12 weeks of treatment. The trial was conducted without adjunctive diet and exercise interventions that are the standard for obesity trials.
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Business of this Annual Report for detailed discussion of the data readout. 12-Week Type 2 Diabetes Safety Trial In March 2023, we announced the topline results from a 12-week Phase 1b safety trial of pemvidutide, which was conducted to evaluate the safety profile of pemvidutide in subjects with overweight or obesity and type 2 diabetes.
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In December 2022 we announced the topline results from our 24-week (12-week extension) Phase 1b clinical trial of pemvidutide in subjects with NAFLD. The trial was conducted without adjunctive diet and exercise interventions and the double-blinding of the trial was maintained during the extension study.
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The trial was comprised of 54 subjects randomized 1:1:1:1 to 1.2 mg, 1.8 mg, 2.4 mg pemvidutide or placebo administered weekly for 12 weeks. See Item 1. Business of this Annual Report for detailed discussion of the data readout.
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The same endpoints as the 12-week parent NAFLD trial were employed, with a primary efficacy endpoint of percent (%) reduction in liver fat content; key secondary endpoints were reduction in liver inflammation, as measured by serum alanine aminotransferase (“ALT”) levels and corrected T1 (“cT1”), and percent weight loss.
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HepTcell On April 11, 2023, we announced the completion of enrollment in our Phase 2 clinical trial of HepTcell, an immunotherapeutic for the treatment of chronic hepatitis B (“CHB”). 87 Table of Contents The multicenter clinical trial, which is being conducted at 26 sites in North America, Europe and Southeast Asia, enrolled approximately 80 subjects with inactive CHB and low levels of hepatitis B surface antigen (“HBsAg”).
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Impact of COVID-19 We are closely monitoring how the spread of COVID-19, including any resurgences or the emergence of new variants, is affecting our employees, business, preclinical studies and clinical trials.
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Subjects were randomized 1:1 to HepTcell or placebo. The primary endpoint of the trial is clinical response, defined as a 1-log or greater reduction or clearance in HBsAg. Secondary endpoints include changes in the levels of hepatitis B virus (“HBV”) DNA, pre-genomic RNA and other markers of virologic response.
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We have reopened our executive office to allow employees to return to the office based on an approach that is intended to comply with federal and state guidelines, 85 Table of Contents with a focus on employee safety and optimal work environment.
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On March 27, 2024, we announced that the overall response in the Phase 2 trial was deemed to be insufficient to warrant further advancement in clinical trials. As a result, we have stopped any further development related to HepTcell.
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We are continuing our regular interactions with the FDA and other regulatory agencies and, based on current information, we do not anticipate COVID-19 to materially affect our regulatory timelines for our ongoing clinical trials.
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Our revenue has historically consisted primarily of government and foundation grants and contracts that supported our efforts on specific research projects. These grants and contracts generally provided for reimbursement of approved costs as those costs were incurred by us.
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Furthermore, as a government contractor, we are subject to the federal government vaccination mandate, which requires federal contractor employees, except in certain limited circumstances, to be vaccinated against COVID-19 by December 8, 2021.
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A significant portion of our research and development efforts have been related to the development of pemvidutide and HepTcell. The development of HepTcell was discontinued on March 27, 2024. We do not allocate personnel-related costs, costs associated with our general research platform improvements, depreciation or other indirect costs to specific programs.
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While the vaccination mandate remains subject to the interpretation of various government agencies and other entities, and questions remain regarding the specific application of the vaccination mandate, we are continuing to develop and implement health, safety, employment and operational protocols in order to timely comply with the vaccination mandate.
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Our revenue has historically consisted primarily of government and foundation grants and contracts that supported our efforts on specific research projects. We are closing out one such contract and any revenue reported during the years ended December 31, 2023 and 2022 were for indirect rate adjustments.
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As of and for the year ended December 31, 2022, the vaccination mandate has not had a material impact on our employees or operations.
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Research and development expenses for the years ended December 31, 2023 and 2022 are summarized as follows: Year Ended December 31, Product candidates 2023 2022 Increase (Decrease) Pemvidutide $ 35,768 $ 46,928 $ (11,160) (24) % HepTcell 6,616 7,524 (908) (12) % Non-project costs 23,415 16,086 7,329 46 % Total research and development expenses $ 65,799 $ 70,538 $ (4,739) (7) % The decrease in research and development expenses for pemvidutide was primarily due to a $13.7 million reduction in expenses associated with the metabolic dysfunction-associated steatotic liver disease (“MASLD”), previously termed non-alcoholic fatty liver disease (“NAFLD”), trials, a $6.8 million reduction in expenses associated with Phase 1 safety trials, all of which were ongoing during the year ended December 31, 2022, and which were substantially completed by March 31, 2023 and a $1.7 million reduction in expense associated with the MOMENTUM Phase 2 trial in obesity, which had commenced and was fully enrolled in the year ended December 31, 2022, but completed its in-life portion by September 30, 2023 and wound down in the year ended December 31, 2023.
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Although operations have not been materially affected by the COVID-19 pandemic as of and for the year ended December 31, 2022, at this time, however, disruptions caused by the COVID-19 pandemic may result in difficulties or delays in initiating, enrolling, conducting or completing our planned and ongoing trials and the incurrence of unforeseen costs as a result of disruptions in clinical supply or preclinical study or clinical trial delays.
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The decrease in these research and development expenses were partially offset by an $8.3 million increase related to the ramp up of the IMPACT Phase 2b 90 Table of Contents trial in MASH, and a $2.8 million increase in net manufacturing expenses for production of Good Manufacturing Practice (“GMP”) drug substance materials.
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The impact of COVID-19 on our future results will largely depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as the ultimate geographic spread of the disease, the duration of the pandemic, travel restrictions and social distancing in the United States and other countries, business closures or business disruptions, the ultimate impact on financial markets and the global economy, and the effectiveness of actions taken in the United States and other countries to contain and treat the disease.
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The decrease in research and development expenses for HepTcell was primarily due to the winddown and completion of the in-life portion of the Phase 2 trial in 2023.
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In addition, a recurrence of COVID-19 cases, or variants thereof, could cause other widespread or more severe impacts depending on where infection rates are highest. We continue to monitor developments as we deal with the disruptions and uncertainties relating to the COVID-19 pandemic.
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The increase in other non-project specific research and development expenses was primarily due to $3.3 million for labor related costs, $1.9 million in stock compensation, $1.0 million for electronic document management system (“EDMS”) implementation and service costs and $0.3 million for consultants.
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See “Risk Factors— A pandemic, epidemic or outbreak of an infectious disease in the United States such as the COVID-19 pandemic may adversely affect our business.” in Part I, Item 1A of this Annual Report on Form 10-K.
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This shelf registration allows us to offer and sell any amount of our common stock, preferred stock, debt securities, warrants, rights and units (the “2023 Shelf”) for a period of three years from effectiveness or until such determination that we no longer qualify as a well-known seasoned issuer.
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Recent Global Events Russia and Ukraine Conflict The military conflict in Russia and Ukraine that began in February 2022 continues as of the date of this annual report. As the conflict continues to evolve, we are closely monitoring the impact on our business.
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The net cash provided by financing activities during the year ended December 31, 2023 was primarily the result of the receipt of $86.6 million in net proceeds from the issuance of common stock from our at-the-market offerings program and $0.2 million in proceeds from our employee stock purchase 92 Table of Contents plan, partially offset by a $0.5 million payment for tax withholding obligations related to share-based compensation.
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The conflict, and the sanctions and counter-sanctions imposed in response to it, have created increased economic uncertainty and operational complexity globally. While we have no direct exposure to Russia and Ukraine, and do not at the moment believe the situation will have a material impact on our operating results, we are monitoring any broader economic impact from the situation.
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However, the preliminary data from this trial that management analyzed in December 2023, indicates that the results are not sufficient to warrant moving forward with this product candidate. As a result, we expect to stop all further development related to HepTcell and do not anticipate that there would be any third-party interest in the asset.
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Should the conflict continue or escalate, it could have a significant negative effect on the global economy or on our operations, including continued inflationary pressures on raw materials, supply chain and logistics disruptions, volatility in foreign exchange rates and interest rates and heightened cybersecurity threats. Financial Operations Overview The consolidated financial information presented below includes the accounts of Altimmune, Inc., Altimmune UK, Ltd, Spitfire Pharma, LLC. and Altimmune AU Pty, Ltd.
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This decision rendered the probability of success, which is one of the key inputs in the fair value measurement of this asset, to be effectively zero or close to zero.
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To date, a significant portion of our research and development efforts have been related to the development of pemvidutide and HepTcell, as well as for NasoShield, NasoVAX, AdCOVID and T-COVID programs which were 87 Table of Contents discontinued in 2021.
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With no alternative use nor any anticipated interest from third parties for this asset, management determined that the fair value of the IPR&D asset was deemed di minimis as of December 31, 2023.
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Additionally, if and when we believe a regulatory approval of the first product candidate appears likely, we anticipate an increase in staffing and related expenses as a result of our preparation for commercial operations, especially as it relates to the sales and marketing of our product candidates.
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