You should read the following discussion and analysis of our financial condition
and results of operations together with our unaudited condensed financial
statements and related notes thereto included in Part I, Item 1 of this
Quarterly Report on Form 10-Q and with our audited financial statements and
notes for the year ended December 31, 2019, included in our Annual Report on
Form 10-K filed with the U.S. Securities and Exchange Commission ("SEC") on
March 9, 2020.
This discussion and other parts of this report contain forward-looking
statements that involve risks and uncertainties, such as statements of our
plans, objectives, expectations and intentions. Our actual results could differ
materially from those discussed in these forward-looking statements. Factors
that could cause or contribute to such differences include, but are not limited
to, those discussed in the section of this report entitled "Risk Factors."
Except as may be required by law, we assume no obligation to update these
forward-looking statements or the reasons that results could differ from these
forward-looking statements.
Overview
We are a clinical stage biopharmaceutical company focused on the development and
commercialization of precisely targeted oncology therapies. Our strategy is to
identify and utilize novel biomarkers to enhance selection of patients we
believe will be most likely to benefit from treatment with our product
candidates. We have utilized adaptive clinical protocol designs that enable us
to evaluate our agents in multiple dosing regimens and for a range of cancer
types.
Since we began operations in November 2014, we have built a pipeline of five
oncology programs. Three of these product candidates are now in international
multicenter trials directed against a broad number of cancer indications. To
date, we have evaluated our product candidates in over 350 patients. We are
developing small molecules that are designed to selectively inhibit the binding
of immunosuppressive adenosine to either A2A receptors or to A2B receptors.
Another small molecule inhibitor is designed to block the function of ITK, a
kinase protein inside T cells that is crucial to T-cell activation and
differentiation. We also are developing injectable monoclonal antibodies. One of
these antibodies is designed to block the production of adenosine by tumors by
inhibiting the cell surface enzyme CD73. This antibody is designed to have dual
properties; in addition to blocking production of immunosuppressive adenosine,
the antibody is designed to stimulate various immune cells. Another antibody
that is designed to bind to the chemokine receptor CXCR2 on myeloid cells to
block the activity of immunosuppressive myeloid cells that infiltrate tumors is
in preclinical development. Our product candidates' designed specificity has the
potential to provide greater safety and facilitate their development either as
monotherapies or in combination with other cancer therapies such as immune
checkpoint inhibitors or chemotherapy.
Ciforadenant (formerly CPI-444), is an oral, small molecule antagonist of the
A2A receptor for adenosine and is currently being studied under a Phase 2
expansion protocol in combination with Genentech, Inc.'s cancer immunotherapy,
Tecentriq® (atezolizumab) for patients with either advanced, refractory renal
cell cancer ("RCC") or patients with refractory metastatic castration resistant
prostate cancer ("mCRPC"). Our second clinical product candidate, CPI-006, is an
antiCD73 monoclonal antibody that is designed to both inhibit the production of
adenosine and stimulate various immune cells. CPI-006 is currently being studied
in a Phase 1/1b clinical trial as a monotherapy and in combination with
ciforadenant, in combination with pembrolizumab and in triplet combination with
both ciforadenant and pembrolizumab. Our third clinical product candidate,
CPI-818, is a selective, covalent inhibitor of ITK and is in a multi-center
Phase 1/1b clinical trial in patients with various malignant T-cell lymphomas.
CPI-818 is designed to be directly cytotoxic to certain malignant T-cells and we
believe has the potential to regulate immune responses to tumors. We believe the
breadth and status of our pipeline demonstrates our management team's expertise
in understanding and developing oncology assets as well as in identifying
product candidates that can be inlicensed and further developed internally to
treat many types of cancer. We hold worldwide rights to all of our product
candidates.
To date, the majority of our efforts have been focused on the research,
development and advancement of ciforadenant, CPI-006 and CPI-818, and we have
not generated any revenue from product sales and, as a result, we have incurred
significant losses. We expect to continue to incur significant research and
development and general and
18
Table of Contents
administrative expenses related to our operations. Our net loss for the three
months ended March 31, 2020 was $12.9 million. As of March 31, 2020, we had an
accumulated deficit of $230.1 million. We expect to continue to incur losses for
the foreseeable future, and we anticipate these losses will increase as we
continue our development of, seek regulatory approval for and begin to
commercialize ciforadenant, CPI-006 and CPI-818, and as we develop other product
candidates. Even if we achieve profitability in the future, we may not be able
to sustain profitability in subsequent periods.
Since our inception and through March 31, 2020, we have funded our operations
primarily through the sale and issuance of stock. On March 22, 2016, our
registration statement on Form S1 (File No. 333208850) relating to our initial
public offering ("IPO") of our common stock was declared effective by the SEC.
Shares of our common stock began trading on the Nasdaq Global Market on
March 23, 2016. The IPO closed on March 29, 2016, pursuant to which we sold
4,700,000 shares of our common stock at a public offering price of $15.00 per
share. In April 2016, we sold an additional 502,618 shares of our common stock
to the underwriters upon partial exercise of their overallotment option, at the
initial offering price of $15.00 per share. We received aggregate net proceeds
of approximately $70.6 million, after underwriting discounts, commissions and
offering expenses. Immediately prior to the consummation of the IPO, all of our
outstanding shares of convertible preferred stock were converted into
14.3 million shares of our common stock. In March 2018, in a follow-on offering,
we sold 8,117,647 shares of our common stock at a price of $8.50 per share,
which included 1,058,823 shares issued pursuant to the underwriters' exercise of
their option to purchase additional shares of common stock. We received
aggregate net proceeds of approximately $64.9 million, after underwriting
discounts, commissions and offering expenses.
In March 2020, we entered into an open market sale agreement (the "Sales
Agreement") with Jefferies LLC ("Jefferies") to sell shares of the Company's
common stock, from time to time, with aggregate gross sales proceeds of up to
$50,000,000, through an atthemarket equity offering program under which
Jefferies will act as our sales agent. Jefferies is entitled to compensation for
its services equal to up to 3.0% of the gross proceeds of any shares of common
stock sold through Jefferies under the Sales Agreement. As of March 31, 2020, we
had not sold any shares of our common stock pursuant to the Sales Agreement.
As of March 31, 2020, we had capital resources consisting of cash, cash
equivalents and marketable securities of approximately $68.7 million. We do not
expect our existing capital resources to be sufficient to enable us to fund the
completion of our clinical trials and remaining development program of any of
ciforadenant, CPI-006 or CPI-818 through commercialization. In addition, our
operating plan may change as a result of many factors, including those described
in the section of this report entitled "Risk Factors" and others currently
unknown to us, and we may need to seek additional funds sooner than planned,
through public or private equity, debt financings or other sources, such as
strategic collaborations. Such financing would result in dilution to
stockholders, imposition of debt covenants and repayment obligations or other
restrictions that may affect our business. If we raise additional capital
through strategic collaboration agreements, we may have to relinquish valuable
rights to our product candidates, including possible future revenue streams. In
addition, additional funding may not be available to us on acceptable terms or
at all and any additional fundraising efforts may divert our management from its
day-to-day activities, which may adversely affect our ability to develop and
commercialize our product candidates. Furthermore, even if we believe we have
sufficient funds for our current or future operating plans, we may seek
additional capital due to favorable market conditions or strategic
considerations.
We currently have no manufacturing capabilities and do not intend to establish
any such capabilities. We have no commercial manufacturing facilities for our
product candidates. As such, we are dependent on third parties to supply our
product candidates according to our specifications, in sufficient quantities, on
time, in compliance with appropriate regulatory standards and at competitive
prices.
COVID-19 Update
A novel strain of coronavirus ("COVID-19") was first identified in Wuhan, China
in December 2019, and subsequently declared a pandemic by the World Health
Organization. COVID-19 has placed strains on the providers of healthcare
services, including the healthcare institutions where we conduct our clinical
trials. These strains have resulted in institutions prohibiting the initiation
of new clinical trials, enrollment in existing trials and restricting the
on-site
19
Table of Contents
monitoring of clinical trials. As our clinical trial enrollment goals for 2020
are largely completed, we have not been significantly affected by any clinical
trial enrollment restrictions. Patients in our ongoing clinical trials have
generally completed their scheduled visits and we have been able to collect the
essential data from those visits. We also follow FDA guidance on clinical trial
conduct during the COVID-19 pandemic, including the remote monitoring of
clinical data.
We have not experienced any disruption in our supply chain of drug necessary to
conduct our clinical trials and given our drug inventories, believe we will be
able to supply the drug needs of our clinical trials in 2020. We are supporting
our employees by utilizing remote work, leveraging virtual meeting technology
and encouraging employees to follow local guidance.
Product Pipeline
Our oncology product candidate pipeline includes the following:
[[Image Removed: Picture 1]]
Ciforadenant Adenosine A2A Receptor Antagonist. Our initial product candidate,
ciforadenant, is an oral, small molecule antagonist of the A2A receptor for
adenosine that we in-licensed from Vernalis (R&D) Limited ("Vernalis") in
February 2015. In January 2016, we began enrolling patients in a large expansion
cohort trial for ciforadenant. This Phase 1/1b clinical trial is designed to
examine safety, tolerability, biomarkers and preliminary efficacy of
ciforadenant in several solid tumor types, both as a single agent and in
combination with Genentech, Inc.'s cancer immunotherapy, Tecentriq, a fully
humanized monoclonal antibody targeting PDL1. In November 2016, we completed
enrollment of 48 patients in the first step of the Phase 1/1b clinical trial,
which was designed to determine the optimal dose of ciforadenant as both a
single agent therapy and in combination with Tecentriq for use in the cohort
expansion stage of the trial. The expansion cohort portion of the trial enrolled
patients with nonsmall cell lung cancer ("NSCLC"), RCC, melanoma ("MEL"),
triple negative breast cancer ("TNBC") and other cancers including colorectal
cancer, prostate cancer, head and neck cancer and bladder cancer at leading
medical centers in the U.S., Australia and Canada. We have enrolled over 300
patients in this clinical trial to date. In 2017, both the single agent and
combination arms of the NSCLC and RCC cohorts met the protocoldefined criteria
for expansion from 14 to 26 patients, and both arms of the RCC cohort further
met the protocoldefined criteria for expansion to 48 patients. In December
2017, Genentech began enrolling patients in a Phase 1b/2 clinical trial that is
evaluating ciforadenant in combination with Tecentriq in patients with NSCLC
under an umbrella protocol known as Morpheus. In 2018, we amended our Phase 1/1b
protocol to enroll patients in a Phase 1b/2 clinical trial with RCC who have
failed therapies with both anti-PD-(L)1 antibodies and tyrosine kinase
inhibitors ("TKI"). Based on data observed in the Phase 1b/2 trial in 2019, we
began enrolling patients with metastatic castration-resistant prostate cancer
("mCRPC") in a Phase 2 expansion arm of our
20
Table of Contents
ongoing Phase 1/1b clinical trial with mCRPC who will receive the combination of
ciforadenant with Tecentriq based on data from the Phase 1b/2 trial that showed
activity in this disease.
As of November 2019, the key findings from these clinical trials included:
· Ciforadenant has been well-tolerated at doses that achieved substantial
receptor blockade;
· Ciforadenant has shown evidence of anti-tumor activity as a monotherapy and in
combination with atezolizumab;
· Of cancers studied, RCC, mCRPC and NSCLC have appeared most responsive to
therapy; and
· Identification of a gene expression signature, known as the adenosine gene
signature, that enhances selection of patients we believe are most likely to
benefit from therapy and may be a useful biomarker for selection of patients in
future clinical trials.
We expect to present initial clinical data from a 25-patient RCC cohort in a
presentation at the 2020 American Society of Clinical Oncology (ASCO) Virtual
Annual Meeting in May 2020.
The issued U.S. patents that we inlicensed from Vernalis for ciforadenant are
directed to the composition of matter of ciforadenant and its method of use for
treating disorders treatable by purine receptor blocking. The composition of
matter patent covering ciforadenant is expected to expire in the United States
in July 2029, excluding any patent term extension that may be available. We hold
an exclusive, worldwide license under these patent rights and related knowhow,
including a limited right to grant sublicenses, for all fields of use, to
develop, manufacture and commercialize products containing certain adenosine
receptor antagonists, including ciforadenant. We have also filed patent
applications covering the use of ciforadenant in combination with other
checkpoint inhibitors, and the use of various biomarkers to select and monitor
patients receiving therapy.
CPI-006, Immunomodulatory AntiCD73 Antibody. Our second clinical product
candidate, CPI-006, is an antiCD73 monoclonal antibody that is designed to
inhibit the production of adenosine, which we inlicensed from The Scripps
Research Institute ("Scripps") in December 2014. CPI-006 was developed into a
humanized antiCD73 monoclonal antibody from a mouse hybridoma clone expressing
an antihuman CD73 antibody. We have further modified CPI006 to improve binding
to CD73 and maximize its inhibition of catalytic activity. CD73 is an
ectonucleotidase often found on lymphocytes, tumors and other tissues and is
believed to play an important role in tumor immune suppression by catalyzing the
production of extracellular adenosine. In preclinical in vitro studies, our
humanized monoclonal antiCD73 antibody has been shown to inhibit the catalytic
activity of CD73, resulting in the blocking of extracellular adenosine
production by tumor cells, which we believe could stimulate or enhance immune
response to tumors. In addition to its role in the production of adenosine, CD73
also functions as an immunomodulatory receptor present on B-cells, T-cells and
certain myeloid cells. In February 2018, we initiated a Phase 1/1b clinical
trial with CPI-006 administered alone and in combination with ciforadenant and
in combination with pembrolizumab. In addition, we recently added a treatment
arm to the study to evaluate the triplet combination of CPI-006, ciforadenant
and pembrolizumab. As of February 2020, the key findings from this clinical
trial included the observation that CPI-006 has been well-tolerated and has
resulted in changes in lymphocyte migration and activation in peripheral blood.
We plan to present updated clinical data from the phase 1/1b clinical trial is
targeted to be presented at the Society for Immunotherapy of Cancer (SITC)
annual meeting in November 2020. We also expect to meet with the FDA to discuss
the study design and plans for a cifordenant pivotal study in advanced
refractory RCC using the Adenosine Gene Signature as a biomarker.
We hold a nonexclusive, worldwide license for all fields of use under Scripps'
rights in a hybridoma clone expressing an antiCD73 antibody, and to progeny,
mutants or unmodified derivatives of such hybridoma and any antibodies expressed
by such hybridoma. In 2016, we filed a patent application covering the
composition of matter of CPI006. In 2019, we filed patent applications covering
the use of this CPI-006 for immunomodulation and enhancement of anti-tumor
immunity.
21
Table of Contents
CPI-818, ITK Inhibitor. Our third clinical product candidate, CPI-818, is a
selective, covalent inhibitor of ITK. ITK, an enzyme that functions in Tcell
signaling and differentiation, is expressed predominantly in Tcells, which are
lymphocytes that play a vital role in immune responses. One of the key survival
mechanisms of tumors is believed to be the reprogramming of Tcells to create an
inflammatory environment that inhibits antitumor immune response and favors
tumor growth. We believe highly selective inhibitors of this enzyme will
facilitate induction of Tcell antitumor immunity and also may be useful in the
treatment of Tcell lymphomas. CPI-818 is orally bioavailable and has been shown
to achieve cellular occupancy of the target in vivo in various animal models.
Pre-clinical studies have demonstrated that CPI-818 was well-tolerated in vivo
and resulted in inhibition of T-cell activation. In March of 2019, we initiated
a phase 1/1b study of CPI-818 in patients with advanced refractory T-cell
lymphomas. Early interim results from the dose-escalation portion of the study
were presented in December 2019 at the American Society of Hematology (ASH)
meeting and in February 2020 at the 12th Annual T-cell Lymphoma Forum, showing
that, CPI-818 was well tolerated and achieved substantial ITK target occupancy,
one of the goals of the study.
We plan to present updated clinical data from the CPI-818 phase 1/1b clinical
trial at the American Society of Hematology (ASH) annual meeting in December
2020.
We have filed patent applications covering composition of matter and uses of our
ITK inhibitors and hold exclusive worldwide rights for all indications.
CPI-182, Anti-CXCR2 Antibody designed to block Myeloid Suppression. In 2017, we
in-licensed this monoclonal antibody designed to block CXCR2, a novel target
expressed on myeloid derived suppressor cells ("MDSC"). Preclinical studies have
demonstrated that this antibody blocked MDSCs and also may have reacted with
CXCR2 present on certain cancers such as acute myeloid leukemia cells and other
cancers. We had begun Investigational New Drug ("IND")-enabling studies and
scale-up manufacturing for this product candidate but paused this work in
mid-March 2020 as a result of COVID-19 pandemic.
CPI-935, Adenosine A2B Receptor Antagonist. Adenosine A2B receptors have been
found to play an important role in the immune response to tumors as well as in
inflammation and fibrosis. Similar to adenosine A2A receptors, adenosine binds
to adenosine A2B receptors, which leads to immunosuppression. Preclinical models
have shown that inhibition of A2B receptors prevents fibrosis. In 2018, we
selected a development candidate for this program, a small molecule antagonist
of the A2B receptor.
Significant Accounting Policies
Our significant accounting policies are described in Note 2 to our financial
statements for the year ended December 31, 2019 included in our Annual Report on
Form 10-K. There have been no material changes to our significant accounting
policies during the three months ended March 31, 2020.
Components of Results of Operations
Revenue
To date, we have not generated any revenues. We do not expect to receive any
revenues from any product candidates that we develop unless and until we obtain
regulatory approval and commercialize our products or enter into
revenue-generating collaboration agreements with third parties.
Research and Development Expense
Our research and development expenses consist primarily of costs incurred to
conduct research and development of our product candidates. We record research
and development expenses as incurred. Research and development expenses include:
· employee-related expenses, including salaries, benefits, travel and non-cash
stock-based compensation expense;
22
Table of Contents
· external research and development expenses incurred under arrangements with
third parties, such as contract research organizations, preclinical testing
organizations, contract manufacturing organizations, academic and non-profit
institutions and consultants;
· costs to acquire technologies to be used in research and development that have
not reached technological feasibility and have no alternative future use;
· license fees; and
· other expenses, which include direct and allocated expenses for laboratory,
facilities and other costs.
We plan to increase our research and development expenses substantially as we
continue the development and potential commercialization of our product
candidates. Our current planned research and development activities include the
following:
· enrollment and completion of our Phase 1/1b clinical trial and amended Phase
1b/2 clinical trial of ciforadenant;
· enrollment of our ongoing Phase 1/1b clinical trial of CPI-006;
· enrollment of our ongoing Phase 1/1b clinical trial of CPI-818;
· process development and manufacturing of drug supply of ciforadenant, CPI-006
and CPI-818; and
· preclinical studies under our other programs in order to select development
product candidates.
In addition to our product candidates that are in clinical development, we
believe it is important to continue substantial investment in potential new
product candidates to build the value of our product candidate pipeline and our
business.
Our expenditures on current and future preclinical and clinical development
programs are subject to numerous uncertainties related to timing and cost to
completion. The duration, costs and timing of clinical trials and development of
product candidates will depend on a variety of factors, including many of which
are beyond our control. The process of conducting the necessary clinical
research to obtain regulatory approval is costly and time consuming, and the
successful development of our product candidates is uncertain. The risks and
uncertainties associated with our research and development projects are
discussed more fully in "Part II, Item 1A-Risk Factors." As a result of these
risks and uncertainties, we are unable to determine with any degree of certainty
the duration and completion costs of our research and development projects or
if, when or to what extent we will generate revenues from the commercialization
and sale of any of our product candidates that obtain regulatory approval. We
may never succeed in achieving regulatory approval for any of our product
candidates.
General and Administrative Expenses
General and administrative expenses include personnel costs, expenses for
outside professional services and allocated expenses. Personnel costs consist of
salaries, benefits and stockbased compensation. Outside professional services
consist of legal, accounting and audit services and other consulting fees.
Allocated expenses consist of rent expense related to our office and research
and development facility.
We expect that our general and administrative expenses will increase in the
future as we increase our headcount to support our continued research and
development and potential commercialization of one or more of our product
candidates.
23
Table of Contents
Results of Operations
Comparison of the periods below as indicated (in thousands):
Three Months Ended
March 31,
2020 2019 Change
Operating expenses:
Research and development $ 10,163 $ 9,419 $ 744
General and administrative 3,106 2,886 220
Total operating expenses 13,269 12,305 964
Loss from operations (13,269) (12,305) (964)
Interest income and other expense, net 334 662 (328)
Net loss $ (12,935) $ (11,643) $ (1,292)
Research and Development Expense
Research and development expenses for the three months ended March 31, 2020 and
2019 consisted of the following costs by program (specific program costs consist
solely of external costs):
Three Months Ended
March 31,
2020 2019 Change
Ciforadenant (formerly CPI-444) $ 1,232 $ 1,362 $ (130)
CPI006 2,664 1,069 1,595
CPI-818 1,132 1,990 (858)
Other programs 597 316 281
Unallocated employee and overhead costs 4,538 4,682 (144)
$ 10,163 $ 9,419 $ 744
For the three months ended March 31, 2020, the decrease in ciforadenant costs of
$0.1 million as compared to the three months ended March 31, 2019, primarily
consisted of a decrease in drug manufacturing costs.
For the three months ended March 31, 2020, the increase in CPI-006 costs of $1.6
million as compared to the three months ended March 31, 2019, primarily
consisted of an increase of $1.3 million in clinical trial expenses, an increase
of $0.2 million in drug manufacturing costs and an increase of $0.1 million in
other outside services.
For the three months ended March 31, 2020, the decrease in CPI-818 costs of $0.9
million as compared to the three months ended March 31, 2019, primarily
consisted of a decrease of $0.9 million in drug manufacturing costs and a
decrease of $0.2 million in other outside services, partially offset by an
increase of $0.2 million in clinical trial expenses.
For the three months ended March 31, 2020, the increase in other program costs
of $0.3 million as compared to the three months ended March 31, 2019, primarily
consisted of an increase of $0.5 million in drug manufacturing costs, partially
offset by a decrease of $0.3 million in outside services.
For the three months ended March 31, 2020, the decrease in unallocated costs of
$0.1 million as compared to the three months ended March 31, 2019, primarily
consisted of a decrease of $0.3 million in outside services, partially offset by
an increase of $0.2 million in personnel and related costs.
24
Table of Contents
General and Administrative Expense
For the three months ended March 31, 2020, the increase in general and
administrative expenses of $0.2 million as compared to the three months ended
March 31, 2019, primarily consisted of an increase of $0.3 million in
professional service costs, partially offset by a decrease of $0.1 million in
personnel and related costs.
Interest Income and Other Expense, net
For the three months ended March 31, 2020, the decrease in interest income and
other expense, net of $0.3 million as compared to the three months ended March
31, 2019, primarily consisted of a decrease in interest income earned due to a
decrease in cash equivalents and marketable securities.
Liquidity and Capital Resources
As of March 31, 2020, we had cash, cash equivalents and marketable securities of
$68.7 million, and an accumulated deficit of $230.1 million, compared to cash
and cash equivalents and marketable securities of $78.0 million and an
accumulated deficit of $217.1 million as of December 31, 2019. We have financed
our operations primarily through private placements of convertible preferred
stock and the sale of common stock.
In March 2016, we consummated our IPO and sold 4,700,000 shares of our common
stock at a price of $15.00 per share, and in April 2016, sold 502,618 shares at
a price of $15.00 per share pursuant to the partial exercise of the
underwriters' option to purchase additional shares of common stock. We received
net proceeds of approximately $70.6 million, after deducting underwriting
discounts, commissions and offering expenses. Immediately prior to the
consummation of our IPO, all outstanding shares of the convertible preferred
stock were converted into common stock on a one-for-one basis.
In March 2018, in a follow-on offering, we sold 8,117,647 shares of our common
stock at a price of $8.50 per share, which included 1,058,823 shares issued
pursuant to the underwriters' exercise of their option to purchase additional
shares of common stock. We received aggregate net proceeds of approximately
$64.9 million, after underwriting discounts, commissions and offering expenses.
In March 2020, we entered into the Sales Agreement with Jefferies to sell shares
of our common stock, from time to time, with aggregate gross sales proceeds of
up to $50,000,000, through an at-the-market equity offering program under which
Jefferies will act as its sales agent. As of March 31, 2020, we had received no
proceeds from the sale of shares of common stock pursuant to the Sales
Agreement.
We believe our current cash, cash equivalents and marketable securities will be
sufficient to fund our planned expenditures and meet our obligations through at
least the next twelve months from the issuance of our financial statements as of
and for the three months ended March 31, 2020. The amounts and timing of our
actual expenditures depend on numerous factors, including:
· the progress, timing, costs and results of clinical trials for ciforadenant,
CPI-006 and CPI-818;
· the extent to which the COVID-19 coronavirus may impact our business, including
our clinical trials and financial condition;
· the timing, progress, costs and results of preclinical and clinical development
activities for our other product candidates;
· the number and scope of preclinical and clinical programs we decide to pursue;
· the costs involved in prosecuting, maintaining and enforcing patent and other
intellectual property rights;
25
Table of Contents
· the cost and timing of regulatory approvals;
· our efforts to enhance operational systems and hire additional personnel,
including personnel to support development of our product candidates and
satisfy our obligations as a public company; and
· other factors described in the section of this report entitled "Risk Factors."
We expect to increase our spending in connection with the development and
commercialization of our product candidates. Until such time, if ever, as we can
generate substantial revenue from product sales, we expect to fund our
operations and capital funding needs through equity and/or debt financings. We
may also enter into additional collaboration arrangements or selectively partner
for clinical development and commercialization. The sale of additional equity
would result in dilution to our stockholders. The incurrence of debt financing
would result in debt service obligations and the governing documents would
likely include operating and financing covenants that would restrict our
operations. In addition, sufficient additional funding may not be available on
acceptable terms, or at all. If we are not able to secure adequate additional
funding, we may be forced to make reductions in spending, extend payment terms
with suppliers, liquidate assets where possible and/or suspend or curtail
planned programs. Any of these actions could have a material effect on our
business, financial condition and results of operations.
© Edgar Online, source Glimpses