You should read the following discussion and analysis of our financial condition and results of operations in conjunction with the financial statements and the related notes appearing elsewhere in this Quarterly Report on Form 10-Q. This discussion contains forward-looking statements reflecting our current expectations that involve risks and uncertainties. See our Annual Report on Form 10-K for the year ended December 31, 2021 filed with the Security and Exchange Commission ("SEC") on March 18, 2022 (the "2021 Annual Report on Form 10-K"), under "Risk Factors", available on the SEC EDGAR website at www.sec.gov, for a discussion of the uncertainties, risks and assumptions associated with these statements. Actual results and the timing of events could differ materially from those discussed in our forward-looking statements as a result of many factors, including those set forth under "Risk Factors" and elsewhere in this Quarterly Report on Form 10-Q.



              CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains "forward-looking statements", within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, that involve substantial risks and uncertainties. In some cases, you can identify forward-looking statements by the words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "objective," "ongoing," "plan," "predict," "project," "potential," "should," "will," or "would," and or the negative of these terms, or other comparable terminology intended to identify statements about the future. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from the information expressed or implied by these forward-looking statements, including the risks set forth in our Annual Report on Form 10-K filed with the SEC on March 18, 2022. Although we believe that we have a reasonable basis for each forward-looking statement contained in this Quarterly Report on Form 10-Q, we caution you that these statements are based on a combination of facts and factors currently known by us and our expectations of the future, about which we cannot be certain.

The forward-looking statements contained in this Quarterly Report on Form 10-Q include, among other things, statements about:

? our business strategies;

our ability to obtain regulatory approval of our product candidate and any

? other product candidates we may develop, and the labeling under any regulatory

approval we may obtain;

? risks relating to the timing and costs of clinical trials and the timing and

costs of other expenses;

? timing and likelihood of success of our clinical trials and regulatory approval

of our product candidates;

? risks associated with our reliance on third-party organizations;

? our competitive position;

? assumptions regarding the size of the available market, product pricing and

timing of commercialization of our product candidates, if approved;

? our intellectual property position and our ability to maintain and protect our

intellectual property rights;

? our results of operations, financial condition, liquidity, prospects, and

growth strategies;

? our cash needs and financing plans;




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? the industry in which we operate; and

? the trends that may affect the industry or us.

Overview

We are a development-stage biotechnology company focused on advancing novel combination antiviral therapies to treat diseases that we believe are associated with herpes virus activation, such as fibromyalgia ("FM"). Overactive immune response related to activation of tissue resident herpes virus has been postulated to be a potential root cause of chronic illnesses such as FM, irritable bowel disease ("IBS"), chronic fatigue syndrome and functional somatic syndrome, all of which are characterized by a waxing and waning manifestation of disease. While not completely understood, there is general agreement in the medical community that activation of the herpes virus is triggered by some form of environmental and/or health stressor. Our lead product candidate, IMC-1, is a novel, proprietary, fixed dose combination of famciclovir and celecoxib. IMC-1 represents a novel combination antiviral therapy designed to synergistically suppress herpes virus activation and replication, with the end goal of reducing viral mediated disease burden.

IMC-1 combines two specific mechanisms of action purposely designed to inhibit herpes virus activation and replication, thereby keeping the herpes virus in a latent (dormant) state or "down-regulating" the herpes virus from a lytic (active) state back to latency. The famciclovir component of IMC-1 inhibits viral DNA replication and thus inhibits upregulation of the herpes virus. The celecoxib component of IMC-1 inhibits cyclooxegenase-2 ("COX-2") and to a lesser degree cyclooxegenase-1 ("COX-1"), enzymes used by the herpes virus to amplify or accelerate its own replication. We are unaware of any other antivirals in development for the treatment of FM with the goal of keeping tissue resident herpes virus tissue in a latent state. We believe this novel approach was a germane consideration in the U.S. Food and Drug Administration ("FDA") designating IMC-1 for fast-track review status for the treatment of FM. IMC-1 has also been granted a synergy patent based on the fact that neither of the individual components has proven effective in the management of FM, yet the combination therapy generated a result that is greater than the sum of its parts.

In July 2022, our final patients completed their 16 weeks of treatment in our landmark Phase 2b clinical trial in FM. This study, known as the FORTRESS study (Fibromyalgia Outcome Research Trial Evaluating Synergistic Suppression of Herpes Simplex Virus-1) is a double-blind, placebo-controlled safety and efficacy study of IMC-1 antiviral combination therapy. Our final enrollment was 425 female patients aged 18 to 65, who were randomized 1-to-1 either to IMC-1 or matching placebo, all of whom had been diagnosed using the 2016 American College of Rheumatology diagnostic criteria for FM. The primary endpoint for our FORTRESS study is reduction in pain over time. Pain was measured using an electronic diary system that patients used at home on a daily basis. In addition to assessing FM patients' pain reduction, we also assessed IMC-1's ability to improve symptoms of fatigue and sleep disturbance and measured improvements in overall global health status and patient function. Following the completion of all patients' participation in this study, our clinical team and vendors will enter final data into the electronic data system, resolve any outstanding queries, and begin the cleaning process leading to database lock. Once the database is locked, the data will be transferred to our statistical vendor along with the unblinding codes to allow the production of the unblinded top line results. We expect to report these top line results in September 2022.

Our chronic toxicology studies in two species have also been completed as planned. These studies are required by regulatory authorities to support chronic administration of IMC-1 in future clinical studies, and the results from these studies will be an important element of the package we plan to submit to the FDA to facilitate our Phase 3 program discussions.

In February 2022, we announced a collaboration with the Bateman Horne Center ("BHC") of Salt Lake City, Utah, to explore the role of combination antiviral therapy in treating the symptoms associated with Long COVID, otherwise known as Post-Acute Sequelae of COVID-19. We are providing BHC with an unrestricted grant for an investigator-sponsored study to explore the therapeutic potential of combination antiviral therapy with our second development candidate, IMC-2, a combination of valcyclovir and celecoxib. The study will



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evaluate changes in common Long COVID symptoms such as fatigue, sleep, attention, pain, autonomic function and anxiety. We expect the BHC to begin recruiting patients in the third quarter of 2022 for this study, with results expected in the first half of 2023.

We may face future business disruption and related risks resulting from the ongoing outbreak of COVID-19 or from another pandemic, epidemic or outbreak of an infectious disease, any of which could have a significant impact on our business or delay the development of our drug candidates including the enrollment or completion of our proposed clinical trials. Future emergence of widespread health emergencies or pandemics could lead to new quarantines, business shutdowns, disruptions to the healthcare system and overall economic instability. If suppliers, clinical research organizations, clinical trial sites, regulators, consultants and other third parties with whom we conduct business were to experience shutdowns or other business disruptions, our ability to enroll patients and conduct clinical trials in the manner and on the timelines presently planned could be materially and negatively impacted. In addition, the global economy, including credit and financial markets, has experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates, increases in inflation rates and uncertainty about economic stability. For example, the current conflict between Ukraine and Russia has created extreme volatility in the global capital markets and is expected to have further global economic consequences, including disruptions of the global supply chain and energy markets. Any such volatility and disruptions may have adverse consequences on us or the third parties on whom we rely. If the equity and credit markets deteriorate, including as a result of political unrest or war, it may make any necessary debt or equity financing more difficult to obtain in a timely manner or on favorable terms, if at all.

Results of Operations

Below is a summary of the results of operations:



                                  Three Months Ended             Six Months Ended
                                      June 30,                      June 30,
                                 2022           2021           2022           2021

Operating expenses:                  (Unaudited)                   (Unaudited)
Research and development      $ 2,406,438    $ 3,209,201    $ 5,175,540    $ 4,916,159
General and administrative      1,265,621      1,075,256      2,457,733      2,425,732
Total operating expenses      $ 3,672,059    $ 4,284,457    $ 7,633,273    $ 7,341,891

Three and Six Months Ended June 30, 2022 and 2021

Research and Development Expenses

Research and development expenses decreased by $0.8 million and increased by $0.3 million for the three and six months ended June 30, 2022, respectively, compared to the prior year periods. The decrease of $0.8 million for the three months ended June 30, 2022 was due to decreases in expenses for clinical trials of $0.1 million, toxicology studies of $0.6 million and drug development and manufacturing costs of $0.1 million. The increase of $0.3 million for the six months ended June 30, 2022 was due to increases in expenses for clinical trials of $1.3 million and salaries and related costs of $0.1 million offset by a decrease in toxicology studies of $0.8 million and drug development and manufacturing costs of $0.3 million.

General and Administrative Expenses

General and administrative expenses increased by $0.2 million and remained level for the three and six months ended June 30, 2022, respectively, compared to the prior year periods. The increase of $0.2 million for the three months ended June 30, 2022 was due to increases in expenses for legal and accounting fees of $0.1 million and salaries and related costs of $0.1 million. For the six months ended June 30, 2022,



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increases in expenses for salaries and related costs of $0.1 million were offset by a decrease in legal and accounting fees of $0.1 million.

Liquidity and Capital Resources

Since our inception, we have financed our operations through a public offering of common stock and proceeds from private placements of membership interests and convertible promissory notes. To date, we have not generated any revenue from the sale of products and we do not anticipate generating any revenue from the sales of products for the foreseeable future. We have incurred losses and generated negative cash flows from operations since inception. As of June 30, 2022, our principal source of liquidity was our cash, which totaled $7.7 million.

Equity Financings

There were no equity financings during the six months ended June 30, 2022 and 2021.

Debt Financings

There were no debt financing during the six months ended June 30, 2022 and 2021. There was no debt outstanding at June 30, 2022 and December 31, 2021.

Future Capital Requirements

We estimate our current cash of $7.7 million at June 30, 2022 is sufficient to complete our FORTRESS study and commence the planning of our Phase 3 study in FM for IMC-1. The Company will need to raise additional capital within the next six to nine months to fund operations, complete clinical development and to commercially develop its product candidates. We will need to finance our cash needs through public or private equity offerings, debt financings, collaboration and licensing arrangements or other financing alternatives. Failure to secure the necessary financing in a timely manner and on favorable terms could have a material adverse effect on the Company's strategy and value and could require the delay of product development and clinical trial plans. It is difficult to predict our spending for our product candidate prior to obtaining regulatory approval from the FDA. Moreover, changing circumstances may cause us to expend cash significantly faster than we currently anticipate, and we may need to spend more cash than currently expected because of circumstances beyond our control.

We have no committed external sources of funds. Additional equity or debt financing or collaboration and licensing arrangements may not be available on acceptable terms, if at all.

As a result, substantial doubt exists regarding the Company's ability to continue as a going concern twelve months from the date the financial statements contained in this Quarterly Report on Form 10-Q were available to be issued.



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