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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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The following discussion and analysis of
our financial condition and results of operations should be read in conjunction with our unaudited interim condensed consolidated financial
statements and related notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q (this “Quarterly Report”) and with the audited financial statements and notes thereto of the Company as of and for the year ended December 31, 2024 on Form
10-K, filed with the Securities and Exchange Commission, or SEC, on March 27, 2025.
Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report contains forward-looking statements (including within the meaning of Section 21E of the United States Securities
Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended) concerning the Company and other matters. These statements may discuss goals, intentions and expectations as to future plans, trends, events,
results of operations or financial condition, or otherwise, based on current beliefs of the Company’s management, as well as assumptions made by, and information currently available to, management. Forward-looking statements generally include
statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “may,” “will,” “should,” “would,” “expect,” “anticipate,” “plan,” “likely,” “believe,” “estimate,” “project,” “intend,”
“forecast,” “guidance”, “outlook” and other similar expressions among others. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties and are not guarantees of future performance. Actual
results could differ materially from those contained in any forward-looking statement as a result of various factors, including, without limitation:
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the Company’s ability to protect its intellectual property rights;
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the Company’s anticipated capital requirements, including the Company’s anticipated cash runway and the Company’s current expectations regarding its plans for future
equity financings;
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the Company’s dependence on additional financing to fund its operations and complete the development and commercialization of its clinical and product candidates, and the
risks that raising such additional capital may restrict the Company’s operations or require the Company to relinquish rights to the Company’s technologies or clinical and product candidates;
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the Company’s limited operating history in the current line of business, which makes it difficult to evaluate the Company’s prospects, the Company’s business plan or the
likelihood of the Company’s successful implementation of such business plan;
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the timing for the Company or its partners to initiate the planned clinical trials for
its Versamune® products, including Versamune® HPV (formerly PDS0101), Versamune®
MUC1 (formerly PDS0103), and others, alone or in combination with PDS01ADC, as well as Infectimune® based clinical candidates and the future success of such trials;
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the successful implementation of the Company’s research and development programs and collaborations, including any collaboration trials concerning the Company’s
Versamune®, PDS01ADC and Infectimune® based clinical and product candidates and the Company’s interpretation of the results and findings of such programs and collaborations and whether such results are sufficient to support the future success
of the Company’s clinical and product candidates;
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the success, timing and cost of the Company’s ongoing clinical trials and anticipated
clinical trials for the Company’s current clinical candidates, including statements regarding the timing of initiation, pace of enrollment and completion of the trials (including our ability to fully fund our disclosed clinical trials, which
assumes no material changes to our currently projected expenses), futility analyses, presentations at conferences and data reported in an abstract, and receipt of interim results (including, without limitation, any preclinical results or
data), which are not necessarily indicative of the final results of the Company’s ongoing clinical trials;
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expectations for the clinical and preclinical development, manufacturing, regulatory approval, and commercialization of the Company’s clinical and product candidates;
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any Company statements about its understanding of clinical and product candidates’ mechanisms of action and interpretation of preclinical and early clinical results from
its clinical development programs and any collaboration trials; the acceptance by the market of the Company’s clinical and product candidates, if approved;
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the timing of and the Company’s ability to obtain and maintain U.S. Food and Drug Administration or other regulatory authority approval of, or other action with respect
to, the Company’s clinical and product candidates; and
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other factors, including legislative, regulatory, political and economic developments not within the Company’s control, including unforeseen circumstances or other
disruptions to normal business operations arising from or related to those listed under Part II, Item 1A. Risk Factors.
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Any forward-looking statements in this Quarterly Report reflect our current views with respect to future events or to our future financial
performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by
these forward-looking statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any
reason, whether as a result of new information, future events or otherwise.
In this Quarterly Report, unless otherwise stated or the context otherwise indicates, references to “PDS Biotech,” “the Company,” “we,”
“us,” “our” and similar references refer to PDS Biotechnology Corporation, a Delaware corporation.
Company Overview
We are a clinical-stage immunotherapy company developing a growing pipeline of targeted cancer and infectious disease immunotherapies
based on our Versamune® T cell activator and Versamune® in combination with our interleukin 12 (IL-12) fused anti-body drug conjugate (ADC), PDS01ADC. In addition, we are developing the Infectimune® T cell-activator in infectious diseases.
We believe our investigational targeted immunotherapies have the potential to overcome limitations of current immunotherapy approaches
through effective conversion of the immune suppressive tumor to an immunogenic microenvironment in addition to the induction of the right type, potency and quantity of tumor-targeting killer (CD8) T cells. Our Versamune® immunotherapies and
Versamune® in combination with PDS01ADC, are being developed for treatments in oncology, and Infectimune® is being developed for preventive vaccines against infectious agents. When paired with an antigen, which is a disease-related protein that is
recognizable by the immune system, Versamune® and Infectimune® have both been shown to induce, in vivo, large quantities of high-quality, highly potent polyfunctional disease-specific CD4 helper and CD8 killer T cells, a specific sub-type of T cell
that has shown potential to be more effective at killing infected or target cells. Infectimune® is also designed to promote the induction of disease-specific neutralizing antibodies. PDS01ADC is an investigational tumor targeting IL-12 that we
believe may enhance the proliferation, potency and longevity of T cells in the tumor microenvironment and reduces the prevalence of immune suppressive cells and components within the tumor. We believe that our proprietary combinations of Versamune®
and PDS01ADC together with immune checkpoint inhibitors or other standards of care, may enhance the proliferation, potency and longevity of antigen specific multifunctional CD8 T cells in the tumor microenvironment and work synergistically to inhibit
or treat cancer.
In February 2023, we announced a successful completion of a
Type B meeting with the FDA for the triple combination of Versamune® HPV and PDS01ADC with an FDA-approved immune checkpoint inhibitor for the treatment of
recurrent/metastatic, ICI resistant head and neck cancer that is positive for the HPV type 16. In recent interactions with the FDA, we confirmed the required contents of a clinical protocol for the potential registrational trial.
In June 2023, an abstract was presented at the 2023 American Society of Clinical Oncology: Abstract number 6012, Safety and Efficacy of
Immune Checkpoint Inhibitor (ICI) Naïve Cohort from Study of Versamune® HPV and Pembrolizumab in HPV16-Positive Head and Neck Squamous Cell Carcinoma (HNSCC). The
abstract was also selected as one of the featured posters reviewed by an expert panel in the Head and Neck Cancer discussion session.
In September 2023, data on our investigational universal flu vaccine, PDS0202, was presented at the 9th European Scientific
Working Group on Influenza (ESWI) conference. This data demonstrated broad neutralization across multiple influenza strains in animals and provided protection against infection after challenging animals not previously exposed to flu with lethal doses
of the pandemic H1N1 flu virus.
In October 2023, data demonstrating Versamune® HPV in
combination with standard-of-care (SOC) chemoradiotherapy was associated with a rapid decline in human papillomavirus circulating cell-free DNA (ctHPV-DNA), a potential predictive biomarker of treatment response. The data from the IMMUNOCERV Phase 2
clinical trial were featured in an oral presentation at the American Society for Radiation Oncology Annual Meeting.
In October 2023, updated interim data based on an August 2, 2023 cut off from our VERSATILE-002 Phase 2 clinical trial evaluating the
combination of Versamune® HPV in combination with Merck’s anti-PD-1 therapy, Keytruda® (pembrolizumab) which is the FDA-approved standard of care for first-line
treatment of recurrent/metastatic head and neck cancer was presented at a key opinion leader roundtable that we sponsored.
In October 2023, interim safety and immune response data was presented for the first-in-human Phase1/2 clinical trial evaluating PDS01ADC
in combination with current SOC chemotherapy, docetaxel, to treat metastatic castration sensitive and castration resistant prostate cancer. The data was featured in an oral presentation at the 11th Annual Meeting of the International
Cytokine & Interferon Society.
In October 2023, immune response data from a preliminary analysis of a subset of patients in our VERSATILE-002 Phase 2 clinical trial was
presented at the European Society for Medical Oncology Congress 2023.
In November 2023, we announced updated survival data from our NCI-led Phase 2 trial investigating the triple combination of Versamune® HPV, PDS01ADC and an investigational immune checkpoint inhibitor (ICI) in two groups of advanced cancer patients with various types of human papillomavirus (HPV)
16-positive cancers. The data showed 75% Survival of ICI naïve patients at 36 months.
In November 2023, preclinical data from our NCI-led trial including Versamune® HPV, PDS01ADC and an HDAC inhibitor in ICI-resistant HPV-16 positive cancer was presented during a poster presentation at the Society for Immunotherapy of Cancer 38th Annual Meeting.
In September 2024, we announced updated data from our VERSATILE-002 Phase 2 clinical trial presented during a poster session at the
European Society for Medical Oncology (ESMO) Congress 2024.
In March 2025, we announced the initiation of our VERSATILE-003 Phase 3 clinical trial evaluating Versamune® HPV in first-line treatment
of recurrent/metastatic head and neck squamous cell carcinoma in HPV16-positive patients.
Clinical Candidate Pipeline
VERSATILE-003: Versamune® HPV + pembrolizumab
The clinical trial is designed to enroll a total of 351 patients with approximately 234 patients receiving the combination treatment of
Versamune® HPV and pembrolizumab, and approximately 117 patients receiving pembrolizumab alone. Generally, the patient treatment protocol is identical to that of VERSATILE-002, described below, enrolling only ICI naïve patients. As such, patients
in the trial will receive a total of 5 cycles of combination therapy, with standard of care pembrolizumab therapy administered every three weeks until disease progression.
The clinical trial’s primary endpoint is median overall survival. Secondary endpoints are objective response rate, disease control
rate, duration of response and progression free survival.
Furthermore, the clinical trial design includes two interim data readouts estimated at approximately 6 months following full enrollment
and 18 months following full enrollment, respectively. Final readout from the trial is expected approximately 24 months following full enrollment.
VERSATILE-002: Versamune® HPV (PDS0101) + Keytruda®
In November 2020, our VERSATILE-002 Phase 2 clinical trial evaluating the combination of Versamune® HPV in combination with Merck’s
anti-PD-1 therapy, Keytruda® (pembrolizumab) which is the FDA-approved standard of care for first-line treatment of recurrent/metastatic head and neck cancer commenced. Enrollment in stage 2 of 2 for the ICI naïve arm and the ICI resistant arms are
complete. The clinical trial will evaluate the efficacy and safety of this therapeutic combination as a first and second line treatment in patients with recurrent or metastatic head and neck cancer and high-risk human papillomavirus-16 (HPV16)
infection.
In this trial sponsored by PDS Biotech, patients whose cancer has returned following initial treatment or spread will be treated with the
combination of Versamune® HPV and Keytruda® to evaluate if the addition of Versamune® HPV might improve the efficacy reported in published studies of Keytruda® alone. Patients in the trial will receive a total of 5 cycles of combination therapy in the context of standard of care Keytruda® therapy administered every three weeks until disease progression. The primary endpoint of VERSATILE-002 is the objective response rate, or ORR, at six months following initiation of
treatment. There are two cohorts in the trial. Cohort 1 is for patients who have yet to be treated with an immune checkpoint inhibitor (ICI naïve) and cohort 2 which
consists of patients who have failed immune checkpoint inhibitor therapy (ICI resistant).
In May 2023, we completed enrollment in the ICI naïve arm. We filed our amended IND with the FDA in the third quarter of 2023. In
October 2023, we received feedback from the FDA on the amended IND.
In June 2023, an abstract was presented at the 2023
American Society of Clinical Oncology: Abstract number 6012, Safety and Efficacy of Immune Checkpoint Inhibitor (ICI) Naïve Cohort from Study of Versamune® HPV and Pembrolizumab in HPV16-Positive Head and Neck Squamous Cell Carcinoma (HNSCC). The
abstract was also selected as one of the featured posters to be reviewed by an expert panel in the Head and Neck Cancer discussion session. Data on 34 patients was presented. The data from the abstract is as follows:
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Estimated 12-month overall survival rate was 87.1%. Published results are 36-50% with approved ICIs used alone.
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Median progression-free survival was 10.4 months (95% CI 4.2, 15.3). Published results are median PFS of 2-3 months for approved ICIs when used as monotherapy in
patients with similar PD-L1 levels.
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A disease control rate (disease stabilization or tumor shrinkage) of 70.6% (24/34)
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Confirmed and unconfirmed objective response rate is 41.2% (14/34 patients), which is identical to the preliminary response rate data PDS Biotech previously reported
at ASCO 2022 (7/17 patients). To date these responses have been confirmed in nine of the 34 patients (26.5%), including one complete response.
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15/34 patients (44.1%) had stable disease.
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9/34 patients (26.5%) had progressive disease.
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4/48 (8.3%) of patients had a Grade 3 treatment-related adverse event (TRAE). No Grade 4 or higher TRAEs were observed.
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In October 2023, at a key opinion roundtable updated interim data was presented based on an August 2, 2023 cut-off from our VERSATILE-002
Phase 2 clinical trial evaluating the combination of Versamune® HPV in combination with Merck’s anti-PD-1 therapy, Keytruda® (pembrolizumab) which is an FDA-approved standard of care for first-line treatment of recurrent/metastatic head and neck
cancer. Data on 52 patients was presented. The data from the roundtable based on investigator assessment was as follows:
Highlights from the ICI naïve cohort included:
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24-month overall survival (OS) rate of 74%; published 24-month survival rate of less than 30% for approved ICI.
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12-month OS rate of 80%; published results of 30-50% with approved ICIs.
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Tumor shrinkage seen in 60% (31/52) of patients.
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Confirmed overall response rate ORR of 27% (14/52) to date.
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Median progression-free survival (PFS) of 8.1 months to date; published results of 2-3 months PFS with approved ICIs.
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13% (8/62) of patients experienced Grade 3 treatment-related adverse events (TRAE) and 0% (0/62) experienced Grade 4 or 5 TRAE; published results report 13-17% Grade
3-5 TRAE with approved ICI monotherapy.
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60% (33/55) of patients had CPS score of 1-19 (who generally have a weaker response to Keytruda®), and 40% (22/55) have CPS score >20 (who generally have a stronger
response to Keytruda®).
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In May 2024, at a virtual key opinion leader event, updated interim data was presented based on a November 30, 2023 cut-off from our
VERSATILE-002 Phase 2 clinical trial evaluating the combination of Versamune® HPV in combination with Merck’s anti-PD-1 therapy, Keytruda® (pembrolizumab) which is an FDA-approved standard of care for first-line treatment of recurrent/metastatic head
and neck cancer. Data from 53 patients was presented. The data from the event based on investigator assessment was as follows:
Highlights from the ICI naïve cohort with CPS > 1 included:
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Median overall survival of 30 months; published results for ICIs are 7-18 months.
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Confirmed overall response rate ORR of 34% (18/53) to date; published results for comparable patients receiving treatment with ICIs are less than 20%.
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Confirmed complete responses, partial responses and stable disease according to RECIST v1.1 were seen in 75.5% of patients.
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Median progression-free survival (PFS) of 6.3 months to date; published results of 2-3 months PFS with approved ICIs.
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The combination of Versamune® HPV and Keytruda® appeared to be well tolerated with 11% (7/62) of patients experienced Grade 3 treatment-related adverse events (TRAE)
and 2% (1/62) experienced Grade 4 or 5 TRAE; published results report 13-17% Grade 3-5 TRAE with approved ICI monotherapy.
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60% (32/53) of patients had CPS score of 1-19 (who generally have a weaker response to Keytruda®), and 40% (21/53) have CPS score >20 (who generally have a higher
response to Keytruda®).
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During the May 2024 event, we also announced an updated clinical strategy with a two-part registrational trial focused on the double
combination of Versamune® HPV + pembrolizumab, accompanied by an investigation of the triple combination of Versamune® HPV + PDS01ADC + pembrolizumab as a first line treatment in HPV16-positive recurrent/metastatic HNSCC.
In June 2024, we provided a data update from our VERSATILE-002 clinical trial. Interim data was presented based on a May 17, 2024 cut-off.
The data update was as follows:
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Median Overall Survival of 30 months, consistent with data presented our key opinion leader event in May of 2024, which was based on a data cut as of November 30, 2023.
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27 of the censored patients remained alive and were awaiting their next clinical assessment, 6 censored patients had withdrawn consent for further follow-up, and 2
patients had been lost to follow-up, and 18 patients had died.
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The lower limit of the 95% confidence interval is 19.7 months, and the upper limit is not yet estimable, as the majority of patients continue to be followed for survival.
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In August 2024, we provided an update to our clinical strategy following discussions with the FDA. During the August 2024 update, we
announced our intent to initiate a registrational study in first line treatment in HPV16-positive recurrent/metastatic HNSCC with the double combination of Versamune® HPV + pembrolizumab.
In September 2024, we announced updated data from our VERSATILE-002 Phase 2 clinical trial presented during a poster session at the European
Society for Medical Oncology (ESMO) Congress 2024. The data presented was based on a May 17, 2024 data cut-off. The main elements of the update were as follows:
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Median Overall Survival (mOS) was 30 months with a lower 95% confidence interval of 19.7 months; Published mOS for pembrolizumab is 12-18 months
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Objective Response Rate (ORR) of 36% (19/53); Published ORR for pembrolizumab is 19-25%
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Disease Control Rate (DCR) is 77% (41/53)
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21% (11/53) of patients had deep tumor responses and shrinkage of 90-100%
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9% (5/53) of patients had a complete response
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Treatment-related adverse events of Grade ≥3 were seen in 9 patients (Grade 3, n=8 and Grade 4, n=1)
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National Cancer Institute: Versamune® HPV+ PDS01ADC +Bintrafusp Alfa
In June 2020, the first patient was dosed under a Cooperative Research and Development Agreement (CRADA), in the NCI led Phase 2
investigator-initiated trial evaluating Versamune® HPV with PDS01ADC, and M7824 (Bintrafusp alfa), which is owned by EMD Serono (Merck KGaA) in patients with advanced HPV-positive cancers who have failed prior treatment. In February 2021, the NCI’s
Phase 2 clinical trial of Versamune® HPV for the treatment of advanced HPV-positive cancers had achieved its preliminary objective response target in patients naïve to check point inhibitors which allowed for full enrollment of approximately 20
patients in this group. In addition, based on promising results in the ICI naïve arm, the trial was amended to allow enrollment of a separate cohort of IC -resistant patients for assessment of safety and activity of the triple combination. The trial
has been closed for enrollment. Preliminary efficacy assessment of the triple combination in this added group of 29 ICI resistant patients has been completed and evaluation of long-term patient survival is ongoing.
Preclinical study results arising from this CRADA were published in the Journal for ImmunoTherapy of Cancer, Immunomodulation to enhance the efficacy of an HPV therapeutic vaccine (Journal for ImmunoTherapy of Cancer2020;8:e000612. Doi:10.1136/ jitc-2020-000612), and indicate
that Versamune® HPV generated both HPV-specific T cells and an associated antitumor
response when used as a monotherapy. When Versamune® HPV was combined with the two other novel clinical-stage anti-cancer agents, Bintrafusp Alfa and M9241 (which is now owned by us and referred to as PDS01ADC), the preclinical data suggested that all three therapeutic agents worked synergistically to provide superior tumor T cell responses and subsequent tumor regression when compared to any of the agents alone or the 2-component combinations. The published preclinical data
demonstrating powerful activity of the triple combination appears to be corroborated in the Phase 2 trial, and this triple combination could form the basis of a unique
platform providing improved cancer treatments across multiple cancers.
In February 2023, we announced the completion of a Type B meeting with the FDA for the combination therapy of Versamune® HPV, PDS01ADC,
and an FDA-approved immune checkpoint inhibitor for the treatment of recurrent/metastatic HPV-positive ICI-resistant head and neck cancer. We confirmed the required contents of the trial design for a potential registrational trial of the combination.
In November 2023, we released updated interim survival data as follows:
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75% of immune checkpoint inhibitor (ICI) naïve patients remain alive at 36 months; published median overall survival (OS) in similar patients is 7-11 months
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12-month survival rate in (ICI) resistant patients of 72%
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Median OS in ICI resistant HPV-positive patients of approximately 20 months; published median OS is 3.4 months
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In February 2025, we announced the publication of clinical results in the Journal of the American Medical Association (JAMA) Oncology:
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Median Overall Survival (mOS) of 42.4 months in immune checkpoint inhibitor naïve patients; Historical published result is 7-12 months
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Continued survival in the cohort of HPV16-positive immune checkpoint inhibitor naïve patients - mOS not yet reached
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Median OS of 17 months in HPV16-positive immune checkpoint inhibitor resistant patients; Historically published result is 3-4 months
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Significant tumor shrinkage with confirmed objective response rate (ORR) of 75% in HPV16-positive immune checkpoint inhibitor naïve patients; Historically published
result is 11-24%
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MD Anderson Cancer Center (IMMUNOCERV): Versamune®
HPV + Chemoradiotherapy
In October 2020, a Phase 2 Investigator Initiated Trial (IIT)
was initiated with The University of Texas MD Anderson Cancer Center and is actively recruiting patients. This clinical trial is investigating the safety and anti-tumor efficacy of Versamune® HPV in combination with standard-of-care chemo-radiotherapy, or CRT, and their correlation with critical immunological biomarkers in patients with locally advanced cervical cancer. We believe that Versamune® has strong
T cell induction with the potential to enhance efficacy of the current standard of care CRT treatment in this indication with the FDA at this meeting.
In October 2023, data demonstrating Versamune® HPV in combination with standard-of-care (SOC) chemoradiotherapy was associated with a
rapid decline in human papillomavirus circulating cell-free DNA (ctHPV-DNA), a potential predictive biomarker of treatment response. The data from the IMMUNOCERV Phase 2 clinical trial was featured in an oral presentation at the American Society for
Radiation Oncology Annual Meeting which included the following:
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Earlier and greater proportion of ctDNA clearance with Versamune® HPV plus chemoradiation (CRT) vs. SOC CRT alone (81.3% clearance after 3 weeks vs. 30.3% with SOC
(p=0.0018), and 91.7% of clearance at 5 weeks vs. 53.1% with SOC (p=0.0179).
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Baseline ctDNA levels correlated with the International Federation of Gynecology and Obstetrics (FIGO) stage and lymph node involvement; 100% of patients treated with
Versamune® HPV had cancer that had spread to the lymph nodes.
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Mayo Clinic: Versamune® HPV Monotherapy and in combination with Keytruda®
In February 2022, we initiated an IIT, MC200710, for Versamune® HPV alone or in combination with the immune checkpoint inhibitor,
Keytruda®, in patients with HPV-positive oropharyngeal cancer (HPV(+) OPSCC) at high risk of recurrence. The trial is conducted by the Mayo Clinic, a nationally and internationally recognized center of excellence for the treatment of head and neck
cancers. We believe that this trial allows us to better understand the activity of Versamune® HPV alone or in combination with Keytruda® in earlier stages of disease.
In this trial, treatment will be administered before patients proceed to transoral robotic surgery (TORS) with curative intent. Treatment
in this setting is referred to as neoadjuvant treatment. Versamune® HPV has been shown to induce killer T cells that target and kill HPV-positive cancers, either alone or in combination with ICIs in preclinical studies, and in combination in clinical
studies of patients with advanced recurrent/metastatic HPV-positive cancers. The trial will explore whether Versamune® HPV with or without checkpoint inhibition may increase HPV-specific anti-tumor responses, potentially resulting in tumor shrinkage,
pathologic regression, and decreases in circulating tumor DNA (ctDNA).
Versamune® MUC1 (formerly PDS0103)
In April 2020, the above mentioned CRADA between PDS Biotech and the NCI was expanded beyond Versamune® HPV (formerly PDS0101) to include
clinical and preclinical development of Versamune® MUC1. Versamune® MUC1 is an investigational immune therapy owned by PDS Biotech and designed to treat cancers associated with the mucin-1, or MUC1, oncogenic protein. These include cancers such as
ovarian, breast, colorectal and lung cancers. Versamune® MUC1 combines Versamune® with novel highly immunogenic agonist epitopes of MUC1 developed by the NCI and licensed by us.
MUC1 is highly expressed in several types of cancer and has been shown to be associated with drug resistance and poor disease prognosis in
breast, colorectal, lung and ovarian cancers, for which Versamune® MUC1 is being developed. Expression of MUC1 is often associated with poor disease prognosis, due in part to drug resistance. In preclinical studies, and similarly to Versamune® HPV,
Versamune® MUC1 demonstrated the ability to generate powerful MUC1-specific CD8 killer T cells.
In March 2025, we announced FDA clearance of our IND application for the combination of Versamune® MUC1 and PDS01ADC in treatment of
metastatic colorectal cancer.
PDS0102
PDS0102 is an investigational immunotherapy utilizing tumor-associated and immunologically active T cell receptor gamma alternate reading
framed protein (TARP) from the NCI. PDS0102 is designed to treat TARP-associated cancers including acute myeloid leukemia (AML), prostate and breast cancer. In our preclinical work, in the administration of PDS0102, the Versamune®+TARP antigen
combination led to the induction of large numbers of tumor targeted killer T cells. In addition, the TARP tumor antigen alone has already been studied at the NCI in men with prostate cancer and has been shown to be safe, and immunogenic with slowing
tumor growth rates (NCT00972309).
IL-12 Oncology Immunocytokine Pipeline
PDS01ADC is a novel investigational IL-12 fused antibody drug conjugate (IgG1), tumor-targeting interleukin 12 (IL-12) immune-cytokine
that enhances the proliferation, potency and longevity of T cells in the tumor microenvironment. Together with Versamune® based immunotherapies, PDS01ADC works synergistically to overcome tumor immune suppression and to promote a targeted T cell
attack against cancers. As with Versamune®, PDS01ADC is given by a simple subcutaneous injection. Clinical data suggests the addition of PDS01ADC to Versamune® based immunotherapies may demonstrate significant disease control in advanced cancer
patients by shrinking tumors and/or prolonging life.
With the exclusive global license agreement with Merck
KGaA, Darmstadt, Germany for PDS01ADC, we believe we have simplified our registrational pathway for the NCI-led triple combination by owning both Versamune® HPV and PDS01ADC and combining these agents with an FDA approved ICI. PDS01ADC has been
designed to overcome the limitations of cytokine therapy as explained above, and based on extensive preclinical studies performed at the NCI evaluating PDS01ADC as a monotherapy and also in combinations with established standard of care treatments
for cancer, we believe that PDS01ADC has significant potential as a cytokine therapy independent of Versamune®. Based on the informative preclinical studies, a number of IIT Phase 2 trials are currently in progress at the NCI, some of which are
outlined below:
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Phase 2 Study Evaluating ICI Naïve and Resistant Patients with HPV-positive malignancies
treated with PDS01ADC, Versamune® HPV and bintrafusp alfa.
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A Phase 2 Study Evaluating T-Cell Clonality After Stereotactic Body Radiation Therapy Alone and in Combination with the Immunocytokine PDS01ADC in Localized High and
Intermediate Risk Prostate Cancer Treated with Androgen Deprivation Therapy
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A Phase 1/2 Study of PDS01ADC in Combination with Docetaxel in Adults with Metastatic Castration Sensitive and Castration Resistant Prostate Cancer
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Phase 1/2 of PDS01ADC going forward as a Monotherapy in Advanced Kaposi Sarcoma
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Phase 1/2 of PDS01ADC in Combination of with a Histone Deacetylase (HDAC) Inhibitor in ICI resistant MUC1-positive colon and bladder cancers among others
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In October 2023, interim safety and immune response data was presented for the first-in-human Phase 1/2 clinical trial evaluating
PDS01ADC in combination with current SOC chemotherapy, docetaxel, to treat metastatic castration sensitive and castration resistant prostate cancer. The data was featured in an oral presentation at the 11th Annual Meeting of the
International Cytokine & Interferon Society. The data presented included the following:
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Decrease in PSA levels was seen in all patients at all three tested doses of PDS01ADC and 61% of patients had at least a 60% decrease in PSA levels.
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All doses of the combination were well-tolerated with one patient experiencing Grade 4 neutropenia.
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Administration of the combination was associated with decreases in T reg cells and increases in activated natural killer (NK) cells, memory CD8 T cells, proliferating
CD4 and CD8 T cells and cytokines INF-γ and Interleukin 10 (IL-10).
|
|
● |
The changes in immune responses with the combination were independent of the PDS01ADC dose.
|
We are working closely with the NCI to determine the best pathway forward for the prioritized PDS01ADC studies, as well as evaluating
the use of PDS01ADC in combination with other Versamune® based clinical candidates.
Current Clinical Pipeline of Versamune®, and PDS01ADC Based Therapies
We have never been profitable and have incurred net losses in each year since inception. Our net losses were $8.5 million, and $10.6
million for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, we had an accumulated deficit of $190.6 million. Substantially all of our net losses have resulted from costs incurred in connection with our research and
development programs and from general and administrative costs associated with these operations.
As of March 31, 2025, we had $40.0 million in cash and cash equivalents.
Our future funding requirements will depend on many factors, including the following:
|
● |
the timing and costs of our planned and ongoing clinical trials;
|
|
● |
the timing and costs of our planned preclinical studies of our Versamune® platform;
|
|
● |
the outcome, timing and costs of seeking regulatory approvals;
|
|
● |
the terms and timing of any future collaborations, licensing, consulting or other arrangements that we may enter into;
|
|
● |
the amount and timing of any payments we may be required to make in connection with the licensing, filing, prosecution, maintenance, defense and enforcement of any
patents or patent applications or other intellectual property rights; and
|
|
● |
the extent to which we license or acquire other products and technologies.
|
Infectimune® Development Strategy
We believe that the key differentiating attributes of the Infectimune® platform technology are strong induction of CD8 and CD4 T cells as
well as antibodies which can be leveraged to improve treatment and preventive options in several infectious disease indications. In January 2022, we presented preclinical data on our universal flu program sponsored by the National Institute of Allergy
and Infectious Disease (NIAID) demonstrating the potential of the Infectimune® technology with computationally designed influenza proteins developed by the laboratory of Dr. Ted Ross at the University of Georgia to generate broadly protective
anti-influenza immune responses across multiple strains of influenza. This data has provided a unique opportunity to highlight Infectimune®’s potentially transformative utility in the development of more broadly effective and longer lasting protective
vaccines. Current preventive and prophylactic vaccine approaches and technologies predominantly focus on creating strong induction of antibody responses. However, the induction of T cell responses, in addition to antibody responses, provides more
durable and broad protection against infectious diseases.
Based on the preclinical data with the universal seasonal flu vaccine and the current focus of the NIAID in developing more effective flu
vaccines, we have decided to focus our near-term infectious disease activities to align with the interests of the NIAID Collaborative Influenza Vaccine Innovation Centers (CIVICs) program. This will involve development of a universal seasonal flu
vaccine and the potential development of a universal pandemic influenza vaccine based on similar computationally designed antigens as have shown promise with Infectimune®.
The preclinical results for Infectimune® based vaccines were published in two separate articles in the peer reviewed journal Viruses in
February 2023: 1. preclinical studies demonstrating complete protection against sickness after lethal challenge with live SARS-CoV-2 or influenza viruses (Gandhapudi SK et al. Viruses 2023, 15, 432) and 2. Dramatically enhanced CD4 T cell responses to
recombinant influenza proteins compared to leading commercial vaccine adjuvants (Henson TR et al. Viruses 2023, 15, 538).
In September 2023, preclinical data on our investigational universal flu vaccine, PDS0202, was presented at the 9th European Scientific
Working Group on Influenza (ESWI) conference. This data demonstrated active neutralization across multiple influenza viruses in animals and provided protection against infection and weight loss after challenging with high doses of H1N1 viruses when
they were not previously exposed to flu.
SELECTED FINANCIAL OPERATIONS OVERVIEW
Revenue
We have not generated any revenues from commercial product sales and do not expect to generate any such revenue in the near future. We may
generate revenue in the future from a combination of research and development payments, license fees and other upfront payments or milestone payments.
Research and Development Expenses
Research and development expenses include employee-related
expenses, costs to acquire license rights to use certain technology in our research and development projects, costs of acquiring, developing and manufacturing clinical trial materials, as well as fees paid to consultants and various entities that
perform certain research and testing on our behalf. Costs for certain development activities, such as clinical trials, are recognized based on an evaluation of the progress to completion of specific tasks using data such as patient enrollment,
clinical site activations or information provided by vendors on their actual costs incurred. Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected
in the Condensed Consolidated Financial Statements as prepaid or accrued expenses. Costs incurred in connection with research and development activities are expensed as incurred.
We expect that our research and development expenses will increase significantly over the next several years as we advance our
Versamune® and PDS01ADC clinical and product candidates into and through clinical trials, pursue regulatory approval of our Versamune® and PDS01ADC product candidates and prepare for a possible commercial launch, all of which will also require a
significant investment in contract research services, manufacturing process validation and inventory related costs.
The process of conducting human clinical trials necessary to obtain regulatory approval is costly and time consuming. We may never succeed
in achieving marketing approval for our clinical and product candidates. The probability of successful commercialization of our clinical and product candidates may be affected by numerous factors, including clinical data obtained in future trials,
competition, manufacturing capability and commercial viability. As a result, we are unable to determine the duration and completion costs of our research and development projects or when and to what extent we will generate revenue from the
commercialization and sale of any of our clinical and product candidates.
Results of Operations
The following table summarizes the results of our operations for the three months ended March 31, 2025 and 2024:
| |
|
Three Months Ended
March 31,
|
|
|
Increase ( Decrease)
|
|
| |
|
2025
|
|
|
2024
|
|
|
$ Amount
|
|
|
%
|
|
| |
|
(in thousands)
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development expenses
|
|
$
|
5,831
|
|
|
$
|
6,704
|
|
|
$
|
(873
|
)
|
|
|
(13
|
)%
|
|
General and administrative expenses
|
|
|
3,275
|
|
|
|
3,393
|
|
|
|
(118
|
)
|
|
|
(3
|
)%
|
|
Total operating expenses
|
|
|
9,106
|
|
|
|
10,097
|
|
|
|
(991
|
)
|
|
|
(10
|
)%
|
|
Loss from operations
|
|
|
(9,106
|
)
|
|
|
(10,097
|
)
|
|
|
991
|
|
|
|
(10
|
)%
|
|
Interest income (expense), net
|
|
|
(553
|
)
|
|
|
(506
|
)
|
|
|
(47
|
)
|
|
|
9
|
%
|
|
Benefit from income taxes
|
|
|
1,170
|
|
|
|
-
|
|
|
|
1,170
|
|
|
|
100
|
%
|
|
Net loss and comprehensive loss
|
|
$
|
(8,489
|
)
|
|
$
|
(10,603
|
)
|
|
$
|
2,114
|
|
|
|
(20
|
)%
|
Research and Development Expenses
Research and development (R&D) expenses decreased to $5.8 million for the three months ended March 31, 2025 from $6.7 million for the three months ended March 31, 2024. The decrease of $0.9 million was primarily attributable to a decrease of $0.6 million in clinical trial costs, a decrease of $0.2 million in personnel costs, and a decrease of $0.1 million in manufacturing costs.
General and Administrative Expenses
General and administrative expenses decreased to $3.3 million for the three months ended March 31, 2025 from $3.4 million for the three months ended March 31, 2024. The decrease of $0.1 million was primarily
attributable to a decrease of $0.2 million in personnel costs offset by an increase of $0.1 million in professional fees.
Benefit from Income Taxes
Income tax benefit was $1.2 million for the three months ended March 31, 2025 and $0 million for the three months ended March 31, 2024.
The increase of $1.2 million was due to the timing of proceeds received from the net sale of tax benefits to an unrelated, profitable New Jersey corporation pursuant to the Company’s participation in the New Jersey Technology Business Tax Certificate
Transfer Net Operating Loss (NOL) Program. The comparable tax benefit of $0.9 million was received in April 2024 and reflected as an income tax benefit for the three months ended June 30, 2024.
Liquidity and Capital Resources
In August 2022, we filed a shelf registration statement, or the 2022 Shelf Registration Statement, with the SEC for the issuance of common
stock, preferred stock, warrants, rights, debt securities, and units, up to an aggregate amount of $150 million, approximately $97 million of which covers the offer, issuance and sale by us of our common stock under the Sales Agreement and the New
Sales Agreement (as discussed below). The 2022 Shelf Registration Statement was declared effective on September 2, 2022.
In August 2022, we entered into an At Market Issuance Sales Agreement, or the Sales Agreement, with B. Riley Securities, Inc. and BTIG,
LLC, each an Agent and collectively the Agents, with respect to an at-the-market offering 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 $50
million, or the Placement Shares, through or to the Agents, as sales agents or principals. Upon delivery of a placement notice and subject to the terms and conditions of the Sales Agreement, the Agents may sell the Placement Shares by any method
permitted by law deemed to be an “at the market” offering as defined in Rule 415 of the Securities Act of 1933, as amended, including, without limitation, sales made through The Nasdaq Capital Market or on any other existing trading market for our
common stock. The Agents will use commercially reasonable efforts to sell the Placement Shares from time to time, based upon our instructions (including any price, time or size limits or other customary parameters or conditions we may impose). We will
pay the Agents a commission equal to three percent (3%) of the gross sales proceeds of any Placement Shares sold through the Agents under the Sales Agreement, and we have also provided the Agents with customary indemnification and contribution rights.
We are not obligated to make any sales of our common stock under the Sales Agreement. The offering of Placement Shares pursuant to the Sales Agreement will terminate upon the earlier of (i) the sale of all Placement Shares subject to the Sales
Agreement or (ii) the termination of the Sales Agreement in accordance with its terms. In August 2024, we entered into an Amended and Restated At Market Issuance Sales Agreement, or the New Sales Agreement, with B. Riley Securities, Inc. and H.C.
Wainwright & Co., LLC, with terms that are substantially consistent with those included in the original Sales Agreement. The New Sales Agreement superseded and replaced the Sales Agreement. For the year ended December 31, 2024, the Company sold
3,428,681 shares of common stock for a net value of $19.5 million pursuant to the Sales Agreement and 1,108,105 shares of common stock for a net value of $3.2 million pursuant to the New Sales Agreement. During the three months ended March 31, 2025,
the Company sold 205,350 shares of common stock for a net value of $0.3 million pursuant to the New Sales Agreement and during the three months ended March 31, 2024, we sold 3,428,681 shares of common stock for a net value of $19.5 million, pursuant to
the Sales Agreement.
In August 2022, the Company entered into a
venture loan and security agreement, or the Loan and Security Agreement, with Horizon Technology Finance Corporation, as lender and collateral agent for itself and the other lenders. In total, the Company received $24.6 million in net proceeds under the Loan and Security Agreement. The Company’s indebtedness under the Loan and Security Agreement was satisfied in full and retired in full with a portion
of the proceeds received from the Securities Purchase Agreement, as discussed below.
In connection with the Loan and Security Agreement, we issued Horizon Technology Finance Corporation and Powerscourt Investments XXV, LP
warrants to purchase an aggregate total of 381,625 shares of our common stock at an initial exercise price of $3.6685 per share. Each warrant is classified as equity and is exercisable at any time for a period beginning on the date of grant and
ending on the earlier of (A) 10 years from the date of grant, and (B) the closing of (A) (i) the sale, lease, exchange, conveyance or other disposition of all or substantially all of the our property or business, or (ii) its merger into or
consolidation with any other corporation (other than a wholly-owned subsidiary of the Company), or any transaction (including a merger or other reorganization) or series of related transactions, in which more than 50% of the voting power of the
Company is disposed of, in each case, for cash or for marketable securities meeting certain requirements as described in the applicable warrants. The key assumptions used in Black-Scholes option pricing model were (i) expected term of 10 years, (ii) a risk-free rate of 3.11%, (iii) expected volatility of 93.8%, and (iv) no estimated dividend yield.
In April 2024, we received approximately $0.9 million from the net sale of tax benefits to an unrelated, profitable New Jersey corporation
pursuant to its participation in the New Jersey Technology Business Tax Certificate Transfer NOL program for tax year 2022.
In January and February of 2025, we received approximately $1.2 million from the net sale of tax benefits to an unrelated, profitable
New Jersey corporation pursuant our participation in the New Jersey Technology Business Tax Certificate Transfer NOL program for tax year 2023.
In February 2025, we entered into a Securities Purchase Agreement with certain purchasers, pursuant to which the we agreed to sell an
aggregate of 6,396,787 shares of common stock, pre-funded warrants to purchase up to an aggregate of 933,334 shares of common stock, and common stock warrants to purchase up to an aggregate of 7,330,121 shares of common stock at a combined purchase
price of $1.50 per share and warrant (the “February 2025 Offering”). Two of our directors participated in the February 2025 Offering and purchased 30,121 shares of common stock in the aggregate at an offering price per share of $1.66 and common stock
warrants to purchase 30,121 shares of common stock. The common stock warrants issued to our directors have an exercise price per share of $1.53, but are otherwise identical to the common stock warrants issued to all other participants in the February
2025 Offering. Aggregate gross proceeds from the February 2025 Offering were approximately $11 million. Net proceeds to us from the offering, after deducting the placement agent fees and other estimated offering expenses payable by us, were
approximately $10.05 million. The February 2025 Offering closed on February 28, 2025.
On April 30, 2025, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with certain third
party lenders and JGB Collateral LLC, as collateral agent. Pursuant to the Securities Purchase Agreement, the Company agreed to sell (i) senior secured convertible
debentures in an aggregate principal amount of $22,222,222 (collectively, the “Debentures”) and (ii) warrants to purchase up to 1,000,000 shares of common stock, for an exercise price of $2.52 per share (collectively, the “Warrants”), subject to
adjustments as set forth in the Warrants, for a total purchase price of $20,000,000. Approximately $19 million of the proceeds from the transactions contemplated by the Securities Purchase Agreement were used to satisfy in full and retire the
Company’s indebtedness under the Loan and Security Agreement.
As of March 31, 2025, we had $40.0 million in cash and cash equivalents. Our primary uses of cash are to fund operating expenses,
primarily research and development expenditures. Cash used to fund operating expenses is impacted by the timing of when we pay these expenses, as reflected in the change in our outstanding accounts payable and accrued expenses.
We evaluated whether there are any conditions and events, considered in the aggregate, that raise substantial doubt about our ability to
continue as a going concern within one year beyond the filing of this Quarterly Report on Form 10-Q. Our budgeted cash requirements in 2025 and beyond include expenses related to continuing development and clinical studies as well as payments on our
debt.
We plan to continue to fund our operations and capital
funding needs through existing cash and additional equity and/or debt financing. However, we cannot be certain that additional financing will be available when needed or that, if available, financing will be obtained on terms favorable to us or our
existing stockholders. We may also enter into government funding programs and consider selectively partnering for clinical development and commercialization. The sale of additional equity would result in additional dilution to our stockholders.
Incurring debt financing would result in debt service obligations, and the instruments governing such debt could provide for operating and financing covenants that would restrict our operations. If we are unable to raise additional capital in
sufficient amounts or on acceptable terms, we may be required to delay, limit, reduce, or terminate our product development or future commercialization efforts or grant rights to develop and market immunotherapies that we would otherwise prefer to
develop and market ourselves In addition, the Debentures allow for the lenders to call the outstanding balance of the Debentures if we fail to maintain minimum cash balances outlined in the Debentures. Any of these actions could harm our business,
results of operations and prospects. Failure to obtain adequate financing also may adversely affect our ability to operate as a going concern.
As a result of these uncertainties, we have concluded that substantial doubt exists about our ability to continue as a going concern for a
period of at least 12 months from the date of the issuance of these unaudited Condensed Consolidated Financial Statements. The unaudited Condensed Consolidated Financial Statements do not include any adjustments to the carrying amounts and
classifications of assets and liabilities that would result if we are unable to continue as a going concern.
Cash Flows
The following table shows a summary of our cash flows for each of the periods indicated (in thousands):
| |
|
Three Months Ended March 31,
|
|
| |
|
2025
|
|
|
2024
|
|
Net cash used in operating activities
|
|
$
|
(9,032
|
)
|
|
$
|
(9,938
|
)
|
|
Net cash provided by financing activities
|
|
|
7,321
|
|
|
|
20,012
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
$
|
(1,711
|
)
|
|
$
|
10,074
|
|
Net Cash Used in Operating Activities
Net cash used in operating activities was $9.0 million and
$9.9 million for the three months ended March 31, 2025 and 2024, respectively. The decrease in net cash used in operating activities of $0.9 million was primarily due to a decrease in the non-cash stock-based compensation expense of $0.4
million offset by a decrease in net loss of $2.1 million and changes in the timing of working capital requirements, including changes in prepaid expenses and other assets, accrued expenses and accounts payable.
Net Cash Provided by Financing Activities
Net cash provided by financing activities for the three months ended March 31, 2025 and 2024 decreased by $12.7 million primarily due to a
$19.2 million decrease in proceeds from the issuance of common stock from the Sales Agreement, an increase in proceeds from the issuance of common stock and pre-funded warrants of $10.2 million from the financing agreement, offset by a $3.1 million
loan repayment.
Operating Capital Requirements
To date, we have not generated any product revenue. We do not know when, or if, we will generate any product revenue and we do not expect
to generate significant product revenue unless and until we obtain regulatory approval and commercialize one of our current or future product candidates. We anticipate that we will continue to generate losses for the foreseeable future, and we expect
the losses to increase as we continue the development of, and seek regulatory approvals for, our product candidates, and begin to commercialize any approved products. We are subject to all of the risks incident to the development of new products, and
may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may harm our business. We expect to incur additional costs associated with operating as a public company and anticipate that we will need substantial
additional funding in connection with our continuing operations.
We evaluated whether there are any conditions and events, considered in the aggregate, that raise substantial doubt about our ability to
continue as a going concern within one year after the filing of this Quarterly Report. Our budgeted cash requirements in 2025 and beyond include expenses related to continuing development and clinical studies as well as payments on our debt. Until we
can generate significant cash from our operations, we expect to continue to fund our operations with available financial resources. These financial resources may not be adequate to sustain our operations. While we intend to finance our cash needs
principally through equity or debt financings, collaborations, strategic alliances, or license agreements with third parties, there is no assurance that new financing will be available to us on commercially acceptable terms or in the amounts required,
if at all. In addition, the Loan and Security Agreement allows for the lenders to call the outstanding balance of the term loans if we fail to maintain the minimum cash balances outlined in the Loans and Security Agreement. We have concluded that
substantial doubt exists about our ability to continue as a going concern for a period of at least 12 months from the date of the issuance of these unaudited Condensed Consolidated financial statements.
We have based our projections of operating capital requirements on assumptions that may prove to be incorrect and we may use all of our
available capital resources sooner than we expect. Because of the numerous risks and uncertainties associated with research, development and commercialization of pharmaceutical products, we are unable to estimate the exact amount of our operating
capital requirements. Our future funding requirements will depend on many factors, including, but not limited to:
|
● |
the initiation, progress, timing, costs and results of our planned clinical trials;
|
|
● |
the effects of health epidemics, pandemics, or outbreaks of infectious diseases, on our business operations, financial condition, results of operations and cash flows;
|
|
● |
the outcome, timing and cost of meeting regulatory requirements established by the U.S. Food and Drug Administration, or FDA, the European Medicines Agency, or EMA, and
other comparable foreign regulatory authorities;
|
|
● |
the cost of filing, prosecuting, defending and enforcing our patent claims and other intellectual property rights;
|
|
● |
the cost of defending potential intellectual property disputes, including patent infringement actions brought by third parties against us now or in the future;
|
|
● |
the effect of competing technological and market developments;
|
|
● |
the cost of establishing sales, marketing and distribution capabilities in regions where we choose to commercialize our products on our own; and
|
|
● |
the initiation, progress, timing and results of our commercialization of our clinical and product candidates, if approved, for commercial sale.
|
Please see the section titled “Risk Factors” elsewhere in the Quarterly Report and Annual Report for additional risks associated with our
operations.
Purchase Commitments
We have no material non-cancelable purchase commitments with service providers as we have generally contracted on a cancelable, purchase
order basis.
Critical Accounting Policies and Estimates
Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which
have been prepared in accordance with U.S. GAAP. Our accounting policies are more fully described in Note 2 to the Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q. As described in Note 2, the preparation of
these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the expenses
incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying
value of assets and liabilities that are not readily apparent from other sources. Estimates are assessed each period and updated to reflect current information. Actual results may differ from these estimates under different assumptions or conditions.
We believe that the discussion in our management’s discussion and analysis addresses our most critical accounting policies, which are those that are most important to the portrayal of our financial condition and results of operations and require
management’s most difficult, subjective and complex judgments.
There have been no material changes to our critical accounting policies and estimates during the three months ended March 31, 2025 from
those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024.
Off-Balance Sheet Arrangements
We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements, as defined in the rules
and regulations of the SEC.
Smaller Reporting Company
As of January 1, 2021, we were no longer an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012, or
the JOBS Act. However, we remain a “smaller reporting company,” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended. We will cease to be a smaller reporting company if we have a non-affiliate public float in excess of $250
million and annual revenues in excess of $100 million, or a non-affiliate public float in excess of $700 million, determined on an annual basis. As a smaller reporting company, we are permitted and intend to rely on exemptions from certain disclosure
requirements that are applicable to other public companies that are not smaller reporting companies. We will continue to take advantage of some or all of the available exemptions.
| ITEM 3. |
QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
|
We are exposed to market related changes in interest rates. As of March 31, 2025, our cash equivalents consisted of bank deposits and
money market accounts. Additionally, the principal balance under our Loan and Security Agreement bears a floating interest pegged to the prime rate. Our primary exposure to market risk is interest rate sensitivity, which is affected by changes in
the general level of U.S. interest rates. Historically, the net impact of fluctuations in interest rates have not been material to us.
Inflation generally affects us by increasing our cost of labor and pricing of contracts. We do not believe that inflation has had a
material effect on our business, financial condition, or results of operations during the three months ended March 31, 2025.
| ITEM 4. |
CONTROLS AND PROCEDURES
|
Evaluation of Disclosure Controls and Procedures
An evaluation was carried out, under the supervision of and with the participation of our management, including our Chief Executive
Officer and our Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15 (e)) under the Securities Exchange Act of 1934, or the Exchange Act, as of the end of the period covered
by this report. Based on the evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that our disclosure controls and procedures are effective to ensure that the information required to be disclosed by us in the reports
we file or submit under the Exchange Act was recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act)
identified in connection with the evaluation identified above that occurred during the quarter ended March 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
| PART II. |
OTHER INFORMATION
|
| ITEM 1. |
LEGAL PROCEEDINGS
|
The information in Note 9 to the Condensed Consolidated Financial Statements contained in Part I, Item 1 of this Quarterly Report on Form
10-Q is incorporated herein by reference. There are no matters which constitute material pending legal proceedings to which we are a party other than those incorporated into this item by reference from Note 9 to our Condensed Consolidated Financial
Statements for the quarter ended March 31, 2025 contained in this Quarterly Report on Form 10-Q.
There have been no material changes from our risk factors as previously reported in our Annual Report on Form 10-K for the year ended
December 31, 2024. However, any investment in our business involves a high degree of risk. Before making an investment decision, you should carefully consider the information we include in this Quarterly Report on Form 10-Q, including our unaudited
interim Condensed Consolidated Financial Statements and accompanying notes, our Annual Report on Form 10-K for the year ended December 31, 2024 filed on March 27, 2025, including the risk factors and our financial statements and related notes contained
therein, and the additional information in the other reports we file with the Securities and Exchange Commission, including, without limitation, the risk factors previously disclosed in our prior quarterly reports on Form 10-Q filed during this fiscal
year. These risks may result in material harm to our business and our financial condition and results of operations. In this event, the market price of our common stock may decline and you could lose part or all of your investment. Additional risks that we currently believe are immaterial may also impair our business operations. Our business, financial conditions and future
prospects and the trading price of our common stock could be harmed as a result of any of these risks.
| ITEM 2. |
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
There were no unregistered sales of the Company’s equity securities during the three months ended March 31, 2025.
| ITEM 3. |
DEFAULTS UPON SENIOR SECURITIES
|
None.
| ITEM 4. |
MINE SAFETY DISCLOSURES
|
Not applicable.
| ITEM 5. |
OTHER INFORMATION
|
None.
|
Exhibit
Number
|
|
Exhibit Description
|
|
|
|
Form of Pre-Funded Warrant (incorporated herein by reference to Exhibit 4.1 to the Current Report on Form 8-K, filed with the SEC on February 28,
2025).
|
| |
|
|
|
|
|
Form of Common Warrant (incorporated herein by reference to Exhibit 4.2 to the Current Report on Form 8-K, filed with the SEC on February 28, 2025).
|
| |
|
|
|
|
|
Form of Debenture (incorporated herein by reference to Exhibit 4.1 to the Current Report on Form 8-K, filed with the SEC on May 2, 2025).
|
| |
|
|
|
|
|
Form of Warrant (incorporated herein by reference to Exhibit 4.2 to the Current Report on Form 8-K, filed with the SEC on May 2, 2025).
|
| |
|
|
|
|
|
Form of Securities Purchase Agreement dated February 26, 2025, by and between PDS Biotechnology Corporation and the Purchasers (incorporated herein
by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed with the SEC on February 28, 2025).
|
| |
|
|
|
|
|
Placement Agency Agreement dated February 26, 2025, between PDS Biotechnology Corporation and A.G.P./Alliance Global Partners (incorporated herein by
reference to Exhibit 10.2 to the Current Report on Form 8-K, filed with the SEC on February 28, 2025).
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Securities Purchase Agreement, dated April 30, 2025, by and among PDS Biotechnology Corporation, the purchasers named therein, and JGB Collateral LLC
(incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed with the SEC on May 2, 2025).
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Registration Rights Agreement, dated April 30, 2025, by and among PDS Biotechnology Corporation and the purchasers named therein (incorporated herein
by reference to Exhibit 10.2 to the Current Report on Form 8-K, filed with the SEC on May 2, 2025).
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Security Agreement, dated April 30, 2025, by and among PDS Biotechnology Corporation., each of PDS Biotechnology Corporation’s specified subsidiaries
named therein, the purchasers named therein and JGB Collateral LLC (incorporated herein by reference to Exhibit 10.3 to the Current Report on Form 8-K, filed with the SEC on May 2, 2025).
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Form of Subsidiary Guarantee (incorporated herein by reference to Exhibit 10.4 to the Current Report on Form 8-K, filed with the SEC on May 2, 2025).
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Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002.
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Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002.
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Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(furnished herewith).
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Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(furnished herewith).
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101.INS*
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Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the
Inline XBRL document.
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101.SCH*
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Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents.
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101.CAL*
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XBRL Taxonomy Extension Calculation Linkbase Document
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101.DEF*
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XBRL Taxonomy Extension Definition Linkbase Document
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101.LAB*
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XBRL Taxonomy Extension Label Linkbase Document
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101.PRE*
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XBRL Taxonomy Extension Presentation Linkbase Document
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104
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Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
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| * |
Filed herewith (unless otherwise noted as being furnished herewith)
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| + |
Pursuant to Item 601(a)(5) of Regulation S-K, schedules have been omitted and will be furnished on a supplemental basis to the Securities and Exchange Commission upon
request.
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Pursuant to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
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PDS Biotechnology Corporation
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May 14, 2025
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By:
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/s/ Frank Bedu-Addo
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Frank Bedu-Addo, Ph.D.
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President and Chief Executive Officer
(Principal Executive Officer)
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May 14, 2025
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By:
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/s/ Lars Boesgaard
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Lars Boesgaard
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Chief Financial Officer
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(Principal Financial and Accounting Officer)
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34
