美国证券交易委员会
华盛顿特区20549
表格
[mark one]
根据1934年证券交易法第13或15(d)条，本季度报告 |
截止季度结束日期：
根据1934年证券交易法第13或15（d)条的转型报告 |
过渡期从______________到______________
委员会文件号
(公司注册名完全按照其章程规定)
(注册地或其他司法管辖区 | (税务局雇主 |
组建或组织) | 标识号码) |
(主要行政办公室地址，包括邮政编码)
(
(公司电话号码，包括区号)
(先前名称、先前地址和先前财政年度，如自上次报告以来发生变更)
根据证券法第12(b)条注册的证券：
每一类的名称 |
| 交易标的 |
| 注册交易所的名称 |
请在以下方框内打勾：(1) 在过去的12个月内(或者在注册公司需要提交此类报告的较短时期内)，公司已经提交了根据证券交易法1934年第13或15(d)条规定需要提交的所有报告；以及 (2) 在过去的90天内，公司一直受到了此类报告提交的要求。
请确认是否在过去12个月内（或该注册人需要提交此类文件的更短期间内）已经以电子方式提交了每个交互式数据文件，这些文件需要根据规则405（S-T条例§232.405）进行提交。
在交易所法案第120亿.2条中，勾选表示报告人为大型加速文件提交人、加速文件提交人、非加速文件提交人、小型报告公司或新成长公司。请参阅“大型加速文件提交者”、“加速文件提交者”、“小型报告公司”和“新兴成长公司”的定义。
大型加速报告人 | ☐ | 加速文件提交人 | ☐ | ☒ | 较小的报告公司 | 新兴成长公司 |
如果是一家新兴成长型公司，请在核对标记内指示公司是否已选择不使用从根据证券交易法第13(a)条提供的依据进行遵守任何新的或修订的财务会计准则的扩展过渡期。 ☐
请在以下方框内打勾：公司是否是空壳公司(根据证券交易法第12b-2条规定定义）。是
截至最近可行日期，发行人普通股的流通股数为：
前瞻性声明
Cellectar Biosciences公司的Form 10-Q季度报告中包含根据1934年修正的证券交易法第21E条的前瞻性声明，我们将其称为交易所法案。我们的前瞻性陈述示例包括：
| ● | 我们对业务策略、业务计划和研发活动的当前看法； |
| ● | 我们产品开发项目的进展，包括临床测试以及启动和结果的时间安排； |
| ● | 我们的预计操作结果，包括研究和开发费用； |
| ● | 我们有能力继续开发 iopofosine I 131（iopofosine，也称为CLR 131），CLR 1900 系列，CLR 2000 系列和CLR 12120 的计划； |
| ● | 我们有能力继续开发我们的磷脂酸药物结合物（PDC）™ 的计划； |
| ● | 我们有能力在美国继续维持对孤儿药物的指定 iopofosine 作为治疗多发性骨髓瘤、神经母细胞瘤、骨肉瘤、横纹肌肉瘤、尤因氏肉瘤和淋巴浆细胞淋巴瘤的治疗药物，以及孤儿药品地位的预期好处； |
| ● | 我方唯一供应商发生任何中断情况 iopofosine; |
| ● | 我们通过出售股权和/或债务证券、战略交易或其他方式获得额外资金的能力； |
| ● | 我们推进技术成为产品候选人的能力； |
| ● | 我们当前资源的增强和消费，以及获得额外资金的能力； |
| ● | 我们对于一般经济和市场状况，包括我们的竞争优势的当前看法； |
| ● | 由于冲突、军事行动、恐怖袭击、自然灾害、公共卫生危机(包括传染病或疾病如COVID-19大流行的发生)、网络攻击和一般不稳定性所导致的不确定性和经济不稳定性； |
| ● | 美国立法和监管发展对我们产品候选品定价和报销的未来影响； |
| ● | 我们达到纳斯达克的持续上市标准的能力； |
| ● | 任何上述内容的假设；以及 |
| ● | 任何其他涉及我们打算或相信将来会发生的事件或发展的声明。 |
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在某些情况下，您可以通过术语识别前瞻性声明，例如“预计”，“预计”，“打算”，“估计”，“计划”，“相信”，“寻求”，“可能”，“应该”，“可以”，“愿意”或类似表达。因此，这些声明涉及估计，假设和不确定性，可能导致实际结果与其中表达的结果有实质差异。前瞻性声明还涉及风险和不确定性，其中许多超出我们的控制范围。任何前瞻性声明都应完全参考本季度报告中讨论的因素。
您应该完整阅读本报告，并理解我们实际未来的结果可能与我们的预期有实质不同。您应该假定出现在本报告中的信息仅截至本日期为准确。因为本报中提到的风险因素可能导致实际结果或结果与我们或代表我们提出的任何前瞻性声明有实质不同，您不应过度依赖任何前瞻性声明。此外，任何前瞻性声明仅表明其发表之日，我们没有义务更新任何前瞻性声明以反映发表声明之日之后的事件或情况，或反映不可预测事件的发生。新的因素不时出现，我们无法预测哪些因素会出现。此外，我们无法评估每个因素对我们业务的影响，或任何因素，或多个因素的影响，可能导致实际结果与任何前瞻性声明中包含的结果有实质不同。
这份Form 10-Q季度报告中包含Cellectar Biosciences, Inc.的商标和服务标记。除非在本10-Q季度报告中另有规定，以™标识的商标属于Cellectar Biosciences, Inc.。所有其他商标均为其各自所有者的财产。
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第一部分 财务信息
项目1：基本报表
CELLECTAR BIOSCIENCES, INC.
简明合并资产负债表
(未经审计)
6月30日， | 运营租赁负债： | |||||
| 2024 |
| 2023 | |||
资产 |
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流动资产： |
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现金及现金等价物 | $ | |
| $ | | |
预付费用和其他流动资产 |
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总流动资产 |
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固定资产、厂房和设备，净额 |
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经营租赁资产使用权 |
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其他长期资产 |
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资产总计 | $ | |
| $ | | |
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负债和股东权益（赤字） |
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流动负债： |
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应付账款及应计费用 | $ | |
| $ | | |
认股权负债 | |
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租赁负债，流动 |
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流动负债合计 |
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长期租赁负债，扣除应付本金 |
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负债合计 | | | ||||
承诺和 contingencies（见注 7） |
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中间资本: |
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D轮优先股， |
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股东权益（赤字）： | ||||||
E-2系列优先股， |
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E-3系列优先股 |
| |
| — | ||
普通股，每股面值为 $0.0001； |
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额外实收资本 |
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累积赤字 |
| ( |
| ( | ||
3660 | | ( | ||||
负债合计及股东权益（亏损） | $ | | $ | | ||
随附说明是这些简明合并财务报表的一部分。
5
CELLECTAR BIOSCIENCES, INC.
简明合并利润表
(未经审计)
截至6月30日的三个月： | 截至6月30日的六个月： | |||||||||||
| 2024 |
| 2023 |
| 2024 |
| 2023 | |||||
营业费用: |
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研发 | $ | | $ | | $ | | $ | | ||||
ZSCALER, INC. |
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营业费用总计 |
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营业亏损 |
| ( |
| ( |
| ( |
| ( | ||||
其他收益（费用）： |
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认股权证估值收益（损失） | | ( | ( | ( | ||||||||
利息收入 |
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其他收入（支出）总额 |
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| ( |
| ( |
| ( | ||||
净损失 | $ | ( | $ | ( | $ | ( | $ | ( | ||||
每股亏损 - 基本 | $ | ( | $ | ( | $ | ( | $ | ( | ||||
每股稀释净损失 | $ | ( | $ | ( | $ | ( | $ | ( | ||||
基本加权平均普通股流通量 | | | | | ||||||||
稀释后加权平均每股优先股实际已发行数量 |
| |
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| |
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随附说明是这些简明合并财务报表的一部分。
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CELLECTAR BIOSCIENCES, INC.
可转换优先股和股东（赤字）权益综合报表
(未经审计)
D系列优先股 | 总费用 | ||||||||||||||||||||||||
股票 | 优先股 | 普通股 | 额外的 | 累积的 | 股东的 | ||||||||||||||||||||
| 股份 |
| 数量 |
|
| 股份 |
| 金额 |
| 股份 |
| 面值 |
| 实收资本 |
| $ |
| （亏损）股权 | |||||||
2022年12月31日结存余额 |
| | $ | | — | $ | — | | $ | | $ | | $ | ( | $ | | |||||||||
将预先融资权证转换为普通股 |
| — | — | — | — | | | — | — | | |||||||||||||||
以股票为基础的报酬计划 | — | — | — | — | — | — | | — | | ||||||||||||||||
净亏损 | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||
2023年3月31日的余额 | | | — | — | | | | ( | | ||||||||||||||||
以股票为基础的报酬计划 |
| — | — | — | — | — | — | | — | | |||||||||||||||
净亏损 | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||
2023年6月30日的余额 |
| | $ | | — | $ | — | | $ | | $ | | $ | ( | $ | ( | |||||||||
| |||||||||||||||||||||||||
2023年12月31日结余为 | | $ | | | $ | | | $ | | $ | | $ | ( | $ | ( | ||||||||||
以股票为基础的报酬计划 | — | — | — | — | — | — | | — | | ||||||||||||||||
将预付权证转换为普通股 | — | — | — | — | | | | — | | ||||||||||||||||
行使优先股认股权，扣除发行成本（注2） | — | — | | | — | — | — | — | | ||||||||||||||||
将E-3系列优先股转换为普通股 | — | — | ( | ( | | | | — | — | ||||||||||||||||
行使认股权证以换取普通股 | — | — | — | — | | | | — | | ||||||||||||||||
将E-2系列优先股转换为普通股 |
| — | — | ( | ( | | | | — | — | |||||||||||||||
已退市股票 | — | — | — | — | ( | — | — | — | — | ||||||||||||||||
净亏损 | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||
2024年3月31日结存余额 | | | | | | | | ( | | ||||||||||||||||
以股票为基础的报酬计划 | — | — | — | — | — | — | | — | | ||||||||||||||||
将E-3系列优先股转换为普通股 | — | — | ( | ( | | | | — | — | ||||||||||||||||
净亏损 |
| — | — | — | — | — | — | — | ( | ( | |||||||||||||||
2024年6月30日余额 |
| | $ | | | $ | | | $ | | $ | | $ | ( | $ | | |||||||||
随附说明是这些简明合并财务报表的一部分。
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CELLECTAR BIOSCIENCES, INC.
现金流量表简明综合报表
(未经审计)
截至2022年4月30日的六个月内 | ||||||
6月30日， | ||||||
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| 2024 |
| 2023 | ||
经营活动产生的现金流量： |
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净亏损 | $ | ( |
| $ | ( | |
用于调节净损失和经营活动产生的现金流量的调整项目为: |
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折旧和摊销 |
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股票补偿费用 |
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经营租赁权使用资产的变动 |
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认股证公允价值变动 |
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变动情况： | ||||||
预付费用和其他流动资产 | ( | | ||||
租赁负债 |
| ( |
| ( | ||
应付账款及应计费用 |
| ( |
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经营活动使用的现金 |
| ( |
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投资活动产生的现金流量： |
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购置固定资产 |
| ( | — | |||
投资活动使用的现金 |
| ( |
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筹资活动产生的现金流量： |
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行使认股权证所得款项，扣除发行成本净额 |
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融资活动提供的现金流量 | | | ||||
现金及现金等价物净增加额 | | ( | ||||
期初现金及现金等价物 |
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期末现金及现金等价物 | $ | | $ | | ||
现金流量补充披露 | ||||||
解除认股权证并转为股本 | $ | | $ | — | ||
优先股转换为普通股 | $ | | $ | — | ||
随附说明是这些简明合并财务报表的一部分。
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CELLECTAR 生物科学有限公司
简明合并财务报表附注（未经审计）
1。业务和组织的性质
Cellectar Biosciences, Inc.（以下简称 “公司”）是一家处于后期阶段的临床生物制药公司，专注于癌症治疗药物的发现、开发和商业化，利用公司专有的磷脂药物偶联物™（PDC™）交付平台，该平台专门靶向癌细胞，通过减少脱靶效应来提高疗效和安全性。
继续关注 — 作为一家新兴成长型公司，该公司自成立以来一直遭受巨额经常性亏损，并在运营中使用净现金，因为该公司将几乎所有的精力都用于研究、开发和寻求批准其候选产品在市场上商业化。由于这些努力，该公司的累计赤字约为 $
为了为其研究、开发和审批工作提供资金，公司自成立以来一直严重依赖私人投资者和公众股东通过发行证券提供的资金，例如普通股、可转换优先股和认股权证（外部资本）。该公司预计，在可预见的将来，该公司将继续严重依赖外部资本为公司的运营提供资金，直到其一种或多种候选产品获得批准并在市场上成功商业化。尽管管理层认为将根据需要获得额外的外部资本，但无法保证额外的外部资本会得到担保，也无法保证以公司可接受的条件进行担保。
截至随附的合并财务报表发布之日（“发行日期”），公司在发行之后的未来十二个月中为公司运营提供资金的可用流动性仅限于约美元
这些不确定性使人们对公司继续经营的能力产生了极大的怀疑。随附的财务报表是在公司将继续作为持续经营企业运营的基础上编制的，这意味着在可预见的将来，它将能够在正常业务过程中变现资产并结清负债和承诺。因此，随附的合并财务报表不包括可能因这些不确定性结果而产生的任何调整。
简明合并财务报表由Cellectar Biosciences, Inc.根据美利坚合众国普遍接受的中期财务信息会计原则（美国公认会计原则）以及表格10-Q和第S-X条例第10条的说明编制。因此，它们不包括美国公认会计原则要求的完整财务报表的所有信息和脚注。管理层认为，本文件中的披露足以满足中期报告要求。
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截至2023年12月31日的附注简明合并资产负债表来源于公司经审计的基本报表。截至2024年6月30日的附注简明合并资产负债表，以及截至2024年6月30日和2023年的前六个月的简明合并损益表、现金流量表和股东权益合并报表，以及基本报表附注中包含的相关中期信息，均按照美国一般公认会计原则（美国U.S. GAAP）和证券交易委员会（SEC）有关中期财务信息的指导、规则和法规编制。因此，它们不包括美国U.S. GAAP要求的所有细节和附注，以形成完整的基本报表。在管理层看来，未经审计的中期简明合并财务报表反映了截至2024年6月30日公司的合并财务状况以及截至2024年和2023年的前六个月公司的合并经营业绩、现金流量和股东权益的公平呈现所需的本质性调整。截至2024年6月30日的六个月业绩并不一定代表未来业绩。
这些未经审计的简明合并财务报表应与公司于2024年10月29日提交给SEC的年度财务报表附注一起阅读，该报表包括截至2023年12月31日的财年10-K/A表。
使用估计根据通用会计准则编制附带的合并基本报表，需要管理层对资产和负债的报告金额以及在合并基本报表日期当日的或有资产和负债的披露以及报告期间费用金额做出一定的估计和假设。重要的估计包括用于潜在负债的计提假设，权证负债的估值，债务和权益工具的估值，用于服务发行的股票期权的估值以及递延税资产准备金的估值。实际结果可能与这些估计值有所不同。
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固定资产 —— 固定资产以成本计量。折旧额按照资产的预计可用年限采用直线法提供，
使用权（ROU） 资产和租赁负债 公司按照FASB会计准则 codification（ASC）第842号主题《租赁》的规定，计提所有重大租约。使用权资产按照其估计的有用寿命摊销，其表示租约的全期。详见注释8。
以股票为基础的补偿公司使用Black-Scholes期权定价模型计算授予日期的股票期权奖励的公允价值。由此产生的补偿费用，扣除非基于绩效的奖励的弃权，按照奖励的服务期间以直线方式确认，截至2024年和2023年6月30日结束的三个月和六个月批准日期范围内。
迄今为止，我们的研究和开发费用与AV-101的开发有关。研究和开发费用按照发生的原则确认，并将在收到将用于研究和开发的货物或服务之前支付的款项资本化，直至收到这些货物或服务。研发成本会在发生的时候支出。公司确认当有可能公司会遵守补助安排附带的条件并且补助款项会收到时，公司会确认收入和成本报销。政府补助款项会按照公司确认与政府补助款项有关的成本的期间，系统性地确认。具体来说，当政府补助款项与收入成本或营业费用的报销相关时，政府补助会在综合损益表中确认为相关费用的减少。公司会在资产负债表中的预付费用和其他流动资产中记录应收政府补助款项。
率所得税会使用负债会计方法来核算。根据这种方法，延缓税资产和负债是根据资产和负债的财务报表基础和税基础之间的暂时差异以及净营运亏损和信贷转嫁使用实施的税率来确定的，这种差异预计会在税率会恢复的年份生效。对于税率变更对延缓税资产和负债的影响会在包括批准日期的那个期间在收入中确认。一旦有更加可能不实现公司毛延缓税资产的一部分，就会设立估值准备金。在准备纳税申报表的过程中所采取或预计会采取的税收立场需要评估，以确定这些税收立场是否更可能会被适用纳税权威维持。未能达到更可能会达到的门槛的税收立场会在当年记录为税收支出。截至2024年6月30日和2023年12月31日，没有需要计入或在财务报表中披露的不确定的税收立场。
金融工具的公允价值ASC主题825指南要求披露某些金融工具的公允价值。附表中的金融工具包括货币资金、预付费用和其他资产、应付账款及应计负债、长期负债等。由于其短期性质，货币资金、预付费用、其他流动资产和应付账款的账面价值近似于其公允价值（见附注2和3）。
权证 公司根据ASC480《区分负债与权益》和ASC815《衍生工具和套期交易》中的具体条款和适用的权威指引，将权证分类为权益类或负债类工具。评估考虑了权证是否根据ASC480独立存在的金融工具，是否符合ASC480对负债的定义，以及权证是否符合ASC815对权益分类的所有要求，包括权证是否与公司自身的普通股挂钩，以及权证持有人是否可能在公司无控制权的基本交易中要求净现金结算等权益分类条件。这一评估需要专业判断，分别在发行权证时和权证有效期内的每个后续季度结束日期进行（见附注2）。如果权证属于负债分类，估值变动以及发行权证的成本将计入基本报表中的其他收入（费用）（见附注3）。如果初始将这些工具分类为负债或者权益，后续评估确定分类已更改，公司将在基本报表中反映这一变化。
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优先股 公司根据ASC 480和ASC 815的权威指导，基于特定条款对优先股进行核算，包括它们是否是独立工具，是否存在任何赎回或转换方面，以及它们如何要求结算（特别是是否存在现金结算方面），以及它们是否具有主要类似债务或类似股权的特征，它们是否具有嵌入式衍生工具，以及是否具有赎回特征。根据这些标准的分析，优先股将被分类为债务、临时（或“中层”）股权或永久股权。然后每季度评估结果分类，判断是否需要更改分类。
信贷风险集中—— 使公司面临信用风险的金融工具主要包括存放在金融机构的现金和现金等价物。截至2024年6月30日和2023年12月31日，公司的多余现金存放在与知名金融机构的利息收入账户中。有时，这些金额可能超过FDIC保险限额。截至2024年6月30日和2023年12月31日，未投保的现金余额约为$
政府援助 根据政府援助计划，符合条件的支出报销会被记录为营业成本减少，前提是公司有合理保证会遵守拨款安排附加条件，并且已经提出了报销。确定报销金额，以及因此而产生的应收金额，需要管理层根据其对符合计划条款的支出的解释进行计算。公司提交的报销申请将由相关政府机构进行审核。 公司目前通过新华保险获得了一项癌症治疗研究奖，总额约为1000万美元，为期约
2024年6月30日结束的六个月内，公司获得了约
最近颁布但尚未颁布的会计准则— 2023年12月，FASB发布了《会计准则更新》（ASU）2023-09，所得税（第740号课题）—改进所得税披露，旨在增强所得税披露的透明度和决策效用。公众企业必须在2024年12月15日后开始的年度财政期间采纳此标准，允许提前采纳。公司正在评估采纳此指导对其合并财务报表和相关披露的影响。
2023年11月，FASB发布了ASU 2023 - 07，分部报告（课题280）。此更新的修订扩展了分部披露要求，包括针对具有单个可报告分部的实体的新分部披露要求，以及其他披露要求。此更新对于2023年12月15日后开始的财政年度和2024年12月15日后开始的财政年度内的中期时段有效。公司目前正在评估采纳ASU 2023 - 07将对其简明合并财务报表产生的影响。
公司评估了FASB发布的所有ASU，以考虑其对财务报表的适用性。公司评估了所有已发布但尚未采纳的ASU，并得出结论，未披露的不相关于公司或预计不会对公司产生实质影响。
修正前发出的合并财务报表 — 在2024年第三季度，并在提交本10-Q表格之前，公司确定有必要重新评估公司以往发行的某些认股权证和优先股的会计处理方式。此外，公司确定部分先前列为研发费用的运营成本更适合归类为一般和管理费用。根据《会计理论公告》第99号（SAb No. 99）第1.m，“重要性”和SAb No. 99 第1.N “在计量当年财务报表中的错报后考虑错报的影响”条款，公司评估了这些错误对其先前发行的合并财务报表的重要性。基于公司对定量和定性因素的评估，公司得出结论，这些错误对公司截至2023年12月31日和2022年的合并财务报表，以及2024年第一季度的财务报表具有重要性。因此，本10-Q表格呈现了公司截至2023年12月31日已反映在公司10-K/A表中的6月30日为止的重新说明的公司简明合并财务报表。
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2. 股东权益
2023年9月定向增发
2023年9月8日，在私募定向增发中，公司向某些机构投资者发行了
优先股的转换价格如下：对于E-1或E-2系列优先股，每股美元
| ● | A档认股权证，总行使价格为 $ |
| ● | B档认股权证，总行使价格为 $ |
截至2023年12月31日，Tranche A和Tranche b认股权证不符合衍生品的资格；但是，它们不符合公司股票可被编入指数的要求。因此，根据FASB ASC 815的指导，认股权证被视为负债。截至2024年6月30日，Tranche A认股权证结算后，Tranche b认股权证不再符合衍生品，符合公司股票可被编入指数的要求。然而，由于现金结算功能需要在公司无法控制的基本交易事件中进行现金结算，导致与其他证券持有人获得的结算方式不一致，认股权证不符合权益分类指导。因此，根据ASC 815的指导，Tranche b认股权证继续被视为负债。所有此类负债必须按公允价值列示，变动应反映在财务期间的财务结果中。有关估值请参阅附注3。
发行时，Series E-1优先股具有赎回特性；因此，截至2023年9月30日，它被归类为中间资本。Series E-1优先股还设有清算特权，计算方法为每股金额等于（i）原始每股价格的两倍（2倍），加上任何已宣布但未支付的股利，或（ii）如果所有Series E-1优先股立即在清算前转换为普通股，则应支付的每股金额。在Series E-1优先股未偿还时，由于清算特权影响了这些认股权证在清算事件中的处理，导致Tranche A和Tranche b认股权证被视为可处置的。根据ASC 480的指导，可处置认股权证被视为负债。这些特征仅适用于Series E-1优先股未偿还时；在公司于2023年10月25日举行的股东特别会议上获得股东批准该交易后，Series E-1优先股立即转换为Series E-2优先股和/或普通股，具体取决于持有人的受益所有权位置。
2023年9月定向增发的净收益首先分配给Tranche A和Tranche b认股权证的公平价值，其发行时的公允价值为$
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E-2系列优先股可在持有人的请求下转换为普通股，但转换需遵守融资协议规定的持有人不得超过一定的受益所有权比例。E-2系列优先股发行后，2023年12月31日前，优先股持有人进行了转换。
在2024年6月30日结束的六个月内，没有发行股份。
2024年1月，公司发布了其关键性、第20亿项CLOVER Wam试验的前期数据。根据第A笔认股权证的条款，认股权的到期日提前至 在前期数据发布后的交易日后，认股权持有人全部行使了A笔认股权，导致公司发行
2024年6月30日结束的六个月内，持有
2022年10月公开发行和定向增发
于2022年10月25日，公司完成了每股
在2024年6月30日结束的六个月内，没有发行股份。
权证
以下表格总结了截至2024年6月30日持有的购买股票的未行使认股权证信息：
股份数量 | ||||||||
可发行的 |
| |||||||
行使 |
| |||||||
未偿还金额 | 行权 |
| ||||||
增发计划 |
| 权证 |
| 价格 |
| 到期日期 | ||
2023 年份 B 类优先认股权证 | | $ | | |||||
2022年普通认股权证 | | $ | ||||||
2020年6月H系列普通认股权证 | | $ | ||||||
2017年10月份D系列普通认股权证 | | $ |
| |||||
总费用 |
| |
|
|
|
| ||
以上表格中的所有认股权证均被分类为负债。
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3. 公允价值
根据ASC 820中对公允价值衡量和披露主题的规定，公司将其一般以公允价值衡量的金融资产和金融负债分为三个级别，根据资产和负债交易的市场以及确定公允价值所使用的假设的可靠性:
| ● | 第1级：在活跃市场中报价的相同金融资产或负债的输入价格。 |
| ● | 第2级：除第1级报价之外的输入，例如在活跃市场中报价的类似金融资产和负债的价位，以及在不活跃市场中的相同资产和负债的价格，或者可由可观察的市场数据证实或经可观察的市场数据证实的其他输入。 |
| ● | 三级：输入报价对于金融资产或负债的公允价值具有重要意义，但并非通过活跃市场观察或支持。 |
在估值基于市场上不太可观察或难以观测的模型或输入时，公允价值的判断需要更多判断。因此，公司在确定公允价值时所行使的判断程度最大的是分类为三级的工具。金融工具在公允价值层次结构中的级别是基于对公允价值测量具有重要意义的任何输入的最低级别。现金及现金等价物的账面价值接近公允价值，因为到期期限不到三个月。其他流动财务资产和负债的报告账面价值接近公允价值，因为其为短期性质。截至2024年6月30日，公司没有任何一级或二级负债。
作为2023年9月融资的一部分（请参见附注2），公司发行了A档和B档权证（2023权证）来购买优先股的股票，根据转换政策，代表了
2023年认股权证被分类到第3级层次中，因为这些输入的性质和使用的估值技术，并且在2024年6月30日和2023年12月31日分别具有50美元的公允价值，这些数值包含在相关资产负债表上的认股权责任标题中。
以下表总结了2024年6月30日和2023年12月31日使用的修改期权定价假设。
| 6月30日, |
| 12月31日 | ||
2024 | 2023 | ||||
波动性 | % | % | |||
无风险利率 |
| % | % | ||
预计寿命（年） |
| ||||
分红 |
| % | % |
在行使A档认股权证时，根据E-3系列优先股的普通股换股比率与认股权证行使时的股票交易价格之间的差额计算，其公允价值被判断为$
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根据ASC 815的规定，根据协议中的现金结算功能，第二特权证继续被列为负债。重新分类为股本。
2022年10月，公司共发行了
2022年普通认股权证的公平价值是通过使用Black-Scholes期权定价模型确定的。影响2022年普通认股权证公平价值测量的定量要素包括基础普通股每股价值、无风险利率、预期分红派息和公司股票的预期波动率。无风险利率是根据与认股权证剩余合约期限大致相等的时间段的美国国债收益率曲线确定的。公司根据预期的分红派息和公司从未支付或宣布现金分红的事实，估算了一定的分红率。根据公司普通股的历史波动率确定了预期波动率。由于这些输入的性质和使用的估值技术，这些认股权证属于第3级层次结构。下表总结了每个财务报告日期使用的假设。
| 6月30日， |
| 运营租赁负债： |
| |
2024 | 2023 | ||||
波动性 | % | % | |||
无风险利率 |
| | % | | % |
预计寿命（年） |
| |
| | |
分红 |
| % | % |
以下表格总结了属于第3级公允价值层级内的 warrants 的公允市场价值变化，包括2023年9月份的 Warrants 和 2022年10月份的 Warrants:
| 三级 | ||
2023年12月31日Level 3负债的公允价值 | $ | | |
期权公允价值变动 | | ||
将2023年Tranche A 期权结算为股本 | ( | ||
行使2022年10月份的期权 |
| ( | |
2024年6月30日，三级负债的公允价值 | $ | | |
4. 基于股票的薪酬
股票激励计划会计处理
2021年股票激励计划
公司保留了2021年股票激励计划（“2021计划”）。公司将股票作为雇员和非雇员董事和高管薪酬政策的组成部分之一。董事会的一个委员会确定所授予奖励的条款，并可能授予各种形式的基于股权的激励薪酬。目前，这些激励主要包括期权和受限制股份。根据2015年股票激励计划（“2015计划”）的条款，所有未使用的奖励仍然有效。根据2015计划的条款，当前适用于2015计划的股份以及用于授予2021计划股份的任何股份，如果在2015计划下被没收、取消、公司再收购或以其他方式终止，则将纳入可供授予的股份中。
根据当前的股票期权授予计划，所有期权在发行后一到三年后可行使，并在十年后到期。每份股票期权奖励的公允价值是根据授予日期使用Black-Scholes期权定价模型估计的。波动率基于公司历史普通股波动率。无风险利率基于当时实际的美国国债收益曲线。授予的股票期权的预期期限是基于预计未来期权将被行使的估计。没收在发生时进行记录。过去未记录任何分红派息。
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At the annual meeting of stockholders held on June 14, 2024, the Company’s stockholders approved an increase in the number of shares of common stock available for issuance under the 2021 Stock Incentive Plan by
The following table summarizes amounts charged to expense for stock-based compensation related to employee and director stock option grants:
Three Months Ended | Six Months Ended | |||||||||||
June 30, | June 30, | |||||||||||
| 2024 |
| 2023 |
| 2024 |
| 2023 | |||||
Employee and director stock option grants: |
|
|
|
|
|
|
|
| ||||
Research and development | $ | | $ | | $ | | $ | | ||||
General and administrative |
| |
| |
| |
| | ||||
Total stock-based compensation | $ | | $ | | $ | | $ | | ||||
In December 2023, the Company granted
Assumptions Used in Determining Fair Value
Valuation and amortization method. The fair value of each stock award is estimated on the grant date using the Black-Scholes option-pricing model. The estimated fair value of employee stock options is amortized to expense using the straight-line method over the required service period which is generally the vesting period. The estimated fair value of the non-employee options is amortized to expense over the period during which a non-employee is required to provide services for the award (usually the vesting period).
Volatility. The Company estimates volatility based on the Company’s historical volatility since its common stock is publicly traded.
Risk-free interest rate. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant commensurate with the expected term assumption.
Expected term. The expected term of stock options granted is based on an estimate of when options will be exercised in the future. The Company applies the simplified method of estimating the expected term of the options, as described in the SEC’s Staff Accounting Bulletins 107 and 110, as the historical experience is not indicative of the expected behavior in the future. The expected term, calculated under the simplified method, is applied to groups of stock options that have similar contractual terms. Using this method, the expected term is determined using the average of the vesting period and the contractual life of the stock options granted. The Company applied the simplified method to non-employees who have a truncation of term based on termination of service and utilizes the contractual life of the stock options granted for those non-employee grants which do not have a truncation of service.
Forfeitures. The Company records stock-based compensation expense only for those awards that are expected to vest and accounts for forfeitures as they occur.
Dividends. The Company has not historically recorded dividends related to stock options.
Exercise prices for all grants made during the six months ended June 30, 2024 and June 30, 2023, were equal to the market value of the Company’s common stock on the date of grant.
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5. INCOME TAXES
The Company accounts for income taxes in accordance with the liability method of accounting. Deferred tax assets or liabilities are computed based on the difference between the financial statement and income tax basis of assets and liabilities, and net operating loss carryforwards (“NOLs”), using the enacted tax rates. Deferred income tax expense or benefit is based on changes in the asset or liability from period to period. The Company did not record a provision or benefit for federal, state or foreign income taxes for the six months ended June 30, 2024 or 2023 because the Company has experienced losses on a tax basis since inception. Management has provided a full allowance against the value of its gross deferred tax assets in light of the continuing losses and uncertainty associated with the utilization of the NOLs in the future.
The Company also accounts for the uncertainty in income taxes related to the recognition and measurement of a tax position taken or expected to be taken in an income tax return. The Company follows the applicable accounting guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition related to the uncertainty in income tax positions. No uncertain tax positions have been identified.
6. NET LOSS PER SHARE
Basic net loss per share is computed by dividing net loss attributable to common stockholders by the weighted average number of shares of common stock and pre-funded warrants outstanding during the period. The pre-funded warrants are considered common shares outstanding for the purposes of the basic net loss per share calculation due to the nominal cash consideration and lack of other contingencies for issuance of the underlying common shares. Diluted net loss attributable to common stockholders per share is computed by dividing net loss attributable to common stockholders, as adjusted, by the sum of the weighted average number of shares of common stock and the dilutive potential common stock equivalents then outstanding. Potential common stock equivalents consist of stock options, warrants, and convertible preferred shares. In accordance with ASC Topic 260, Earnings per Share, diluted earnings per share are the amount of earnings for the period available to each share of common stock outstanding during the reporting period and to each share that would have been outstanding assuming the issuance of common shares for all dilutive potential common shares outstanding during the reporting period. In the quarter ended June 30, 2024, the common warrants issued in October 2022 were dilutive. In all other periods presented, all outstanding warrants were antidilutive.
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Net loss allocated to common shares | $ | ( | |
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Net loss per share - diluted | $ | ( |
The following potentially dilutive securities have been excluded from the computation of diluted net loss per share since their inclusion would be antidilutive:
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7. COMMITMENTS AND CONTINGENCIES
Legal
The Company may be involved in legal matters and disputes in the ordinary course of business. It is not anticipated that the outcome of such matters and disputes will materially affect the Company’s financial statements.
8. LEASES
Operating Lease Liability
In June 2018, the Company executed an agreement for office space in the Borough of Florham Park, Morris County, New Jersey to be used as its headquarters (HQ Lease). The HQ Lease commenced upon completion of certain improvements in October 2018.
On December 30, 2022, the Company entered into an Amended Agreement of Lease of the HQ Lease (Amended HQ Lease), with CAMPUS 100 LLC (the “Landlord”). Under the Amended HQ Lease, which was accounted for as a modification of the initial lease, the Company will continue to lease
Under the terms of the Amended Lease, the Company Company’s previously paid security deposit of $
Discount Rate
The Company has determined an appropriate interest rate to be used in evaluating the present value of the Amended Lease liability considering factors such as the Company’s credit rating, borrowing terms offered by the U.S. Small Business Administration, amount of lease payments, quality of collateral and alignment of the borrowing term and lease term. The Company considers
Maturity Analysis of Short-Term and Operating Leases
The following table approximates the dollar maturity of the Company’s undiscounted payments for its short-term leases and operating lease liabilities as of June 30, 2024:
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Present value of lease liabilities | $ | |
9. SUBSEQUENT EVENTS
On July 21, 2024, the Company, entered into a warrant exercise inducement (the “Inducement”) with certain holders (each a “Holder”) of its Tranche B warrants (the “Existing Warrants”), which were originally issued in September 8, 2023, pursuant to which the Holders agreed to exercise for cash their Existing Warrants to purchase an amount of shares of the Company’s Series E-4 Convertible Voting Preferred Stock, par value $
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Overview
You should read the following discussion and analysis of our financial condition and results of operations together with the unaudited financial information and notes thereto included in this Quarterly Report on Form 10-Q. Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report, including information with respect to our plans and strategy for our business, include forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the “Risk Factors” section in our Annual Report on Form 10-K/A for the year ended December 31, 2023, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.
We are a late-stage clinical biopharmaceutical company focused on the discovery, development and commercialization of drugs for the treatment of cancer. Our core objective is to leverage our proprietary phospholipid ether drug conjugate™ (PDC™) delivery platform to develop PDCs that are designed to specifically target cancer cells and deliver improved efficacy and better safety as a result of fewer off-target effects. We believe that our PDC platform possesses the potential for the discovery and development of the next generation of cancer-targeting treatments, and we plan to develop PDCs both independently and through research and development collaborations.
Our lead PDC therapeutic, iopofosine I 131 (iopofosine) is a small-molecule PDC designed to provide targeted delivery of iodine-131 directly to cancer cells, while limiting exposure to healthy cells. We believe this profile differentiates iopofosine from many traditional on-market treatments and radiotherapeutics. Our CLOVER-WaM Phase 2 pivotal study of iopofosine in patients with relapsed/refractory (r/r) Waldenstrom’s macroglobulinemia (WM) has completed, and our Phase 2b studies in r/r multiple myeloma (MM) patients and r/r central nervous system lymphoma (CNSL) are ongoing. The CLOVER-2 Phase 1a study for a variety of pediatric cancers has concluded and a Phase 1b study in pediatric patients with high grade glioma is enrolling. Additionally, a Phase 1 Investigator-initiated study conducted by the University of Wisconsin Madison of iopofosine I 131 in combination with external beam radiation in patients with recurrent head and neck cancer has also completed. As with all clinical trials, adverse events, serious adverse events or fatalities may arise during a clinical trial resulting from medical problems that may not be related to clinical trial treatments.
The U.S. Food and Drug Administration (FDA) granted iopofosine Fast Track Designation for lymphoplasmacytic lymphoma (LPL) and WM patients having received two or more prior treatment regimens, as well as r/r MM and r/r diffuse large B-cell lymphoma (DLBCL). Orphan Drug Designations (ODDs) have been granted for LPL/WM, MM, neuroblastoma, soft tissue sarcomas including rhabdomyosarcoma, Ewing’s sarcoma and osteosarcoma. Iopofosine was also granted Rare Pediatric Disease Designation (RPDD) for the treatment of neuroblastoma, rhabdomyosarcoma, Ewing’s sarcoma and osteosarcoma. The European Commission granted ODD to iopofosine for treatment of r/r MM and WM, as well as PRIME designation for WM.
Additionally, in June 2020, the European Medicines Agency (EMA) granted us Small and Medium-Sized Enterprise (SME) status by the EMA’s Micro, Small and Medium-sized Enterprise office. SME status allows us to participate in significant financial incentives that include a 90% to 100% EMA fee reduction for scientific advice, clinical study protocol design, endpoints and statistical considerations, quality inspections of facilities and fee waivers for selective EMA pre-and post-authorization regulatory filings, including orphan drug and PRIME designations. We are also eligible to obtain EMA certification of quality and manufacturing data prior to review of clinical data. Other financial incentives include EMA-provided translational services of all regulatory documents required for market authorization, further reducing the financial burden of the market authorization process.
Our product pipeline also includes a PDC-based targeted alpha-emitter therapy utilizing actinium-225 as the payload (CLR121225) currently in IND enabling studies. We are also evaluating other alpha emitting isotopes such as astatine-211 and lead-212 preclinically. Additionally, our preclinical PDC programs include small molecule chemotherapeutic compounds, oligonucleotide programs and peptide conjugate programs as well as several partnered PDC assets. These other programs are being developed primarily for solid tumors.
We have leveraged our PDC platform to establish three ongoing collaborations featuring four unique payloads and mechanisms of action. Through research and development collaborations, our strategy is to generate near-term capital, supplement internal resources, gain access to novel molecules or payloads, accelerate product candidate development, and broaden our proprietary and partnered product pipelines.
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Our PDC platform is designed to provide selective delivery of a diverse range of oncologic payloads to cancerous cells, whether a hematologic cancer or solid tumor; a primary tumor, or a metastatic tumor; and cancer stem cells. The PDC platform’s mechanism of entry is designed not to rely upon a specific cell surface epitope or antigen as are required by other targeted delivery platforms but rather a unique change in the tumor cell membrane. Our PDC platform takes advantage of a metabolic pathway (beta oxidation) utilized by nearly all tumor cell types in all stages of the tumor cycle. Tumor cells modify the cell membrane to create specific, highly organized microdomains by which to transport lipids and long chain fatty acids into the cytoplasm, as a result of the utilization of this metabolic pathway. Our PDCs are designed to bind to these regions and directly enter the intracellular compartment. This mechanism allows the PDC molecules to accumulate in tumor cells over time, which we believe can enhance drug efficacy. The direct intracellular delivery allows our molecules to avoid the specialized, highly acidic cellular compartment known as lysosomes, which allows a PDC to deliver payloads that previously could not be delivered in this targeted manner. Additionally, molecules targeting specific cell surface epitopes face challenges in completely eliminating a tumor because the targeted antigens are limited in the total number presented on the cell surface, limiting total potential uptake and resulting in heterogenous uptake across the tumor, have longer cycling time from internalization to relocation on the cell surface, again diminishing their availability for binding, and are not present on all of the tumor cells because of the heterogenous nature of cancer cells, further increasing the unequal distribution of the drug across the tumor. This means a subpopulation of tumor cells always exists that cannot be addressed by therapies targeting specific surface epitopes. Additionally, many epitopes utilized are also present on other normal tissue, resulting in off-target toxicities.
Beyond the benefits provided by the mechanism of entry, the PDC platform features include the capacity to link with almost any molecule, provide a significant increase in targeted oncologic payload delivery, a more uniform delivery, and the ability to target virtually all types of tumor cells. As a result, we believe that we can create PDCs to treat a broad range of cancers with the potential to improve the therapeutic index of oncologic drug payloads, enhance or maintain efficacy while also reducing adverse events by minimizing drug delivery to healthy cells, and increasing delivery to cancerous cells and cancer stem cells.
We employ a drug discovery and development approach that allows us to efficiently design, research and advance drug candidates. Our iterative process allows us to rapidly and systematically produce multiple generations of incrementally improved targeted drug candidates without the expense of having to generate significant compound libraries.
A description of our PDC product candidates follows:
Clinical Pipeline
Our lead PDC therapeutic, iopofosine, is a small-molecule PDC designed to provide targeted delivery of iodine-131 directly to cancer cells, while limiting exposure to healthy cells. We believe this profile differentiates iopofosine from many traditional on-market treatments and treatments in development. Iopofosine was recently evaluated in the completed CLOVER-WaM Phase 2 pivotal study in patients with r/r WM, while evaluation is ongoing in a Phase 2b study in r/r MM and CNS lymphoma patients and the CLOVER-2 Phase 1b study for pediatric patients with high grade gliomas. Adverse events across all studies have been largely restricted to fatigue (39%), and cytopenias; specifically, thrombocytopenia (75%), anemia (61%), neutropenia (54%), leukopenia (56%), and lymphopenia (34%). Fatalities have occurred in patients post-treatment with iopofosine.
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The CLOVER-WaM pivotal Phase 2b study completed enrollment of WM patients that have received at least two previous lines of therapy including those that failed or had a suboptimal response to a BTKi therapy in 4Q 2023. Topline safety data was reported on 45 patients meeting the criteria for the mITT population with a data cut-off date of January 3, 2024. Topline efficacy evaluable population (n=41) was defined as patients who were in the mITT and had follow up of at least 60 days post last dose. The CLOVER-WaM study met its primary endpoint with a MRR of 61% (95% confidence interval [44.50%, 75.80%, two-sided p value < 0.0001]) exceeding the agreed-upon statistical hurdle of 20%. The ORR in evaluable patients was 75.6%, and 100% of patients experienced disease control. Responses were durable, with median duration of response not reached and 76% of patients remaining progression free at a median follow-up of eight months. These outcomes exceed real world data, which demonstrate a 4-12% MRR and a duration of response of approximately six months or less despite continuous treatment in a patient population that is less pretreated and not refractory to multiple classes of drugs. Notably, iopofosine monotherapy achieved a 7.3% complete remission (CR) rate in this highly refractory WM population. Iopofosine I 131 was well tolerated and its toxicity profile was consistent with the Company’s previously reported safety data. There were no treatment-related adverse events (TRAEs) leading to discontinuation. The rates of Grade 3 or greater TRAEs observed in more than 10% of patients included thrombocytopenia (55%), neutropenia (37%), and anemia (26%). All patients recovered from cytopenias with no reported aplastic sequalae. Importantly, there were no clinically significant bleeding events, and the rate of febrile neutropenia was 2%. There were no treatment-related deaths in the study.
The CLOVER-1 Phase 2 study met the primary efficacy endpoints from the Part A dose-finding portion, conducted in r/r B-cell malignancies, and is now enrolling an MM and CNSL expansion cohort (Phase 2b). The Phase 2b study will evaluate highly refractory MM patients in triple class, quad- and penta-drug refractory patients, including post-BCMA immunotherapy patients and r/r CNSL patients. The initial Investigational New Drug (IND) application was accepted by the FDA in March 2014 with multiple INDs submitted since that time. The Phase 1 study was designed to assess the compound’s safety and tolerability in patients with r/r MM and to determine maximum tolerated dose (MTD) and was initiated in April 2015. The study completed enrollment and the final clinical study report is expected in the first half of 2025. Initiated in March 2017, the primary goal of the Phase 2a study was to assess the compound’s efficacy in a broad range of hematologic cancers.
The CLOVER-2 Phase 1a pediatric study was conducted internationally at seven leading pediatric cancer centers. The study was an open-label, sequential-group, dose-escalation study to evaluate the safety and tolerability of iopofosine in children and adolescents with relapsed or refractory cancers, including malignant brain tumors, neuroblastoma, sarcomas, and lymphomas (including Hodgkin’s lymphoma). The maximum tolerated dose was determined to be greater than 60mCi/m2 administered as a fractionated dose. CLOVER-2 Phase 1b study is an open-label, international dose-finding study evaluating two different doses and dosing regiments of iopofosine in r/r pediatric patients with high grade gliomas. These cancer types were selected for clinical, regulatory and commercial rationales, including the radiosensitive nature and continued unmet medical need in the r/r setting, and the rare disease determinations made by the FDA based upon the current definition within the Orphan Drug Act.
In December 2014, the FDA granted ODD for iopofosine for the treatment of MM. In 2018, the FDA granted ODD and RPDD for iopofosine for the treatment of neuroblastoma, rhabdomyosarcoma, Ewing’s sarcoma, and osteosarcoma. In May 2019, the FDA granted Fast Track Designation for iopofosine for the treatment of MM and in July 2019 for the treatment of DLBCL. In September 2019 iopofosine received ODD from the European Union for MM. In December 2019, the FDA and the European Union each granted ODD for iopofosine for the treatment of WM. In September 2023, the European Union granted PRIME designation for iopofosine for the treatment of r/r WM. The FDA granted Fast Track designation for iopofosine for the treatment of r/r LPL and WM in May 2020.
As the result of iopofosine’s RPDD designation, we may be eligible to receive a priority review voucher (PRV) if the product receives approval for any of the treatment of neuroblastoma, rhabdomyosarcoma, Ewing’s sarcoma, or osteosarcoma. The FDA may award PRV to sponsors of a product application for a RPDD that meet its specified criteria. The key criteria to receiving PRV is that the drug be approved for a rare pediatric disease and treat a serious or life-threatening manifestation of the disease or condition that primarily affects individuals under the age of 18. In order to receive a PRV, a sponsor must obtain approval of a “rare pediatric disease product application,” which is a human drug application for prevention or treatment of a rare pediatric disease and which contains no active ingredient, including any ester or salt thereof, that has been approved by the FDA; is deemed eligible for priority review; is submitted under section 505(b)(1) of the Federal Food, Drug, and Cosmetic Act (FDCA) or section 351(a) of the Public Health Service Act (PHSA); relies on clinical data derived from studies examining a pediatric population and dosages of the drug intended for that population; does not seek approval for an adult indication in the original rare pediatric disease application; and is approved after September 30, 2016. Under this program, a sponsor who receives an approval for a drug or biologic for a rare pediatric disease can receive a PRV that can be redeemed to receive a priority review of a subsequent marketing application for a different product. Additionally, the PRV’s can be exchanged or sold to other companies so that the receiving company may use the voucher. Congress has only authorized the rare pediatric disease priority review voucher program until September 30, 2024. However, if a drug candidate receives RPDD before September 30, 2024, it is eligible to receive a voucher if it is approved before September 30, 2026.
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CLOVER-WaM: Phase 2 Pivotal Study in: Patients with r/r Waldenstrom’s Macroglobulinemia
We participated in a Type C guidance meeting with the FDA in September 2020. The results of that guidance meeting provided us with an agreed upon path for conducting the CLOVER-WaM study; a single arm, pivotal study in WM patients that have received and relapsed or were refractory to two prior lines of therapy, including having failed or had a suboptimal response to BTKi therapy. WM is a rare, indolent, and incurable form of non-Hodgkin’s lymphoma (NHL) that is composed of a patient population in need of new and better treatment options.
The study enrolled 65 WM patients who have received at least two prior lines of therapy, failed both lines of therapy including having failed or had a suboptimal response to a BTKi (i.e. ibrutinib). Patients in the trial received 4-doses of iopofosine over two cycles (cycle one: days 1, 15, and cycle two: days 57, 71) with each dose administered as a 15mCi/m2 infusion. The primary endpoint of the trial is major response rate (MRR) defined as a partial response (a minimum of a 50% reduction in IgM) or better in patients that receive a minimum total body dose (TBD) of 60 mCi with secondary endpoints of treatment-free survival (treatment-free remission), duration of response and progression-free survival. An independent data monitoring committee (iDMC) performed an interim safety and futility evaluation on the first 10 patients enrolled. If three of the 10 patients experienced a Clinically Significant Toxicity (CST) then the dose would have been reduced to 12.5 mCi/m2. We believe this design aligned with the feedback received from the FDA during the guidance meeting held in September 2020 and subsequent interactions. The FDA accepted the dose to be tested, our proposal for a safety and futility assessment to be conducted on the first 10 patients, the endpoint to be assessed, the statistical analysis plan and study size of approximately 50 patients in the mITT population (>60mCi TBD). Based upon this agreement, the pivotal study was initiated. The interim futility and safety assessment occurred in 2022 and the iDMC determined the study exceeded the futility threshold and that the CST threshold was not met, therefore the study should continue to enroll with no change to the dosing regimen. The study achieved full enrollment in the fourth quarter 2023 and topline safety data was reported on 45 patients meeting the criteria for the mITT population with a data cut-off date of January 3, 2024. Among mITT patients, median age was 71 years, median IgM level prior to treatment with iopofosine was 2,185, 90% were refractory to either a BTKi (18/36 50%) or anti-CD20 therapy (18/41 40%), with 26.7% multiclass refractory, and 80% of patients were previously treated with a BTKi therapy. Topline efficacy evaluable population (n=41) was defined as patients who were in the mITT and had follow up of at least 60 days post last dose. The CLOVER WaM study met its primary endpoint with a major response rate (MRR) of 61% (95% confidence interval [44.50%, 75.80%, two-sided p value < 0.0001]) exceeding the agreed upon statistical hurdle of 20%. The overall response rate (ORR) in evaluable patients was 75.6%, and 100% of patients experienced disease control. Responses were durable, with median duration of response not reached and 76% of patients remaining progression free at a median follow-up of eight months. These outcomes exceed real world data, which demonstrate a 4-12% MRR and a duration of response of approximately six months or less despite continuous treatment in a patient population that is less pretreated and not refractory to multiple classes of drugs. Notably, iopofosine monotherapy achieved an 7.3% complete remission (CR) rate in this highly refractory WM population. Iopofosine I 131 was well tolerated and its toxicity profile was consistent with the Company’s previously reported safety data. There were no treatment-related adverse events (TRAEs) leading to discontinuation. The rates of Grade 3 or greater TRAEs observed in more than 10% of patients included thrombocytopenia (55%), neutropenia (37%), and anemia (26%). All patients recovered from cytopenias with no reported aplastic sequalae. Importantly, there were no clinically significant bleeding events, and the rate of febrile neutropenia was 2%. There were no treatment-related deaths in the study.
CLOVER-1: Phase 2 Study in Select B-Cell Malignancies
The Phase 2 CLOVER-1 study was an open-label study designed to determine the efficacy and safety of CLR 131 in select B-cell malignancies (multiple myeloma (MM), indolent chronic lymphocytic leukemia (CLL)/small lymphocytic lymphoma (SLL), lymphoplasmacytic lymphoma (LPL)/Waldenstrom’s macroglobulinemia (WM), marginal zone lymphoma (MZL), mantle cell lymphoma (MCL), DLBCL, and central nervous system lymphoma (CNSL) who have been previously treated with standard therapy for their underlying malignancy. As of March 2022, the study arms for CLL/SLL, LPL/WM, MZL, MCL, and DLBCL were closed. Dosing of patients varied by disease state cohort and was measured in terms of TBD.
In July 2016, we were awarded a $2,000,000 National Cancer Institute (NCI) Fast-Track Small Business Innovation Research grant to further advance the clinical development of iopofosine. The funds supported the Phase 2 study initiated in March 2017 to define the clinical benefits of iopofosine in r/r MM and other niche hematologic malignancies with unmet clinical need. These niche hematologic malignancies include CLL, SLL, MZL, LPL/WM and DLBCL. The study was conducted in approximately 10 U.S. cancer centers in patients with orphan-designated relapse or refractory hematologic cancers. The planned study enrollment was up to 80 patients.
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The study’s primary endpoint was clinical benefit response (CBR), with secondary endpoints of ORR, PFS, time to next treatment (TtNT), median Overall Survival (mOS), DOR and other markers of efficacy following patients receiving one of three TBDs of iopofosine (<50mCi, ~50mCi and >60mCi), with the option for a second cycle approximately 75-180 days later. Dosages were provided either as a single bolus or fractionated (the assigned dose level split into two doses) given day 1 and day 15. Over the course of the study the dosing regimen of iopofosine advanced from a single bolus dose to two cycles of fractionated administrations of 15 mCi/m2 per dose on days 1, 15 (cycle 1), and days 57, 71 (cycle 2). Adverse events occurring in at least 25% of subjects were fatigue (39%) and cytopenias, specifically, thrombocytopenia (75%), anemia (61%), neutropenia (54%), leukopenia (51%), and lymphopenia (25%). Serious adverse events occurring in greater than 5% of subjects were restricted to thrombocytopenia (9%) and febrile neutropenia (7.5%).
Phase 2a Study: Patients with r/r Waldenstrom’s Macroglobulinemia Cohort
Patients in the r/r WM cohort all received TBD of ≥ 60 mCi (25 mCi/m2 single bolus, 31.25 mCi/m2 fractionated, 37.5 mCi/m2 fractionated, or two cycles of mCi/m2 fractionated) either as a bolus dose or fractionated. Current data from our Phase 2a CLOVER-1 clinical study show a 100% ORR in six WM patients and an 83.3% major response rate with one patient achieving a complete response (CR), which reached 39 months post-last treatment. While median treatment free survival (TFS), also known as treatment free remission (TFR), and DOR have not been reached, the average treatment TFS/TFR is currently at 330 days. We believe this may represent an important improvement in the treatment of r/r WM as we believe no approved or late-stage development treatments for second- and third-line patients have reported a CR to date. Based on study results to date, patients continue to tolerate iopofosine well, with the most common adverse events being cytopenias and fatigue.
Phase 2a Study: Patients with r/r Multiple Myeloma Cohort
In September 2020, we announced that a 40% ORR was observed in the subset of refractory MM patients deemed triple class refractory who received 60 mCi or greater TBD. Triple class refractory is defined as patients that are refractory to immunomodulatory, proteasome inhibitors and anti-CD38 antibody drug classes. The 40% ORR (6/15 patients) represents triple class refractory patients enrolled in Part A of Cellectar’s CLOVER-1 study and additional patients enrolled in Part B from March through May 2020 and received >60mCi TBD (25 mCi/m2 single bolus, 31.25 mCi/m2 fractionated, 37.5 mCi/m2 fractionated, or two cycles of mCi/m2 fractionated) either as a bolus dose or fractionated. Patients with MM received 40 mg of dexamethasone concurrently beginning within 24 hours of the first CLR 131 infusion. All MM patients enrolled in the expansion cohort are required to be triple class refractory. The additional six patients enrolled in 2020 were heavily pre-treated with an average of nine prior multi-drug regimens. Three patients received a TBD of > 60 mCi and three received less than 60 mCi. Consistent with the data released in February 2020, patients receiving > 60 mCi typically exhibit greater responses. Based on study results to date, patients continue to tolerate iopofosine well, with the most common and almost exclusive treatment-emergent adverse events are cytopenias, such as thrombocytopenia, neutropenia, and anemia.
In December 2021, we presented data from 11 MM patients from our ongoing Phase 2 CLOVER-1 study in a poster at the American Society of Hematology (ASH) Annual Meeting and Exposition. The MM patients were at least triple class refractory (defined as refractory to an immunomodulatory agent, proteasome inhibitor and monoclonal antibody) with data current as of May 2021. Patients had a median of greater than 7 prior therapies with 50% classified as high risk. Initial results in these patients showed an ORR of 45.5%, a CBR of 72.7%, and a disease control rate (DCR) of 100%. Median PFS was 3.4 months. In a subset of five quad/penta drug refractory patients, efficacy increased, demonstrating an ORR of 80% and CBR of 100% in this highly treatment refractory group. The most commonly observed treatment emergent adverse events were cytopenias that included Grade 3 or 4 thrombocytopenia (62.5%), anemia (62.5%), neutropenia (62.5%) and decreased white blood cell count (50%). Treatment emergent adverse events were mostly limited to bone marrow suppression in line with prior observations. No patients experienced treatment emergent adverse events of neuropathy, arrhythmia, cardiovascular event, bleeding, ocular toxicities, renal function, alterations in liver enzymes, or infusion-site reactions or adverse events. We continue to enrich the r/r MM patient cohort with patients that are even more refractory, specifically enrolling patients that are quad-class refractory (triple class plus refractory to any of the recent approved product classes) and have relapsed post-BCMA immunotherapy. We reported in the Blood Cancer Journal in August 2022 that iopofosine demonstrated a 50% ORR in patients receiving >60mCi total administered dose (3/6 patients).
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Phase 2a: Patients with r/r non-Hodgkin’s lymphoma Cohort
In February 2020, we announced positive data from our Phase 2a CLOVER-1 study in patients with NHL patients were treated with three different doses (<50mCi, ~50mCi and >60mCi TBD. Patients in the r/r NHL cohort received TBD of either ≥ 60 mCi or < 60 mCi (25 mCi/m2 single bolus, 31.25 mCi/m2 fractionated, 37.5 mCi/m2 fractionated, or two cycles of mCi/m2 fractionated) either as a bolus dose or fractionated. Patients with r/r NHL who received <60mCi TBD and the >60mCi TBD had a 42% and 43% ORR, respectively and a combined rate of 42%. These patients were also heavily pre-treated, having a median of three prior lines of treatment (range, 1 to 9) with the majority of patients being refractory to rituximab and/or ibrutinib. The patients had a median age of 70 with a range of 51 to 86. All patients had bone marrow involvement with an average of 23%. In addition to these findings, subtype assessments were completed in the r/r B-cell NHL patients. Patients with DLBCL demonstrated a 30% ORR with one patient achieving a CR, which continues at nearly 24 months post-treatment. The ORR for CLL/SLL and MZL patients was 33%.
Based upon the dose response observed in the Phase 2a study for patients receiving TBDs of 60mCi or greater, we determined that patient dosing of iopofosine in the pivotal study would be >60mCi TBD. Therefore, patients are now grouped as receiving <60mCi or >60mCi TBD.
The most frequently reported adverse events in all patients were cytopenias, which followed a predictable course and timeline. The frequency of adverse events did not increase as doses were increased and the profile of cytopenias remained consistent. Importantly, our assessment is that these cytopenias have had a predictable pattern to initiation, nadir and recovery and are treatable. The most common grade ≥3 events at the highest dose (75mCi TBD) were hematologic toxicities including thrombocytopenia (65%), neutropenia (41%), leukopenia (30%), anemia (24%) and lymphopenia (35%). No patients experienced cardiotoxicities, neurological toxicities, infusion site reactions, peripheral neuropathy, allergic reactions, cytokine release syndrome, keratopathy, renal toxicities, or changes in liver enzymes. The safety and tolerability profile in patients with r/r NHL was similar to r/r MM patients except for fewer cytopenias of any grade. Based upon iopofosine being well tolerated across all dose groups, the observed response rate, and especially in difficult to treat patients such as high risk and triple class refractory or penta-refractory, and corroborating data showing the potential to further improve upon current ORRs and durability of those responses, the study has been expanded to test a two-cycle dosing optimization regimen with a target TBD >60 mCi/m2 of iopofosine.
In May 2020, we announced that the FDA granted Fast Track Designation for iopofosine in WM in patients having received two or more prior treatment regimens.
Phase 1 Study in Patients with r/r Multiple Myeloma
In February 2020, final results from a multicenter, Phase 1 dose escalation clinical trial of iopofosine in r/r MM were presented. The trial was designed to evaluate the safety and potential initial efficacy of iopofosine administered in an up to 30-minute I.V. infusion either as a single bolus dose or as a fractionated dose in heavily pretreated MM patients. The study enrolled a total of 26 evaluable patients at three trial sites. For the trial, which used a modified three-plus-three dose escalation design, 15 evaluable patients were dosed in single bolus doses from 12.5mCi/m2 up to 31.25mCi/m2 (TBD 20.35-59.17 mCi) and 11 evaluable patients were dosed in fractionated dosing cohorts of 31.25mCi/m2 to 40mCi/m2 (TBD 54.915-89.107 mCi). An iDMC did not identify dose-limiting toxicities in any cohort. Of the 26 evaluable patients in the trial, a partial response was observed in 4 of 26 patients (15.4%) and stable disease or minimal response in 22 of 26 patients (84.6%), for a disease control rate of 100%. A significant decrease in M-protein and free light chain (FLC) was also observed.
Iopofosine in combination with dexamethasone was under investigation in adult patients with r/r MM. MM is an incurable cancer of the plasma cells and is the second most common form of hematologic cancer. Patients had to be refractory to or relapsed from at least one proteasome inhibitor and at least one immunomodulatory agent. The clinical study was a standard three-plus-three dose escalation safety study to determine the maximum tolerable dose. We use the International Myeloma Working Group (IMWG) definitions of response, which involve monitoring the surrogate markers of efficacy, M protein and FLC. The IMWG defines a PR as a 50% or greater decrease in M protein or to 50% or greater decrease in FLC levels (for patients in whom M protein is unmeasurable). Secondary objectives included the evaluation of therapeutic activity by assessing surrogate efficacy markers, which include M protein, FLC, PFS and OS. All patients were heavily pretreated with an average of five prior lines of therapy. An iDMC assessed the safety of iopofosine up to its planned maximum single, bolus dose of 31.25 mCi/m2 or a TBD of ~63 mCi. The four single dose cohorts examined were: 12.5 mCi/m2 (~25mCi TBD), 18.75 mCi/m2 (~37.5mCi TBD), 25 mCi/m2(~50mCi TBD), and 31.25 mCi/m2(~62.5mCi TBD), all in combination with low dose dexamethasone (40 mg weekly). Of the five patients in the first cohort, four were assessed as achieving stable disease and one patient progressed at Day 15 after administration and was taken off the study. Of the five patients admitted to the second cohort, all five were assessed as achieving stable disease; however, one patient progressed
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at Day 41 after administration and was taken off the study. Four patients were enrolled to the third cohort, and all were assessed as achieving stable disease. In September 2017, we announced safety and tolerability data for cohort 4, in which patients were treated with a single infusion up to 30-minutes of 31.25mCi/m2 of iopofosine, which was tolerated by the three patients in the cohort. Additionally, all three patients experienced CBR with one patient achieving a partial response (PR). The patient experiencing a PR had an 82% reduction in FLC. This patient did not produce M protein, had received seven prior lines of treatment including radiation, stem cell transplantation and multiple triple combination treatments including one with daratumumab that was not tolerated. One patient experiencing stable disease attained a 44% reduction in M protein. In January 2019, we announced that the pooled mOS data from the first four cohorts was 22.0 months. In late 2018, we modified this study to evaluate a fractionated dosing strategy to potentially increase efficacy and decrease adverse events.
Cohorts five and six received fractionated dosing of 31.25 mCi/m2(~62.5mCi TBD) and 37.5 mCi/m2 (~75mCi TBD), each administered on day 1 and day 8. Following the determination that all prior dosing cohorts were tolerated, we initiated a cohort seven utilizing a 40mCi/m2 (~95mCi TBD) fractionated dose administered 20mCi/m2 (~40mCi TBD) on days 1 and day 8. Cohort seven was the highest pre-planned dose cohort and subjects have completed the evaluation period. The study completed enrollment and the final clinical study report is expected in the first half of 2022. Adverse events occurring in at least 25% of subjects were fatigue (26%) and cytopenias, specifically, thrombocytopenia (90%), anemia (65%), neutropenia (55%), leukopenia (61%), and lymphopenia (58%). Serious adverse events occurring in greater than two subjects were restricted to febrile neutropenia n=3 (9.7%).
In May 2019, we announced that the FDA granted Fast Track Designation for iopofosine in fourth line or later r/r MM. Iopofosine is currently being evaluated in our ongoing CLOVER-1 Phase 2 clinical study in patients with r/r MM and other select B-cell lymphomas. Patients in the study received up to four, approximately 20-minute, IV infusions of iopofosine over 3 months, with doses given 14 days apart in each cycle and a maximum of two cycles. Low dose dexamethasone 40 mg weekly (20mg in patients ≥ 75), was provided for up to 12 weeks. The planned study enrollment was up to 80 patients. Its primary endpoint was clinical benefit rate (CBR), with additional endpoints of ORR, PFS, median overall survival (OS) and other markers of efficacy. Over the course of the study the dosing regimen of iopofosine advanced from a single bolus dose to two cycles of fractionated administrations of 15 mCi/m2 per dose on days 1, 15 (cycle 1), and days 57, 71 (cycle 2). Following treatment with iopofosine, approximately 91% of patients experience a reduction in tumor marker with approximately 73% experiencing greater than 37% reduction.
CLOVER 2: Phase 1 Study in r/r Pediatric Patients with select Solid tumors, Lymphomas and Malignant Brain Tumors
In December 2017, the Division of Oncology at the FDA accepted our IND and study design for the Phase 1 study of iopofosine in children and adolescents with select rare and orphan designated cancers. This study was initiated during the first quarter of 2019. In December 2017, we submitted an IND application for r/r pediatric patients with select solid tumors, lymphomas and malignant brain tumors. The Phase 1 clinical study of iopofosine is an open-label, sequential-group, dose-escalation study evaluating the safety and tolerability of intravenous administration of iopofosine in children and adolescents with relapsed or refractory malignant solid tumors (neuroblastoma, Ewing’s sarcoma, osteosarcoma, rhabdomyosarcoma) and lymphoma or recurrent or refractory malignant brain tumors for which there are no standard treatments. Secondary objectives of the study are to identify the recommended efficacious dose of iopofosine and to determine preliminary antitumor activity (treatment response) of iopofosine in children and adolescents.
In August 2020, based on data on four dose levels from 15mCi/m2 up to 60mCi/m2, the iDMC permitted the beginning of the evaluation of the next higher dose cohort, at 75mCi/m2. The iDMC advised, based upon the initial data, to enrich the 60 mCi/m2 dose level for patients over the age of 10 with HGG and Ewing sarcoma. Changes in various tumor parameters appeared to demonstrate initial response and tumor uptake. This includes patients with relapsed HGGs with over five months of PFS. In November 2020, we announced clinical data providing that iopofosine had been measured in pediatric brain tumors, confirming that systemic administration of iopofosine crosses the blood brain barrier and is delivered into tumors and that the data show disease control in heavily pretreated patients with ependymomas. In November 2021, we announced favorable data on changes in various tumor parameters in a Phase 1 study in children and adolescents with relapsed and refractory high-grade gliomas (HGGs) and soft tissue sarcomas. Pediatric HGGs are a collection of aggressive brain and central nervous system tumor subtypes (i.e. diffuse intrinsic pontine gliomas, glioblastomas, astrocytomas, ependymomas, etc.) with about 400 new pediatric cases diagnosed annually in the U.S. Children with these tumors have a poor prognosis and limited 5-year survival. Adverse events occurring in at least 25% of subjects were fatigue, headache, nausea and vomiting (28% respectively), and cytopenias, specifically, thrombocytopenia (67%), anemia (67%), neutropenia (61%), leukopenia (56%), and lymphopenia (33%). There were no serious adverse events occurring in more than 2 subjects. The Part A portion of this Phase 1 study has concluded, and part B has initiated to determine the appropriate dosing regimen in pediatric patients with r/r HGG. In 2022, the NCI awarded Cellectar a $1,900,000 SBIR Phase 2 grant to explore iopofosine in pediatric HGG.
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In 2018, the FDA granted ODD and RPDD for iopofosine for the treatment of neuroblastoma, rhabdomyosarcoma, Ewing’s sarcoma and osteosarcoma. If iopofosine should be approved for any of these pediatric indications, the first approved RPDD would enable us to receive a priority review voucher. Priority review vouchers can be used by the sponsor to receive priority review for a future New Drug Application (NDA) or Biologic License Application (BLA) submission, which would reduce the FDA review time from 12 months to six months. Currently, these vouchers can also be transferred or sold to another entity. In December 2020, the FDA extended the Priority Review Voucher Program through September 2026 for rare pediatric diseases.
Phase 1 Study in r/r Head and Neck Cancer
In August 2016, the University of Wisconsin Carbone Cancer Center (UWCCC) was awarded a five-year Specialized Programs of Research Excellence (SPORE) grant of $12,000,000 from the NCI and the National Institute of Dental and Craniofacial Research to improve treatments and outcomes for head and neck cancer (HNC) patients. HNC is the sixth most common cancer across the world with approximately 56,000 new patients diagnosed every year in the U.S. As a key component of this grant, the UWCCC researchers completed testing of iopofosine in various animal HNC models and initiated the first human clinical study enrolling up to 30 patients combining iopofosine and external beam radiation treatment (EBRT) with recurrent HNC in the fourth quarter of 2019. UWCCC has completed the part A portion of a safety and tolerability study of iopofosine in combination with EBRT and preliminary data suggest safety and tolerability in relapsed or refractory HNC. The reduction in the amount or fractions (doses) of EBRT has the potential to diminish the (number and severity of) adverse events associated with EBRT. Patients with HNC typically receive approximately 60-70 Grays (Gy) of EBRT given as 2 – 3 Gy daily doses over a six-week timeframe. Patients can experience long-term tumor control following re-irradiation in this setting; however, this approach can cause severe injury to normal tissue structures, significant adverse events and diminished quality of life. Part B of the study was to assess the safety and potential benefits of iopofosine in combination with EBRT in a cohort of up to 24 patients. This portion of the study has fully enrolled, and data were reported at the ASTRO 2024 conference on March 2, 2024. Complete remission was achieved in 64% of patients, with an ORR of 73% (n=11). Prior to treatment with iopofosine I 131, six patients had multiple recurrence and one had metastatic disease, both of which are indicative of poor outcomes. Additionally, the study demonstrated durability of tumor control with an overall survival of 67% and progression free survival of 42% at 12 months. Eleven patients (92%) experienced a treatment-related adverse event. Treatment-related adverse events of grade 3 or higher occurring in 20% or more patients were thrombocytopenia (75%), lymphopenia (75%), leukopenia (75%), neutropenia (67%), and anemia (42%). Observed adverse events were consistent with the known toxicity profile of iopofosine I 131, with cytopenias being the most common. All patients recovered. We believe that these data support the notion of enhanced patient outcomes when combining the use of iopofosine I 131 in combination with external beam radiation for a treatment of solid tumors.
Preclinical Pipeline
We believe our PDC platform has potential to provide targeted delivery of a diverse range of oncologic payloads, as exemplified by the product candidates listed below, that may result in improvements upon current standard of care (SOC) for the treatment of a broad range of human cancers:
| ● | CLR 12120 Series is an alpha emitting radio-conjugate program. The company has validated the in vivo potential of alpha emitting phospholipid radioconjugates and their potential to treat highly refractory and difficult to treat solid tumors. Cellectar is currently progressing with a lead molecule using actinium-225 as the alpha emitting payload. |
| ● | The company has developed a series of proprietary small molecule phospholipid drug conjugates. These programs employ either novel payload or novel linkers. Many of these molecules have demonstrated efficacy and tolerability in preclinical mouse models. The collaboration with IntoCell Inc. successfully met its agreed upon endpoint. The collaboration provided significant data which has led Cellectar to select a series of highly potent cytotoxic small molecule payloads for further development. |
| ● | In collaboration with other parties, Cellectar has also validated that the PLE is capable of delivering peptide payloads and oligonucleotide (siRNA, mRNA, etc.) payloads to the tumors when delivered systemically. These molecules have also been shown to demonstrate activity and safety in multiple preclinical mouse models. Based upon these collaborations and the data, the company has initiated internal proprietary programs with each of these treatment modalities. |
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Results of Operations
Research and development expense. Research and development expense consist of costs incurred in identifying, developing and testing, and manufacturing product candidates, which primarily include salaries and related expenses for personnel, cost of manufacturing materials and contract manufacturing fees paid to contract manufacturers and contract research organizations, fees paid to medical institutions for clinical studies, and costs to secure intellectual property. The Company analyzes its research and development expenses based on four categories as follows: clinical project costs, preclinical project costs, manufacturing and related costs, and general research and development costs that are not allocated to the functional project costs, including personnel costs, facility costs, related overhead costs and patent costs.
General and administrative expense. General and administrative expense consists primarily of salaries and other related costs for personnel in executive, finance and administrative functions. Other costs include insurance, costs for public company activities, investor relations, directors’ fees and professional fees for legal and accounting services.
Three Months Ended June 30, 2024 and 2023
Research and Development. Research and development expense for the three months ended June 30, 2024 was approximately $7,345,000, compared to approximately $6,135,000 for the three months ended June 30, 2023.
The following table is a summary comparison of approximate research and development costs for the three months ended June 30, 2024 and 2023:
Three Months Ended | |||||||||
June 30, | |||||||||
| 2024 |
| 2023 |
| Variance | ||||
Clinical project costs | $ | 3,951,000 | $ | 2,284,000 | $ | 1,667,000 | |||
Manufacturing and related costs |
| 2,628,000 |
| 2,258,000 |
| 370,000 | |||
Pre-clinical project costs |
| 31,000 |
| 33,000 |
| (2,000) | |||
General research and development costs |
| 735,000 |
| 1,560,000 |
| (825,000) | |||
$ | 7,345,000 | $ | 6,135,000 | $ | 1,210,000 | ||||
The overall increase in research and development expense of approximately $1,210,000, or 20%, was primarily a result of increased clinical project costs of approximately $1,667,000, driven by the timing of the activities related to our pivotal and pediatric trials and an increase in personnel.
General and administrative. General and administrative expense for the three months ended June 30, 2024 was approximately $6,358,000, compared to approximately $2,159,000 for the same period in 2023. The overall increase in general and administrative expense of approximately $4,199,000, or 194%, was primarily driven by costs associated with the development of infrastructure necessary to support commercialization upon anticipated NDA approval, including the related marketing and personnel cost.
Other income (expense), net. Other income (expense), net, for the three months ended June 30, 2024, was income of approximately $12,784,000, as compared to approximately $1,885,000 of expense in the same period of 2023, resulting almost exclusively from changes in warrant valuation. Fluctuations in the Company’s common stock price result in warrant valuation changes that are presented here. Interest income increased year-over-year to approximately $329,000 in 2024 as compared to approximately $73,000 in 2023. The Company’s cash on hand and increased interest rates drove the improved return.
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Six Months Ended June 30, 2024 and 2023
Research and Development. Research and development expense for the six months ended June 30, 2024 was approximately $14,434,000, compared to approximately $12,494,000 for the six months ended June 30, 2023.
The following table is a summary comparison of approximate research and development costs for the six months ended June 30, 2024 and 2023:
| Six Months Ended |
| |||||||
June 30, | |||||||||
2024 |
| 2023 | Variance | ||||||
Clinical project costs | $ | 6,644,000 | $ | 4,909,000 | $ | 1,735,000 | |||
Manufacturing and related costs |
| 5,941,000 |
| 4,175,000 |
| 1,766,000 | |||
Pre-clinical project costs |
| 52,000 |
| 216,000 |
| (164,000) | |||
General research and development costs |
| 1,797,000 |
| 3,194,000 |
| (1,397,000) | |||
$ | 14,434,000 | $ | 12,494,000 | $ | 1,940,000 | ||||
The overall increase in research and development expense of approximately $1,940,000, or 16%, was primarily a result of increased manufacturing and related costs of approximately $1,766,000 related to production sourcing and increased clinical project costs of approximately $1,735,000 driven by the timing of the activities related to our pivotal and pediatric trial, partially offset by a decrease in general research and development costs.
General and administrative. General and administrative expense for the six months ended June 30, 2024 was approximately $11,272,000, compared to approximately $4,505,000 for the same period in 2023. The overall increase in general and administrative expense of $6,767,000, or 150%, was primarily driven by costs associated with the development of infrastructure necessary to support commercialization upon anticipated NDA approval, including the related marketing and personnel costs.
Other income (expense), net. Other income (expense), net, for the first six months of 2024 was an expense of approximately $1,856,000, while the expense for the same period in 2023 was approximately $370,000. A significant portion of the expense comes from changes in the valuation of the Company’s outstanding warrants. Warrant valuation consists of a number of aspects, but the most significant driver is the value at which the Comapany’s common stock is trading at the end of each reporting period. Interest income was approximately $649,000 year-to-date in 2024, and approximately $197,000 in 2023. The Company’s improved return on cash equivalents is a product of higher average cash balance and a higher interest rate environment.
Liquidity and Capital Resources
We have incurred losses since inception in devoting substantially all of our efforts toward research and development of drug candidates for which we are seeking FDA approval. During the six months ended June 30, 2024, we generated a net loss of approximately $27.6 million and used approximately $27.5 million in cash for operations. We expect that we will continue to generate operating losses for the foreseeable future. As of June 30, 2024, our consolidated cash balance was approximately $25.9 million. As of the date the accompanying consolidated financial statements were issued (the “issuance date”), the Company’s available liquidity to fund the Company’s operations over the next twelve months beyond the issuance date was limited to approximately $34.3 million of unrestricted cash and cash equivalents. Absent further action taken by management to increase its liquidity, the Company may be unable to fund its operations under normal course beyond the second quarter of 2025. To improve the Company’s liquidity, management plans to secure additional outside capital via the sale of equity and/or debt securities or execute a strategic transaction. Management also plans to preserve liquidity, as needed, by implementing temporary cost saving measures. While management believes their plans will be successful, no assurance can be provided such plans will be effectively implemented over the next twelve months beyond the issuance date. In the event management’s plans are not effectively implemented, the Company will be required to seek other alternatives which may include, among others, the sale of assets, discontinuance of certain operations, and/or filing for bankruptcy protection.
These uncertainties raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements have been prepared on the basis that the Company will continue to operate as a going concern, which contemplates it will be able to realize assets and settle liabilities and commitments in the normal course of business for the foreseeable future.
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Accordingly, the accompanying consolidated financial statements do not include any adjustments that may result from the outcome of these uncertainties.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Under the supervision, and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness 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, as amended (the “Exchange Act”), in connection with the period ending March 31, 2024. Based on that evaluation, management has concluded that as of the respective period, our disclosure controls and procedures were not effective due to the material weaknesses in internal control over financial reporting described below.
Notwithstanding the material weaknesses in our internal control over financial reporting, management has concluded that the audited consolidated financial statements included in this Form 10-Q/A fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented in conformity with accounting principles generally accepted in the United States of America.
Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act for the Company. Management assessed the effectiveness of internal control over financial reporting as of the year ended December 31, 2023. In making this assessment, our management used the criteria set forth in the Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (the “COSO Framework”). Based on this evaluation, our management concluded that our internal control over financial reporting was not effective as of December 31, 2023, continuing through June 30, 2024, because of the material weaknesses described below.
Material Weaknesses
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that a reasonable possibility exists that a material misstatement of our annual or interim consolidated financial statements would not be prevented or detected on a timely basis.
Management concluded that material weaknesses existed as of the year ended December 31, 2023. Specifically, management identified deficiencies in the principles associated with the control environment, risk assessment, control activities, information and communication and monitoring components of internal control, based on the criteria established by the COSO Framework, that constitute material weaknesses, either individually or in the aggregate.
| ● | Control Environment: The Company lacked appropriate policies and resources to develop and operate effective internal control over financial reporting, which contributed to the Company’s inability to properly analyze, record and disclose accounting matters accurately and timely. This was further impacted by the limited number of staff in the Company’s accounting and finance function. This material weakness contributed to additional material weaknesses further described below. |
| ● | Risk Assessment: The Company does not have a formal process to identify, update, and assess risks, including risks around the accounting for complex transactions, that could significantly impact the design and operation of the Company’s control activities. |
| ● | Control Activities: Management did not design and implement effective control activities and identified the following material weaknesses: |
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| o | Management failed to design and implement adequate internal controls over financial reporting which resulted in the inaccurate accounting of preferred equity and warrants |
| o | Management failed to design and implement adequate internal controls over the recording of stock-based compensation expense related to the restricted stock awards granted in December 2023. |
| o | Management failed to design and implement adequate internal controls over financial reporting as it relates to the proper fair value methodologies and assumptions used to value financial instruments, specific to the assumptions utilized in the valuation of the preferred warrants. |
| ● | Information and Communication: As noted above, the Company had a limited number of staff in its finance and accounting function, and therefore was unable to design and maintain appropriate segregation of duties in the initiation, recording, and approval of transactions within its financial systems. This, coupled with management having not designed and maintained user access controls that adequately restrict user and privileged access to financial applications, and the absence of sufficient other mitigating controls, created a segregation of duties deficiencies. |
| ● | Monitoring Activities: Management did not appropriately select, develop, and perform ongoing evaluations to ascertain whether the components of internal controls are present and functioning |
These material weaknesses resulted in errors that required the restatement of the Company’s consolidated financial statements as of and for the fiscal years ended December 31, 2023 and December 31, 2022, as well as the restatement of the Company’s condensed consolidated financial statements as of and for the interim periods ended September 30, 2023, June 30, 2023, March 31, 2023, September 30, 2022, June 30, 2022, and March 31, 2022. Additionally, these material weaknesses could result in a misstatement of the account balances or disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or timely detected.
Management’s Plan to Remediate the Material Weaknesses
The process of designing and maintaining effective internal control over financial reporting is a continuous effort that requires management to anticipate and react to changes in our business, economic and regulatory environments and to expend significant resources. In early 2024, the Company began recruiting and hired qualified accounting and financial reporting personnel to supplement our level of knowledge and experience with internal control over financial reporting in order to begin to design and implement a formal control environment and risk assessment process. Such process includes identification of risks, the level of detail in our risk assessment, and the clarity of the linkage between risks and internal controls. The results of this effort are expected to enable us to effectively identify, develop, evolve and implement controls and procedures to address risks. Additionally, the Company has also initiated the implementation of an ERP system, which will provide a system-based control structure for all financial transactions.
As our remediation efforts are still on-going, we will continue to consider the need for additional resources and implement further enhancements to our policies and procedures as necessary to further improve our internal control over financial reporting. As we work to improve our internal control over financial reporting, we may modify our remediation plan and may implement measures as we continue to review, optimize and enhance our financial reporting controls and procedures in the ordinary course. The material weaknesses will not be considered remediated until the remediated controls have been operating for a sufficient period of time and can be evidenced through testing that these are operating effectively.
Changes in Internal Control over Financial Reporting
Except for the identification of the material weaknesses described above, there has been no change in our internal control over financial reporting during the period ended June 30, 2024, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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PART II. OTHER INFORMATION
Item 1. Legal Proceedings
We may be a party to proceedings in the ordinary course of business, however, we do not anticipate that the outcome of such matters and disputes will materially affect our financial statements.
Item 1A. Risk Factors
Other factors that could materially adversely affect our business and our equity securities are described in the Risk Factors previously disclosed in Form 10-K/A, our Annual Report filed with the SEC on October 28, 2024, pursuant to Section 13 or 15(d) of the Exchange Act. That information should be considered carefully, together with other information in this report and other reports and materials we file with the SEC.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Default Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
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Item 6. Exhibits
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10.1 | Cellectar Biosciences, Inc. 2021 Stock Incentive Plan, as Amended | 8-K | June 29, 2023 | 10.1 | ||||||
31.1 |
| Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
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31.2 |
| Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
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104 | Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit). | X | ||||||||
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| CELLECTAR BIOSCIENCES, INC. | |
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Date: October 29, 2024 | By: | /s/ James V. Caruso |
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| James V. Caruso |
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| President and Chief Executive Officer |
(Principal Executive Officer) | ||
Date: October 29, 2024 | By: | /s/ Chad J. Kolean |
Chad J. Kolean | ||
Chief Financial Officer | ||
(Principal Financial and Accounting Officer) | ||
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