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| PART I. | FINANCIAL INFORMATION | 2 |
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| Item 1. | Financial Statements (Unaudited) | 2 |
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| Balance Sheets | 2 |
| Statements of Operations and Comprehensive Loss | 3 |
| Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) | 4 |
| Statements of Cash Flows | 5 |
| Notes to Unaudited Interim Financial Statements | 6 |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 19 |
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| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 33 |
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| Item 4. | Controls and Procedures | 33 |
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| PART II. | OTHER INFORMATION | 34 |
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| Item 1. | Legal Proceedings | 34 |
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| Item 1A. | Risk Factors | 35 |
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| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 88 |
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| Item 3. | Defaults Upon Senior Securities | 88 |
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| Item 4. | Mine Safety Disclosures | 88 |
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| Item 5. | Other Information | 89 |
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| Item 6. | Exhibits | 89 |
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| Signatures | 91 |
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains statements that are not historical facts and are considered forward-looking within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Our forward-looking statements include, but are not limited to, statements regarding our or our management team’s expectations, hopes, beliefs, intentions or strategies, our ability to fund our working capital requirements, our financial performance and our ability to effectively manage our anticipated growth, our ability to obtain additional funding for our operations, and other risks and uncertainties, including those listed under the section titled “Risk Factors” in this Quarterly Report regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including, any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward looking statements in this Quarterly Report on Form 10-Q (“Quarterly Report”) may include, for example, statements about:
| • | the initiation, timing, progress and results of our current and future preclinical studies and clinical trials and related preparatory work and the period during which the results of the trials will become available, as well as our research and development programs; |
| • | our estimates regarding expenses, future revenue, capital requirements and needs for additional financing; |
| • | our strategies, prospects, plans, expectations or objectives of management for our future operations; |
| • | our progress, scope or timing of the development of our product candidates; |
| • | our expectations surrounding the potential safety, efficacy, and regulatory and clinical progress of TX45 and any other product candidates, and our anticipated milestones and timing therefor; |
| • | the benefits that may be derived from any of our future products or the commercial or market opportunity with respect to any of our future products; |
| • | our ability to identify and develop additional product candidates using our GEODe™ platform; |
| • | our ability to protect our intellectual property rights; |
| • | our ability to enroll patients in clinical trials, to timely and successfully complete those trials and to receive necessary regulatory approvals; |
| • | the expected timing of filings with regulatory authorities for any product candidates that we develop; |
| • | our expectations regarding the potential market size and the rate and degree of market acceptance for any current or future product candidates that we develop; and |
| • | our ability to receive any milestone or royalty payments under our collaboration and license agreements. |
These forward-looking statements are based on our management’s current expectations, estimates, forecasts and projections about our business and the industry in which we operate, and management’s beliefs and assumptions and are not guarantees of future performance or development. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described under the section titled “Risk Factors” under Part II, Item 1A below, and under similar captions in our periodic reports filed with the SEC from time to time. Moreover, we operate in a very competitive and rapidly changing environment, and new risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this Quarterly Report may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this Quarterly Report. While we believe that information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information.
You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance, or events and circumstances reflected in the forward-looking statements will be achieved or occur. We undertake no obligation to update publicly any forward-looking statements for any reason after the date of this Quarterly Report to conform these statements to new information, actual results or changes in our expectations, except as required by law.
