HCW Biologics Inc.
For the period ended Jun 30, 2026. Filed Aug 14, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 14, 2026
HCWB$1.02-1.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-14.
0001493152-26-023131
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-14.
0001493152-26-038262
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 133 previous paragraphs and 161 current paragraphs.
53 unchanged; 22 reworded; 83 added; 57 removed; 1 previous and 3 current paragraphs rearranged.
Tables are not compared: 28 previous and 26 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (83)
Current report
Reverse Stock Split
Current report
The Company completed a one-for-six reverse stock split on June 30, 2026 (the “Reverse Stock Split”). All share amounts and price per share amounts discussed herein reflect the Reverse Stock Split.
Current report
On May 21, 2026, the Company completed a $4.0 million private placement with a group of existing stockholders, in which the Company sold 474,496 units, each of which consisted of one share of Common Stock, or a Pre-Funded Warrant in lieu thereof, and a Common Stock Warrant to purchase one share of Common Stock. Net proceeds to the Company after placement agent commissions and offering costs were $3.5 million. On June 18, 2026, the SEC declared effective a resale registration statement on Form S-1 (File No. 333-296577) covering the resale of shares of Common Stock and warrants issued in this private placement. Investors included a single institutional investor and certain of our directors and executive officers. Scott Garrett, Chairman of our board of directors, purchased $250,000 of securities, Hing C. Wong, our Founder and Chief Executive Officer, purchased $160,000 of securities, and Rebecca Byam, our Chief Financial Officer, purchased $20,000 of securities. Such purchases were made on the same terms and conditions as those offered to other investors. On June 22, 2026, the holder exercised all Pre-Funded Warrants issued in this transaction to purchase 403,322 shares of Common Stock for $0.0001 per share.
Current report
July 2026 Sale of Units Comprised of Common Stock, Pre-Funded Warrants and Rights to Receive Common Stock Warrants
Current report
Subsequent to June 30, 2026, on July 29, 2026, the Company completed a private placement with certain accredited investors in which the Company sold 618,682 units, each unit consisting of one share of Common Stock, or a Pre-Funded Warrant in lieu thereof, and (ii) the right to receive one Common Stock Warrant upon, and subject to, stockholder approval of the issuance of such Common Stock Warrants, which approval the Company is obligated to seek pursuant to the terms of the purchase agreement. Gross proceeds of the offering were approximately $1.6 million before deducting offering expenses. Hing C. Wong, Ph.D., our Founder and Chief Executive Officer, Scott Garrett, Chairman of our board of directors, and Lee Flowers, our Senior Vice President of Business Development, participated in the private placement on the same terms and conditions as the other investor.
Current report
Preparing for Business Development Transaction for Commercial-Ready Reagents
Current report
Two of our internally-developed, multi-cytokine fusion protein molecules, HCW9201 and HCW9206, were licensed to AlloTera Therapeutics in 2020. During 2025, AlloTera Therapeutics was refocusing its clinical development programs, and the Company agreed to a suspension of the AlloTera Therapeutics License. On May 21, 2026, the Company elected to terminate the AlloTera Therapeutics License according to the terms provided in the suspension agreement.
Current report
We are positioning HCW9206 and HCW9201 as commercial-ready reagents for use in supporting the manufacture of cell-based immunotherapeutics to treat cancer and infectious diseases. The extensive research done in collaboration with the Albert Einstein College of Medicine showed that HCW9206 and similar molecules developed by the Company appear to support more efficient production of CAR-T cells that keep fighting disease longer. We intend to enter into a commercialization partnership with a biopharmaceutical manufacturing company in the second half of 2026.
Current report
Since inception in December 2020, the Company has recognized $16.2 million in revenue derived from the AlloTera Therapeutics License, including upfront license fees in cash and shares of AlloTera Therapeutics common stock, purchases of the Company’s inventory of certain molecules needed for manufacturing, and purchases of materials for its clinical trials. In addition, the Company received over $1.8 million in reimbursements for its R&D expenses. The upfront license fee is nonrefundable, and as such, the Company retains ownership of the 2.2 million shares of AlloTera Therapeutics common stock.
Current report
Settlement of Accounts Payable Obligations
Current report
The Company continues to strengthen its balance sheet through repayment and restructuring of obligations. In the three months ended June 30, 2026, the Company settled $2.8 million of overdue accounts payable, including $1.1 million owed to B&I Contractors, Inc. (“B&I”) and $1.7 million owed to Eirgenix. Settlement terms fully resolved all amounts claimed to be owed by the Company to these vendors. In the three months ended June 30, 2026, the Company paid Eirgenix $620,000 and paid B&I $512,655. In the six months ended June 30, 2026, the Company paid Eirgenix $1,240,000 and paid B&I $865,655.
Current report
Nasdaq Compliance
Current report
On June 26, 2025, the Company received formal notice from The Nasdaq Stock Market LLC (“Nasdaq”) that the Company is in compliance with Listing Rule 5550(b)(1) (the “Equity Rule”). On June 29, 2026, the Company received written notice from the Nasdaq Listing Staff that the Nasdaq Hearings Panel found that the Company had regained compliance with the Bid Price Rule, subject to certain restrictions. The Company will be subject to a Mandatory Panel Monitor until June 17, 2027. See Part II, Item 1, “Legal Proceedings – Other Matters.”
Current report
Clinical Development
Current report
Preliminary Human Data Readout for Phase 1 Clinical Study Evaluating HCW9302 as Monotherapy in Alopecia Areata
Current report
On June 16, 2026, the Company disclosed a preliminary human data readout for the Phase 1 clinical study evaluating HCW9302 in patients with alopecia areata. The Company believes that based on the human data readout and extensive preclinical studies, HCW9302 is potentially a best-in-class IL-2 based treatment for autoimmune diseases by expanding and activating regulatory T cells. Preliminary results indicate that HCW9302 is well tolerated, with no dose-limiting toxicities or significant known IL-2-treatment-related adverse effects, including no reported incidence of capillary leak syndrome, cytokine release syndrome, or increase in blood eosinophil counts.
Current report
The readout was for two dose cohorts in a dose-escalating study. All patients, including the first dose cohort at one (1) microgram/kg body weight and the second dose cohort at three (3) micrograms/kg body weight, received a single subcutaneous dose of HCW9302 monotherapy. In the second dose cohort, all three participants showed preliminary indications of improvement in their Severity of Alopecia Tool (“SALT”) scores. These three participants, all with mild alopecia, showed a ≥25% reduction in SALT scores compared to baseline at four and/or nine weeks after dosing. Treatment of patients in the third dose cohort (i.e., eight (8) micrograms/kg body weight) is underway and evaluation of correlative study endpoints is ongoing.
Current report
There were no reported incidences of capillary leak or cytokine release syndromes associated with high dose intravenous IL-2 therapy. Additionally, HCW9302 treatment did not increase blood eosinophil counts, another serious side effect commonly associated with IL-2 therapy. All reported HCW9302 treatment emergent adverse events were mild in severity and self-limiting and resolved without medical intervention. The most common side effect was temporary injection-site reaction.
Current report
Dosing of the third dose cohort is underway at eight (8) micrograms/kg body weight. The Company has not reported any dose limiting toxicities in the patients treated to date. Patient enrollment continues to be strong, and the Company has added a third clinical site to the study. The full Phase 1 human data readout for the HCW9302 study remains on track to be released in the fourth quarter of 2026. Primary endpoints are safety and a recommended Phase 1 dose. Working with collaborators, the Company is conducting ancillary studies to supplement this data.
Current report
Milestone for HCW11-018b, Leading Product Candidate in Company’s Tetravalent T-Cell Engager Program
Current report
The Company requested a Type B (pre-IND application) meeting with the U.S. Food and Drug Administration (“FDA”) to discuss the development and regulatory strategy for its investigational lead product candidate, HCW11-018b, a tetravalent T-cell engager (“TCE”) constructed with the Company’s proprietary TRBC drug development platform. The Company would like to reach agreement with FDA on requirements for a clinical study before we submit an IND application to evaluate HCW11-018b in cancer. This clinical trial is on track to initiate in the first half of 2027, provided we secured FDA authorization.
Current report
HCW11-018b is intended to treat solid tumors and is administered by subcutaneous injection. In preclinical studies, it has shown the ability to target tissue factor-expressing cancer cells and activate CD3-positive effector T cells, while simultaneously reducing immunosuppression in the tumor microenvironment. Immunosuppression in the tumor microenvironment can limit effector T-cell infiltration and antitumor activity in solid tumors, particularly in gynecologic and pancreatic cancers.
Current report
The Company believes that our robust, streamlined, and cost-efficient manufacturing process will produce high-quality cGMP material to support clinical development. Our manufacturing process for HCW11-018b is based on high-producing recombinant CHO cell lines and a proprietary monoclonal antibody needed for the affinity purification process. This monoclonal antibody will be manufactured under GMP standards using a top-tier CDMO.
Current report
TCEs have emerged as a potent therapeutic modality to treat cancer. First-generation TCEs represented a breakthrough in immunotherapy but they continue to face significant challenges, including limited antigen selection, poor efficacy in solid tumors, tolerability and safety concerns, and complex manufacturing processes. Extensive preclinical studies of HCW11-018b —including assessments ofin vitro andin vivo potency, antigen specificity, pharmacokinetics, toxicity in nonhuman primates, and its therapeutic window — suggest that HCW11-018b may be able to overcome the limitations of earlier-generation TCEs.
Current report
AlloTera Therapeutics License
Current report
General and Administrative
Current report
The Company was involved in an Arbitration and related Complaint that were dismissed with prejudice as of December 31, 2024. See Part II, Item 1, “Legal Proceedings – Arbitration, Settlement and General Release.” In the Settlement Agreement, the Company retained exclusive rights to HCW9302 and certain other molecules. The Company anticipates that it will continue to incur legal expenses for patent filings and other matters to protect our intellectual property rights and remain in compliance with the terms of the Settlement Agreement.
Current report
When Trimmune paid the full nonrefundable upfront license fee on March 16, 2026, the Chinese government withheld income taxes of $330,186, which the Company recognized as an expense in the six months ended June 30, 2026 in the accompany condensed statements of operations.
Current report
The Company received 2.2 million shares of AlloTera Therapeutics as an in-kind payment for a nonrefundable license fee in December 2020. In the second quarter of 2025, the Company elected to account for its shares of AlloTera Therapeutics, previously accounted for under the measurement alternative, at fair value determined using financial valuation techniques and market information available. In May 2025, the Company entered two transactions to restructure and convert debt. The terms of conversion gave the converting Secured Noteholders and holders of Convertible Bridge Notes the right to a portion of the proceeds upon the sale or liquidation of the Company’s AlloTera Therapeutics shares, if such an event occurs, giving rise to a contingent liability. The Company derives the fair value of the contingent liability according to the fair value measured for underlying the AlloTera shares. The Company remeasures the change in fair value of the AlloTera shares and related contingent liability in earnings.
Current report
From time to time, the Company restructures liabilities and debt obligations to strengthen our balance sheet. When the Company settles the obligation for less than the recorded carrying value, we recognize a gain on debt extinguishment or extinguishment of a liability in earnings during the period in which it is settled.
Current report
For the three months ended June 30, 2025, there was $6,550 of revenue the Company derived from ancillary services such as drug storage and insurance related to the winddown of the AlloTera Therapeutics License during the one-year suspension period that began on May 29, 2025.
Current report
For the three months ended June 30, 2026, there was $135,568 of revenue related to the completion of some of the services required under the Service Performance Obligation for the Trimmune License, primarily for supporting Trimmune with building a master cell bank. For remaining services under the Service Performance Obligation as of June 30, 2026, the Company recognized a contractual liability of $348,270 in deferred revenue in the accompanying condensed balance sheet.
Current report
Research and development expenses decreased by $23,472, or 2%, from $1.2 million for the three months ended June 30, 2025 to $1.2 million for the three months ended June 30, 2026. The decrease was primarily due to decreases in salaries, benefits and related taxes and clinical trial expenses.
Current report
Salaries, benefits, and related expenses decreased by $17,128, or 2%, from $778,440 for the three months ended June 30, 2025 to $761,312 for the three months ended June 30, 2026. This decrease was primarily attributable to decreases of $24,900 in salaries, benefits and related taxes and $15,448 in expense for stock-based compensation, partially offset by an increase of $23,220 in costs associated with employee benefits.
Current report
Manufacturing and materials expense decreased by $6,913, or 20%, from $33,986 for the three months ended June 30, 2025 to $27,073 for the three months ended June 30, 2026. In the three months ended June 30, 2025, the Company had produced and vialed the product necessary for the clinical trials for HCW9302. In the three months ended June 30, 2026, the Company focused on internal development and preparation for the creation of master cell banks to generate its TRBC-based lead product candidates.
Current report
Expenses associated with preclinical activities increased by $11,969, or 8%, from $146,948 for the three months ended June 30, 2025 to $158,917 for the three months ended June 30, 2026. In the three months ended June 30, 2025, the Company incurred costs to complete development of intellectual property required for the technology being licensed to Trimmune. In the three months ended June 30, 2026, the Company focused on IND-enabling activities required to prepare HCW11-018b, the Company’s tetravalent T-cell engager, for a Phase 1 clinical trial in cancer. The Company will continue to incur preclinical expenses for IND-enabling studies for HCW11-018b as well as HCW11-040, the second-generation immune checkpoint inhibitor in the coming year. The Company intends to file an IND-application to seek authorization to evaluate HCW11-018b in a Phase 1 clinical study in patients with cancer in the first half of 2027, and an IND-application to seek authorization to evaluate HCW11-040 in bronchopulmonary dysplasia, a chronic lung disease primarily affecting premature infants, in the second half of 2027.
Current report
Expenses associated with clinical activities decreased by $9,689, or 9%, from $110,935 for the three months ended June 30, 2025 to $101,246 for the three months ended June 30, 2026. The decrease was primarily attributable to decreases of $51,301 for consulting and outsourced R&D services and $10,961 for IRB fees and clinical site start-up expenses, partially offset by increases of $47,767 in patient fees and $4,806 for software licenses and data management. We anticipate that clinical expenses will increase in the coming year due to the continuation of clinical trials to evaluate HCW9302 in autoimmune indications and the initiation of a Phase 1 clinical study to evaluate HCW11-018b in cancer.
Current report
Other expenses, which include overhead allocations, decreased by $1,711, or 1%, from $156,515 for the three months ended June 30, 2025 to $154,804 for the three months ended June 30, 2026. This decrease is primarily attributable to a $7,617 decrease in the allocation of depreciation for scientific equipment, partially offset by an increase of $5,908 in rent, utilities and other office expenses.
Current report
NM = Not meaningful
Current report
General and administrative expenses decreased $225,646, or 11%, from $2.1 million for the three months ended June 30, 2025 to $1.9 million for the three months ended June 30, 2026. The decrease is primarily attributable to decreases in compensation expense for stock-based compensation and accretion of fixed bonus upon maturity of Secured Notes, offset by an increase of expenses for financing related activities.
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Removed paragraphs (57)
Previous report
Clinical Development Highlights
Previous report
The Company has selected the following compounds for our clinical development programs, which are currently being developed in Company-sponsored programs:
Previous report
HCW9302
Previous report
Clinical-stage compound that is an injectable, first-in-kind interleukin 2 (“IL-2”) fusion protein complex constructed using the Company’s proprietary TOBI platform technology. Its mechanism of action involves binding to IL-2αβγ receptors predominantly expressed on regulatory T (“Treg”) cells, thereby activating and expanding Treg cells that can suppress unwanted immune and inflammatory responses. Beijing Trimmune Biotech Co., Ltd. (“Trimmune”) has an option to license the rights to the China market for HCW9302.
Previous report
On November 17, 2025, the first patient was dosed at The Ohio State University Wexner Medical Center for the Company-sponsored, multi-center first-in-human clinical trial to evaluate HCW9302 in patients with alopecia areata (NCT07049328). This marks a major milestone in the Company’s clinical development program in autoimmune diseases. With continued patient enrollment, a full Phase 1 human data readout is expected in Q4 2026.
Previous report
HCW11-018b
Previous report
HCW11-018b, the lead candidate of the “Big BiTE” program, is a tetra-valent T-cell engager designed to enhance anti-tumor activities and tolerability to treat a wide spectrum of solid tumors. The Company presented a poster at the American Association of Cancer Research Annual Meeting 2026, which took place from April 17 – 22, 2026 in San Diego, California.
Previous report
The Company’s preclinical data showed HCW11-018b could significantly shrink well-established tumors and prevent cancer metastasis in xenograft animal models with broad coverage for human solid tumor indications. The new data in the poster has revealed the mechanism of action that drives these results. HCW11-018b utilizes Cis-binding (or cis-interaction) to regulate immune cell reactivity that masks the receptors which prevent trans-binding and inhibit membrane flexibility. The data showed that HCW11-018b is only activated within the tumor microenvironment, which is expected to increase the efficacy and tolerability of this tetra-valent T Cell Engager against human tumor cells.
Previous report
IND-enabling activities are expected to be completed in the first half of 2027. The Company intends to file an IND application shortly thereafter, for authorization to evaluate HCW11-018b in patients with pancreatic cancer.
Previous report
HCW11-040
Previous report
HCW11-040 is a preclinical molecule that is a unique combination of cytokines and pembrolizumab, a generic form of Keytruda®, in a multi-functional fusion molecule. This lead product candidate exhibits the ability to expand exhausted progenitors T (“Tpex”) cells without a cytokine storm in preclinical studies. In addition, it exhibits superior immune-cell activation, expansion, and cytotoxicity against cancer cells and tumors when compared to pembrolizumab in in-vitro and in-vivo studies.
Previous report
IND-enabling activities for HCW11-040 are expected to be completed in the second half of 2027. The Company intends to file an IND application shortly thereafter, for authorization to evaluate HCW11-040 in neonatal infants with bronchopulmonary dysplasia (“BPD”). BPD is a chronic lung disease affecting premature infants, characterized by lung damage from oxygen and ventilator use. Infants who have BPD may have long-term problems, including increased risk of asthma, respiratory infections, and potential delays in development.
Previous report
Advancing our programs may be accomplished through Company-sponsored programs or with a corporate partner. Business development transactions are considered a key aspect of our financing strategy. We continually assess our programs to determine the optimal path to successfully complete clinical development and launch commercialization.
Previous report
The Company is developing HCW11-006 through a corporate partnership with Beijing Trimmune Biotech Co., Ltd. (“Trimmune”). Trimmune is a new operating entity formed for the purpose of development and commercialization of HCW11-006, by WY Biotech Co., Ltd. (“WY Biotech”), a China-based company specializing in the early-stage development of recombinant protein drugs and gene/cell therapies, and the Company. Trimmune investors include CITIC Medical Fund, a multi-billion-dollar investment fund focused on innovative companies primarily targeting pharmaceuticals, biotechnology, medical devices, and diagnostics, and TigerYeah Capital Fund of TigerMed, a global leading Contract Research Organization. Trimmune is led by a team with an impressive track record for success in the development and commercialization of innovative drugs that treat diseases with large, unmet medical needs for the Chinese market. HCW11-006 is a preclinical molecule that combines several different immune functional domains as part of a group of compounds characterized as multi-functional immune cell stimulators.
Previous report
As of March 16, 2026, we received the full payment of the upfront licensing fee for the exclusive worldwide license for HCW11-006, a preclinical molecule, from Trimmune. The Company received $3.5 million in gross proceeds, or $2.9 million net of taxes. In addition to the cash portion of the upfront license fee, before taxes, the Company also received a minority co-founder equity interest in Trimmune. In addition, for additional compensation, Trimmune has an option to license the China rights to HCW9302.
Previous report
HCW Biologics is eligible to receive additional payments under the license, including development milestone payments and double-digit royalties on future product sales, as well as a portion of the proceeds from certain future transaction(s) involving the licensed molecule, if and when such transaction(s) occur. Upon completion of Phase 1 by the licensee, the Company may exercise its Opt-In Rights to reclaim the rights to the Americas market. For an additional fee, Trimmune may exercise an option to license the China rights to HCW9302, the Company’s clinical-stage molecule, currently being evaluated in a Phase 1 trial in an autoimmune disorder. These elements were not deemed to be probable, and the Company did not recognize these events in the three months ended March 31, 2026.
Previous report
Commercial-Ready Molecules Used as Reagents
Previous report
On March 13, 2026, Science Advances, a peer-reviewed, high-impact journal, released a publication with the Company’s data that showed the Company’s proprietary, commercial-ready compound, HCW9206, could fundamentally change how CAR-T cell therapies are manufactured and potentially improve how they perform against diseases such as cancer and HIV. These findings support the Company’s belief that HCW9206 is a leap forward in both clinical potential and manufacturing efficiency. The Company is actively seeking an appropriate corporate partner to commercialize the reagent program.
Previous report
On February 19, 2026, the Company raised $1.5 million before commission and transaction costs payable by us through the sale of 2,477,292 Units for $0.6055 per Unit, each consisting of one share of Common Stock (or Pre-funded Warrant that may be exercised to purchase one share of Common Stock) plus one Common Stock Warrant each of which can be exercised to purchase one share of Common Stock. In a private transaction, the Company agreed to reprice the 3,020,410 of Existing Warrants that were issued in November 2025 from $2.41 per share to $0.6055 per share. However, under Nasdaq rules, the investor’s ability to exercise the Common Stock Warrants issued in this transaction and the reduction of the exercise price for the Existing Warrants issued in November 2024 are both subject to stockholder approval. Pursuant to the terms of the warrants, the Company submitted two proposals to our stockholders at a Special Stockholders’ Meeting held on April 27, 2026, which had to be adjourned due to lack of quorum. These two proposals will be included in the matters put to a stockholders’ vote at the Company’s Annual Meeting, to be held on June 15, 2026.
Previous report
Compliance with Nasdaq Listing Rules
Previous report
An important part of the Company’s future financing plans is the ability to access the public markets for the sale of securities. This requires that the Company remain in compliance with all Nasdaq Listing Rules. On May 5, 2026, the Company was granted a Hearing before a Nasdaq Hearings Panel to appeal a determination by the Nasdaq Listing Qualifications Staff (the“Staff”) to delist the Company’s securities from The Nasdaq Capital Market (“Nasdaq”) due to the Company’s non-compliance with the $1.00 minimum bid price requirement. As of the date of issuance, the Company has not received the Panel’s determination.
Previous report
For discussion of risks related to potential impacts of supply chain, inflation, geopolitical and macroeconomic challenges on our operations, business results and financial condition, see Part I, Item 1A. “Risk Factors” in the Annual Report filed on March 31, 2026.
Previous report
Wugen License
Previous report
Trimmune License
Previous report
In accordance with the terms of the Trimmune License, the closing took place upon receipt of the full upfront payment.The Company recognized $6.5 million in revenue for the three months ended March 31, 2026 in the accompanying condensed statement of operations and deferred revenue of $470,000 in the accompanying condensed balance sheet. Deferred revenue relates to the Services Performance Obligation, for services not yet completed primarily for building of the master cell bank.
Previous report
Legal Expenses (Recoveries), Net
Previous report
Legal expenses (recoveries), net consist of legal fees incurred in connection with the Arbitration and related proceedings involving the Company and Dr. Hing C. Wong, net of insurance reimbursements received. The Arbitration and related Complaint were dismissed with prejudice as of December 31, 2024. On an ongoing basis, the Company will continue to incur some costs to remain in compliance with the settlement and release, primarily related to maintenance of proper patent protection for the Company’s intellectual property rights.
Previous report
In connection with the payment of the nonrefundable upfront license fee from Trimmune, the Chinese government withheld indirect taxes (VAT) of $198,146 and income taxes of $330,186. The Company intends to apply for a tax refund.
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Interest Expense
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Other Income, Net
Previous report
The Company recognized revenues of $5,065 and $6.5 million for the three months ended March 31, 2025 and 2026, respectively. The Company recognized revenues of $5,065 and $13,001 for the three months ended March 31, 2025 and 2026, respectively, in connection with the Wugen License. The Wugen license is currently suspended for a period of one year, which ends on May 29, 2026. While the license is in suspension, the Company will recognize revenue from ancillary activities such as storage. On March 16, 2026, the Trimmune license transaction closed, the Company recognized $6.5 million in revenue of the nonrefundable upfront license fee, which was paid in a combination of cash and an in-kind payment in the form of a transferable equity interest in Trimmune.
Previous report
Salaries, benefits, and related expenses increased by $77,279, or 11%, from $701,106 for the three months ended March 31, 2025 to $778,385 for the three months ended March 31, 2026. This increase is primarily due to increases of $74,419 in salaries and related taxes and $11,727 for health insurance and other benefits, partially offset by a decrease of $8,867 for stock-based compensation expense.
Previous report
Manufacturing and materials expense decreased by $272,757, or 104%, from $262,798 for the three months ended March 31, 2025 to a contra-expense of $9,959 for the three months ended March 31, 2026. In the three months ended March 31, 2025, expenses were primarily attributable to the costs of production and materials related to manufacturing the high producing cell-line of HCW9101, which was wrapped up prior to the three months ended March 31, 2026. The contra-expense reported in the three months ended March 31, 2026 was primarily due to a refund of insurance costs related to clinical materials stored and insured on behalf of our licensee, Wugen.
Previous report
Expenses associated with preclinical activities increased by $40,455, or 23%, from $177,111 for the three months ended March 31, 2025 to $217,566 for the three months ended March 31, 2026. The Company received clearance of its IND from the FDA to evaluate HCW9302 in a Phase 1 clinical study in patients with alopecia areata in the three months ended March 31, 2025. In the three months ended March 31, 2026, the Company incurred expenses related to experimental drug testing and preparations for IND applications for HCW11-018b and HCW11-040. The $40,455 increase in expenses is attributable to increases of $23,926 in fees paid to collaborators and $16,529 for drug testing.
Previous report
Expenses associated with clinical activities decreased by $60,287, or 32%, from $187,820 for the three months ended March 31, 2025 to $127,533 for the three months ended March 31, 2026. The decline in expenses is primarily attributable to a decrease in $84,531 in fees for collaborators and other professional services, partially offset by increases of $14,293 in patient-related fees and $9,951 in software licenses and data management fees.
Previous report
Other expenses decreased by $5,541, or 4%, from $149,876 for the three months ended March 31, 2025 to $144,423 for the three months ended March 31, 2026. The decline is primarily attributable to a $12,721 decrease in depreciation for scientific equipment, partially offset by increases of $2,754 for equipment and repairs and $2,203 in rent and occupancy expenses.
Previous report
General and administrative expenses decreased $394,320, or 18%, from $2.2 million for the three months ended March 31, 2025 to $1.8 million for the three months ended March 31, 2026. The decrease is primarily due to decreases in salaries and benefits and the accretion expense related to the fixed bonus payment due to the holders of the Secured Notes, in the event they are repaid on the Maturity Date of August 30, 2026.
Previous report
Salaries, benefits and related expenses decreased by $265,137, or 34%, from $788,490 for the three months ended March 31, 2025 to $523,353 for the three months ended March 31, 2026. The decrease is primarily due to decreases of $256,757 in stock-based compensation expense, as equity awards reached full vesting in particular for our Chief Executive Officer, and $10,000 in Board compensation, as we had one fewer Board member in the three months ended March 31, 2026 than we did in the three months ended March 31, 2025.
Previous report
Professional services increased by 30,768, or 7%, from $454,369 for the three months ended March 31, 2025 to $485,137 for the three months ended March 31, 2026. Professional services include corporate legal services, legal services for procuring patents, as well as other professional services, such as auditing and tax advisory fees. The increase is primarily attributable to a $40,418 increase in fees for corporate legal services, partially offset by a decrease of $7,724 for legal services related to patents.
Previous report
Facilities and office expenses increased by $18,582, or 20%, from $94,330 for the three months ended March 31, 2025 to $112,912 for the three months ended March 31, 2026, primarily due to increases of $15,798 for general office expenses such as utilities and other services, such as electricity and waste disposal.
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Previous wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with (i) our unaudited condensed financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and (ii) our audited financial statements and related notes and the discussion under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for the fiscal year ended December 31, 2025 included in the Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 31, 2026 (the “Annual Report”). Our historical results are not necessarily indicative of the results that may be expected for any period in the future. Unless the context requires otherwise, references in this Quarterly Report on Form 10-Q to the “Company,” “HCW Biologics,” “HCWB”, “we,” “us” and “our” refer to HCW Biologics Inc.
Current wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with (i) our unaudited condensed interim financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and (ii) our audited financial statements and related notes and the discussion under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for the fiscal year ended December 31, 2025 included in the Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 31, 2026 (the “Annual Report”). Our historical results are not necessarily indicative of the results that may be expected for any period in the future. Unless the context requires otherwise, references in this Quarterly Report on Form 10-Q to the “Company,” “HCW Biologics,” “HCWB,” “we,” “us” and “our” refer to HCW Biologics Inc.
Previous wording
HCW Biologics Inc. (“HCW Biologics” or the “Company”) is a clinical-stage biopharmaceutical company developing transformative fusion immunotherapeutics to support or treat diseases promoted by chronic inflammation. We have created novel compounds that represent a new class of drugs that we believe have the potential to fundamentally change the treatment of autoimmune disorders and other inflammatory diseases, cancer and senescence-associated dysplasia. Among other things, we have begun commercialization of certain commercial-ready proprietary compounds for use as reagents in the production of immunotherapeutics for the treatment of infectious diseases and cancer. We want our products to improve patients’ healthspan as well as their quality of life, and possibly extend longevity.
Current wording
HCW Biologics Inc. (“HCW Biologics” or the “Company”) is a clinical-stage biopharmaceutical company developing transformative fusion immunotherapeutics to treat diseases promoted by chronic inflammation. We have created novel compounds that represent a new class of drugs that we believe have the potential to fundamentally change the treatment of autoimmune disorders and other inflammatory diseases, cancer and senescence-associated dysplasia. In addition, we have begun commercialization of certain commercial-ready proprietary compounds for use as reagents to support the production of immunotherapeutics for the treatment of infectious diseases and cancer.
Previous wording
During the three months ended March 31, 2026, $851,641 of cash was provided by financing activities which consisted primarily of $1.5 million of cash provided through the issuance of pre-funded warrants and common stock warrants partially offset by $389,056 of cash used for issuance costs and $259,303 of cash used for debt repayment.
Current wording
May 2026 Sale of Common Stock, Pre-Funded Warrants and Common Stock Warrants
Previous wording
Our operations have been affected by many headwinds, including inflationary pressures, tariffs, rising interest rates, ongoing global supply chain disruptions resulting from increased geopolitical tensions such as the war between Russia and Ukraine, the war in the Middle East, China-Taiwan relations, financial market volatility and currency movements. These headwinds, specifically the supply chain disruptions, have adversely impacted our ability to procure certain services and materials, which in some cases impacts the cost and timing of clinical trials and IND-enabling activities. In addition, we have been impacted by inflation when procuring materials required for the buildout of our new headquarters, the costs for recruiting and retaining employees and other employee-related costs. Further, rising interest rates would also increase borrowing costs to the extent that the Company takes on any additional debt. The Company uses a number of strategies to effectively navigate these issues, including product redesign, alternate sourcing, and establishing contingencies in budgeting and timelines. However, the extent and duration of such events and conditions, and resulting disruptions to our operations, are highly unpredictable.
Current wording
The Company’s operations have been affected by many headwinds, including inflationary pressures, tariffs, rising interest rates, ongoing global supply chain disruptions resulting from increased geopolitical tensions such as the war in the Middle East, the conflict between Russia and Ukraine, China-Taiwan relations, financial market volatility and currency movements. The Company has been impacted by inflation, and may continue to be so, when securing materials needed for our operations, the costs for recruiting and retaining employees and other employee-related costs. Management employs a number of strategies to effectively navigate these issues, including product redesign, alternate sourcing, and establishing contingencies in budgeting and timelines. Future developments in these and other areas present material uncertainty and risk with respect to the Company’s clinical trials, IND-enabling activities, as well as the Company’s financial condition and results of operations. The extent and duration of such events and conditions, and resulting disruptions to our operations, are highly unpredictable.
Previous wording
The Company entered the Wugen License with Wugen at the end of 2020, and we entered a development supply agreement with Wugen to provide it with clinical development materials needed for research and clinical development in the first quarter of 2021. On May 29, 2025, the Company agreed to a request from Wugen to suspend the Wugen License for a period of one year from the effective date of the suspension, or until May 29, 2026. During the suspension, the Company is free to enter licenses with other parties for the molecules that are subject of the Wugen license. The Company expects to generate revenue for ancillary services such as storage of clinical supply of material provided to Wugen while the license is in suspension.
Current wording
The Company entered the AlloTera Therapeutics License at the end of 2020, and we entered a development supply agreement with them to provide it with clinical development materials needed for research and clinical development in the first quarter of 2021. On May 29, 2025, the Company agreed to a one-year suspension of the AlloTera Therapeutics License, while they assessed the strategic direction of their clinical development programs. On May 21, 2026, the Company elected to terminate the AlloTera Therapeutics License according to the terms of the suspension agreement. The Company has launched a commercial-ready program to commercialize the two molecules formerly licensed to AlloTera Therapeutics as reagents to support the manufacturing process of cell-based immunotherapies for cancer and infectious diseases.
Previous wording
The upfront, nonrefundable license fee included 2.2 million shares of Wugen common stock, which the Company will continue to hold even if the Wugen Licenses is terminated.
Current wording
The Company will continue to hold the upfront, nonrefundable license fee from AlloTera Therapeutics, including the in-kind payment of 2.2 million shares of their common stock.
Previous wording
On March 16, 2026, the Company received the full nonrefundable upfront license fee, consisting of $3.5 million in gross cash proceeds, or $2.9 million net of taxes, and a transferable minority equity ownership interest in Trimmune with a fair value of $3.5 million, whereupon the transaction was deemed closed and the contract was binding.
Current wording
On March 16, 2026, the Company received the full nonrefundable upfront license fee, consisting of $3.5 million in gross cash proceeds, or $2.9 million net of taxes, and a transferable minority equity ownership interest in Trimmune with a fair value of $3.5 million, whereupon the transaction was deemed closed and the contract was binding. The Company elected to use the measurement alternative under ASC 321-10-35-2 to account for the investment in Trimmune shares — cost less impairment, with adjustment for observable price changes in orderly transactions for the identical or a similar investment of the same issuer.
Previous wording
During the three months ended March 31, 2025, the Company recognized $6.9 million in principal amount of Secured Notes. During the second quarter of 2025, certain noteholders agreed to restructure amounts owed by the Company and convert to equity. Noteholders who purchased notes for $325,000 did not elect to convert their Secured Notes. The Secured Notes bear interest at an annual rate of 9%, payable quarterly in arrears. These noteholders are also entitled to a fixed bonus, payable on the Maturity Date, which is accreted on a straight line basis.
Current wording
During the three months ended June 30, 2025, certain noteholders agreed to restructure $6.6 million of the principal amount of Secured Notes issued by the Company, including the accumulated accretion of a fixed bonus payable on Maturity Date, and convert to equity. Noteholders who purchased notes for $325,000 did not elect to convert their Secured Notes. The Secured Notes bear interest at an annual rate of 9%, payable quarterly in arrears. They are also entitled to a fixed bonus, payable on the Maturity Date of August 31, 2026, which is accreted on a straight-line basis.
Previous wording
As a result of the modification of existing warrants that may be exercised to purchase up to 3,020,410 shares of Common Stock to lower the strike price from $2.41 to $0.6055 per share, the Company classified these warrants as a warrant liability and recognized it at fair value on the date of the modification. The Company will recognize the change in fair value of the warrant liability in each subsequent reporting period, so long as the warrant liability remains classified as a derivative liability. In the three months ended March 31, 2026, the Company recognized a change in fair value of $667,343.
Current wording
As a result of the modification of existing warrants that may be exercised to purchase up to 503,402 shares of Common Stock to lower the strike price from $14.46 to $3.633 per share, the Company classified these warrants as a warrant liability and recognized it at fair value on the date of the modification as of March 31, 2026. On June 15, 2026, the Company’s stockholders approved the repricing of these warrants at the Annual Meeting of Stockholders. The Company recognized the change in fair value of the warrant liability through the period ended June 15, 2026. With the resolution of the contingency for settlement, these warrants were reclassified to equity as of June 15, 2026.
Previous wording
In the three months ended March 31, 2025 and 2026, the Company recognized interest expense of $255,822 and $109,274, respectively, including the following items which were reported within Interest expense on the condensed statements of operations:
Current wording
In the three months ended June 30, 2025 and 2026, the Company recognized interest expense of $228,714 and $100,541, respectively, including the following items which were reported within Interest expense on the condensed statements of operations:
Previous wording
Research and development expenses decreased by $220,763, or 15%, from $1.5 million for the three months ended March 31, 2025 to $1.3 million for the three months ended March 31, 2026. The decrease was primarily due to a decline in manufacturing and materials and clinical expenses, partially offset by increases in salaries and benefits and preclinical expenses.
Current wording
Research and development expenses decreased by $244,236, or 9%, from $2.7 million for the six months ended June 30, 2025 to $2.5 million for the six months ended June 30, 2026. This decrease was primarily attributable to a decrease in expenses related to manufacturing and materials and clinical trials, partially offset by increases in salaries, benefits and related expenses.
Previous wording
For the three months ended March 31, 2025, the Company reported a contra expense of $1.7 million for legal expenses (recoveries), net, reflecting a $2.0 million insurance recovery and legal fees of $260,507. The Arbitration was settled on July 13, 2024, and the Arbitration and related Complaint were dismissed with prejudice as of December 31, 2024. For the three months ended March 31, 2026, the Company reported an expense of $6,850 for legal expenses (recoveries), net.
Current wording
For the six months ended June 30, 2025, the Company reported a contra expense of $1.6 million for legal expenses (recoveries), net, reflecting a $2.0 million insurance recovery and legal fees of $397,470. For the six months ended June 30, 2026, the Company reported an expense of $5,525 for legal expenses (recoveries), net.
Previous wording
Change in Fair Value of Investment
Current wording
There was a net change in the fair value of investment in AlloTera shares and the related contingent liability of $1.8 million in the six months ended June 30, 2025. There was no change in fair value in the six months ended June 30, 2026.
Previous wording
The change in Other income, net was de minimus, from $24,749 for the three months ended March 31, 2025 and $8,888 for the three months ended March 31, 2026.
Current wording
The change in Other income, net was de minimis, from $41,122 for the six months ended June 30, 2025 and $16,439 for the six months ended June 30, 2026.
Previous wording
As of March 31, 2026, the Company had not generated any revenue from commercial product sales of its internally developed immunotherapeutic products. During its development activities, the Company has sustained operating losses, experienced negative operating cash flows and negative working capital position and expects to continue to incur operating losses for the foreseeable future. Since inception to March 31, 2026, the Company incurred cumulative net losses of $102.3 million.
Current wording
As of June 30, 2026, the Company had a cash and cash equivalents of $741,324. The Company has not generated any revenue from commercial product sales of its internally developed immunotherapeutic products. During its development activities, the Company has sustained operating losses, experienced negative operating cash flows and negative working capital position and expects to continue to incur operating losses for the foreseeable future. Since inception to June 30, 2026, the Company incurred cumulative net losses of $107.5 million.
Previous wording
Comparison of the Cash Flows for the Three Months Ended March 31, 2025 and March 31, 2026
Current wording
Comparison of the Cash Flows for the Six Months Ended June 30, 2025 and June 30, 2026
Previous wording
The following table summarizes our cash flows for the three months ended March 31, 2025 and March 31, 2026:
Current wording
The following table summarizes our cash flows for the six months ended June 30, 2025 and June 30, 2026:
Previous wording
Net cash used in operating activities was $3.5 million for the three months ended March 31, 2025 and $1.6 million for the three months March 31, 2026.
Current wording
Net cash used in operating activities was $6.8 million for the six months ended June 30, 2025 and $5.4 million for the six months June 30, 2026.
Previous wording
Cash used in operating activities for the three months ended March 31, 2026 consisted primarily of noncash revenue in the form of an in-kind payment of a transferable minority equity interest in Trimmune recognized at the fair value of $3.5 million, as well as $1.3 million of cash used to decrease Accounts payable and other liabilities, an decrease in cash arising from an adjustment for a non-cash change in fair value of warrant liability of $667,343, and $117,883 of cash used to increase Prepaid expenses and other assets. The uses were partially offset by cash provided by operations, which consisted of $3.5 million of net income and increases of $470,000 in Deferred revenue and noncash adjustments, including $142,049 for Depreciation, amortization and accretion and $10,019 for stock-based compensation.
Current wording
Cash used in operating activities for the six months ended June 30, 2026 consisted primarily of a net loss for the period of $1.7 million, noncash revenue in the form of an in-kind payment of a transferable minority equity interest in Trimmune recognized at the fair value of $3.5 million, $2.0 million of cash used to decrease Accounts payable and other liabilities, a gain on extinguishment of a liability of $483,383 and a $108,214 increase in prepaid expenses and other assets. The uses were partially offset by an increase of $348,270 in Deferred revenue related to contract liabilities under the Trimmune License and noncash adjustments, including a $1.8 million change in fair value of warrant liability, $269,144 for Depreciation and accretion and $11,239 for stock-based compensation.
Previous wording
There was no cash used in or provided by investment activities for the three months ended March 31, 2025 or 2026.
Current wording
There was no cash used in or provided by investing activities for the six months ended June 30, 2025 and June 30, 2026, respectively.
Previous wording
Noncash financing activities consisted of a $1.5 million dividend to investor as a result of a financing transaction with an existing stockholder, deemed to be a related party. On February 19, 2026, the Company closed on a financing with gross proceeds of $1.5 million, in which we issued shares of the Company’s Common Stock, new warrants to exercise to purchase shares of the Company’s Common Stock and repriced previously issued warrants. The Company estimated the fair value of the securities issued and repriced warrants was $3.0 million. As a result, the Company recorded a $1.5 million dividend to additional paid-in capital as of March 31, 2026.
Current wording
In the six months ended June 30, 2026, the Company closed on two financing transactions for $5.5 million in which it issued shares of the Company Common Stock, warrants to exercise to purchase shares of the Company’s Common Stock to investors, including officers, directors and significant existing stockholders of the Company, and repriced previously issued warrants with an existing stockholder of the Company. The Company estimated fair value of the securities issued and repriced warrants was $17.1 million. The difference between the gross proceeds and fair value was recognized as an equity dividend to investors, as both transactions were with an existing stockholder of the Company. The Company recorded a $11.6 million dividend to investors within additional paid-in capital for the period ended June 30, 2026.
Previous wording
Our management’s discussion and analysis of our financial condition and results of operations is based on our unaudited condensed financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgements about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We believe that the accounting policies discussed below are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgements and estimates.
Current wording
Our management’s discussion and analysis of our financial condition and results of operations is based on our unaudited condensed interim financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgements about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We believe that the accounting policies discussed below are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgements and estimates.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
The following table summarizes our research and development expenses for the six months ended June 30, 2025 and June 30, 2026:
Current report — wording carried from elsewhere
The following table summarizes our general and administrative expenses for the six months ended June 30, 2025 and June 30, 2026:
Current report — wording carried from elsewhere
In the six months ended June 30, 2025 and 2026, the Company recognized interest expense of $505,853 and $209,815, respectively, including the following items which were reported within Interest expense on the condensed statements of operations:
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Change in fair value of Warrant Liability