CytoDyn Inc
For the period ended Feb 29, 2024. Filed Apr 15, 2024.
View on SEC.govAbout this filing
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.
Feb 29, 2024 · Filed Apr 15, 2024
CYDYStored price and day change unavailable
What changed in Risk Factors?
Read the current filingPrevious report: 10-Q
Period ended 2023-11-30; filed 2024-01-16.
0001558370-24-000305
ITEM 1A. RISK FACTORSCurrent report: 10-Q
Period ended 2024-02-29; filed 2024-04-15.
0001558370-24-005134
ITEM 1A. RISK FACTORSThe 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 18 previous paragraphs and 10 current paragraphs.
4 unchanged; 5 reworded; 1 added; 9 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 7 previous and 0 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 (1)
Current report
During the past 24 months, we have experienced significant turnover among our senior executives, and currently have only three executive officers. Mitchell Cohen, the Company’s current Interim Chief Financial Officer, was appointed effective February 1, 2024. The Company’s Board of Directors intends to initiate a search for a long-term Chief Financial Officer at some point in the coming months, in collaboration with Mr. Cohen. If we are successful in
Removed paragraphs (9)
Previous report
During the past 24 months, we have experienced significant turnover among our senior executives, and currently have only three executive officers. Dr. Jacob Lalezari, the Company’s current Principal Executive Officer, was appointed as the Company’s interim CEO, effective November 17, 2023. The Board’s search for a new President and/or Chief Executive Officer remains in progress. If we are successful in recruiting one or more individuals to executive positions, the complexity inherent in integrating a new key member of the senior management team with existing senior management may limit the effectiveness of any such successor or otherwise adversely affect our business. Leadership
Previous report
We have been notified by Samsung of Samsung’s intent to terminate the Company’s agreements for manufacturing of our drug product and related services.
Previous report
Beginning in fiscal 2022, we have received communications from Samsung regarding alleged breaches of our agreements with Samsung relating to past due balances. The Company has been pursuing negotiations with Samsung regarding potential approaches to resolve the issues short of litigation.
Previous report
On November 21, 2023, Samsung informed the Company of Samsung’s intent to terminate the agreements with the Company, effective January 5, 2024. As of the date of this filing, the parties remain in communication about the outstanding issues under the agreements and potential options moving forward. There can be no assurance that we will be able to address the issues raised by Samsung or avoid being found in breach of our agreements with Samsung. Failure to resolve the issues may ultimately result in termination of our agreements with Samsung, which could jeopardize our ability to properly store our inventories of drug product and manufacture additional drug product when needed.
Previous report
Refer to Note 8,Commitments and Contingencies – Commitments with Samsung BioLogics Co., Ltd. (“Samsung”) for further information.
Previous report
If we are unable to obtain all required regulatory approvals for leronlimab, we will not be able to commercialize our primary product candidate, which would materially and adversely affect our business, financial condition, and stock price.
Previous report
The FDA notified the Company at the beginning of December 2023 that: (i) the FDA’s “partial hold” imposed in March 2022 had been lifted; and (ii) a new “full hold” had been applied related to the clinical trial protocol the Company submitted in November 2023 alongside the Company’s complete response to the partial clinical hold. The Company currently anticipates that it will be able to submit a revised protocol to the FDA in January 2024, and will remain on clinical hold until the FDA clears the protocol.
Previous report
Clinical testing is expensive, difficult to design and implement, may take many years to complete, and its outcome is uncertain. The research, testing, manufacturing, labeling, packaging, storage, approval, sale, marketing, advertising and promotion, pricing, export, import, and distribution of drug products are subject to extensive regulation by the FDA and other regulatory authorities in the United States and other countries, with regulations differing from country to country. We are not permitted to market a drug candidate as prescription pharmaceutical products in the United States until we receive approval from the FDA, or in foreign markets until we receive the requisite approval from comparable regulatory authorities in foreign countries. In the United States, the FDA generally requires the completion of clinical trials of each drug to establish its safety and efficacy, and extensive pharmaceutical development to ensure its quality before approval. Regulatory authorities in other jurisdictions impose similar requirements. Of the large number of drugs in development, only a small percentage are approved for commercialization. Receipt of necessary regulatory approval for the use of leronlimab for one or more indications is subject to a number of risks which include, among others:
Previous report
We cannot guarantee that regulators will agree with our assessment of the results of our past or future clinical trials or that such trials will be considered by regulators to have shown safety or efficacy of our product candidate. In particular, there remains no guarantee that the FDA will lift the clinical hold on our recently submitted protocol. The FDA has substantial discretion in the approval process and may refuse to accept any application or may require additional clinical trials or pre-clinical or other studies. Additionally, we have limited experience in filing the applications necessary to gain regulatory approvals and expect to continue to rely on consultants and our CROs to assist us in this process. Securing FDA approval requires the submission of pre-clinical, clinical, and/or pharmacokinetic data, information about product manufacturing processes and inspection of facilities, and supporting information for each therapeutic indication to establish a product candidate’s safety and efficacy for each indication. Our drug candidate may prove to have undesirable or unintended side effects, toxicities, or other characteristics that may preclude us from obtaining regulatory approval or prevent or limit commercial use with respect to one or all intended indications. Failure to obtain regulatory approval for leronlimab will prevent us from commercializing it as a prescription product, and our ability to generate revenue will be seriously impaired.
Reworded paragraphs (5)
Previous wording
Our cash reserves are extremely low, requiring that we obtain substantial additional financing to satisfy our current payment obligations and to fund our operations, which continues to be difficult in light of the low trading price of our common stock.
Current wording
Our cash balances are extremely low, requiring that we obtain substantial additional financing to satisfy our current payment obligations and to fund our operations, which continues to be difficult in light of the low trading price of our common stock.
Previous wording
As of December 31, 2023, we had an unrestricted cash balance of approximately $0.5 million and a reserved cash balance of approximately $6.6 million. We must continue to raise substantial additional funds in the near term to meet our payment obligations and fund our operations. Additional funding may not be available on acceptable terms or at all. In addition, as of** **December 31, 2023, we had approximately 371.0 million shares of common stock unreserved for other purposes and available for issuance in new financing transactions. We will need to use some of the additional authorized shares (or funds raised through the sale of such shares) to satisfy a portion of our outstanding accounts payable and accrued liabilities, which totaled approximately $ 71.5 million on November 30, 2023. If we are not able to raise additional funds on a timely basis, we may be forced to delay, reduce the scope of, or eliminate one or more of our planned operating activities, including continuing to seek removal of the clinical hold placed on us by the FDA in December 2023, analyzing clinical trial data for purposes of responding to FDA requirements, and preparing additional regulatory submissions, developing additional clinical trials for indications we plan to pursue, regulatory and compliance activities, and legal defense activities. Any delay or inability to pursue our planned activities likely will adversely affect our business, financial condition, and stock price. The continued low trading price of our common stock (with a closing price of $0.20 per share on January 5, 2024) presents a significant challenge to our ability to raise additional funds. If we deplete our cash reserves, we may have to discontinue our operations and liquidate our assets.
Current wording
As of March 31, 2024, we had an unrestricted cash balance of approximately $3.0 million and a reserved cash balance of approximately $6.6 million. We must continue to raise substantial additional funds in the near term to meet our payment obligations and fund our operations. Additional funding may not be available on acceptable terms or at all. In addition, as of March 31, 2024, we had approximately 298.7 million shares of common stock unreserved for other purposes and available for issuance in new financing transactions. We will need to use some of the additional authorized shares (or funds raised through the sale of such shares) to satisfy a portion of our outstanding accounts payable and accrued liabilities, which totaled approximately $72.6 million on February 29, 2024. If we are not able to raise additional funds on a timely basis, we may be forced to delay, reduce the scope of, or eliminate one or more of our planned operating activities, including: conducting a Phase II study evaluating the effects of leronlimab on chronic immune activation and inflammation; pursuing research and development of longer-acting molecules, including for the treatment and/or prevention of HIV; evaluating whether to conduct a combination pre-clinical study or monotherapy Phase 2b/3 clinical trial in MASH; and evaluating opportunities for pre-clinical and clinical studies in solid tumors in oncology and publishing data from previously conducted studies. Any delay or inability to pursue our planned activities likely will adversely affect our business, financial condition, and stock price. The continued low trading price of our common stock (with a closing price of $0.16 per share on April 12, 2024) presents a significant challenge to our ability to raise additional funds. If we deplete our cash reserves, we may have to discontinue our operations and liquidate our assets.
Previous wording
Our Principal Executive Officer is currently serving in an interim role. The loss, temporary loss, or transition of members of our senior management team or any other key employees may adversely affect our business.
Current wording
Our Chief Financial Officer is currently serving in an interim role. The loss, temporary loss, or transition of members of our senior management team or any other key employees may adversely affect our business.
Previous wording
transitions and any disruptions that result are inherently difficult to manage and may cause uncertainty or a disruption to our business or increase the likelihood of turnover of other key officers and employees. Further, we may incur significant expenses related to any executive transition costs. Finding suitable replacements for senior management and other key employees can be difficult, and there is no assurance we will be successful in attracting or retaining qualified personnel.
Current wording
recruiting one or more individuals to executive positions, the complexity inherent in integrating a new key member of the senior management team with existing senior management may limit the effectiveness of any such successor or otherwise adversely affect our business. Leadership transitions and any disruptions that result are inherently difficult to manage and may cause uncertainty or a disruption to our business or increase the likelihood of turnover of other key officers and employees. Further, we may incur significant expenses related to any executive transition costs. Finding suitable replacements for senior management and other key employees can be difficult, and there is no assurance we will be successful in attracting or retaining qualified personnel.
Previous wording
Our success depends significantly on the individual and collective contributions of our senior management team and key employees. The individual and collective efforts of these employees are important as we continue our efforts to develop leronlimab. The loss of the services of a member of our senior management team or the inability to hire and retain experienced management personnel likely would have a material adverse effect on our business and operations.
Current wording
Our success depends significantly on the individual and collective contributions of our senior management team and key employees. The individual and collective efforts of these employees are important as we continue our efforts to develop leronlimab. The loss of the services of a member of our senior management team or the inability to hire and retain key management personnel likely would have a material adverse effect on our business and operations.