Aprea Therapeutics, Inc.
Quarterly Report on Form 10-Q
For the Quarter Ended June 30, 2024
| PART I: FINANCIAL INFORMATION | 5 |
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| Item 1. Financial Statements | 5 |
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| Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations | 16 |
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| Item 3. Quantitative and Qualitative Disclosures About Market Risk | 28 |
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| Item 4. Controls and Procedures | 28 |
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| PART II: OTHER INFORMATION | 29 |
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| Item 1. Legal Proceedings | 29 |
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| Item 1A. Risk Factors | 29 |
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| Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | 87 |
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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 | 88 |
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| Item 6. Exhibits | 89 |
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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q includes statements that are, or may be deemed, “forward-looking statements.” In some cases, these forward-looking statements can be identified by the use of forward-looking terminology, including the terms “believes,” “estimates,” “anticipates,” “expects,” “plans,” “intends,” “may,” “designed,” “would,” “could,” “might,” “will,” “should,” “approximately” or, in each case, their negative or other variations thereon or comparable terminology, although not all forward-looking statements contain these words. They appear in a number of places throughout this Quarterly Report on Form 10-Q and include statements regarding our current intentions, beliefs, projections, outlook, analyses or current expectations concerning, among other things, our ongoing and planned clinical trials, including for ATRN-119, our ongoing and planned IND-enabling studies, including for APR-1051, our ongoing and planned development, prospects for commercialization, and market uptake of our potential product candidates, the strength and breadth of our intellectual property, the timing of and our ability to make regulatory filings and obtain and maintain regulatory approvals for our product candidates, the legal and regulatory landscape impacting our business, the degree of clinical utility of our product candidates, particularly in specific patient populations, expectations regarding clinical trial data, our development and validation of manufacturing capabilities, our results of operations, financial condition, liquidity, prospects, growth and strategies, the length of time that we will be able to continue to fund our operating expenses and capital expenditures, our expected financing needs and sources of financing, the industry in which we operate and the trends that may affect the industry or us.
By their nature, forward-looking statements involve risks and uncertainties because they relate to future events, competitive dynamics, and healthcare, regulatory and scientific developments and depend on economic circumstances that may or may not occur in the future or may occur on longer or shorter timelines than anticipated. We caution you that forward-looking statements are not guarantees, or predictive, of future performance and that our actual results of operations, financial condition and liquidity, and the development of the industry in which we operate may differ materially from the forward-looking statements contained in this Quarterly Report on Form 10-Q.
Some of the factors that we believe could cause actual results to differ from those anticipated or predicted include:
| ● | estimates of our expenses, capital requirements and our needs for additional financing; |
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| ● | business interruptions, including delays in enrollment, patient follow-up and data collection of clinical trials; |
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| ● | the prospects of our product candidates, all of which are still in development; |
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| ● | outcome and results of ongoing or future preclinical studies and clinical trials of our product candidates; |
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| ● | our expectations regarding our ability to identify, discover or acquire additional suitable product candidates; |
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| ● | the design of our ongoing and planned clinical trials, including the sample size, trial duration, endpoint definition, event rate assumptions and eligibility criteria; |
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| ● | our ability to enroll patients in clinical trials, to timely and successfully complete those trials and to receive necessary regulatory approvals; |
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| ● | our expectations regarding the timing of initiation of data readout from our clinical trials; |
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| ● | market acceptance or commercial success of any product candidate we develop and the degree of acceptance among physicians, patients, patient advocacy groups, healthcare payors and the medical community; |
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| ● | our expectations regarding competition, potential market size, the size of the patient populations for our product candidates, if approved for commercial use, and market acceptance; |
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| ● | our ability to obtain regulatory approval of our product candidates, and any restrictions, limitations and/or warnings in their labels, if approved; |
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| ● | the scope of protection we are able to establish and maintain for intellectual property rights covering our product candidates; |
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| ● | potential claims relating to our intellectual property and third-party intellectual property; |
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| ● | the duration of our intellectual property estate that will provide protection for our product candidates; |
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| ● | developments relating to our competitors and our industry; |
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| ● | our sales, marketing or distribution capabilities and our ability to commercialize our product candidates, if we obtain regulatory approval; |
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| ● | current and future agreements with third parties in connection with conducting clinical trials, as well as the manufacturing of our product candidates; |
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| ● | our expectations regarding the ability of our current contract manufacturing partners to produce our product candidates in the quantities and timeframe that we will require; |
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| ● | our expectations regarding our future costs of goods; |
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| ● | our ability to attract, retain and motivate key personnel and increase the size of our organization; |
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| ● | our ability to establish collaborations in lieu of obtaining additional financing; |
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| ● | the impact of government laws and regulations; |
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| ● | our financial performance; and |
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| ● | our expectations regarding the time during which we will be an emerging growth company under the JOBS Act or a smaller reporting company under the Exchange Act. |
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Any forward-looking statements that we make in this Quarterly Report on Form 10-Q speak only as of the date of such statement, and we undertake no obligation to update such statements to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q. You should also read carefully the factors described in the “Risk Factors” included in Part II, Item 1A of this Quarterly Report, in Part I and in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31,2023 to better understand significant risks and uncertainties inherent in our business and underlying any forward-looking statements. As a result of these factors, we cannot assure you that the forward-looking statements in this Quarterly Report on Form 10-Q will prove to be accurate. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may be material. In light of the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation or warranty by us or any other person that we will achieve our objectives and plans in any specified timeframe, or at all.
This Quarterly Report on Form 10-Q includes statistical and other industry and market data that we obtained from industry publications and research, surveys and studies conducted by third parties. Industry publications and third-party research, surveys and studies generally indicate that their information has been obtained from sources believed to be reliable, although they do not guarantee the accuracy or completeness of such information. While we believe these industry publications and third-party research, surveys and studies are reliable, we have not independently verified such data.
We qualify all of our forward-looking statements by these cautionary statements. In addition, with respect to all of our forward-looking statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.
This Form 10-Q may include trademarks, tradenames, and service marks that are the property of other organizations. Solely for convenience, our trademarks and tradenames referred to in this Form 10-Q may appear without the ® and ™ symbols, but those references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights, or the right of the applicable licensor to these trademarks and tradenames.
