Inhibitor Therapeutics, Inc.

Previous wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes appearing elsewhere in this Report. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. The actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, including, but not limited to, those which are not within our control.

Current wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and related notes appearing elsewhere in this Report. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. The actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, including, but not limited to, those which are not within our control.

Previous wording

The Company is a pharmaceutical development company that is focused on developing and ultimately commercializing innovative therapeutics based on already approved active pharmaceuticals that have patent-protected methods of use and/or methods of delivery for patients with certain cancers and certain non-cancerous proliferation disorders. We also have explored and expect to continue to explore acquiring or licensing other innovative pre-clinical and clinical stage therapeutics addressing unmet needs for the treatment of cancer and other diseases based on repurposing active ingredients of already approved drugs.

Current wording

We are a pharmaceutical development company that is focused on developing and ultimately commercializing innovative therapeutics based on already approved active pharmaceuticals that have patent-protected methods of use and/or methods of delivery for patients with certain cancers and certain non-cancerous proliferation disorders. We also have explored and expect to continue to explore acquiring or licensing other innovative pre-clinical and clinical stage therapeutics addressing unmet needs for the treatment of cancer and other diseases based on repurposing active ingredients of already approved drugs.

Previous wording

Our current primary focus is on the development of therapies initially for basal cell carcinoma (“BCC”), prostate and lung cancers in the United States utilizing itraconazole, a drug currently approved by the FDA to treat fungal infections, and which has an extensive history of safe and effective use in humans. The Company has developed intellectual property and know-how related to the treatment of cancer patients using itraconazole. In particular, on December 12, 2023, the Company entered into an Exclusive License Agreement (the “Agreement”) with Johns Hopkins University (“JHU”). Pursuant to the Agreement, JHU granted to the Company the exclusive worldwide patent rights to a Granted US Patent, No. 8,980,930 entitled “New Angiogenesis Inhibitors” (the “Patent”). The Patent relates to the treatment of prostate cancer, BCC including basal cell carcinoma nevus syndrome (“BCCNS”), and lung cancer.

Current wording

Our current primary focus is on the development of therapies initially for BCCNS, prostate and lung cancers in the United States utilizing itraconazole, a drug currently approved by the FDA to treat fungal infections, and which has an extensive history of safe and effective use in humans. We have developed intellectual property and know-how related to the treatment of cancer patients using itraconazole.

Previous wording

We account for stock-based awards to employees and non-employees using Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718 – Accounting for Share-Based Payments, which provides for the use of the fair value-based method to determine compensation for all arrangements where shares of stock or equity instruments are issued for compensation. Fair values of restricted stock units issued are determined by the Company based predominantly on the trading price of the common stock on the date of grant. Fair value of each common stock option is estimated on the date of grant using the Black-Scholes valuation model that uses assumptions for expected volatility, expected dividends, expected term, and the risk-free interest rate. Expected volatility is based on historical volatility of a peer group’s common stock and other factors estimated over the expected term of the options. The expected term of the options granted is derived using the “simplified method” which computes the expected term as the average of the weighted-average vesting term and the contract term. The risk-free rate is based on the U.S. Treasury yield.

Current wording

We account for stock-based awards to employees and non-employees using a fair value-based method to determine compensation for all arrangements where shares of stock or equity instruments are issued for compensation. Fair values of restricted stock units issued are determined by the Company based predominantly on the trading price of the common stock on the date of grant. The fair value of each common stock option is estimated on the date of grant using the Black-Scholes valuation model that uses assumptions for expected volatility, expected dividends, expected term, and the risk-free interest rate. Expected volatility is based on historical volatility of a peer group’s common stock and other factors estimated over the expected term of the options. The expected term of the options granted is derived using the “simplified method” which computes the expected term as the average of the weighted-average vesting term and the contract term. The risk-free rate is based on the U.S. Treasury yield.

Previous wording

Research and Development Expenses. We incurred $1.4 million and $6,150 in research and development expenses during the years ended December 31, 2023 and 2022, respectively. The R&D expenses are primarily internal personnel costs, consisting of salaries, benefits and other related costs, as well as amounts paid to third parties to support the Company’s research and development activities. The increase in research and development expenses is the result of the relative significance of R&D activity during the year ended December 31, 2023 compared to the year ended December 31, 2022.

Current wording

Research and Development Expenses. We incurred $1.7 million and $1.4 million in research and development expenses during the years ended December 31, 2024 and 2023, respectively. These expenses are primarily internal personnel costs, consisting of salaries, benefits and other related costs, as well as amounts paid to third parties to support the Company’s research and development activities. The $0.3 million increase is primarily the result of an increase in internal personnel costs associated with the Company’s R&D activities as a result of the relative significance of R&D activity and developments during the year ended December 31, 2024 compared to the year ended December 31, 2023.

Previous wording

General and Administrative Expenses. We incurred approximately $2.0 million and $0.7 million in general and administrative expenses during the years ended December 31, 2023 and 2022, respectively. During the year ended December 31, 2023, general and administrative expenses were composed primarily of compensation costs of $0.9 million, insurance costs of $0.5 million, professional services fees of $0.5 million and general corporate overhead costs of $0.1 million. The increase of approximately $1.3 million was due primarily to the increase in the various G&A costs incurred as a result of the governance and management transitions related to litigation that resolved in late 2022 and the subsequent execution of the Company’s operations.

Current wording

General and Administrative Expenses. We incurred approximately $2.0 million in general and administrative expenses during each of the years ended December 31, 2024, and 2023. During the year ended December 31, 2024, general and administrative expenses were composed primarily of compensation costs of $1.1 million, professional services fees of $0.5 million and insurance costs of $0.4 million, which represented an increase of $0.2 million in compensation costs and a decrease of $0.2 million in insurance costs, year-over-year.

Previous wording

We are presently focused on our business plan of developing and ultimately commercializing innovative therapeutics based on already approved active pharmaceuticals that have patent-protected methods of use and/or methods of delivery. We expect to progress with the FDA in 2024 to reach a conclusion on whether any additional clinical trials are required before submitting our New Drug Application (NDA). Our current cash on hand, approximately $8.8 million on December 31, 2023, is sufficient to continue to execute our business plan as currently anticipated, without another required clinical trial. Based on our current operational plan and budget, we expect that we will have sufficient cash to manage our business and continue to pursue clinical trials and acquire other drug development opportunities, as needed once we determine our requirements for the BCCNS product. As we determine capital requirements for additional opportunities, we will consider raising additional capital in the public market.

Current wording

We are presently focused on our business plan for developing and ultimately commercializing innovative therapeutics based on already approved active pharmaceuticals that have patent-protected methods of use and/or methods of delivery. We expect to progress with the FDA to reach a conclusion on whether any additional clinical trials are required before submitting our New Drug Application (NDA). Our current cash on hand, approximately $5.6 million on December 31, 2024, is sufficient to continue to execute our business plan as currently anticipated, without another required clinical trial. Based on our current operational plan and budget, we expect that we will have sufficient cash to manage our business and continue to pursue the FDA process for the BCCNS product (without further clinical trials) and explore other drug development opportunities. Once we determine our requirements for the BCCNS NDA, we will assess capital requirements for additional opportunities, at which time we will consider raising additional capital in the public market.