UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 or For the transition period from________ to_________. Corbus Pharmaceuticals Holdings, Inc. (Exact name of registrant as specified in its charter) (Former Name, Former Address and Former Fiscal Year if Changed Since Last Report): N/A Title of Each Class Exchange on Which Registered TradingSymbolNameofEach Large accelerated filer ☐ Accelerated filer ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from________ to_________. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) 500 River Ridge Drive Norwood, MA ...

PART I - FINANCIAL INFORMATION This section presents the unaudited condensed consolidated financial statements and management's analysis for the first quarter of 2023 [Item 1. Condensed Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) This section presents Corbus Pharmaceuticals Holdings, Inc.'s unaudited condensed consolidated financial statements for Q1 2023, detailing a net loss of **$17.7 million** and decreased total assets [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to **$51.6 million** from **$66.3 million** by March 31, 2023, primarily due to reduced cash and investments, while equity significantly declined to **$16.5 million** Condensed Consolidated Balance Sheet Highlights (Unaudited) | Account | March 31, 2023 ($) | December 31, 2022 ($) | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $7,324,437 | $17,002,715 | | Investments | $36,902,563 | $42,194,296 | | Total current assets | $45,864,999 | $60,181,102 | | **Total assets** | **$51,645,273** | **$66,311,940** | | **Liabilities & Equity** | | | | Total current liabilities | $14,358,947 | $12,639,938 | | Total liabilities | $35,186,321 | $33,321,923 | | Accumulated deficit | $(409,825,479) | $(392,080,667) | | **Total stockholders' equity** | **$16,458,952** | **$32,990,017** | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) The company reported a net loss of **$17.7 million** (or **$4.24** per share) for Q1 2023, an increase from **$9.4 million** in Q1 2022, driven by higher research and development expenses Statement of Operations Highlights (Unaudited, for the three months ended March 31) | Metric | 2023 ($) | 2022 ($) | | :--- | :--- | :--- | | Research and development | $13,388,343 | $3,286,236 | | General and administrative | $3,908,682 | $5,230,923 | | Total operating expenses | $17,297,025 | $8,517,159 | | Operating loss | $(17,297,025) | $(8,517,159) | | **Net loss** | **$(17,744,812)** | **$(9,437,242)** | | **Net loss per share, basic and diluted** | **$(4.24)** | **$(2.26)** | [Condensed Consolidated Statement of Stockholders' Equity](index=5&type=section&id=Condensed%20Consolidated%20Statement%20of%20Stockholders%27%20Equity) Stockholders' equity decreased from **$33.0 million** to **$16.5 million** by March 31, 2023, primarily due to a **$17.7 million** net loss, partially offset by stock-based compensation - The balance of stockholders' equity fell to **$16,458,952** at March 31, 2023, down from **$32,990,017** at December 31, 2022[9](index=9&type=chunk) - Key changes during the quarter included a net loss of **$17,744,812**, stock-based compensation expense of **$1,026,379**, and proceeds from the issuance of common stock upon exercise of stock options of **$129,745**[9](index=9&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities was **$15.1 million** for Q1 2023, resulting in a **$9.7 million** net decrease in cash and equivalents, bringing the period-end balance to **$8.0 million** Cash Flow Highlights (Unaudited, for the three months ended March 31) | Activity | 2023 ($) | 2022 ($) | | :--- | :--- | :--- | | Net cash used in operating activities | $(15,114,972) | $(10,615,350) | | Net cash provided by investing activities | $5,549,704 | $42,962,177 | | Net cash used in financing activities | $(113,010) | $(327,125) | | **Net (decrease) increase in cash** | **$(9,678,278)** | **$32,019,702** | | **Cash at end of period** | **$7,994,337** | **$57,696,234** | [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes detail the company's precision oncology business, liquidity, accounting policies including a **1-for-30 reverse stock split**, and specifics on license agreements and compensation - The company is a precision oncology firm developing CRB-701 (ADC targeting Nectin-4), CRB-601 (anti-integrin monoclonal antibody), and seeking partners for CRB-913 (obesity treatment)[12](index=12&type=chunk) - The company expects its cash, cash equivalents, and investments of **$44.2 million** as of March 31, 2023, to be sufficient to fund operations for at least twelve months from the report's issuance[97](index=97&type=chunk) - On February 14, 2023, the company completed a **1-for-30 reverse stock split** of its common stock, with all share and per-share data retroactively adjusted[98](index=98&type=chunk)[154](index=154&type=chunk) - In Q1 2023, the company recorded a **$7.5 million** upfront license payment to CSPC and a **$1.2 million** development milestone under the UCSF License Agreement as research and development expenses[64](index=64&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial condition and Q1 2023 operational results, highlighting the precision oncology pipeline, increased R&D expenses due to licensing, and a cash runway extending through Q2 2024 [Overview](index=25&type=section&id=Overview) Corbus is a precision oncology company developing CRB-701 and CRB-601, seeking partners for CRB-913, and has an accumulated deficit of approximately **$409.8 million** as of March 31, 2023 - The company's precision oncology pipeline includes CRB-701 (Nectin-4 ADC) and CRB-601 (anti-αvβ8 monoclonal antibody)[186](index=186&type=chunk)[217](index=217&type=chunk) - The IND for CRB-701 has been cleared by the FDA, with plans to start a U.S. clinical trial in mid-2024, and an IND submission for CRB-601 is planned for the second half of 2023[204](index=204&type=chunk) - The company is seeking partners to fund further development of CRB-913, a CB1 inverse agonist for obesity[187](index=187&type=chunk)[217](index=217&type=chunk) [Results of Operations](index=27&type=section&id=Results%20of%20Operations) Research and development expenses increased by **$10.1 million** to **$13.4 million** in Q1 2023 due to licensing costs, while general and administrative expenses decreased by **$1.3 million** - Research and development expenses increased to **$13.4 million** in Q1 2023 from **$3.3 million** in Q1 2022, driven by a **$7.5 million** upfront payment for the CSPC License Agreement and a **$1.2 million** milestone payment under the UCSF License Agreement[224](index=224&type=chunk) - General and administrative expenses decreased to **$3.9 million** in Q1 2023 from **$5.2 million** in Q1 2022, a reduction of **$1.3 million**, attributed to lower legal costs, stock-based compensation, and insurance premiums[241](index=241&type=chunk) [Liquidity and Capital Resources](index=28&type=section&id=Liquidity%20and%20Capital%20Resources) The company's **$44.2 million** in cash and equivalents are expected to fund operations through Q2 2024, but significant additional capital will be required for future development and operations - The company's cash, cash equivalents, and marketable securities of approximately **$44.2 million** at March 31, 2023, are expected to fund operations through the second quarter of 2024[228](index=228&type=chunk) - Net cash used in operating activities for Q1 2023 was approximately **$15.1 million**[227](index=227&type=chunk) - The company will need to raise significant additional capital to continue funding operations and may be required to delay or scale back activities if funding is not secured on acceptable terms[215](index=215&type=chunk)[244](index=244&type=chunk) [Critical Accounting Policies and Estimates](index=29&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) Key accounting policies requiring significant judgment include stock-based compensation, accrued research and development expenses, and lease accounting, involving complex estimates and models - Critical accounting policies involve significant estimates for stock-based compensation, accrued research and development expenses, and right-of-use assets and lease liabilities[237](index=237&type=chunk)[247](index=247&type=chunk) - Stock-based compensation is valued using the Black-Scholes model, with key assumptions including expected volatility (**100.13%** in Q1 2023), term (**6.25 years**), and forfeiture rate (**17.64%** in Q1 2023)[180](index=180&type=chunk)[261](index=261&type=chunk) - Accrued R&D expenses are estimated based on services performed by research institutions and CROs, with payments often tied to milestones, and no significant changes to prior estimates were noted[249](index=249&type=chunk)[262](index=262&type=chunk)[263](index=263&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=31&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section is not applicable as the company qualifies as a smaller reporting company - Not Applicable[268](index=268&type=chunk) [Item 4. Controls and Procedures](index=31&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were deemed ineffective as of March 31, 2023, due to a material weakness in reporting accruals for licensing agreement payments - Disclosure controls and procedures were concluded to be not effective as of March 31, 2023[251](index=251&type=chunk) - A material weakness was identified in the control environment over internal control activities for processing and reporting accruals associated with upfront payments and fees in licensing agreements[253](index=253&type=chunk) PART II - OTHER INFORMATION This section provides other required information, including legal proceedings, risk factors, equity sales, and exhibits [Item 1. Legal Proceedings](index=32&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently subject to any material legal proceedings - The company is not currently subject to any material legal proceedings[279](index=279&type=chunk) [Item 1A. Risk Factors](index=32&type=section&id=Item%201A.%20Risk%20Factors) No material changes or additions to the risk factors previously disclosed in the company's 2022 Annual Report on Form 10-K have occurred - There have been no material changes to the risk factors disclosed in the company's 2022 Annual Report on Form 10-K[269](index=269&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=32&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities were reported during the period - None reported for the period[281](index=281&type=chunk) [Item 3. Defaults Upon Senior Securities](index=32&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable - Not applicable[271](index=271&type=chunk) [Item 4. Mine Safety Disclosures](index=32&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable - Not applicable[282](index=282&type=chunk) [Item 5. Other Information](index=32&type=section&id=Item%205.%20Other%20Information) The Board ratified the issuance of **43,836** common shares from March 2023 option exercises, which were inadvertently issued on a pre-reverse stock split basis and are undergoing a ratification process - On May 7, 2023, the Board ratified the issuance of **43,836** shares of common stock (**36,757** on March 8 and **7,079** on March 20) that were inadvertently issued on a pre-reverse stock split basis[272](index=272&type=chunk) - The issuances were deemed potentially defective corporate acts, and the company has initiated a ratification process under Section 204 of the Delaware General Corporation Law[272](index=272&type=chunk) [Item 6. Exhibits](index=33&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including CEO and CFO certifications and XBRL data files - Lists filed exhibits, including CEO/CFO certifications (Exhibits 31.1, 31.2, 32.1, 32.2) and various Inline XBRL documents[274](index=274&type=chunk)[275](index=275&type=chunk)[283](index=283&type=chunk)

In the United States and some foreign jurisdictions, there have been a number of legislative and regulatory changes and proposed changes regarding the healthcare system that could prevent or delay marketing approval for our drug candidates, restrict or regulate post-approval activities and affect our ability to profitably sell our drug candidates. Legislative and regulatory proposals have been made to expand post-approval requirements and restrict sales and promotional activities for pharmaceutical products ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 Title of Each Class Trading Symbol Name of Each Exchange on Which Registered Common Stock, par value $0.0001 per share CRBP Nasdaq Global Market FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from________ to_________. C ...

Financial Performance - Revenue from awards for the three months ended June 30, 2022, was $136,558, compared to $784,382 for the same period in 2021, indicating a decrease of about 82.6%[13] - The net loss for the three months ended June 30, 2022, was $13.25 million, compared to a net loss of $17.14 million for the same period in 2021, reflecting an improvement of about 22.1%[13] - The company reported a basic and diluted net loss per share of $0.11 for the three months ended June 30, 2022, compared to $0.15 for the same period in 2021[13] - The net loss for the second quarter of 2022 was $13,248,888, compared to a net loss of $17,138,376 for the same period in 2021, reflecting a decrease of approximately 22%[62] - For the three months ended June 30, 2022, the net loss was approximately $13.25 million, compared to a net loss of $17.14 million for the same period in 2021, representing a decrease of 22%[139] - For the six months ended June 30, 2022, the company recognized $0 in revenue, compared to $784,000 in revenue for the same period in 2021[155] Expenses and Liabilities - Total operating expenses for the three months ended June 30, 2022, were $12.34 million, down from $16.84 million in the same period of 2021, a reduction of approximately 26.5%[13] - The company incurred $5 million in litigation settlement expenses during the three months ended June 30, 2022[13] - Research and development expenses for the three months ended June 30, 2022, totaled approximately $2.5 million, a decrease of $8.77 million from $11.27 million in the same period of 2021[149] - General and administrative expenses for the three months ended June 30, 2022, were approximately $4.84 million, down from $5.57 million in the same period of 2021[151] - Research and development expenses for the six months ended June 30, 2022, were approximately $5.79 million, a decrease of $16.2 million from $21.99 million in the same period of 2021[156] - Interest expense for the three and six months ended June 30, 2022, was approximately $698,000 and $1,382,000, respectively[94] Assets and Equity - Total assets decreased from $107.73 million on December 31, 2021, to $82.07 million as of June 30, 2022, representing a decline of approximately 23.9%[10] - Total stockholders' equity decreased from $61.16 million on December 31, 2021, to $49.47 million as of June 30, 2022, a decline of approximately 19.1%[16] - Cash and cash equivalents increased slightly from $25.01 million on December 31, 2021, to $25.77 million as of June 30, 2022, an increase of approximately 3.1%[10] - Current liabilities decreased from $17.01 million on December 31, 2021, to $15.63 million as of June 30, 2022, a decline of about 8.1%[10] - As of June 30, 2022, total current assets were approximately $75.24 million, with current liabilities of approximately $15.63 million, resulting in working capital of approximately $59.61 million[162] Cash Flow - For the six months ended June 30, 2022, net cash used in operating activities was $22,844,404, a reduction from $39,338,076 in the same period of 2021[22] - Cash flows from investing activities resulted in a net cash provided of $24,265,670 for the six months ended June 30, 2022, compared to a net cash used of $70,523,241 in the same period of 2021[22] - Net cash used in operating activities for the six months ended June 30, 2022, was approximately $22.84 million[163] - Cash provided by investing activities for the six months ended June 30, 2022, totaled approximately $24.27 million, primarily related to sales and purchases of marketable securities[164] Future Outlook and Financing - The company anticipates ongoing operating losses due to costs related to research funding and development of product candidates[28] - The company will need to raise significant additional capital to fund operations and product candidate development, potentially through equity sales or debt financing[168] - Future financing availability will depend on market conditions and the progress of clinical development programs[169] - The company expects cash, cash equivalents, and marketable securities of approximately $73.3 million will be sufficient to meet operating and capital requirements into Q1 2024[167] Research and Development - The company plans to expand its pipeline in immuno-oncology through internal efforts and business development, focusing on immune modulators for various disease states[25] - The company incurred research and development expenses that are expensed as incurred, with no material adjustments to prior period estimates for clinical trials in 2022[49] - The company has not experienced significant changes in estimates of accrued research and development expenses following each reporting period[184] Legal and Settlement - The company made a $5 million settlement payment to Venn Therapeutics on May 26, 2022, resolving all claims against it[85] - Litigation settlement expense for the three months ended June 30, 2022, totaled $5 million due to a settlement with Venn Therapeutics, LLC[152] Stock and Shares - The weighted average number of common shares outstanding increased from 116.36 million in the second quarter of 2021 to 125.26 million in the second quarter of 2022[13] - As of June 30, 2022, the Company had 125,268,381 shares of common stock issued and outstanding, compared to 125,230,881 shares as of December 31, 2021[109] - The Company was authorized to sell up to $150,000,000 of shares under the August 2020 Sale Agreement, but did not sell any shares during the three and six months ended June 30, 2022[110] Investments and Securities - The Company reported total investments of $47,652,000 as of June 30, 2022, with a fair value of $47,533,000, reflecting a gross unrealized loss of $119,000[68] - The total fair value of financial assets as of June 30, 2022, was $69,316,000, with derivative liabilities amounting to $134,000[70] - The Company has classified all marketable debt securities as available-for-sale, with unrealized gains and losses reported as accumulated other comprehensive gain or loss[37] Risk Factors - The company continues to monitor the impact of the COVID-19 pandemic on its business and operations, indicating potential risks to future performance[27] - There have been no material changes in risk factors since the last annual report[196]

[Part I - Financial Information](index=3&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) [Condensed Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements.) This section presents the unaudited condensed consolidated financial statements for Q1 2022, reporting a net loss of $9.4 million [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20as%20of%20March%2031%2C%202022%20%28unaudited%29%20and%20December%2031%2C%202021) Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Items | March 31, 2022 (Unaudited) | December 31, 2021 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $57,026 | $25,007 | | Investments | $29,095 | $72,641 | | Total current assets | $88,476 | $100,205 | | **Total assets** | **$95,675** | **$107,730** | | **Liabilities & Equity** | | | | Total current liabilities | $15,118 | $17,008 | | Total liabilities | $34,520 | $38,622 | | **Total stockholders' equity** | **$61,155** | **$69,108** | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202022%20and%202021%20%28unaudited%29) Statement of Operations Highlights (in thousands, except per share data) | Metric | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Revenue from awards | $0 | $648 | | Research and development | $3,286 | $10,721 | | General and administrative | $5,231 | $5,341 | | **Operating loss** | **($8,517)** | **($15,414)** | | **Net loss** | **($9,437)** | **($16,065)** | | Net loss per share, basic and diluted | ($0.08) | ($0.14) | | **Total comprehensive loss** | **($9,544)** | **($16,094)** | [Condensed Consolidated Statement of Stockholders' Equity](index=5&type=section&id=Condensed%20Consolidated%20Statement%20of%20Stockholders%27%20Equity%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202022%20and%202021%20%28unaudited%29) - Total stockholders' equity decreased from **$69.1 million** at December 31, 2021, to **$61.2 million** at March 31, 2022, primarily driven by a net loss of **$9.4 million** for the quarter[20](index=20&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202022%20and%202021%20%28unaudited%29) Cash Flow Highlights (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | ($10,615) | ($21,810) | | Net cash provided by (used in) investing activities | $42,962 | ($57,424) | | Net cash (used in) provided by financing activities | ($327) | $60,414 | | **Net increase (decrease) in cash** | **$32,020** | **($18,820)** | [Notes to Unaudited Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) - The company focuses on developing immune modulators for immuno-oncology and fibrosis, including anti-integrin monoclonal antibodies and endocannabinoid system modulators[26](index=26&type=chunk) - As of March 31, 2022, the company had an accumulated deficit of **$359.2 million**, with management expecting approximately **$86.1 million** in cash, cash equivalents, and investments to fund operations for at least **twelve months** from the filing date[29](index=29&type=chunk) - The company has license agreements with Jenrin, Milky Way BioPharma, and UCSF, involving potential future milestone payments totaling up to **$18.4 million**, **$53.0 million**, and **$153.0 million**, respectively, plus royalties on net sales[73](index=73&type=chunk)[75](index=75&type=chunk)[76](index=76&type=chunk) - The company has a **$50 million** secured loan agreement with K2 HealthVentures, with a **$20 million** tranche drawn and a total principal outstanding of **$21.2 million** at March 31, 2022, including a final payment[88](index=88&type=chunk)[91](index=91&type=chunk) - The company recognized **$0** revenue from its development award with the Cystic Fibrosis Foundation (CFF) in Q1 2022, compared to **$647,824** in Q1 2021, as the performance obligation was completed in 2021[103](index=103&type=chunk)[107](index=107&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS.) Management discusses Q1 2022 financial results, strategic focus on immune modulators, and liquidity, noting a net loss and sufficient cash until Q1 2024 [Overview](index=24&type=section&id=Overview) - The company's pipeline focuses on anti-integrin monoclonal antibodies (CRB-601 and CRB-602) for cancer and fibrosis, and second-generation CB1 inverse agonists for obesity[133](index=133&type=chunk)[134](index=134&type=chunk) - Development of lenabasum is being discontinued following a failed Phase 3 study in dermatomyositis, with the company seeking licensing partners for future development[135](index=135&type=chunk) [Results of Operations](index=25&type=section&id=Results%20of%20Operations) - Revenue from the CFF award was **$0** for the three months ended March 31, 2022, compared to **$648,000** in the prior-year period, as the program is complete[144](index=144&type=chunk)[145](index=145&type=chunk) Operating Expense Comparison (in thousands) | Expense Category | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | Change | | :--- | :--- | :--- | :--- | | Research and Development | $3,286 | $10,721 | ($7,435) | | General and Administrative | $5,231 | $5,341 | ($110) | - The decrease in R&D expense was primarily due to a **$4.4 million** reduction in clinical expenses associated with the end of lenabasum studies[146](index=146&type=chunk) [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) - As of March 31, 2022, the company had approximately **$86.1 million** in cash, cash equivalents, and marketable securities, expected to fund operations into the **first quarter of 2024**[156](index=156&type=chunk) - Net cash used in operating activities was **$10.6 million** for the quarter, a significant decrease from **$21.8 million** in the prior-year period[153](index=153&type=chunk) - The company is subject to SEC 'baby shelf rules' due to its public float being below **$75 million**, restricting shelf registration offerings to approximately **$22.7 million** in any **twelve-month period**[155](index=155&type=chunk) [Critical Accounting Policies and Estimates](index=27&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) - Management identifies stock-based compensation, accrued research and development expenses, and right-of-use assets/lease liabilities as critical accounting policies involving significant judgment and complexity[166](index=166&type=chunk) - Accrued R&D expenses require significant estimation regarding services performed by CROs and other vendors, especially when invoices have not yet been received[170](index=170&type=chunk)[171](index=171&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=29&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk.) The company states that this section is not applicable - Not Applicable[178](index=178&type=chunk) [Controls and Procedures](index=29&type=section&id=Item%204.%20Controls%20and%20Procedures.) Management, with the participation of the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of March 31, 2022, with no material changes in internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[180](index=180&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control[181](index=181&type=chunk) [Part II - Other Information](index=30&type=section&id=PART%20II%20OTHER%20INFORMATION) [Legal Proceedings](index=30&type=section&id=Item%201.%20Legal%20Proceedings.) The company reports that Venn Therapeutics, LLC filed an amended complaint against the company, its CEO, and a former employee on April 6, 2022, with Corbus filing a motion to dismiss on May 6, 2022, believing the claims are without merit and intending to defend vigorously - On April 6, 2022, Venn Therapeutics, LLC filed an amended complaint against the Company, which filed a motion to dismiss the complaint in its entirety on May 6, 2022[183](index=183&type=chunk) - The Company believes the complaint is without merit and intends to vigorously defend against the claims[184](index=184&type=chunk) [Risk Factors](index=30&type=section&id=Item%201A.%20Risk%20Factors.) There have been no material changes in or additions to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2021 - There have been no material changes to the risk factors from those included in the Annual Report on Form 10-K for the year ended December 31, 2021[185](index=185&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=30&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds.) None were reported for the period - None[187](index=187&type=chunk) [Defaults Upon Senior Securities](index=30&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities.) None were reported for the period - None[189](index=189&type=chunk) [Mine Safety Disclosures](index=30&type=section&id=Item%204.%20Mine%20Safety%20Disclosures.) This item is not applicable to the company - Not applicable[191](index=191&type=chunk) [Other Information](index=30&type=section&id=Item%205.%20Other%20Information.) None was reported for the period - None[193](index=193&type=chunk) [Exhibits](index=31&type=section&id=Item%206.%20Exhibits.) This section lists the exhibits filed or furnished with the Quarterly Report on Form 10-Q, including CEO and CFO certifications and Inline XBRL documents - The report includes certifications from the Chief Executive Officer and Chief Financial Officer as required by Rule 13a-14(a) and Rule 13a-14(b)[195](index=195&type=chunk) - Inline XBRL instance and taxonomy documents are also filed as exhibits[195](index=195&type=chunk)

Research and Development - Corbus Pharmaceuticals' research and development expenses were approximately $36.4 million and $98.3 million for the years ended December 31, 2021, and 2020, respectively[38]. - The company plans to submit an IND for CRB-601, an anti-αvβ8 monoclonal antibody, to the FDA in the first half of 2023[16]. - CRB-601 demonstrated dose-related effects on tumor volume and weight in preclinical models, indicating its potential as a cancer treatment[26]. - The company does not plan to conduct additional clinical studies for Lenabasum, which failed to meet primary endpoints in previous trials, and will seek licensing partners for future development[18]. - Corbus is developing second-generation cannabinoid receptor type 1 (CB1) inverse agonists that have shown weight loss effects in animal models of diet-induced obesity[17]. - The company is focused on expanding its immuno-oncology pipeline through strategic partnerships and acquisitions[21]. - Lenabasum selectively activates cannabinoid receptor type 2 (CB2) and has shown potential to reduce inflammation and limit fibrosis without immunosuppression[37]. - The intellectual property for CRB-602, an anti-αvβ6/αvβ8 monoclonal antibody for fibrotic diseases, was in-licensed from Milky Way BioPharma[31]. - The company aims to develop therapies targeting immune-resistant cancers, focusing on blocking immune suppression mechanisms[22]. - The company is currently conducting pre-clinical testing for CRB-601 and has advanced its product candidate lenabasum to a phase 3 study, which did not meet its primary endpoint in June 2021[119]. Intellectual Property - Corbus has filed patent applications for lenabasum and its formulations, with potential patent expirations ranging from 2031 to 2040[42]. - The Company has received U.S. Patent No. 9,801,849 for lenabasum, providing exclusivity for treating inflammatory diseases until February 12, 2034[46]. - U.S. Patent No. 9,820,964 was issued for lenabasum's use in treating fibrotic diseases, including systemic sclerosis and cystic fibrosis, with protection until February 12, 2034[47]. - Lenabasum has been granted Orphan Drug Designation for cystic fibrosis, dermatomyositis, and systemic sclerosis, providing seven years of market exclusivity in the U.S. and ten years in Europe and Japan[49]. - The Company entered into an exclusive license agreement with Jenrin Discovery for cannabinoid compounds, including CRB-4001, with patent protection until July 2033[51]. - The UCSF License Agreement grants the Company exclusive rights to develop humanized antibodies against integrin αvβ8, with potential patent expiration in 2041[52]. - The company has in-licensed intellectual property from Jenrin and The Regents, which is crucial for developing drug candidates and may involve various obligations such as milestone payments and royalties[205][207]. - Protecting intellectual property rights is complex and costly, with uncertainties surrounding the enforceability of patents and potential challenges from third parties[199]. - The company relies on trade secrets for technology protection, but maintaining confidentiality is difficult and may not provide sufficient competitive advantage[201]. - Failure to secure patent or trade secret protection could impair the company's ability to compete and generate revenues[202]. Financial Performance - The company has incurred net losses of approximately $45.64 million and $111.27 million for the years ended December 31, 2021, and December 31, 2020, respectively, with an accumulated deficit of approximately $349.7 million as of December 31, 2021[104]. - As of December 31, 2021, the company held cash, cash equivalents, and investments of approximately $97.6 million, which is expected to fund operations into 2024 based on planned expenditures[107][110]. - The company has not generated any revenue from its drug candidates to date and expects to incur substantial expenses without corresponding revenues until regulatory approval is obtained[104][105]. - The company expects to continue incurring substantial losses for the foreseeable future, with uncertainty regarding achieving or sustaining profitability[105][106]. - The company may seek additional capital through private and public equity offerings, debt financings, and strategic collaborations, which could result in dilution for existing stockholders[111][112]. - The Loan and Security Agreement with K2 HealthVentures allows for term loans up to $50 million, secured by a lien covering substantially all personal property[108][113]. Regulatory Environment - The company must navigate extensive regulatory requirements in both the U.S. and Europe for marketing its products, including obtaining marketing authorizations[75][76]. - The centralized procedure for product approval in the EU is mandatory for biotechnological products and optional for new active substances[78]. - The company is subject to ongoing regulation by the FDA and other authorities post-approval, including monitoring and reporting adverse experiences[81]. - The company faces significant uncertainty regarding coverage and reimbursement from third-party payers, which is critical for successful commercialization[87]. - The federal healthcare program anti-kickback law and false claims laws impose strict regulations that the company must comply with to avoid penalties[83]. - The company’s ability to market its products in foreign countries may be impacted by varying drug pricing and reimbursement requirements[91]. - Legislative changes in the U.S. healthcare system may increase the difficulty and cost of obtaining marketing approval for drug candidates[160]. - The company may face challenges in obtaining adequate reimbursement for its products, which could impact profitability[196]. Manufacturing and Supply Chain - The company relies on third-party contract manufacturers for the production of drugs for pre-clinical and clinical studies[58]. - The company relies on a single contract supplier for manufacturing monoclonal antibodies, which poses risks if the supplier fails to meet regulatory requirements[175]. - The company does not have the capability to manufacture its drug candidates and relies on contract manufacturers, which could lead to delays or quality issues[174]. - Any manufacturing problems or loss of a contract manufacturer could disrupt operations and result in lost sales[179]. - The company may face significant interruptions in the supply of drug candidates if third-party manufacturers encounter difficulties[177]. - The company faces risks in scaling up manufacturing to commercial levels, which may lead to delays in regulatory approval and commercialization[181]. - There are significant concerns regarding cost overruns and technical issues in the manufacturing process, which could adversely affect financial results and growth prospects[182]. Competition and Market Dynamics - The biotechnology industry is characterized by rapid innovation and strong competition, with notable competitors targeting the TGFβ pathway in cancer[59][60]. - The company faces intense competition from biotechnology and pharmaceutical companies with greater resources, which could impact its operating results[157]. - The commercial success of drug candidates will depend on acceptance by the medical community, which is influenced by factors such as clinical safety, efficacy, and pricing[143]. - If approved, the company may still face limitations on marketing and commercialization, including potential restrictions on indicated uses or post-approval commitments[146]. Risks and Uncertainties - The company faces risks related to the COVID-19 pandemic, which could adversely affect clinical trial operations and overall business performance[120][124]. - Drug development is a lengthy and expensive process, with a high uncertainty of outcomes, and only a small percentage of drugs in development result in a New Drug Application (NDA) submission to the FDA[132]. - The company has never submitted an NDA to the FDA or any comparable applications to other regulatory authorities, which poses a significant risk to its business[132]. - Regulatory approval is subject to numerous risks, including the potential for pre-clinical testing to yield unsatisfactory results and the possibility of the FDA requiring additional trials[134]. - The company relies on third-party contract research organizations (CROs) for expertise in regulatory approval processes, indicating limited internal experience[136]. - The drug testing process can take many years, and even if initial trials are successful, further trials are required to establish safety and efficacy before an NDA can be filed[140]. - Ongoing regulatory obligations and continued review may result in significant additional expenses for the company[147]. - The company may face administrative or judicial sanctions if unknown problems with a product are discovered, which could inhibit commercialization efforts[152]. - Adverse regulatory actions can lead to increased product liability exposure and potential claims against the company[153]. - The company may experience increased product development costs due to delays in testing or regulatory approval, which could harm commercial prospects[191]. Legal and Compliance Issues - The company may face potential liability for damages if any patent-related legal actions are taken against it, which could hinder its ability to market product candidates[209]. - The pharmaceutical industry is characterized by frequent litigation regarding patent rights, making it challenging to identify relevant third-party patents[208]. - The company may need to obtain licenses for certain patents to research, develop, or commercialize its product candidates, and there is no guarantee that such licenses would be available on commercially reasonable terms[209]. - The company could be forced to rebrand its products if trademark applications are successfully challenged, resulting in loss of brand recognition[203]. - Future license agreements are expected to impose various obligations on the company, which could affect its product discovery and development efforts[205][207]. - The company may be subject to claims regarding the wrongful hiring of employees from competitors or misuse of confidential information[213]. - The company has not faced any claims of infringement yet, but the potential for such claims exists, which could impact its operations[209]. - The company must navigate the complexities of patent validity challenges, which require clear and convincing evidence to prevail in court[210][211].

PART I — FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements.) This section presents Corbus Pharmaceuticals' unaudited condensed consolidated financial statements, including balance sheets, statements of operations, equity, and cash flows, with explanatory notes [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to $119.6 million, liabilities decreased to $41.9 million, and stockholders' equity grew to $77.6 million by September 30, 2021 Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | Sep 30, 2021 (Unaudited) | Dec 31, 2020 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $37,119 | $85,433 | | Marketable securities | $69,744 | $0 | | Total current assets | $111,667 | $92,075 | | **Total assets** | **$119,574** | **$102,295** | | **Liabilities & Equity** | | | | Accounts payable | $2,546 | $7,381 | | Accrued expenses | $13,368 | $22,005 | | Total current liabilities | $17,144 | $31,898 | | Long-term debt, net | $18,551 | $18,029 | | **Total liabilities** | **$41,945** | **$57,020** | | **Total stockholders' equity** | **$77,629** | **$45,275** | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=5&type=section&id=Condensed%20Consolidated%20Statement%20and%20Comprehensive%20Loss) Net loss significantly narrowed to $2.2 million in Q3 2021 and $35.4 million for nine months, driven by reduced R&D expenses and increased other income Statement of Operations Highlights (in thousands, except per share data) | Metric | Q3 2021 | Q3 2020 | Nine Months 2021 | Nine Months 2020 | | :--- | :--- | :--- | :--- | :--- | | Revenue from awards and licenses | $97 | $1,231 | $882 | $3,279 | | Research and development | $8,696 | $27,523 | $30,682 | $82,157 | | General and administrative | $5,277 | $7,682 | $16,191 | $23,120 | | Operating loss | $(13,875) | $(33,974) | $(45,991) | $(101,998) | | Other income (expense), net | $11,699 | $(921) | $10,611 | $(660) | | **Net loss** | **$(2,176)** | **$(34,895)** | **$(35,380)** | **$(102,657)** | | Net loss per share | $(0.02) | $(0.43) | $(0.29) | $(1.37) | [Condensed Consolidated Statement of Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statement%20of%20Stockholders'%20Equity) Stockholders' equity increased to $77.6 million, primarily due to $59.1 million in common stock issuance proceeds, partially offset by net loss - For the nine months ended September 30, 2021, the company issued 25.5 million shares of common stock, raising net proceeds of **$59.1 million** after issuance costs[22](index=22&type=chunk) - The increase in stockholders' equity was offset by a net loss of **$35.4 million** for the nine-month period[22](index=22&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operations was $38.5 million, investing used $70.2 million, and financing provided $60.1 million, resulting in a $48.7 million net cash decrease Cash Flow Summary (Nine Months Ended Sep 30, in thousands) | Cash Flow Activity | 2021 | 2020 | | :--- | :--- | :--- | | Net cash used in operating activities | $(38,481) | $(81,461) | | Net cash used in investing activities | $(70,239) | $(537) | | Net cash provided by financing activities | $60,055 | $133,140 | | **Net (decrease) increase in cash** | **$(48,665)** | **$51,142** | [Notes to Unaudited Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Notes detail the company's drug development focus, liquidity outlook, new license agreements, and secured loan terms - The company is focused on developing medicines targeting inflammation, fibrosis, metabolism, and immuno-oncology, with a pipeline including small molecules and anti-integrin monoclonal antibodies[28](index=28&type=chunk) - Management expects its cash, cash equivalents, and marketable securities of approximately **$106.9 million** at September 30, 2021, to be sufficient to meet operating requirements for at least twelve months from the filing date[32](index=32&type=chunk) - In Q3 2021, the company received **$12.3 million** in cash for refundable research and development tax credits from a foreign taxing authority, which was recorded as other income[64](index=64&type=chunk) - The company entered into a **$50 million** secured loan agreement with K2 HealthVentures in July 2020, receiving an initial **$20 million** tranche, maturing in August 2024[92](index=92&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=32&type=section&id=Item%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS.) Management discusses financial performance, liquidity, and business outlook, highlighting reduced operating expenses and pipeline developments, with capital sufficient into Q1 2024 [Overview](index=33&type=section&id=Overview) Corbus, an immunology company, details its diverse pipeline, including anti-integrin mAbs and lenabasum, and recent licensing activities - The company's pipeline includes anti-integrin monoclonal antibodies (CRB-601, CRB-602), lenabasum (CB2 agonist), CB1 inverse agonists, and novel CB2 agonists[159](index=159&type=chunk)[160](index=160&type=chunk) - The Phase 3 study of lenabasum in dermatomyositis, completed in June 2021, did not meet its primary or secondary endpoints[161](index=161&type=chunk) - In May 2021, the company licensed CRB-602 from Milky Way BioPharma and CRB-601 from the University of California, San Francisco (UCSF) to expand its anti-integrin mAb program[165](index=165&type=chunk)[166](index=166&type=chunk) [Results of Operations](index=35&type=section&id=Results%20of%20Operations) Financial results improved in 2021 due to significant reductions in R&D and G&A expenses, and a boost from refundable R&D tax credits Change in Operating Expenses (Q3 2021 vs Q3 2020) | Expense Category | Change (in millions) | Primary Driver | | :--- | :--- | :--- | | Research & Development | $(18.8) | Lower clinical trial expenses for lenabasum | | General & Administrative | $(2.4) | Lower compensation and consulting expenses | Change in Operating Expenses (Nine Months 2021 vs 2020) | Expense Category | Change (in millions) | Primary Driver | | :--- | :--- | :--- | | Research & Development | $(51.5) | Lower clinical, manufacturing, and compensation costs | | General & Administrative | $(6.9) | Decreases in compensation, marketing, and consulting costs | - Other income for Q3 2021 increased by **$12.6 million** year-over-year, primarily due to the receipt of approximately **$12.3 million** in refundable R&D tax credits from a foreign authority[182](index=182&type=chunk) [Liquidity and Capital Resources](index=37&type=section&id=Liquidity%20and%20Capital%20Resources) The company held $107.5 million in liquid assets, sufficient to fund operations into Q1 2024, but anticipates needing additional capital for long-term development - The company's cash, cash equivalents, marketable securities, and restricted cash totaled approximately **$107.5 million** at September 30, 2021[196](index=196&type=chunk) - Management projects the current cash position is sufficient to fund operations into the first quarter of 2024[196](index=196&type=chunk) - For the nine months ended September 30, 2021, the company raised approximately **$60.1 million** in net cash from financing activities, primarily through its "at the market" offering[193](index=193&type=chunk) - The company will need to raise significant additional capital to continue funding operations and clinical trials for lenabasum and other candidates[197](index=197&type=chunk) [Critical Accounting Policies and Estimates](index=38&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section outlines critical accounting policies requiring significant judgment, including stock-based compensation, R&D accruals, lease accounting, revenue, and derivative liabilities - Key areas requiring significant estimates include stock-based compensation, accrued R&D expenses, lease accounting, revenue recognition, and derivative liabilities[200](index=200&type=chunk) - Accrued R&D expenses are estimated based on services performed by CROs and contract manufacturers, involving judgment on service completion when invoices are not yet received[204](index=204&type=chunk)[205](index=205&type=chunk)[206](index=206&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=41&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk.) The company deems this section not applicable, indicating no material exposure to market risks requiring disclosure - The company states this item is 'Not Applicable'[219](index=219&type=chunk) [Item 4. Controls and Procedures](index=41&type=section&id=Item%204.%20Controls%20and%20Procedures.) Management concluded that disclosure controls and procedures were effective, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the period[220](index=220&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[221](index=221&type=chunk) PART II — OTHER INFORMATION [Item 1. Legal Proceedings](index=42&type=section&id=Item%201.%20Legal%20Proceedings.) The company reports that it is not currently a party to any material legal proceedings - The company is not currently subject to any material legal proceedings[223](index=223&type=chunk) [Item 1A. Risk Factors](index=42&type=section&id=Item%201A.%20Risk%20Factors.) The company states that there have been no material changes to the risk factors disclosed in its Annual Report on Form 10-K for the year ended December 31, 2020 - There have been no material changes in or additions to the risk factors included in the Annual Report on Form 10-K for the year ended December 31, 2020[224](index=224&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=42&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds.) The company reports no unregistered sales of equity securities during the reporting period - None reported[226](index=226&type=chunk) [Item 6. Exhibits](index=43&type=section&id=Item%206.%20Exhibits.) This section lists the exhibits filed with the Form 10-Q, which include a separation agreement, an amendment to an employment agreement, and required officer certifications and XBRL data files - Exhibits filed include a separation agreement, an amendment to an employment agreement, and certifications by the CEO and CFO[236](index=236&type=chunk)[237](index=237&type=chunk)[239](index=239&type=chunk)

Financial Performance - Revenue from awards and licenses for Q2 2021 was $136,558, down 52% from $286,346 in Q2 2020[15] - Total operating expenses decreased to $16,837,617 in Q2 2021, a reduction of 56% from $38,425,039 in Q2 2020[15] - The net loss for Q2 2021 was $17,138,376, compared to a net loss of $38,105,323 in Q2 2020, indicating a 55% improvement[15] - The company reported a basic and diluted net loss per share of $0.15 for Q2 2021, an improvement from $0.52 in Q2 2020[15] - The company had a total comprehensive loss of $17,115,065 for Q2 2021, compared to $38,105,323 in Q2 2020[15] - The net loss for the second quarter of 2021 was $33,203,544, a significant improvement from a net loss of $67,762,123 in the same period of 2020, representing a 51% reduction[27] - The net loss for the three months ended June 30, 2021, was $33,203,544, compared to a net loss of $17,138,376 for the same period in 2020, representing an increase of approximately 93%[73] - The net loss per share of common stock for the three months ended June 30, 2021, was $(0.28), compared to $(0.15) for the same period in 2020, reflecting a deterioration in per-share performance[73] - The company has an accumulated deficit of $337,296,882 as of June 30, 2021, highlighting ongoing financial challenges[32] - The company anticipates continued operating losses due to costs related to research funding and development of product candidates[32] Assets and Liabilities - Total current assets increased to $111,580,059 as of June 30, 2021, compared to $92,074,631 at December 31, 2020, representing a 21% increase[13] - Cash and cash equivalents decreased to $36,080,292 as of June 30, 2021, down 58% from $85,433,441 at December 31, 2020[13] - Total liabilities decreased to $43,649,938 as of June 30, 2021, down 23% from $57,020,006 at December 31, 2020[13] - The total assets increased to $120,609,139 as of June 30, 2021, compared to $102,294,931 at December 31, 2020, reflecting an 18% increase[13] - Total current liabilities were approximately $18,737,000, resulting in working capital of approximately $92,843,000 as of June 30, 2021[186] Cash Flow - Cash used in operating activities decreased to $39,338,076 in Q2 2021 from $54,208,282 in Q2 2020, indicating improved cash flow management[27] - Cash used in operating activities for the six months ended June 30, 2021 was approximately $39,338,000, which includes a net loss of approximately $33,204,000[187] - The company expects to have sufficient cash and marketable securities of approximately $106,452,000 to meet its operating and capital requirements for at least the next twelve months[32] - The company expects to have sufficient cash and equivalents of approximately $107,122,000 to meet operating and capital requirements into 2024, along with a final $2,500,000 milestone payment expected by the end of the second half of 2021[192] Research and Development - The company plans to expand its pipeline through internal efforts and business development, focusing on new medicines targeting inflammation and fibrosis[28] - Research and development expenses decreased to approximately $11,265,000 for the three months ended June 30, 2021, down from $30,686,000 in the same period of 2020, primarily due to lower clinical trial expenses[175] - The company has focused on research and development, including clinical studies for lenabasum and pre-clinical studies for other drug candidates[161] - The company expects to file INDs for CRB-601 and CRB-602 in late 2022 and early 2023, respectively[158] - Lenabasum is in Phase 2 study for systemic lupus erythematosus (SLE), with top line results expected by the end of 2021[155] Stock and Equity - The weighted average number of common shares outstanding increased to 116,364,131 in Q2 2021, compared to 73,885,548 in Q2 2020[15] - The company issued 50,000 and 838,600 shares of common stock upon the exercise of stock options during the three and six months ended June 30, 2021, respectively, generating proceeds of $50,000 and $944,800[129] - As of June 30, 2021, there were 18,476,829 stock options outstanding with a weighted average exercise price of $4.38[138] - The total fair value of options that were vested as of June 30, 2021, was $37,286,931, up from $31,198,928 in 2020[139] - The company has never paid dividends on its common stock and does not anticipate doing so in the foreseeable future[199] Debt and Financing - The company has a secured Loan and Security Agreement with K2 HealthVentures LLC for $50,000,000, with the first tranche of $20,000,000 received upon signing[92] - The interest rate on the K2 HealthVentures loan is variable, with a minimum of 8.5%, and the loan matures on August 1, 2024[92] - The total principal amount of the loan outstanding as of June 30, 2021, is $21,190,000, which includes a final payment of $1,190,000[95] - Future principal payments due under long-term debt total $21,190,000, with $3,093,344 due in 2022 and $9,835,341 due in 2023[99] - The company expects to incur significant operating losses and will need additional financing to support ongoing operations, with plans to seek funding through public or private equity or debt financings[167] License Agreements - The company has entered into a License Agreement with Jenrin Discovery, LLC, involving an upfront payment of $250,000 and potential milestone payments up to $18,400,000 for each compound developed[79][80] - Under the Milky Way License Agreement, the company paid an upfront fee of $500,000 and is obligated to pay up to $53,000,000 in milestone payments[81][82] - The UCSF License Agreement required a license issue fee of $1,500,000 and includes potential milestone payments totaling up to $153,000,000[83][84] - The company has a potential obligation to pay milestone payments totaling up to approximately $173,000,000 under the collaboration agreement with Kaken[103] Accounting and Compliance - The company is currently evaluating the potential impact of recently issued accounting standards on its consolidated financial statements and related disclosures[69] - The company recognizes stock-based compensation costs using the Black-Scholes option-pricing model, amortized over the vesting period, which is generally 48 months[199] - The company has recorded a valuation allowance equal to 100% of the deferred tax assets due to cumulative losses since inception, indicating no expectation of realizing these tax benefits[61] - The company was in compliance with financial and non-financial covenants of the Loan Agreement as of June 30, 2021[96]