Financial Performance - As of December 31, 2022, the company had approximately €29.8 million in cash and cash equivalents, down from €37.2 million at the end of 2021, reflecting a net decrease of €7.4 million in cash used for operating activities[591][592][603]. - The company reported a net loss of approximately €8.5 million for the year ended December 31, 2022, compared to a net loss of approximately €5.5 million in 2021[593][596]. - Operating activities used approximately €7.4 million of cash and cash equivalents in 2022, with non-cash charges of approximately €0.8 million partially offsetting the net loss[593][594]. - The company did not generate any revenue during the year ended December 31, 2022, and does not expect to generate revenue from product candidates in the near future[603]. - The company estimates that its existing cash will be sufficient to fund operations and capital expenditures through 2024, although this is subject to change based on various factors[604][605]. - Future capital requirements will depend on various factors, including the progress of clinical trials and potential regulatory approvals[606][608]. - The company may seek additional funding sooner than planned if cash needs arise, which could impact research and development efforts[606][607]. Governance and Management - The total compensation for all directors and senior management for the year ended December 31, 2022, amounted to €1,107,965[632]. - The statutory auditors received approximately €44,000 in aggregate compensation for their services during 2022[634]. - The company has a board of directors that follows the historical Italian corporate governance system, separate from the board of statutory auditors[633]. - The company established a Compensation, Nomination and Governance Committee to oversee cash compensation and equity award recommendations for executive officers[639]. - The board of statutory auditors consists of three members, with a term expiring at the shareholders' meeting for the year ending December 31, 2023[636]. - The company relies on home country governance requirements and certain exemptions rather than Nasdaq Stock Market Rules[641]. - The company has opted out of shareholder approval requirements for certain share issuances, differing from Nasdaq Listing Rule 5635[643]. - The company established a board of statutory auditors in accordance with Italian law, which performs functions similar to an audit committee[644]. - The company believes its reliance on Rule 10A-3(c)(3) does not adversely affect the independence of its board of statutory auditors[645]. Human Resources - As of April 19, 2023, the company had nine full-time employees, with six in Milan, Italy, and three in the United States[646]. - The company relies on consultants and a large number of collaborators at SR-TIGET and OSR for various activities[646]. Research and Development - Dr. Russo has extensive experience in biotech, having held senior roles in companies focused on medical affairs and R&D, including GSK and Adverum[620]. - Dr. Naldini, a key scientific advisor, is recognized as a pioneer in lentiviral gene therapy and has authored over 250 scientific publications[626]. - The company has a diverse board with members having extensive experience in pharmaceuticals, finance, and corporate governance[622][624][625]. Investments - Investing activities used €27,070 in 2022 for cybersecurity improvements and ERP system implementation, compared to €9,009 in 2021 for fixed asset investments[598][600]. - The company funded its operations primarily through proceeds from the sale of quotas and its IPO, raising approximately €32.7 million in December 2021[591][600]. - The company has not hedged its foreign currency exchange risk, which may impact its financial results due to fluctuations in exchange rates[590][589].

Financial Position - The Company maintained $22.7 million in cash and cash equivalents as of June 30, 2022[23]. - Cash in bank decreased from €37.2 million at December 31, 2021, to €34.7 million at June 30, 2022[32]. - As of June 30, 2022, the total prepaid expenses and other current assets amounted to €2,737,108, an increase of 80.1% from €1,519,023 at December 31, 2021[81]. - The net property and equipment as of June 30, 2022, was €65,928, a significant increase from €23,090 at December 31, 2021[86]. - The retirement benefit obligation increased to €55,192 at June 30, 2022, from €30,618 at December 31, 2021[90]. Share Capital and Stock Options - The Company has 18,216,858 ordinary shares issued and outstanding as of June 30, 2022[36]. - The Company has authorized options on 1,821,685 ordinary shares, representing 10% of the current outstanding shares[51]. - The Company issued 23,502 warrants to underwriters at an exercise price of $14.375 per ADS, exercisable over a four and a half-year period[61]. - The company granted a nonqualified fully vested stock option to its chairman in April 2022, with an expense recorded of €240,043 for the six months ended June 30, 2022[97]. - The company granted 147,783 NSOs to Dr. Squinto on April 26, 2022, with a total recognized expense of €240,043 for the period ended June 30, 2022[102][105]. - The weighted average fair value of options granted during the six months ended June 30, 2022 was €1.62 per share, compared to €1,088 per quota B for the same period in 2021[105][111]. Research and Development - Research and development expenses include costs for salaries, share-based compensation, and external vendor services, with significant annual expenditures to meet business objectives[70][71]. - The cumulative total amount of expenses for the OSR clinical trial activity from inception amounted to approximately €9.0 million[146]. - The total research and development tax credit utilized for the six months ended June 30, 2022, was approximately €706,000, compared to €204,000 in the same period of 2021[84]. - Total research and development expenses for the six months ended June 30, 2022 amounted to €1,640,579, with €1,384,818 from third parties and €255,761 from related parties[114]. Taxation - The tax credit for eligible research and development activities is equal to 20% of eligible costs, with a maximum annual amount of €4.0 million[44]. - No income taxes were accrued for the six months ending June 30, 2022, and June 30, 2021, due to a tax loss position reported in both Italy and the United States[74]. - The Company has adopted ASU 2019-12 for income taxes, effective January 1, 2022, which did not have a material impact on its financial statements[67]. - The Company recognizes tax liabilities from uncertain tax positions only if it is more likely than not that the position will not be sustained upon examination[77]. Compensation and Benefits - Mr. Pierluigi Paracchi's annual gross salary is €420,000 with a 20% annual bonus subject to Board approval[118]. - For the six months ended June 30, 2022, the Company expensed €248,242 for Mr. Paracchi's compensation[119]. - The Company accrued approximately €14,000 for Mr. Paracchi's retirement benefit obligation for the same period[120]. - Dr. Carlo Russo's annual gross salary as Chief Medical Officer is $500,000 with a 30% annual bonus subject to Board approval[123]. - The Company expensed €215,761 related to Dr. Russo for the six months ended June 30, 2022[124]. Contracts and Obligations - The Company is obligated to pay OSR a milestone payment of €350,000 upon the first patient being dosed in a Phase III Clinical Trial in the US for GBM[148]. - The Company has a License Agreement with OSR that includes a royalty payment of 4% of net sales of each Licensed Product[136]. - The Company paid €1.25 million to OSR since inception under the License Agreement, with no milestone payments due as of June 30, 2022[143]. - The License Agreement with OSR includes total potential milestone payments of up to €10 million for lympho-hematopoietic indications and up to €53 million for each Solid Cancer indication[163]. Operational Stability - The Company is classified as an "emerging growth company" and may take advantage of certain exemptions from reporting requirements[38]. - The company had no significant events during the six months ended June 30, 2022, indicating stability in operations[97]. - The company has experienced minimal disruption due to the COVID-19 pandemic, but future clinical trial enrollments may be affected[175].

| --- | --- | --- | --- | --- | --- | --- | --- | --- | |-------|-------|-------|-------|-------|-------|-------|-------|----------------------------------------------------------------------------------------------------------------------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Corporate Presentation Cell-based platform providing durable and safe treatments for solid tumors September, 2022 | | | | | | | | | | enta | science @ 2022 Genenta Science; all rights reserved worldwide FORWARD-LO ...