WATERTOWN, Mass., May 23, 2024 (GLOBE NEWSWIRE) -- Werewolf Therapeutics, Inc. (the "Company" or "Werewolf") (Nasdaq: HOWL), an innovative biopharmaceutical company pioneering the development of conditionally activated therapeutics engineered to stimulate the body's immune system for the treatment of cancer, today announced the upcoming presentation of clinical data from dose-escalation arms of the Phase 1/1b trial evaluating WTX-124, its conditionally activated Interleukin-2 (IL-2) INDUKINE™ molecule, as m ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ______________________________________________________________________________________ FORM 10-Q ______________________________________________________________________________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2024 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ...

Exhibit 99.1 Werewolf Therapeutics Reports First Quarter 2024 Financial Results and Provides Business Update – Company announces cash runway extension through at least the first quarter of 2026 — Watertown, Mass., May 3, 2024 – Werewolf Therapeutics, Inc. (the "Company" or "Werewolf") (Nasdaq: HOWL), an innovative biopharmaceutical company pioneering the development of conditionally activated therapeutics engineered to stimulate the body's immune system for the treatment of cancer and other immune-mediated ...

— Company to present an update of its ongoing monotherapy and combination Phase 1/1b trial of WTX-124 in advanced or metastatic solid tumors at ASCO — — Company plans to present interim, first-in-human clinical data from the ongoing Phase 1 trial of WTX-330 in the second quarter of 2024 — — Multiple presentations of preclinical data demonstrate the potential of the PREDATORTM platform, including in immunology-based diseases — — Company announces cash runway extension through at least the first quarter o ...

Company to present an update of its ongoing monotherapy and combination Phase 1/1b study of WTX-124 in advanced or metastatic solid tumors WATERTOWN, Mass., April 24, 2024 (GLOBE NEWSWIRE) -- Werewolf Therapeutics, Inc. (the "Company" or "Werewolf") (NASDAQ:HOWL), an innovative biopharmaceutical company pioneering the development of conditionally activated therapeutics engineered to stimulate the body's immune system for the treatment of cancer, today announced that an abstract providing an update of the Co ...

Investors might want to bet on Werewolf Therapeutics, Inc. (HOWL) , as it has been recently upgraded to a Zacks Rank #2 (Buy). This rating change essentially reflects an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.A company's changing earnings picture is at the core of the Zacks rating. The system tracks the Zacks Consensus Estimate -- the consensus measure of EPS estimates from the sell-side analysts covering the stock -- for the current and following years. ...

WATERTOWN, Mass., April 04, 2024 (GLOBE NEWSWIRE) --  Werewolf Therapeutics, Inc. (the "Company" or "Werewolf") (NASDAQ:HOWL), an innovative biopharmaceutical company pioneering the development of conditionally activated therapeutics engineered to stimulate the body's immune system for the treatment of cancer, today announced the publication of an abstract for an upcoming poster presentation at IMMUNOLOGYTM 2024, the annual meeting of the American Association of Immunologists (AAI) taking place May 3-7 in C ...

[PART I](index=7&type=section&id=PART%20I) [Business](index=7&type=section&id=Item%201.%20Business) Werewolf Therapeutics is a biopharmaceutical company developing conditionally activated immunotherapies for cancer using its proprietary PREDATOR platform. Its lead clinical candidates are WTX-124 (IL-2) and WTX-330 (IL-12), both in Phase 1/1b trials. The company has a collaboration with Jazz Pharmaceuticals for JZP898 (IFNα) and a pipeline of preclinical assets including WTX-712 (IL-21) and WTX-518 (IL-18). The business model relies on internal development, strategic partnerships, and robust intellectual property protection, while navigating a competitive landscape and complex regulatory environment [Company Overview and Pipeline](index=7&type=section&id=Company%20Overview%20and%20Pipeline) Werewolf Therapeutics is a biopharmaceutical company developing conditionally activated INDUKINE molecules to treat cancer by stimulating the immune system within the tumor microenvironment (TME). Their proprietary PREDATOR platform engineers these molecules to remain inactive in peripheral tissues, aiming to reduce systemic toxicity. The clinical pipeline includes WTX-124 (IL-2) and WTX-330 (IL-12), both in Phase 1 trials. They have licensed JZP898 (IFNα) to Jazz Pharmaceuticals and have preclinical candidates WTX-712 (IL-21) and WTX-518 (IL-18) - The company's core technology is the PREDATOR platform, used to create conditionally activated INDUKINE molecules designed to be selectively activated in the tumor microenvironment (TME)[23](index=23&type=chunk) Clinical and Preclinical Pipeline | Product Candidate | Target | Stage | Rights | |---|---|---|---| | WTX-124 | IL-2 | Phase 1/1b Clinical Trial | Worldwide | | WTX-330 | IL-12 | Phase 1 Clinical Trial | Worldwide | | JZP898 (WTX-613) | IFNα | Phase 1 Clinical Trial (by Jazz) | Licensed to Jazz Pharmaceuticals | | WTX-712 | IL-21 | Preclinical | Worldwide | | WTX-518 | IL-18 | Preclinical | Worldwide | [Our Programs](index=12&type=section&id=Our%20Programs) The company is advancing several INDUKINE molecules. WTX-124 (IL-2) is in a Phase 1/1b trial, with preliminary data showing tolerability and tumor shrinkage at the 12 mg dose. WTX-330 (IL-12) is in a Phase 1 trial for immunotherapy-resistant tumors, with initial data expected in Q2 2024. JZP898 (IFNα) is in a Phase 1 trial run by partner Jazz Pharmaceuticals. Preclinical candidates WTX-712 (IL-21) and WTX-518 (IL-18) are in development, with data presentations planned for the first half of 2024 - WTX-124 (IL-2): A Phase 1/1b clinical trial is ongoing for advanced solid tumors. Preliminary data from monotherapy cohorts showed the drug was generally well-tolerated up to **12 mg**, with tumor shrinkage observed in three of five evaluable patients at that dose level[50](index=50&type=chunk)[51](index=51&type=chunk) - WTX-330 (IL-12): A Phase 1 clinical trial was initiated in February 2023 for patients with immunotherapy-resistant tumors. Initial data is expected in the **second quarter of 2024**[57](index=57&type=chunk) - JZP898 (IFNα): Partner Jazz Pharmaceuticals received IND clearance in **Q3 2023** and initiated a Phase 1 clinical trial in **Q4 2023**[63](index=63&type=chunk) - Preclinical data for WTX-712 (IL-21) and WTX-518 (IL-18) are planned for presentation in the **first half of 2024**[64](index=64&type=chunk)[65](index=65&type=chunk) [Competition](index=16&type=section&id=Competition) Werewolf Therapeutics faces substantial competition from major pharmaceutical and biotechnology companies developing immunotherapies. For its lead candidate WTX-124 (IL-2), competitors include companies with approved products like Proleukin and numerous others with clinical-stage IL-2 molecules such as Roche, Merck, and Xilio Therapeutics. For WTX-330 (IL-12), while no IL-12 therapies are currently approved, several companies including Sanofi, Bristol-Myers Squibb, and Xilio Therapeutics have programs in development - WTX-124 (IL-2) faces competition from the approved product Proleukin (aldesleukin) and numerous clinical-stage programs from companies including Anaveon, Ascendis Pharma, BioNTech, Merck, Roche, and Xilio Therapeutics[70](index=70&type=chunk) - WTX-330 (IL-12) competes with clinical and preclinical programs from companies such as Sanofi (Amunix), DEKA Biosciences, DragonFly Therapeutics, Juno Therapeutics (Bristol-Myers Squibb), and Xilio Therapeutics[71](index=71&type=chunk) [Intellectual Property](index=17&type=section&id=Intellectual%20Property) The company's intellectual property strategy focuses on securing patent protection for its PREDATOR platform, product candidates (WTX-124, WTX-330, JZP898, WTX-712, WTX-518), and related technologies. As of February 29, 2024, its portfolio included approximately 6 issued U.S. patents and over 130 pending U.S. and foreign applications, with patents expected to expire between 2039 and 2044. The company also in-licenses key technology from Harpoon Therapeutics related to serum albumin binding domains, which are incorporated into its product candidates and protected by patents extending through 2037 - As of February 29, 2024, the patent portfolio includes approximately **6 issued U.S. patents**, **30 pending U.S. applications**, **5 pending PCT applications**, and **95 pending foreign applications**. Patents, if issued, are expected to expire between **2039 and 2044**[89](index=89&type=chunk) - The company has **five patent families** for WTX-124 (IL-2), including issued patents in the U.S., Australia, and Europe, with protection running through **2039-2042**[92](index=92&type=chunk)[93](index=93&type=chunk) - The company has **five patent families** for WTX-330 (IL-12), including **two issued U.S. patents**, with protection running through **2039-2043**[94](index=94&type=chunk) - The company in-licenses patents from Harpoon Therapeutics for single immunoglobulin variable domains that bind human serum albumin, used in its product candidates. This licensed patent family has protection through **2037**[99](index=99&type=chunk) [Government Regulation](index=22&type=section&id=Government%20Regulation) The company's operations are subject to extensive regulation by the FDA in the U.S. and similar authorities abroad, covering all stages from research and development to post-approval marketing. Key regulatory frameworks include the FDCA and PHSA, requiring preclinical studies (GLP), IND submissions, and multi-phase clinical trials (GCP) to establish safety and efficacy before a BLA can be submitted for approval. Recent legislative changes like FDORA and the IRA have introduced new requirements for clinical trial diversity, accelerated approval pathways, and Medicare price negotiations, which could significantly impact development timelines, costs, and future revenue - The company must comply with FDA regulations for drug and biologic development, including GLP for preclinical studies, IND submission before human trials, and GCP for all clinical phases[112](index=112&type=chunk)[113](index=113&type=chunk) - The Inflation Reduction Act of 2022 (IRA) introduced significant changes, including authorizing Medicare to negotiate prices for certain drugs (beginning in **2026**) and imposing rebates for price increases that outpace inflation, which could impact future product pricing and profitability[203](index=203&type=chunk)[204](index=204&type=chunk) - The Food and Drug Omnibus Reform Act (FDORA) of 2022 requires sponsors to submit a diversity action plan for pivotal studies and grants the FDA more authority over the accelerated approval process, including requiring confirmatory trials to be underway before approval[124](index=124&type=chunk)[162](index=162&type=chunk) [Human Capital](index=36&type=section&id=Human%20Capital) As of December 31, 2023, Werewolf Therapeutics had 47 full-time employees, with 34 engaged in research and development. The team includes 20 individuals with M.D. or Ph.D. degrees. The company focuses on attracting, retaining, and developing its employees through competitive compensation, equity incentives, and professional development opportunities, while fostering a commitment to diversity, equity, and inclusion - As of December 31, 2023, the company had **47 full-time employees**[211](index=211&type=chunk) - Of the full-time employees, **34** are engaged in research and development, and **20** hold M.D. or Ph.D. degrees[211](index=211&type=chunk) [Risk Factors](index=37&type=section&id=Item%201A.%20Risk%20Factors) The company faces numerous risks, including a limited operating history, significant financial losses, and the need for substantial additional funding. Its business is highly dependent on the success of its early-stage INDUKINE molecules and unproven PREDATOR platform. Key risks involve clinical trial delays and failures, manufacturing complexities for novel biologics, reliance on third parties for clinical trials and manufacturing, and intense competition. Intellectual property risks include the ability to obtain and enforce patents. Regulatory hurdles, potential healthcare reforms affecting pricing, and the identified material weakness in internal financial controls also pose significant threats - The company has a limited operating history, has incurred significant losses (**$37.4 million** net loss in 2023), and expects to incur substantial losses for the foreseeable future[217](index=217&type=chunk)[218](index=218&type=chunk) - The PREDATOR platform and INDUKINE molecule approach are unproven, and the business is highly dependent on the success of its early-stage candidates, WTX-124 and WTX-330[235](index=235&type=chunk)[244](index=244&type=chunk) - A material weakness in internal control over financial reporting was identified in **Q2 2023** related to the purchasing process, which was not fully remediated as of December 31, 2023[498](index=498&type=chunk)[501](index=501&type=chunk) - The company relies on third parties for conducting clinical trials and for all cGMP manufacturing of its product candidates, making it vulnerable to their performance and capacity[304](index=304&type=chunk)[310](index=310&type=chunk) - The company faces substantial competition from major pharmaceutical companies with greater resources, particularly in the IL-2 and IL-12 therapy spaces[285](index=285&type=chunk)[291](index=291&type=chunk) [Cybersecurity](index=90&type=section&id=Item%201C.%20Cybersecurity) The company has implemented processes for managing cybersecurity risks, overseen by the Director of Operations and the audit committee of the board. These processes include technical safeguards, employee training, and third-party penetration testing. The company does not believe any known cybersecurity threats are reasonably likely to materially affect its business, strategy, or financial condition - The company has processes to identify, assess, and mitigate cybersecurity risks, including employee training, technology tools, and third-party penetration testing[513](index=513&type=chunk) - The Director of Operations leads cybersecurity oversight, with the audit committee of the board of directors providing overall governance and receiving periodic updates[516](index=516&type=chunk) [Properties](index=91&type=section&id=Item%202.%20Properties) The company's principal facilities consist of 25,778 square feet of leased office and laboratory space in Watertown, Massachusetts. The lease for this facility expires in May 2030 - The company leases **25,778 square feet** of office and laboratory space in Watertown, Massachusetts, under a lease that expires in **May 2030**[517](index=517&type=chunk) [PART II](index=91&type=section&id=PART%20II) [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=91&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Werewolf Therapeutics' common stock is traded on The Nasdaq Global Select Market under the symbol 'HOWL'. As of March 1, 2024, there were approximately 21 holders of record. The company has never paid cash dividends and does not anticipate doing so in the foreseeable future, intending to retain earnings for business development. No equity securities were repurchased by the company during the reporting period - The company's common stock trades on The Nasdaq Global Select Market under the symbol **'HOWL'**[521](index=521&type=chunk) - The company has never declared or paid cash dividends and does not intend to in the foreseeable future[522](index=522&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=92&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) For the year ended December 31, 2023, Werewolf Therapeutics reported revenue of $19.9 million, up from $16.4 million in 2022, primarily from its collaboration with Jazz Pharmaceuticals. The net loss decreased to $37.4 million from $53.8 million in 2022, driven by higher revenue and a $12.0 million reduction in R&D expenses, mainly due to lower manufacturing costs. As of December 31, 2023, the company had $134.3 million in cash and cash equivalents, which, along with subsequent ATM proceeds, is expected to fund operations through at least Q2 2025. The company drew down a $40.0 million term loan in March 2023 [Results of Operations](index=97&type=section&id=Results%20of%20Operations) For the year ended December 31, 2023, revenue increased to $19.9 million from $16.4 million in 2022, due to achieving a variable consideration component in the Jazz collaboration. Research and development expenses decreased by $12.0 million to $41.8 million, primarily from a $14.3 million reduction in manufacturing costs, partially offset by increased clinical trial and personnel costs. General and administrative expenses remained flat at $18.7 million. The net loss for 2023 was $37.4 million, a significant improvement from the $53.8 million net loss in 2022 Results of Operations Summary (in thousands) | | Year Ended Dec 31, 2023 | Year Ended Dec 31, 2022 | $ Change | |---|---|---|---| | Collaboration revenue | $19,943 | $16,401 | $3,542 | | Research and development | $41,776 | $53,761 | $(11,985) | | General and administrative | $18,670 | $18,696 | $(26) | | Operating loss | $(40,503) | $(56,056) | $15,553 | | Net loss | $(37,368) | $(53,810) | $16,442 | - The **$12.0 million** decrease in R&D expenses was primarily driven by a **$14.3 million** decrease in manufacturing costs for WTX-124, WTX-330, and JZP898, and a **$2.3 million** decrease in contract research organization costs[561](index=561&type=chunk)[562](index=562&type=chunk) - The decrease in R&D expenses was partially offset by a **$2.2 million** increase in clinical trial costs for WTX-124 and WTX-330, and a **$1.1 million** increase in personnel costs[562](index=562&type=chunk) [Liquidity and Capital Resources](index=99&type=section&id=Liquidity%20and%20Capital%20Resources) As of December 31, 2023, the company had $134.3 million in cash and cash equivalents. Operations have been funded through private placements, an IPO, payments from the Jazz collaboration, an at-the-market (ATM) stock offering, and a term loan facility. In March 2023, the company drew down $40.0 million from its term loan with PWB. Through its ATM offering, the company raised net proceeds of $34.0 million as of year-end 2023 and has subsequently raised additional funds. Management expects current cash to fund operations through at least the second quarter of 2025 but will require substantial additional funding for future development - As of December 31, 2023, the company had cash and cash equivalents of **$134.3 million** and an accumulated deficit of **$344.1 million**[568](index=568&type=chunk) - In March 2023, the company drew down the full **$40.0 million** available under its term loan facility with Pacific Western Bank (PWB)[571](index=571&type=chunk) - As of December 31, 2023, the company had sold an aggregate of **11,259,548 shares** under its ATM Offering for net proceeds of **$34.0 million**. The program was subsequently expanded[577](index=577&type=chunk) - The company expects its existing cash and cash equivalents, plus subsequent ATM proceeds, will be sufficient to fund operations through at least the **second quarter of 2025**[579](index=579&type=chunk) [Controls and Procedures](index=102&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were not effective as of December 31, 2023. This was due to a previously reported material weakness in internal control over financial reporting related to the purchasing process. Although significant remediation efforts were undertaken in 2023, including hiring personnel and implementing new processes, the controls were not in place long enough to demonstrate operating effectiveness. Management believes the financial statements are fairly presented despite this weakness and is committed to completing remediation - Management concluded that disclosure controls and procedures were not effective as of December 31, 2023, due to a material weakness in internal control over financial reporting[598](index=598&type=chunk) - The material weakness, first reported for **Q2 2023**, relates to design and operating deficiencies in the purchasing process, including invoice application and expense estimation for purchase orders[603](index=603&type=chunk) - Remediation efforts in 2023 included hiring additional accounting personnel, reviewing the procurement process, and engaging a professional services firm. However, these measures were not in place long enough to be considered fully remediated by year-end[604](index=604&type=chunk)[605](index=605&type=chunk) [PART III](index=104&type=section&id=PART%20III) [Directors, Executive Officers and Corporate Governance](index=104&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information regarding directors, executive officers, corporate governance, and delinquent Section 16(a) reports is incorporated by reference from the company's definitive proxy statement for its 2024 Annual Meeting of Stockholders. The company has adopted a code of business conduct and ethics, which is available on its website - Required information is incorporated by reference from the company's **2024 Annual Meeting of Stockholders proxy statement**[612](index=612&type=chunk) - The company has adopted a code of business conduct and ethics applicable to all directors, officers, and employees[613](index=613&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=104&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information regarding security ownership is incorporated by reference from the 2024 proxy statement. As of December 31, 2023, under the company's equity compensation plans, 6,120,474 securities were to be issued upon exercise of outstanding options and rights, with a weighted-average exercise price of $6.82. There were 2,418,773 securities remaining available for future issuance under these plans Equity Compensation Plan Information as of December 31, 2023 | Plan Category | Number of Securities to be Issued upon Exercise (a) | Weighted-Average Exercise Price of Outstanding Options (b) | Number of Securities Remaining Available for Future Issuance (c) | |---|---|---|---| | Equity compensation plans approved by security holders | 6,120,474 | $6.82 | 2,418,773 | | Total | 6,120,474 | $6.82 | 2,418,773 | [PART IV](index=106&type=section&id=PART%20IV) [Financial Statements and Exhibits](index=106&type=section&id=Item%2015.%20Exhibit%20and%20Financial%20Statement%20Schedules) This section contains the company's consolidated financial statements for the years ended December 31, 2023 and 2022, and the report from the independent registered public accounting firm, Ernst & Young LLP. The financial statements detail the company's financial position, results of operations, and cash flows. Key notes to the financial statements provide further detail on the Jazz collaboration, debt facilities, stock-based compensation, and income taxes. The section also includes an index of all exhibits filed with the report [Consolidated Financial Statements](index=107&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements for the years ended December 31, 2023 and 2022, show a decrease in net loss from $53.8 million to $37.4 million. Total assets increased from $160.2 million to $174.8 million, primarily due to an increase in cash and restricted cash from financing activities. Total liabilities rose from $37.9 million to $63.5 million, largely driven by the drawdown of a $40.0 million note payable. Stockholders' equity decreased from $122.3 million to $111.4 million Consolidated Balance Sheet Data (in thousands) | | Dec 31, 2023 | Dec 31, 2022 | |---|---|---| | **Assets** | | | | Cash and cash equivalents | $134,343 | $129,315 | | Total current assets | $138,370 | $140,200 | | Total assets | $174,833 | $160,245 | | **Liabilities & Equity** | | | | Total current liabilities | $19,378 | $23,989 | | Note payable, net | $39,323 | $0 | | Total liabilities | $63,459 | $37,908 | | Total stockholders' equity | $111,374 | $122,337 | Consolidated Statement of Operations Data (in thousands) | | Year Ended Dec 31, 2023 | Year Ended Dec 31, 2022 | |---|---|---| | Collaboration revenue | $19,943 | $16,401 | | Total operating expenses | $60,446 | $72,457 | | Operating loss | $(40,503) | $(56,056) | | Net loss | $(37,368) | $(53,810) | | Net loss per share | $(1.05) | $(1.86) | [Notes to Consolidated Financial Statements](index=112&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes provide detailed explanations of the company's accounting policies and financial results. Key details include the recognition of $19.9 million in revenue from the Jazz collaboration in 2023, which includes a $5.0 million variable payment. The company drew down a $40.0 million term loan in 2023. As of Dec 31, 2023, the company had $96.6 million in federal NOL carryforwards and a full valuation allowance against its deferred tax assets. Stock-based compensation expense was $8.0 million in 2023. The company also details its lease obligations and license agreements with Harpoon and Adimab - In April 2022, the company entered into a collaboration agreement with Jazz Pharmaceuticals, receiving a **$15.0 million** upfront payment and a **$5.0 million** variable payment in July 2023. Revenue is recognized using a cost-to-cost input method[680](index=680&type=chunk)[681](index=681&type=chunk)[687](index=687&type=chunk) - In April 2022, the company entered a loan agreement with PWB for up to **$40.0 million**, which was fully drawn down in March 2023. The loan requires interest-only payments until **August 31, 2024**[700](index=700&type=chunk) - As of December 31, 2023, the company had federal net operating loss (NOL) carryforwards of **$96.6 million** and state NOLs of **$44.9 million**. A full valuation allowance is maintained against deferred tax assets[747](index=747&type=chunk) - Total stock-based compensation expense was **$8.0 million** in 2023, compared to **$7.4 million** in 2022[718](index=718&type=chunk)

Exhibit 99.1 Werewolf Therapeutics Reports Fourth Quarter and Full Year 2023 Financial Results and Provides Business Update Watertown, Mass., March 7, 2024 – Werewolf Therapeutics, Inc. (the "Company" or "Werewolf") (Nasdaq: HOWL), an innovative biopharmaceutical company pioneering the development of conditionally activated therapeutics engineered to stimulate the body's immune system for the treatment of cancer, today provided a business update and reported financial results for the fourth quarter and full ...

Revenue and Commercialization Challenges - The company has no products approved for commercial sale and has not generated any revenue from product sales, with no expectation of revenue for several years[172] - The company's ability to generate product revenue depends on successful development and commercialization of WTX-124 and WTX-330, which are still in early stages[198] - The company lacks commercialization experience and may struggle to build sales and marketing capabilities[240] - The commercialization of product candidates depends on favorable coverage, adequate reimbursement, and pricing policies with third-party payors, including governmental healthcare programs like Medicare and Medicaid[252] - Market acceptance of product candidates is uncertain and depends on factors such as efficacy, safety, convenience, and third-party insurance coverage[256][258] Clinical Trials and Development Risks - Clinical trials for the company's product candidates may face substantial delays, increasing costs and potentially limiting revenue generation[210] - The company's preclinical programs may experience delays or fail to advance to clinical trials, impacting regulatory approvals and commercialization[206] - The company may encounter issues in clinical trial execution, including delays in FDA acceptance of INDs, patient recruitment, and clinical supply quality[194] - Clinical trials may face delays or rejection due to conflicts of interest with principal investigators, potentially jeopardizing FDA approval[214] - Enrollment delays in clinical trials may result in increased development costs and jeopardize marketing approval[222] - Undesirable side effects from product candidates could delay or halt clinical trials and limit commercial potential[223] - Combination therapies, such as WTX-124 with KEYTRUDA, may face adverse events and complex trial designs[232] - The company's clinical trials depend on third-party CROs, and any failure to meet deadlines or regulatory requirements could delay product development[265][266] Manufacturing and Supply Chain Risks - Manufacturing of INDUKINE molecules is highly complex and presents significant risks, including potential delays or failures in clinical development and commercial production[203] - Manufacturing biologics is complex and susceptible to contamination, equipment failure, and variability, which could lead to higher costs and delays[267] - The company relies on third-party contract manufacturers for preclinical, clinical, and commercial supplies, with risks of delays, quality issues, or supply disruptions[267][269] - Manufacturing delays and COVID-19 complications could impact clinical trials and increase costs[214] - The company relies on a limited number of suppliers, including single-source suppliers, for critical drug components and raw materials, which could lead to supply chain disruptions[271] - Manufacturing and quality issues, including scale-up challenges and compliance with cGMP standards, could impact the company's ability to produce and sell product candidates[271] Regulatory and Approval Risks - FDA approval of a Biologics License Application (BLA) is uncertain, expensive, and may take several years, with no guarantee of success[196] - Regulatory approval processes in the US and abroad are lengthy, expensive, and uncertain, with no guarantee of approval for any product candidates[337][338] - The company has not yet submitted or received marketing approval for any product candidates in the US or other jurisdictions, relying on third-party CROs for assistance[337] - Changes in regulatory policies or interpretations during development could delay or prevent marketing approval, potentially limiting commercial viability[339] - Failure to obtain marketing approval in foreign jurisdictions would prevent the company from marketing its products abroad, with no assurance that US approval guarantees foreign approval[341] - In many non-US countries, product candidates must also be approved for reimbursement, and pricing may require regulatory approval, adding further delays and costs[342] - The company may seek orphan drug designation for its product candidates, but exclusivity periods (7 years in the US, 10 years in Europe) may not prevent competition from clinically superior products[346][347] - Any approved products will be subject to ongoing regulatory requirements, including post-marketing studies, surveillance, and compliance with manufacturing and advertising regulations[350][351] - FDA approval of products is contingent on passing pre-approval inspections of manufacturing facilities and quality systems[361][362] - Non-compliance with FDA regulations could result in costly remedial measures, including suspension of clinical trials or commercial sales[363] - FDA may not accept data from clinical trials conducted outside the U.S., potentially requiring additional trials and delaying product development[365] - Government shutdowns or disruptions at the FDA could delay regulatory submissions and approvals, adversely affecting the company's business[366][370] - COVID-19 pandemic has caused delays in FDA inspections, potentially extending review timelines for product approvals[369] Intellectual Property and Patent Risks - The company's success depends on obtaining and maintaining patent protection for its PREDATOR platform and product candidates, with potential risks of competitors developing similar technologies[278] - Patent protection may not be sufficiently broad to prevent competitors from designing around the company's patents, potentially impacting commercialization efforts[281] - The company may face challenges in enforcing patent rights due to uncertainties in patent laws and potential legal disputes, which could harm its competitive position[285] - Patents protecting product candidates may expire before or shortly after commercialization, limiting the company's ability to exclude competitors[286] - The company may need to rely on co-owners of patents for enforcement, and lack of cooperation could negatively impact its business and competitive position[286] - The company relies on the Harpoon Agreement for non-exclusive and exclusive rights to technology incorporated into its PREDATOR platform, development programs, and product candidates[287] - The company may face risks if it fails to comply with obligations under the Harpoon Agreement, including potential loss of important intellectual property rights[287] - Future growth may depend on acquiring or licensing additional third-party intellectual property, which is highly competitive and may not be available on commercially reasonable terms[288] - The company has limited control over the prosecution and maintenance of licensed patents under the Harpoon Agreement, which could impact the scope and enforceability of its rights[289] - Disputes over licensed intellectual property could prevent the company from developing or commercializing affected product candidates[290] - Termination of current or future license agreements could remove the company's ability to develop and commercialize products covered by those agreements[291] - The company may face significant royalty obligations on future product sales, which could impact profitability even if products are successfully commercialized[294] - Failure to protect proprietary intellectual property could result in loss of competitive advantage and market entry by competitors[295] - The company may be subject to claims challenging the inventorship or ownership of its patents and other intellectual property, potentially leading to costly disputes[330] - The company may face litigation or claims related to the wrongful use or disclosure of confidential information from competitors or former employers[331] Financial and Market Risks - The company may need to seek additional financing sooner than planned due to changing circumstances or strategic considerations[178] - Competition from established pharmaceutical companies and new therapies could limit market success[249] - Third-party payors may challenge pharmaceutical product prices, potentially limiting reimbursement for the company's product candidates if cheaper alternatives are available[253] - The company faces significant uncertainty regarding insurance coverage and reimbursement for newly approved products, with varying regulations across countries[254] - Coverage and reimbursement policies differ among third-party payors in the U.S., requiring time-consuming and costly processes to secure approval[255] - Product candidates may face biosimilar competition sooner than anticipated due to regulatory changes or FDA interpretations of exclusivity periods[259][260] - Changes in reimbursement rules and regulations are likely, potentially impacting the company's ability to achieve adequate reimbursement levels[255] - The company may face significant royalty obligations on future product sales, which could impact profitability even if products are successfully commercialized[294] - The company is subject to GDPR regulations, with potential fines of up to 4% of annual global revenues or 20 million Euros for violations[400] - Compliance with GDPR and other data protection laws may require significant resources, diverting attention from other initiatives and increasing operational costs[401] - The company faces risks related to export control, import, sanctions, anti-corruption, and anti-money laundering laws, with potential criminal or civil liability for non-compliance[402] - Environmental, health, and safety regulations could result in fines, penalties, or increased costs, particularly related to hazardous materials and waste disposal[404] - The company does not maintain insurance for environmental liability or toxic tort claims, increasing financial risk[405] - Misconduct by employees, contractors, or partners could lead to regulatory sanctions, reputational harm, and financial penalties[407] - The company relies heavily on key personnel, and the loss of executive officers or other key employees could impede business objectives[409] - The company expects significant growth, with 46 employees as of September 30, 2023, and plans to expand in clinical development, regulatory affairs, and sales[412] - The company's IT systems are vulnerable to cyber-attacks, data breaches, and disruptions, which could compromise sensitive information and harm operations[413] - Increased remote and hybrid working due to COVID-19 has heightened risks of cyber threats and data security breaches[414] - Significant costs associated with mitigating network security problems, including potential interruptions, delays, and reputational harm[415] - Potential legal claims and liability due to breaches of privacy laws, particularly involving sensitive patient or consumer information[417] - Risk of material disruption to business operations and regulatory approval efforts due to loss of clinical trial data[418] - Dependence on third-party contract manufacturers and potential disruptions from natural or man-made disasters[419] - Impact of unfavorable economic conditions, including inflation, capital market volatility, and geopolitical events on costs and access to capital[420] - Risks associated with international expansion, including differing regulatory requirements and compulsory licensing laws[421][423] - Potential for strategic transactions to increase expenses, dilute equity, and distract management[424] - Volatility in stock price, with historical range from $1.39 to $23.99 since April 30, 2021[426] - Increased costs and management time required for compliance as a public company[434] - The company is evaluating new rules and regulations and cannot predict the additional costs or timing of such costs[435] - The application of these rules may evolve over time, leading to ongoing uncertainty and higher compliance costs[435] - The company plans to invest resources to comply with evolving laws and regulations[435] - These regulations could delay, defer, or prevent a change of control of the company[435] - The rules may impede mergers, consolidations, takeovers, or other business combinations involving the company[435] - Potential acquirers might be discouraged from making tender offers or attempting to obtain control of the company[435] Collaboration and Partnership Risks - In April 2022, the company entered into a Collaboration and License Agreement with Jazz Pharmaceuticals to develop and commercialize products containing the IFNα INDUKINE™ molecule[274] - Collaborations with third parties may pose risks, including delays in clinical trials, insufficient funding, or termination of agreements, which could adversely affect the company's business[275] - The company may face risks if it fails to comply with obligations under the Harpoon Agreement, including potential loss of important intellectual property rights[287] - Future growth may depend on acquiring or licensing additional third-party intellectual property, which is highly competitive and may not be available on commercially reasonable terms[288] - The company has limited control over the prosecution and maintenance of licensed patents under the Harpoon Agreement, which could impact the scope and enforceability of its rights[289] - Disputes over licensed intellectual property could prevent the company from developing or commercializing affected product candidates[290] - Termination of current or future license agreements could remove the company's ability to develop and commercialize products covered by those agreements[291] Pricing and Reimbursement Risks - Third-party payors may challenge pharmaceutical product prices, potentially limiting reimbursement for the company's product candidates if cheaper alternatives are available[253] - The company faces significant uncertainty regarding insurance coverage and reimbursement for newly approved products, with varying regulations across countries[254] - Coverage and reimbursement policies differ among third-party payors in the U.S., requiring time-consuming and costly processes to secure approval[255] - Changes in reimbursement rules and regulations are likely, potentially impacting the company's ability to achieve adequate reimbursement levels[255] - Legislative changes, such as the ACA and Medicare sequester reductions, may impact reimbursement and pricing for the company's products[373] - Executive orders and regulations aim to reduce pharmaceutical prices, which could limit the company's ability to generate revenues[375][377] - States are pursuing drug importation programs from Canada, which could affect the U.S. pharmaceutical market and pricing dynamics[376] - The IRA requires manufacturers to engage in price negotiations with Medicare starting in 2026, with prices subject to a cap[378] - Medicare will negotiate prices for 10 high-cost Part D drugs in 2026, 15 Part D drugs in 2027, and 20 Part B or Part D drugs in 2029 and beyond[379] - The IRA imposes rebates for Medicare Part B and Part D drugs if price increases exceed inflation, with the first rebates due in 2023[378] - Medicare out-of-pocket drug costs are capped at $4,000 in 2024 and $2,000 starting in 2025[380] - The IRA introduces a new discounting program to replace the Part D coverage gap discount program starting in 2025[378] - Drug manufacturers face civil monetary penalties and excise taxes for failing to comply with the IRA's price negotiation and inflation rebate requirements[380] - The IRA may reduce the expected return on drug products due to price negotiations after 9 years on the market[379] - The IRA's provisions could lead to reduced reimbursement for products, potentially impacting the company's financial condition[382] - State-level legislation is increasingly targeting pharmaceutical pricing, which could reduce demand or pressure product pricing[383] - The IRA's Drug Price Negotiation Program has led to lawsuits from pharmaceutical companies and industry groups, with uncertain outcomes[381] Legal and Compliance Risks - The company is subject to GDPR regulations, with potential fines of up to 4% of annual global revenues or 20 million Euros for violations[400] - Compliance with GDPR and other data protection laws may require significant resources, diverting attention from other initiatives and increasing operational costs[401] - The company faces risks related to export control, import, sanctions, anti-corruption, and anti-money laundering laws, with potential criminal or civil liability for non-compliance[402] - Environmental, health, and safety regulations could result in fines, penalties, or increased costs, particularly related to hazardous materials and waste disposal[404] - The company does not maintain insurance for environmental liability or toxic tort claims, increasing financial risk[405] - Misconduct by employees, contractors, or partners could lead to regulatory sanctions, reputational harm, and financial penalties[407] - The company relies heavily on key personnel, and the loss of executive officers or other key employees could impede business objectives[409] - The company's IT systems are vulnerable to cyber-attacks, data breaches, and disruptions, which could compromise sensitive information and harm operations[413] - Increased remote and hybrid working due to COVID-19 has heightened risks of cyber threats and data security breaches[414] - Significant costs associated with mitigating network security problems, including potential interruptions, delays, and reputational harm[415] - Potential legal claims and liability due to breaches of privacy laws, particularly involving sensitive patient or consumer information[417] - Risk of material disruption to business operations and regulatory approval efforts due to loss of clinical trial data[418] - Dependence on third-party contract manufacturers and potential disruptions from natural or man-made disasters[419] - Impact of unfavorable economic conditions, including inflation, capital market volatility, and geopolitical events on costs and access to capital[420] - Risks associated with international expansion, including differing regulatory requirements and compulsory licensing laws[421][423] - Potential for strategic transactions to increase expenses, dilute equity, and distract management[424] - Volatility in stock price, with historical range from $1.39 to $23.99 since April 30, 2021[426] - Increased costs and management time required for compliance as a public company[434] - The company is evaluating new rules and regulations and cannot predict the additional costs or timing of such costs[435] - The application of these rules may evolve over time, leading to ongoing uncertainty and higher compliance costs[435] - The company plans to invest resources to comply with evolving laws and regulations[435] - These regulations could delay, defer, or prevent a change of control of the company[435] - The rules may impede mergers, consolidations, takeovers, or other business combinations involving the company[435] - Potential acquirers might be discouraged from making tender offers or attempting to obtain control of the company[435]