Alaunos Therapeutics, Inc. (NASDAQ:TCRT) Q1 2022 Earnings Conference Call May 16, 2022 8:30 AM ET Company Participants Alex Lobo - Stern, Investor Relations Kevin Boyle - Chief Executive Officer Drew Deniger - Vice President, Research and Development Mike Wong - Vice President, Finance Conference Call Participants Nick Abbott - Wells Fargo Prakhar Agrawal - Cantor Fitzgerald Thomas Flaten - Lake Street Capital Markets Operator Good day and thank you for standing by. Welcome to Alaunos Therapeutics First Qu ...

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements (unaudited)](index=6&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) This section presents the unaudited interim financial statements for Alaunos Therapeutics, Inc., including the Balance Sheets, Statements of Operations, Statements of Changes in Stockholders' Equity, and Statements of Cash Flows, along with detailed notes explaining the company's organization, significant accounting policies, debt, fair value measurements, related party transactions, commitments, and equity-related activities [Balance Sheets](index=6&type=section&id=Balance%20Sheets%20as%20of%20March%2031%2C%202022%20(unaudited)%20and%20December%2031%2C%202021) **Balance Sheet Highlights (in thousands):** | Item | March 31, 2022 | December 31, 2021 | | :--------------------------------- | :------------- | :---------------- | | Cash and cash equivalents | $68,255 | $76,054 | | Total current assets | $69,772 | $78,831 | | Total assets | $84,991 | $94,865 | | Current portion of long-term debt | $13,993 | $7,868 | | Total current liabilities | $21,234 | $16,041 | | Total liabilities | $35,869 | $36,809 | | Total stockholders' equity | $49,122 | $58,057 | [Statements of Operations](index=7&type=section&id=Statements%20of%20Operations%20for%20the%20Periods%20Ended%20March%2031%2C%202022%20and%202021%20(unaudited)) **Statements of Operations Highlights (Three Months Ended March 31, in thousands):** | Item | 2022 | 2021 | | :---------------------------------------------------------------- | :----- | :----- | | Research and development | $5,580 | $13,336 | | General and administrative | $3,505 | $8,227 | | Total operating expenses | $9,085 | $21,563 | | Loss from operations | $(9,085) | $(21,563) | | Net loss | $(9,788) | $(21,554) | | Basic and diluted net loss per share | $(0.05) | $(0.10) | | Weighted average common shares outstanding | 214,946,569 | 213,954,665 | [Statements of Changes in Stockholders' Equity](index=8&type=section&id=Statements%20of%20Changes%20in%20Stockholders'%20Equity%20for%20the%20Periods%20Ended%20March%2031%2C%202022%20and%202021%20(unaudited)) **Statements of Changes in Stockholders' Equity Highlights (in thousands):** | Item | Balance at Dec 31, 2021 | Stock-based compensation | Cancelled restricted common stock | Net loss | Balance at Mar 31, 2022 | | :------------------------ | :---------------------- | :----------------------- | :------------------------------ | :------- | :---------------------- | | Common Stock Amount | $216 | — | — | — | $216 | | Additional Paid-in Capital | $900,693 | $853 | — | — | $901,546 | | Accumulated Deficit | $(842,852) | — | — | $(9,788) | $(852,640) | | Total Stockholders' Equity | $58,057 | $853 | — | $(9,788) | $49,122 | [Statements of Cash Flows](index=9&type=section&id=Statements%20of%20Cash%20Flows%20for%20the%20Periods%20Ended%20March%2031%2C%202022%20and%202021%20(unaudited)) **Statements of Cash Flows Highlights (Three Months Ended March 31, in thousands):** | Activity | 2022 | 2021 | | :-------------------------------- | :------- | :------- | | Net cash used in operating activities | $(7,770) | $(15,313) | | Net cash used in investing activities | $(29) | $(717) | | Net cash provided by financing activities | $— | $1,017 | | Net decrease in cash and cash equivalents | $(7,799) | $(15,013) | | Cash and cash equivalents, end of period | $68,255 | $100,056 | [Notes to Unaudited Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Financial%20Statements%20(unaudited)) - The Company changed its corporate name from ZIOPHARM Oncology, Inc. to **Alaunos Therapeutics, Inc.** on January 25, 2022[29](index=29&type=chunk) - The Company is a clinical-stage oncology-focused cell therapy company developing adoptive TCR-T cell therapies, leveraging its proprietary non-viral Sleeping Beauty gene transfer platform and cancer hotspot mutation TCR library[29](index=29&type=chunk) - The Company has operated at a loss since its inception in 2003, with an accumulated deficit of approximately **$852.6 million** as of March 31, 2022[32](index=32&type=chunk) - Cash and cash equivalents were approximately **$68.3 million** as of March 31, 2022, anticipated to fund operations into the **second quarter of 2023**, raising substantial doubt about the Company's ability to continue as a going concern[32](index=32&type=chunk)[33](index=33&type=chunk) - The Loan and Security Agreement with Silicon Valley Bank (SVB Facility) was fully drawn at **$25.0 million** as of March 31, 2022, bearing interest at **8.00%**[48](index=48&type=chunk) - The SVB Facility maturity can extend from August 1, 2023, to August 1, 2024, if the Company achieves Amended Milestones by August 31, 2022, including receiving **$50.0 million** in net cash proceeds from equity sales and positive data in the first cohort of the Library TCR-T Trial[43](index=43&type=chunk)[48](index=48&type=chunk) - The Company is required to cash collateralize **half of the outstanding principal plus 5.75% of the original principal** if Amended Milestones are not met by August 31, 2022[50](index=50&type=chunk) - Cash equivalents of **$67.255 million** (March 31, 2022) and **$75.222 million** (December 31, 2021) are classified as Level 1 assets[56](index=56&type=chunk) **Potentially Dilutive Shares (as of March 31, in thousands):** | Item | 2022 | 2021 | | :---------------------- | :----------- | :----------- | | Common stock options | $10,969,654 | $10,738,378 | | Unvested restricted stock | $993,879 | $1,074,606 | | Warrants | $22,922,342 | $22,272,727 | | Total | $34,885,875 | $34,549,044 | - The joint venture Eden BioCell with TriArm Therapeutics was mutually agreed to be dissolved in **September 2021**[63](index=63&type=chunk)[117](index=117&type=chunk) - The Company has exclusive worldwide license agreements with PGEN Therapeutics, MD Anderson Cancer Center, and the National Cancer Institute (NCI) for various TCR, CAR, and Sleeping Beauty technologies, involving annual fees, milestone payments, and royalties[64](index=64&type=chunk)[71](index=71&type=chunk)[82](index=82&type=chunk) **Stock-Based Compensation Expense (Three Months Ended March 31, in thousands):** | Item | 2022 | 2021 | | :-------------------------- | :--- | :--- | | Research and development | $315 | $733 | | General and administrative | $538 | $1,464 | | Total | $853 | $2,197 | - Total unrecognized compensation costs related to unvested stock options amounted to **$7.5 million**, expected to be recognized over **2.08 years**[102](index=102&type=chunk) - Total unrecognized compensation costs related to unvested restricted stock amounted to **$1.5 million**, expected to be recognized over **2.15 years**[104](index=104&type=chunk) - Warrants outstanding include 2019 Warrants (**17,803,031 shares**, **$7.00 exercise price**), MD Anderson Warrant (**3,333,333 shares**, **$0.001 exercise price**, vests upon clinical milestones), and SVB Warrants (**649,615 shares**, **$1.16 exercise price**)[107](index=107&type=chunk)[108](index=108&type=chunk)[109](index=109&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition, results of operations, and liquidity for the three months ended March 31, 2022, compared to the same period in 2021, highlighting the company's focus on TCR-T cell therapy, recent developments, and the ongoing need for additional capital due to significant net losses and limited cash runway - The Company is a clinical-stage oncology-focused cell therapy company developing adoptive TCR-T cell therapy, leveraging its proprietary non-viral Sleeping Beauty gene transfer platform and cancer hotspot mutation TCR library[125](index=125&type=chunk) - The Company is currently enrolling patients for a Phase 1/2 clinical trial (TCR-T Library Phase 1/2 Trial) evaluating **ten TCRs** for various solid tumor types, with the first patient treated on **May 2, 2022**, and interim data anticipated in the **second half of 2022**[125](index=125&type=chunk)[131](index=131&type=chunk) - The Company incurred a net loss of **$9.8 million** for the three months ended March 31, 2022, and an accumulated deficit of approximately **$852.6 million** since inception[126](index=126&type=chunk) - A restructuring in **September 2021** eliminated approximately **60 positions**, extending the anticipated cash runway into the **second quarter of 2023**[129](index=129&type=chunk) - Management has determined that current capital resources are insufficient to fund planned operations for at least **one year**, raising substantial doubt about the Company's ability to continue as a going concern[146](index=146&type=chunk)[147](index=147&type=chunk) **Operating Expenses Comparison (Three Months Ended March 31, in thousands):** | Expense Category | 2022 | 2021 | Change ($) | Change (%) | | :-------------------------- | :----- | :----- | :--------- | :--------- | | Research and development | $5,580 | $13,336 | $(7,756) | (58)% | | General and administrative | $3,505 | $8,227 | $(4,722) | (57)% | | Other income (expense), net | $(703) | $9 | $(712) | (7911)% | - The decrease in R&D expenses was primarily due to winding down IL-12 and CAR-T programs and reduced headcount[140](index=140&type=chunk) - The increase in other expense, net, was primarily due to **$0.7 million** in interest expense associated with the Amended Loan and Security Agreement[143](index=143&type=chunk) **Cash Flow Summary (Three Months Ended March 31, in thousands):** | Activity | 2022 | 2021 | | :-------------------------------- | :------- | :------- | | Net cash used in operating activities | $(7,770) | $(15,313) | | Net cash used in investing activities | $(29) | $(717) | | Net cash provided by financing activities | $— | $1,017 | | Net decrease in cash and cash equivalents | $(7,799) | $(15,013) | - Working capital as of March 31, 2022, was **$48.6 million**, a decrease from **$62.8 million** as of December 31, 2021[161](index=161&type=chunk) - The Company recognized **$0.3 million** in license payments to the NCI for the three months ended March 31, 2022 and 2021[164](index=164&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=27&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) As a smaller reporting company, Alaunos Therapeutics, Inc. is not required to provide quantitative and qualitative disclosures about market risk - As a smaller reporting company, the registrant is not required to provide quantitative and qualitative disclosures about market risk[169](index=169&type=chunk) [Item 4. Controls and Procedures](index=27&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the principal executive and accounting officers, concluded that the company's disclosure controls and procedures were effective as of March 31, 2022, with no material changes in internal control over financial reporting during the quarter - Management concluded that disclosure controls and procedures were **effective** at the reasonable assurance level as of March 31, 2022[170](index=170&type=chunk) - There were no changes in internal control over financial reporting that materially affected, or are reasonably likely to materially affect, internal control over financial reporting during the three months ended March 31, 2022[171](index=171&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=29&type=section&id=Item%201.%20Legal%20Proceedings) The Company is not currently subject to any material legal proceedings that are likely to have a material adverse effect on its financial position, results of operations, or cash flows - As of March 31, 2022, there are no material legal matters that are likely to result in a material adverse effect on the Company's financial position, results of operations, or cash flows[174](index=174&type=chunk) [Item 1A. Risk Factors](index=29&type=section&id=Item%201A.%20Risk%20Factors) This section outlines significant risks that could materially affect the company's business and financial results, including the need for substantial additional capital, challenges in developing novel cell therapies, regulatory hurdles, manufacturing complexities, commercialization difficulties, intellectual property disputes, and other company-specific risks such as stock price volatility and corporate governance issues - The Company requires substantial additional financial resources to continue as a going concern, with current cash resources anticipated to fund operations only into the **second quarter of 2023**, raising substantial doubt about its ability to continue[176](index=176&type=chunk)[177](index=177&type=chunk) - Developing and commercializing non-viral adoptive TCR-T cell therapies is a new approach to cancer treatment, subject to significant challenges including regulatory approval, clinical trial design, manufacturing, and market acceptance[189](index=189&type=chunk) - The Company's product candidates are based on novel technologies with limited clinical data, and there is no assurance that current and planned clinical trials will produce data supporting regulatory approval[191](index=191&type=chunk)[196](index=196&type=chunk) - The Company faces substantial competition from other biopharmaceutical companies in the TCR and CAR technology space, many of which have greater financial resources and experience[203](index=203&type=chunk)[208](index=208&type=chunk) - Any termination of licenses with PGEN, MD Anderson, or NCI, or research and development agreements, could result in the loss of significant rights and harm the ability to develop and commercialize product candidates[210](index=210&type=chunk) - The Company is partly reliant on the NCI for research and development and early clinical testing, with limited control over the timing and progress of NCI's clinical trials, which have experienced delays[218](index=218&type=chunk) - Manufacturing cell-based therapy product candidates is complex, relies on limited vendors for specialized materials, and the Company has limited experience in large-scale production, posing risks to supply and clinical trial timelines[253](index=253&type=chunk)[258](index=258&type=chunk)[261](index=261&type=chunk) - The gene transfer vectors used in the Sleeping Beauty system carry a theoretical risk of insertional oncogenesis, potentially triggering new cancers or other adverse events[268](index=268&type=chunk) - Commercialization success depends on obtaining U.S. and worldwide regulatory approvals, establishing sales and marketing capabilities, achieving physician and patient acceptance, and securing adequate reimbursement from payors[273](index=273&type=chunk)[276](index=276&type=chunk)[278](index=278&type=chunk)[280](index=280&type=chunk) - The market price for the Company's common stock is **volatile**, and failure to satisfy Nasdaq listing standards (e.g., minimum bid price) could lead to delisting, potentially requiring a reverse stock split[332](index=332&type=chunk)[335](index=335&type=chunk)[339](index=339&type=chunk) - The exercise of outstanding warrants (**22.9M shares**) and issuance of equity awards (**11.0M options**) may have a dilutive effect on the stock and negatively impact its price[353](index=353&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=58&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The Company did not report any unregistered sales of equity securities or use of proceeds during the period - No unregistered sales of equity securities or use of proceeds were reported[358](index=358&type=chunk) [Item 3. Defaults Upon Senior Securities](index=58&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable to the Company for the reporting period - This item is not applicable[359](index=359&type=chunk) [Item 4. Mine Safety Disclosures](index=58&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the Company for the reporting period - This item is not applicable[360](index=360&type=chunk) [Item 5. Other Information](index=58&type=section&id=Item%205.%20Other%20Information) The Company announced the resignation of Dr. Eleanor de Groot, Executive Vice President, Operations, effective May 13, 2022 - Dr. Eleanor de Groot resigned from her position as Executive Vice President, Operations, effective **May 13, 2022**[361](index=361&type=chunk) [Item 6. Exhibits](index=59&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed as part of the Quarterly Report on Form 10-Q, including corporate governance documents, certifications, and XBRL data files - Exhibits include Amended and Restated Certificate of Incorporation, Certifications of Principal Executive Officer and Principal Accounting Officer, and Inline XBRL documents[363](index=363&type=chunk)

Financial Data and Key Metrics Changes - For Q4 2021, the company reported a net loss of approximately $11.8 million or $0.05 net loss per share, compared to a net loss of approximately $22.8 million or $0.11 net loss per share for Q4 2020, indicating a significant improvement in financial performance [19] - For the full year 2021, the net loss was approximately $78.8 million or $0.37 net loss per share, compared to a net loss of approximately $80 million or $0.38 net loss per share for 2020, showing a slight improvement [21] - Research and development expenses decreased by 41% to approximately $8.2 million in Q4 2021 from approximately $14 million in Q4 2020 [19] - General and administrative expenses decreased by 76% to approximately $2.1 million in Q4 2021 from approximately $8.8 million in the same period in 2020 [20] - As of December 31, 2021, the company had approximately $76.1 million in cash and cash equivalents, with a cash burn of $61.5 million for the full year 2021 [22] Business Line Data and Key Metrics Changes - The TCRT library study is a basket trial targeting hotspot mutations across six solid tumor indications, with the first patient consented and expected to be treated in Q2 2022 [10][13] - The TCRT library now includes a total of 10 TCRs, which increases the addressable market and pool of patients eligible for the trial [11] Market Data and Key Metrics Changes - The company is focused on executing its clinical programs and expanding its research and development efforts, particularly in collaboration with the National Cancer Institute [15] Company Strategy and Development Direction - The company aims to focus on execution and delivering clinical results, with plans to advance its membrane-bound IL-15 program towards an IND filing in 2023 [24] - The strategic restructuring has reduced headcount from 112 to approximately 40, emphasizing capital stewardship [25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the TCRT platform and its potential to create shareholder value through clinical data generation [9] - The company anticipates sufficient cash runway to fund operations into Q2 2023, indicating a stable financial outlook [22] Other Important Information - The company has engaged a consultant with over 30 years of experience in clinical and drug development to support its efforts following the departure of the Chief Medical Officer [14] Q&A Session Summary Question: Clinical development plans under new leadership - Management indicated that there would not be wholesale changes to the clinical development plan despite the leadership change, maintaining focus on patient accrual and preclinical progress [31][32] Question: Expansion of TCRT library - The company confirmed that it is flexible in including additional mutations into the current trial without launching a new study [43] Question: Manufacturing capacity and patient enrollment - Management clarified that while the manufacturing capacity is one product per month, actual patient enrollment may vary due to various factors [50] Question: Efficacy signals from initial dosing - The primary focus of the Phase 1 trial is on safety, with any efficacy signals being a secondary consideration [61]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-K ☒ ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 OR ☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to _______ Commission File Number 001-33038 Alaunos Therapeutics, Inc. (Exact Name of Registrant as Specified in Its Charter) Delaware 84-1475642 (State or Other ...

Financial Data and Key Metrics Changes - For Q3 2021, the company reported a net loss of approximately $22.7 million, or $0.11 net loss per share, compared to a net loss of approximately $20.3 million, or $0.10 net loss per share for Q3 2020, indicating a year-over-year increase in net loss [13] - Research and development expenses totaled approximately $14.5 million for Q3 2021, an increase of 4% from approximately $14 million for the same period in 2020 [13] - General and administrative expenses were approximately $8.2 million for Q3 2021, compared to approximately $6.4 million for Q3 2020 [13] - Total operating expenses for Q3 2021 were approximately $22.7 million, an increase of 12% compared to approximately $20.3 million for the same period in 2020 [14] - Cash and cash equivalents as of September 30, 2021, were approximately $91.7 million, with an anticipated cash runway extending into the second quarter of 2023 [14][15] Business Line Data and Key Metrics Changes - The company is focusing on advancing its differentiated TCR-T cell platform and has made significant progress in operationalizing its in-house CGMP clinical production unit [5][6] - The TCR-T library trial is set to evaluate patients across six solid tumor indications, including lung, colorectal, endometrial, pancreatic, ovarian, and bile duct cancers [10] Market Data and Key Metrics Changes - The company has opened its screening study at the MD Anderson Cancer Center and is actively screening patients for the Phase 1/2 treatment study [10] Company Strategy and Development Direction - The company has strategically restructured to focus on generating clinical data and advancing its TCR-T platform [4] - The TCR-T library platform is enabled by non-viral Sleeping Beauty technology, allowing the company to target multiple solid tumor indications within a single trial, which is critical for its go-forward strategy [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the internal capabilities to advance scientific research into clinical applications and emphasized the importance of generating clinical data [5][15] - The company aims to begin treating patients in the first half of 2022 and is focused on executing its strategic priorities to bring value to stakeholders [15] Other Important Information - The company has developed an innovative platform with internal resources, including genomics, bioinformatics, and cellular immunology, to generate and validate TCR-T targets exclusively owned by the company [12] Q&A Session Summary Question: What are the gating factors to starting the Phase 1/2 study? - Management indicated that the all-clear on the IND from the FDA is crucial, along with screening and enrolling patients [18] Question: What is the plan for operating expenses following the restructuring? - Management anticipates cash burn to be less than $15 million per quarter moving forward [18] Question: What needs to be completed before dosing the first patient in the TCR-T trial? - Management reiterated that they are waiting for FDA review and are actively screening patients [23] Question: What are the plans for commercial manufacturing? - Management stated that commercial manufacturing is several years away and no strategy has been communicated yet [25] Question: Have there been any retention strategies for staff after restructuring? - Management confirmed that incentive stock options were granted to retain staff, and there have been no unexpected resignations [31] Question: Will new TCRs be added to the IND prior to clearance? - Management indicated that adding new TCRs will be an ongoing process, not linked to the IND submission timeline [33]

[Form 10-Q Filing Information](index=1&type=section&id=Form%2010-Q) This section provides key filing details for the Quarterly Report on Form 10-Q, identifying the registrant and its filing status - The document is a **Quarterly Report on Form 10-Q** for the period ended **September 30, 2021**[2](index=2&type=chunk) - The registrant is **ZIOPHARM Oncology, Inc.**, with common stock trading under the symbol **ZIOP** on The Nasdaq Stock Market LLC[2](index=2&type=chunk)[4](index=4&type=chunk) - The company is classified as a **Large Accelerated Filer**[5](index=5&type=chunk) [Forward-Looking Statements](index=3&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section highlights the inherent risks and uncertainties associated with forward-looking statements in the report, which may cause actual results to differ materially - This report contains forward-looking statements based on current beliefs and expectations, which involve known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially[6](index=6&type=chunk) - Key forward-looking statements include those regarding the ability to raise capital, estimates of expenses, timing and results of preclinical and clinical trials, regulatory approvals, intellectual property, and the impact of the COVID-19 pandemic[7](index=7&type=chunk) [Summary of Selected Business Risks](index=4&type=section&id=SUMMARY%20OF%20SELECTED%20RISKS%20ASSOCIATED%20WITH%20OUR%20BUSINESS) This section outlines critical business risks, including health epidemics, funding requirements, novel therapy development challenges, and internal control weaknesses - The company's business, operations, and clinical development plans are vulnerable to health epidemics, including the COVID-19 pandemic, affecting manufacturing, clinical trials, and third-party activities[14](index=14&type=chunk) - Substantial additional financial resources are required for ongoing product candidate development; failure to obtain these resources may lead to delays or discontinuation of planned operations[14](index=14&type=chunk) - The company's non-viral TCR T-cell therapy is a new approach to cancer treatment, subject to significant development challenges and supported by limited clinical data[14](index=14&type=chunk) - A material weakness in internal controls over financial reporting was identified as of **June 30, 2021**, and remained unremediated as of **September 30, 2021**[14](index=14&type=chunk) [Part I - Financial Information](index=7&type=section&id=Part%20I%20-%20Financial%20Information) This part encompasses the company's unaudited interim financial statements and management's discussion and analysis of financial condition and results of operations [Financial Statements](index=7&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited interim financial statements, including the balance sheets, statements of operations, statements of changes in stockholders' equity, and statements of cash flows, along with detailed notes explaining the company's business, significant accounting policies, debt, equity, and various commitments and contingencies [Balance Sheets](index=7&type=section&id=Balance%20Sheets%20as%20of%20September%2030,%202021%20(unaudited)%20and%20December%2031,%202020) This section presents the unaudited balance sheets, detailing assets, liabilities, and stockholders' equity as of September 30, 2021, and December 31, 2020 Balance Sheet Highlights (in thousands) | Metric | Sep 30, 2021 (in thousands) | Dec 31, 2020 (in thousands) | Change (vs. Dec 31, 2020) | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Cash and cash equivalents | $91,725 | $115,069 | -$23,344 | | Total current assets | $96,554 | $130,589 | -$34,035 | | Total assets | $113,762 | $146,345 | -$32,583 | | Total current liabilities | $28,173 | $18,368 | +$9,805 | | Total liabilities | $45,055 | $22,363 | +$22,692 | | Total stockholders' equity | $68,707 | $123,982 | -$55,275 | [Statements of Operations](index=8&type=section&id=Statements%20of%20Operations%20for%20the%20three%20and%20nine%20months%20ended%20September%2030,%202021%20and%202020%20(unaudited)) This section provides the unaudited statements of operations, outlining revenues, expenses, and net loss for the three and nine months ended September 30, 2021 and 2020 Statements of Operations Highlights (in thousands) | Metric | 3 Months Ended Sep 30, 2021 (in thousands) | 3 Months Ended Sep 30, 2020 (in thousands) | Change (YoY) | 9 Months Ended Sep 30, 2021 (in thousands) | 9 Months Ended Sep 30, 2020 (in thousands) | Change (YoY) | | :-------------------------- | :--------------------------------------- | :--------------------------------------- | :-------------------------- | :--------------------------------------- | :--------------------------------------- | :-------------------------- | | Collaboration revenue | $398 | $0 | +$398 | $398 | $0 | +$398 | | Research and development | $14,521 | $13,968 | +$553 | $41,427 | $38,725 | +$2,702 | | General and administrative | $8,173 | $6,353 | +$1,820 | $25,469 | $18,862 | +$6,607 | | Total operating expenses | $22,694 | $20,321 | +$2,373 | $66,896 | $57,587 | +$9,309 | | Loss from operations | $(22,296) | $(20,321) | -$(1,975) | $(66,498) | $(57,587) | -$(8,911) | | Net loss | $(22,733) | $(20,315) | -$(2,418) | $(66,957) | $(57,204) | -$(9,753) | | Basic and diluted net loss per share | $(0.11) | $(0.10) | -$(0.01) | $(0.31) | $(0.27) | -$(0.04) | [Statement of Changes in Stockholders' Equity](index=9&type=section&id=Statement%20of%20Changes%20in%20Stockholders'%20Equity%20for%20the%20three%20and%20nine%20months%20ended%20September%2030,%202021%20and%202020%20(unaudited)) This section details changes in stockholders' equity, including common stock, additional paid-in capital, and accumulated deficit, for the specified periods Statement of Changes in Stockholders' Equity Highlights (in thousands) | Metric | Balance at Dec 31, 2020 (in thousands) | 9 Months Ended Sep 30, 2021 Changes (in thousands) | Balance at Sep 30, 2021 (in thousands) | | :-------------------------- | :--------------------------------------- | :--------------------------------------- | :--------------------------------------- | | Common Stock (Shares) | 214,591,906 | +1,553,898 | 216,145,804 | | Common Stock (Amount) | $215 | +$1 | $216 | | Additional Paid-In Capital | $887,868 | +$11,681 | $899,549 | | Accumulated Deficit | $(764,101) | -$(66,957) | $(831,058) | | Total Stockholders' Equity | $123,982 | -$(55,275) | $68,707 | [Statements of Cash Flows](index=11&type=section&id=Statements%20of%20Cash%20Flows%20for%20the%20nine%20months%20ended%20September%2030,%202021%20and%202020%20(unaudited)) This section presents the unaudited statements of cash flows, categorizing cash activities into operating, investing, and financing for the nine months ended September 30, 2021 and 2020 Cash Flow Activities (in thousands) | Cash Flow Activity (in thousands) | 9 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2020 | Change (YoY) | | :--------------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net cash used in operating activities | $(46,342) | $(39,977) | $(6,365) | | Net cash used in investing activities | $(2,964) | $(6,012) | $3,048 | | Net cash provided by financing activities | $25,962 | $101,719 | $(75,757) | | Net increase (decrease) in cash and cash equivalents | $(23,344) | $55,730 | $(79,074) | | Cash and cash equivalents, end of period | $91,725 | $135,471 | $(43,746) | [Notes to Financial Statements](index=12&type=section&id=Notes%20to%20Financial%20Statements%20(unaudited)) This section provides detailed explanatory notes supporting the unaudited interim financial statements, covering business overview, accounting policies, and specific financial items [Business Overview](index=12&type=section&id=1.%20Business) This note describes the company's core business as a clinical-stage biopharmaceutical firm, its financial history, and current strategic focus - ZIOPHARM Oncology, Inc. is a clinical-stage biopharmaceutical company focused on developing next-generation immuno-oncology platforms, specifically **TCR T-cell therapies** for solid tumors using non-viral 'Sleeping Beauty' genetic engineering[34](index=34&type=chunk)[35](index=35&type=chunk) - The company has operated at a loss since its inception in **2003**, with an accumulated deficit of approximately **$831.1 million** as of **September 30, 2021**[37](index=37&type=chunk) - Cash and cash equivalents were approximately **$91.7 million** as of **September 30, 2021**, anticipated to fund operations into the **second quarter of 2023**[37](index=37&type=chunk) - The existing Controlled IL-12 clinical program for recurrent glioblastoma multiforme is being wound down, with the company seeking a partner for this program[36](index=36&type=chunk) [Financings](index=13&type=section&id=2.%20Financings) This note details the company's financing activities, including recent term loan agreements and equity offerings, and their impact on capital resources - In **August 2021**, the company entered into a Term Loan Agreement for an initial **$25.0 million**, with an additional **$25.0 million** available if certain funding and clinical milestones are met by **August 31, 2022**[44](index=44&type=chunk) - A **February 2020** public offering raised approximately **$84.8 million (net)** from the sale of **27,826,086 shares**, plus an additional **$3.9 million (net)** from an underwriters' option[45](index=45&type=chunk)[46](index=46&type=chunk)[47](index=47&type=chunk) - Under an At-the-Market (ATM) facility, the company sold **2,814,673 shares** for approximately **$13.0 million (net)** during the nine months ended **September 30, 2020**, but had no sales in the same period of **2021**[49](index=49&type=chunk)[50](index=50&type=chunk) [Summary of Significant Accounting Policies](index=14&type=section&id=3.%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines the company's significant accounting policies, noting any recent changes and their impact on financial reporting - No material changes in accounting policies since the Annual Report, except for the adoption of **ASU 2019-12 (Income Taxes)** effective **January 1, 2021**, with no material impact[51](index=51&type=chunk)[52](index=52&type=chunk) [Debt](index=14&type=section&id=4.%20Debt) This note provides details on the company's debt obligations, including the term loan agreement, its terms, and associated warrants Debt Summary (in thousands) | Metric | September 30, 2021 (in thousands) | | :-------------------------- | :--------------------------------------- | | Term Loan Agreement | $25,078 | | Unamortized discount on Term Loan Agreement | $(867) | | Total debt | $24,211 | | Less: current portion of long-term debt | $(12,037) | | Long-term debt | $12,174 | - On **August 6, 2021**, the company secured a **$50.0 million** Term Loan Agreement with SVB, with an initial **$25.0 million** drawn. Loans are secured by company assets (excluding intellectual property)[53](index=53&type=chunk) - Principal repayments for the initial tranche begin **April 1, 2022**, with a maturity of **March 1, 2023**, extendable to **August 1, 2025**, if an Equity Milestone is achieved[55](index=55&type=chunk) - Warrants to purchase **432,844 shares** of common stock at **$2.22 per share** were issued to SVB in connection with the loan, recorded at a fair value of **$0.8 million**[61](index=61&type=chunk) [Fair Value Measurements](index=15&type=section&id=5.%20Fair%20Value%20Measurements) This note explains the company's fair value measurements for financial instruments, primarily cash equivalents, and their classification within the fair value hierarchy - The company classifies cash equivalents as **Level 1 assets**, representing deposits in short-term United States treasury money market mutual funds quoted in an active market[66](index=66&type=chunk)[67](index=67&type=chunk) Fair Value Measurements (in thousands) | Asset | Sep 30, 2021 (in thousands) | Dec 31, 2020 (in thousands) | Fair Value Hierarchy (Level) | | :---------------- | :-------------------------- | :-------------------------- | :--------------------------- | | Cash equivalents | $84,891 | $75,990 | Level 1 | [Net Loss per Share](index=16&type=section&id=6.%20Net%20Loss%20per%20Share) This note details the calculation of basic and diluted net loss per share, including the treatment of potentially dilutive securities - Potentially dilutive shares (stock options, restricted stock, warrants) were excluded from diluted net loss per share calculation for all periods presented as their inclusion would be anti-dilutive[68](index=68&type=chunk) Potentially Dilutive Shares | Potentially Dilutive Shares | Sep 30, 2021 | Sep 30, 2020 | | :-------------------------- | :----------- | :----------- | | Stock options | 11,072,894 | 6,572,191 | | Inducement stock options | 97,500 | 863,333 | | Unvested restricted stock | 1,510,655 | 1,289,389 | | Warrants | 22,705,571 | 22,272,727 | | Total | 35,386,620 | 30,997,640 | [Related Party Transactions](index=16&type=section&id=7.%20Related%20Party%20Transactions) This note describes the company's agreements and financial interactions with related parties, including collaboration partners and joint ventures - The company has collaboration agreements with **PGEN Therapeutics**, **MD Anderson Cancer Center**, and **Vineti Inc.**[69](index=69&type=chunk)[70](index=70&type=chunk)[72](index=72&type=chunk) - The joint venture **Eden BioCell** with TriArm Therapeutics was mutually agreed to be dissolved in **September 2021**[75](index=75&type=chunk) - As of **September 30, 2021**, the net balance of cash resources at MD Anderson available to offset expenses was **zero**, with **$1.1 million** in accounts receivable due from MD Anderson and **$2.1 million** in accrued expenses due to MD Anderson[71](index=71&type=chunk) [Commitments and Contingencies](index=17&type=section&id=8.%20Commitments%20and%20Contingencies) This note outlines the company's contractual commitments and potential contingent liabilities, such as license agreements and development cost reimbursements - The company holds exclusive worldwide rights to research, develop, and commercialize IL-12, CD19 CAR, and TCR products for cancer under a license agreement with PGEN, involving an annual license fee of **$0.1 million** and potential milestone payments up to **$52.5 million per program**, plus tiered royalties[77](index=77&type=chunk)[79](index=79&type=chunk)[80](index=80&type=chunk) - Under the **2019 Research and Development Agreement** with MD Anderson, the company will reimburse up to **$20.0 million** for development costs incurred after **January 1, 2021**, and pay low-single digit royalties on net sales of TCR products, along with potential benchmark payments totaling **$36.5 million**[91](index=91&type=chunk) - The company holds an exclusive worldwide license from the NCI for certain intellectual property related to TCR T-cell therapy products, requiring minimum annual royalties of **$0.3 million** (reducible to **$0.1 million**) and potential benchmark payments of **$4.3 million**[93](index=93&type=chunk)[96](index=96&type=chunk)[98](index=98&type=chunk) [Leases](index=22&type=section&id=9.%20Leases) This note provides information on the company's operating lease agreements for office and lab spaces, including future payment obligations - The company extended its Boston office lease through **August 2026** and has multiple lease agreements for office and lab space in Houston at MD Anderson, with the latest extension through **April 2028**[111](index=111&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk) Lease Expense (in thousands) | Lease Expense (in thousands) | 3 Months Ended Sep 30, 2021 | 3 Months Ended Sep 30, 2020 | 9 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2020 | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Operating lease cost | $352 | $267 | $1,113 | $768 | - Future minimum operating lease payments total **$6.747 million**, with **$1.097 million** due in less than **1 year** as of **September 30, 2021**[118](index=118&type=chunk) [Stock-Based Compensation](index=24&type=section&id=10.%20Stock-Based%20Compensation) This note details the company's stock-based compensation plans, including expense recognition, option grants, and unrecognized compensation costs Stock-Based Compensation Expense (in thousands) | Expense (in thousands) | 3 Months Ended Sep 30, 2021 | 3 Months Ended Sep 30, 2020 | 9 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2020 | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Research and development | $535 | $522 | $2,115 | $1,587 | | General and administrative | $1,836 | $1,270 | $7,742 | $3,806 | | Total stock-based compensation expense | $2,371 | $1,792 | $9,857 | $5,393 | - Total unrecognized compensation costs related to unvested stock options amounted to **$8.0 million** (weighted-average period of **2.03 years**) and for unvested restricted stock amounted to **$2.4 million** (weighted-average period of **2.19 years**) as of **September 30, 2021**[123](index=123&type=chunk)[124](index=124&type=chunk) - The company granted **7,150,438 stock options** during the nine months ended **September 30, 2021**, with a weighted-average grant date fair value of **$1.91 per share**[119](index=119&type=chunk) [Warrants](index=26&type=section&id=11.%20Warrants) This note describes the various warrants issued by the company, their terms, and their accounting treatment - In **August 2021**, the company issued warrants to SVB to purchase **432,844 shares** of common stock at **$2.22 per share**, valued at **$0.8 million**, in connection with the Term Loan Agreement[132](index=132&type=chunk) - In **2019**, the company issued 2019 warrants to purchase up to **17,803,031 additional shares** of common stock at an exercise price of **$7.00** as an inducement for 2018 warrant exercises, resulting in a **$60.8 million** non-cash charge[130](index=130&type=chunk) - Warrants to purchase **3,333,333 shares** were issued to MD Anderson in connection with the **2019 Agreement**, with an initial exercise price of **$0.001 per share** and a grant date fair value of **$14.5 million**, vesting upon the occurrence of certain clinical milestones[131](index=131&type=chunk) [Restructuring](index=28&type=section&id=12.%20Restructuring) This note details the company's recent strategic reduction in force, including the number of employees affected and associated severance expenses - On **September 27, 2021**, the company announced a strategic reduction in force, notifying approximately **60 full-time employees** of termination to lower costs and realign business strategy[133](index=133&type=chunk) Severance Expense (in thousands) | Severance Expense (in thousands) | September 30, 2021 | | :-------------------------- | :------------------- | | Research and Development | $2,248 | | General and Administrative | $1,289 | | Total Severance Expense | $3,537 | [Joint Venture](index=28&type=section&id=13.%20Joint%20Venture) This note discusses the dissolution of the Eden BioCell joint venture and its prior activities in CAR-T cell therapy development - The joint venture **Eden BioCell** with TriArm Therapeutics, established in **2018** for CAR-T therapies in Greater China, was mutually agreed to be dissolved in **September 2021**[135](index=135&type=chunk)[144](index=144&type=chunk) - Eden BioCell began treating patients in a clinical trial with the investigational CD19 RPM CAR-T cell therapy in Taiwan in **March 2021**, with **two patients** treated and no serious adverse safety events reported[142](index=142&type=chunk) - Based on laboratory data from the first two patients, further process development work is required for the CD19 RPM CAR-T cell therapy[143](index=143&type=chunk) [Subsequent Events](index=30&type=section&id=14.%20Subsequent%20Events) This note confirms that no material events occurred after the balance sheet date that would require adjustment or disclosure - No material subsequent events impacting the financial statements or disclosures were identified from the balance sheet date through the date of issuance[145](index=145&type=chunk) [Management's Discussion and Analysis](index=31&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition and results of operations, highlighting key business developments, financial performance, liquidity, and capital resources, with a focus on the TCR T-cell therapy program and recent restructuring efforts [Overview](index=31&type=section&id=Overview) This section provides a high-level summary of the company's business, strategic focus on TCR T-cell therapies, and historical financial performance - The company is a clinical-stage biopharmaceutical company focused on developing next-generation immuno-oncology platforms, specifically **TCR T-cell therapies** for solid tumors using the 'Sleeping Beauty' non-viral genetic engineering system[152](index=152&type=chunk) - The company has incurred significant net losses since inception, with a net loss of **$67.0 million** for the nine months ended **September 30, 2021**, and an accumulated deficit of **$831.1 million**[155](index=155&type=chunk) - Significant operating expenditures and net losses are expected to continue, with substantial increases in expenses anticipated for clinical trials, regulatory approvals, internal systems, personnel, and manufacturing scale-up[155](index=155&type=chunk) [Recent Developments](index=32&type=section&id=Recent%20Developments) This section highlights recent strategic actions, including a workforce restructuring and the ongoing impact of the COVID-19 pandemic on operations - A restructuring announced on **September 27, 2021**, eliminated approximately **60 positions**, with anticipated cost savings extending the cash runway into the **second quarter of 2023**[157](index=157&type=chunk) - The ongoing COVID-19 global pandemic continues to present significant health and economic challenges, potentially impacting productivity, supply chains, and clinical programs and timelines[158](index=158&type=chunk) [Clinical, Manufacturing, Scientific, and Regulatory Developments](index=32&type=section&id=Clinical,%20Manufacturing,%20Scientific,%20and%20Regulatory%20Developments) This section details progress in clinical trials, manufacturing capabilities, and regulatory approvals, alongside updates on strategic program prioritization - The FDA cleared the company-sponsored IND application for a **Phase 1/2 clinical trial** evaluating TCRs from its library for various solid tumors, with patient dosing anticipated in the **first half of 2022**[159](index=159&type=chunk) - The company has built and will open its own **cGMP clinical production unit (CPU)**, with commissioning and aseptic process validation completed in **Q2 2021**, and engineering/process qualification runs completed in **October**[160](index=160&type=chunk)[161](index=161&type=chunk) - The **Eden BioCell** joint venture with TriArm Therapeutics was mutually agreed to be dissolved in **September 2021** to prioritize efforts and capital on the TCR-T program[166](index=166&type=chunk) - The existing Controlled IL-12 clinical program for recurrent glioblastoma multiforme is being wound down, and the company is seeking a partner for this technology[167](index=167&type=chunk) [Financial Overview](index=33&type=section&id=Financial%20Overview) This section provides a comprehensive review of the company's financial performance, including results of operations, liquidity, and capital resources [Overview of Results of Operations](index=33&type=section&id=Overview%20of%20Results%20of%20Operations) This section summarizes the key components of the company's financial performance, including revenue and expense trends for the reporting periods [License Income](index=33&type=section&id=License%20Income) This section details the collaboration revenue generated from licensing agreements for the reported periods Collaboration Revenue (in thousands) | Metric | 3 Months Ended Sep 30, 2021 (in thousands) | 3 Months Ended Sep 30, 2020 (in thousands) | Change (YoY) | 9 Months Ended Sep 30, 2021 (in thousands) | 9 Months Ended Sep 30, 2020 (in thousands) | Change (YoY) | | :-------------------------- | :--------------------------------------- | :--------------------------------------- | :-------------------------- | :--------------------------------------- | :--------------------------------------- | :-------------------------- | | Collaboration revenue | $398 | $0 | +$398 | $398 | $0 | +$398 | [Research and Development Expenses](index=33&type=section&id=Research%20and%20development%20expenses) This section analyzes changes in research and development expenses, attributing fluctuations to restructuring charges and program costs Research and Development Expenses (in thousands) | Metric | 3 Months Ended Sep 30, 2021 (in thousands) | 3 Months Ended Sep 30, 2020 (in thousands) | Change (YoY) | 9 Months Ended Sep 30, 2021 (in thousands) | 9 Months Ended Sep 30, 2020 (in thousands) | Change (YoY) | | :-------------------------- | :--------------------------------------- | :--------------------------------------- | :-------------------------- | :--------------------------------------- | :--------------------------------------- | :-------------------------- | | Research and development | $14,521 | $13,968 | +$553 | $41,427 | $38,725 | +$2,702 | - Q3 2021 R&D expenses increased by **$0.6 million** YoY, primarily due to a **$2.2 million** charge recognized during the third quarter related to the strategic restructuring event, partially offset by **$1.6 million** in reduced trial and consulting costs[169](index=169&type=chunk) - YTD Q3 2021 R&D expenses increased by **$2.7 million** YoY, driven by a **$2.2 million** restructuring charge, **$4.8 million** in salary and employee-related expenses, and **$1.5 million** in facilities and other related expenses, offset by **$5.8 million** in reduced program and consulting costs[170](index=170&type=chunk) - Direct external expenses for the TCR Library program were **$4.7 million** for the three months ended **September 30, 2021**, and **$11.7 million** since inception[174](index=174&type=chunk) [General and Administrative Expenses](index=37&type=section&id=General%20and%20administrative%20expenses) This section examines the trends in general and administrative expenses, highlighting the impact of severance charges and consulting costs General and Administrative Expenses (in thousands) | Metric | 3 Months Ended Sep 30, 2021 (in thousands) | 3 Months Ended Sep 30, 2020 (in thousands) | Change (YoY) | 9 Months Ended Sep 30, 2021 (in thousands) | 9 Months Ended Sep 30, 2020 (in thousands) | Change (YoY) | | :-------------------------- | :--------------------------------------- | :--------------------------------------- | :-------------------------- | :--------------------------------------- | :--------------------------------------- | :-------------------------- | | General and administrative | $8,173 | $6,353 | +$1,820 | $25,469 | $18,862 | +$6,607 | - Q3 2021 G&A expenses increased by **$1.8 million** YoY, mainly due to **$1.3 million** in employee-related severance charges from the **September 2021** strategic reduction in force and an increase of **$0.8 million** related to consulting service costs, partially offset by a **$0.3 million** decrease in salary and employee-related costs[178](index=178&type=chunk) - YTD Q3 2021 G&A expenses increased by **$6.6 million** YoY, primarily due to **$1.3 million** in employee-related severance charges, **$4.2 million** related to employee-related expenses, and **$1.1 million** related to consulting service costs[179](index=179&type=chunk) [Other Income (Expense), Net](index=37&type=section&id=Other%20income%20(expense),%20net) This section reviews other non-operating income and expenses, primarily focusing on interest expense from the term loan Other Income (Expense), Net (in thousands) | Metric (in thousands) | 3 Months Ended Sep 30, 2021 | 3 Months Ended Sep 30, 2020 | Change (YoY) | 9 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2020 | Change (YoY) | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Interest expense, net | $(444) | $7 | $(451) | $(444) | $412 | $(856) | | Other expense, net | $7 | $(1) | $8 | $(15) | $(29) | $14 | | Total Other income (expense), net | $(437) | $6 | $(443) | $(459) | $383 | $(842) | - The increase in other expense, net, for both the three and nine months ended **September 30, 2021**, was primarily due to interest expense associated with the Term Loan with Silicon Valley Bank[180](index=180&type=chunk) [Liquidity and Capital Resources](index=37&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's ability to meet its short-term and long-term financial obligations, including funding sources and requirements [Source of Liquidity](index=37&type=section&id=Source%20of%20liquidity) This section identifies the primary means by which the company has financed its operations, including equity offerings and debt facilities - The company has financed operations primarily through public equity offerings, private placements, term debt, and collaborations, raising an aggregate of **$739.1 million** from equity issuances and the SVB term loan through **September 30, 2021**[182](index=182&type=chunk) - An initial **$25.0 million** term loan was funded in **August 2021** from Silicon Valley Bank, with an additional **$25.0 million** available upon meeting certain funding and clinical milestones[183](index=183&type=chunk) - No shares were sold under the At-the-Market (ATM) facility during the three or nine months ended **September 30, 2021**[187](index=187&type=chunk) [Funding Requirements](index=38&type=section&id=Funding%20Requirements) This section outlines the company's anticipated capital needs and the potential challenges in securing additional financing to support future operations - Cash resources are anticipated to fund operations into the **second quarter of 2023**, with no committed sources of additional capital at this time[188](index=188&type=chunk) - The company's ability to raise additional capital may be hindered by the unpredictability of capital markets and the ongoing COVID-19 pandemic[188](index=188&type=chunk) - If adequate additional funds are not available, the company may be forced to delay, reduce, or eliminate research and development programs or product commercialization efforts[188](index=188&type=chunk) [Cash Flows](index=39&type=section&id=Cash%20Flows) This section analyzes the company's cash inflows and outflows from operating, investing, and financing activities for the reported periods Cash Flow Activities (in thousands) | Cash Flow Activity (in thousands) | 9 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2020 | Change (YoY) | | :--------------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net cash used in operating activities | $(46,342) | $(39,977) | $(6,365) | | Net cash used in investing activities | $(2,964) | $(6,012) | $3,048 | | Net cash provided by financing activities | $25,962 | $101,719 | $(75,757) | | Net increase (decrease) in cash and cash equivalents | $(23,344) | $55,730 | $(79,074) | - Net cash used in operating activities increased by **$6.365 million** YoY, primarily due to a net loss of **$66.0 million**, partially offset by changes in receivables, prepaid expenses, and stock-based compensation[190](index=190&type=chunk) - Net cash used in investing activities decreased by **$3.048 million** YoY, reflecting reduced cash used for expanding internal cell therapy capabilities[191](index=191&type=chunk) - Net cash provided by financing activities decreased significantly by **$75.757 million** YoY, mainly due to lower proceeds from equity offerings in **2021** compared to **2020**, partially offset by the new Term Loan[192](index=192&type=chunk) [Operating Capital and Capital Expenditure Requirements](index=39&type=section&id=Operating%20capital%20and%20capital%20expenditure%20requirements) This section discusses the company's ongoing need for working capital and capital expenditures to support its research, development, and operational activities - The company anticipates continued losses and significant cash requirements for clinical trials, regulatory approvals, manufacturing, and intellectual property protection[193](index=193&type=chunk)[194](index=194&type=chunk) - Working capital as of **September 30, 2021**, was **$68.5 million**, a decrease from **$112.2 million** at **December 31, 2020**[195](index=195&type=chunk) - The realignment of resources to the Sleeping Beauty program and the strategic reduction in force are expected to reduce cash expenditures[195](index=195&type=chunk) [Contractual Obligations](index=41&type=section&id=Contractual%20Obligations) This section details the company's significant contractual commitments, including operating leases, royalty fees, and term loan repayments Contractual Obligations (in thousands) | Obligation (in thousands) | Total | Less than 1 year | 2 - 3 years | 4 - 5 years | More than 5 years | | :-------------------------- | :---- | :--------------- | :---------- | :---------- | :---------------- | | Operating leases | $6,747 | $1,097 | $2,281 | $2,391 | $978 | | Royalty and license fees | $3,277 | $350 | $700 | $450 | $1,777 | | Term loan | $28,481 | $14,258 | $14,223 | $0 | $0 | | Total | $38,505 | $15,705 | $17,204 | $2,841 | $2,755 | - The company's contractual obligations include operating leases for corporate headquarters and lab/office space, royalty and license fees (e.g., **$0.1 million** annual fee to PGEN), and term loan repayments[197](index=197&type=chunk)[198](index=198&type=chunk)[199](index=199&type=chunk)[200](index=200&type=chunk) [Off-balance Sheet Arrangements](index=42&type=section&id=Off-balance%20Sheet%20Arrangements) This section confirms the absence of any material off-balance sheet arrangements that could significantly impact the company's financial position - The company did not have any material off-balance sheet arrangements during the periods presented[201](index=201&type=chunk) [Critical Accounting Policies and Estimates](index=42&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section reiterates the company's critical accounting policies and estimates, consistent with those disclosed in the annual report - Critical accounting policies and estimates remain consistent with those identified in the Annual Report, primarily relating to clinical trial expenses, collaboration agreements, fair value measurements for stock-based compensation, and income taxes[202](index=202&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=33&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company's market risk exposure is limited to its cash and cash equivalents, which are managed to preserve capital and maximize income with minimal interest rate risk. Currency fluctuations are not expected to have a material impact due to the absence of clinical studies outside the U.S - Market risk exposure is limited to cash, which is held in interest-bearing bank accounts, United States treasuries, and other government-backed investments, subject to minimal interest rate risk[203](index=203&type=chunk) - Currency fluctuations are not expected to materially impact financial position, results of operations, or cash flows, as there are currently no clinical studies or clinical trials taking place outside of the United States[204](index=204&type=chunk) [Controls and Procedures](index=33&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of September 30, 2021, at a reasonable assurance level, despite an unremediated material weakness in internal controls over financial reporting related to insufficient accounting resources for timely account reconciliation and review. Remediation efforts are underway [Evaluation of Disclosure Controls and Procedures](index=42&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) This section presents management's conclusion on the effectiveness of the company's disclosure controls and procedures as of the reporting date - Management, with the participation of its principal executive officer and principal accounting officer, concluded that disclosure controls and procedures were effective at the reasonable assurance level as of **September 30, 2021**[205](index=205&type=chunk) [Material Weakness](index=42&type=section&id=Material%20Weakness) This section identifies a material weakness in internal controls over financial reporting and clarifies its impact on the financial statements - A material weakness in internal controls over financial reporting, related to the lack of sufficient accounting resources for timely account reconciliation and review, was identified as of **June 30, 2021**, and remained unremediated as of **September 30, 2021**[206](index=206&type=chunk) - This material weakness had no impact on any amounts reported in the financial statements for the quarter ended **September 30, 2021**, or for any previous period[206](index=206&type=chunk) [Remediation Efforts to Address Material Weakness](index=42&type=section&id=Remediation%20Ef%20orts%20to%20Address%20Material%20Weakness) This section outlines the company's action plans and ongoing efforts to remediate the identified material weakness in internal controls - Remediation action plans, including reassessing the design and operation of internal controls over the financial statement close process and realigning accounting staffing levels, have been identified and implemented[207](index=207&type=chunk) - The effectiveness of these implemented internal controls will be tested beginning in the **fourth quarter of 2021**[207](index=207&type=chunk) [Changes in Internal Control over Financial Reporting](index=44&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) This section reports on any material changes in the company's internal control over financial reporting during the quarter - Other than the disclosed remediation actions for the material weakness, there were no material changes in internal control over financial reporting during the quarter ended **September 30, 2021**[209](index=209&type=chunk) [Part II - Other Information](index=45&type=section&id=Part%20II%20-%20Other%20Information) This part includes disclosures on legal proceedings, risk factors, equity sales, defaults, mine safety, and other significant corporate information [Legal Proceedings](index=35&type=section&id=Item%201.%20Legal%20Proceedings) The company may periodically face legal proceedings and claims in the ordinary course of business, but as of September 30, 2021, management believes there are no material matters likely to have a material adverse effect on its financial position, results of operations, or cash flows - The company may periodically become subject to legal proceedings and claims arising in connection with ongoing business activities, with uncertain outcomes that could materially affect financial results[210](index=210&type=chunk) - As of **September 30, 2021**, management's opinion is that there are no material matters likely to result in a material adverse effect on the company's financial position, results of operations, or cash flows[211](index=211&type=chunk) [Risk Factors](index=35&type=section&id=Item%201A.%20Risk%20Factors) This section details significant risks that could materially affect the company's business and financial results, including those related to health epidemics (like COVID-19), the need for substantial additional financing, challenges in developing novel cancer treatments, intense competition, reliance on third-party licenses, and the volatility of its stock price [Risks Related to Our Business](index=45&type=section&id=RISKS%20RELATED%20TO%20OUR%20BUSINESS) This section outlines key business risks, including the impact of health epidemics, funding needs, novel therapy development, internal control weaknesses, and management transitions - The COVID-19 pandemic could adversely affect business operations, clinical development plans, supply chain, and global financial markets, potentially impacting liquidity and the value of common stock[213](index=213&type=chunk)[215](index=215&type=chunk)[219](index=219&type=chunk) - The company will require substantial additional financial resources to fund operations beyond **Q2 2023**; inability to obtain financing may force delays or discontinuation of planned operations[221](index=221&type=chunk)[222](index=222&type=chunk) - Developing and commercializing non-viral adoptive cellular therapies, such as TCR-T cell therapies, is a new approach to cancer treatment subject to significant challenges, including regulatory approval, manufacturing, and market acceptance[235](index=235&type=chunk) - A material weakness in internal controls over financial reporting was identified as of **June 30, 2021**, and remained unremediated as of **September 30, 2021**, posing risks to financial reporting accuracy and potentially affecting the business and stock price[230](index=230&type=chunk)[231](index=231&type=chunk) - Recent senior management transitions (Interim CEO, Interim CFO, new CEO) and a **September 2021** restructuring (eliminating approximately **60 positions**) could disrupt business, lead to loss of institutional knowledge, and affect employee morale, potentially impacting operations and strategy implementation[265](index=265&type=chunk)[268](index=268&type=chunk) [Risks Related to Clinical Testing, Regulatory Approval, and Manufacturing](index=56&type=section&id=RISKS%20RELATED%20TO%20THE%20CLINICAL%20TESTING,%20REGULATORY%20APPROVAL%20AND%20MANUFACTURING%20OF%20OUR%20PRODUCT%20CANDIDATES) This section details risks associated with clinical trials, regulatory approvals, manufacturing complexities, and supply chain dependencies for product candidates - Failure to obtain necessary U.S. or worldwide regulatory approvals for any product candidate would severely undermine the business, as the approval process is long, complex, costly, and has no guarantee of success[273](index=273&type=chunk)[274](index=274&type=chunk) - Product candidates are in various stages of clinical trials, which are very expensive and time-consuming; any failure or delay in completing these trials could harm the business and delay revenue generation[276](index=276&type=chunk)[277](index=277&type=chunk) - Product candidates may cause undesirable side effects or have other properties that could delay or prevent regulatory approval, limit the commercial profile of an approved label, or result in significant negative consequences following any potential marketing approval[278](index=278&type=chunk)[280](index=280&type=chunk) - Reliance on sole or limited source vendors for reagents, specialized equipment, and materials for cell-based therapy manufacturing exposes the company to risks of supply disruption, quality issues, and higher product costs[281](index=281&type=chunk)[282](index=282&type=chunk) - The novel technology of immuno-oncology product candidates makes predicting development time and cost difficult, and regulatory approval processes are complex, frequently changing, and potentially longer for cell therapy products[287](index=287&type=chunk)[288](index=288&type=chunk)[289](index=289&type=chunk) [Risks Related to Commercialization](index=62&type=section&id=RISKS%20RELATED%20TO%20OUR%20ABILITY%20TO%20COMMERCIALIZE%20OUR%20PRODUCT%20CANDIDATES) This section addresses challenges in commercializing product candidates, including marketing capabilities, market competition, physician acceptance, reimbursement, and healthcare reforms - The company currently lacks internal marketing, sales, and distribution capabilities and must either build them or secure third-party agreements to successfully commercialize product candidates[299](index=299&type=chunk) - The market for product candidates is highly competitive, with numerous pharmaceutical and biotechnology companies having greater resources and experience, potentially limiting market share and product revenues[302](index=302&type=chunk)[303](index=303&type=chunk) - Physician and patient acceptance of product candidates is crucial for revenue generation, depending on perceived safety, effectiveness, cost-effectiveness, and reimbursement availability[305](index=305&type=chunk) - Obtaining coverage and adequate reimbursement from third-party payors is critical for commercialization, but is difficult to predict for novel gene and cell therapies and subject to cost-control measures[306](index=306&type=chunk)[308](index=308&type=chunk)[310](index=310&type=chunk) - Healthcare legislative reforms, including the ACA and initiatives to reduce drug pricing, could adversely affect the business and profitability by imposing more rigorous coverage criteria and downward pressure on prices[315](index=315&type=chunk)[316](index=316&type=chunk)[319](index=319&type=chunk)[322](index=322&type=chunk) [Risks Related to Intellectual Property](index=69&type=section&id=RISKS%20RELATED%20TO%20OUR%20INTELLECTUAL%20PROPERTY) This section highlights risks concerning patent protection, trade secrets, potential infringement claims, and compliance with license agreements for intellectual property - The company's success depends on obtaining and maintaining patent protection for its products and technologies, which is highly uncertain due to complex legal and factual questions, and potential challenges to patents[332](index=332&type=chunk)[334](index=334&type=chunk)[335](index=335&type=chunk) - Reliance on trade secret protection and confidentiality agreements for proprietary know-how may not provide adequate protection against unauthorized use or disclosure, potentially harming the business and competitive position[341](index=341&type=chunk) - Third-party claims of intellectual property infringement could lead to costly litigation, substantial monetary damages, or prevent the development and commercialization of products[342](index=342&type=chunk)[347](index=347&type=chunk) - Failure to comply with procedural requirements for patent maintenance or any breach of license agreements could result in loss of patent rights or termination of licenses, adversely affecting the business[350](index=350&type=chunk)[352](index=352&type=chunk) [Other Risks Related to Our Company](index=75&type=section&id=OTHER%20RISKS%20RELATED%20TO%20OUR%20COMPANY) This section covers additional company-specific risks, such as stock price volatility, anti-takeover provisions, dividend policy, NOL limitations, and significant stockholder control - The market price for the company's common stock is highly volatile and can fluctuate significantly in response to various factors, including clinical trial results, regulatory approvals, and general market conditions[358](index=358&type=chunk)[359](index=359&type=chunk) - Anti-takeover provisions in charter documents and Delaware law may make an acquisition of the company more difficult, potentially preventing beneficial changes for stockholders[361](index=361&type=chunk) - The company has never paid dividends on its common stock and does not anticipate doing so, meaning investors will only realize income from stock sales[362](index=362&type=chunk) - The ability to use net operating loss carryforwards (NOLs) and research and development tax credits (R&D credits) may be limited by 'ownership changes' under tax laws, potentially increasing future tax payments[363](index=363&type=chunk)[364](index=364&type=chunk) - Principal stockholders, executive officers, and directors collectively own **51.4%** of outstanding common stock, giving them substantial control over corporate decisions and potentially harming the market price[369](index=369&type=chunk) [Risks Related to Indebtedness](index=78&type=section&id=RISKS%20RELATED%20TO%20INDEBTEDNESS) This section details risks associated with the company's debt, including servicing requirements, potential defaults, and restrictive covenants - The company has incurred indebtedness through the SVB Facility, with future funding dependent on performance and ability to raise additional capital; failure to meet milestones could reduce liquidity[372](index=372&type=chunk) - Servicing the debt will require a significant amount of cash, and insufficient funds or inability to obtain additional financing could lead to an event of default, acceleration of payments, and enforcement of security interests in assets[373](index=373&type=chunk)[374](index=374&type=chunk) - Current and future debt financing may impose restrictive covenants on business operations, limiting corporate actions, acquisitions, and the cash available for investment in research and development[375](index=375&type=chunk) [Unregistered Sale of Equity Securities and Use of Proceeds](index=63&type=section&id=Item%202.%20Unregistered%20Sale%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities or use of proceeds to report for the period - No unregistered sales of equity securities or use of proceeds occurred during the period[377](index=377&type=chunk) [Defaults upon Senior Securities](index=63&type=section&id=Item%203.%20Defaults%20upon%20Senior%20Securities) This item is not applicable for the reporting period - This item is not applicable[378](index=378&type=chunk) [Mine Safety Disclosures](index=63&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable for the reporting period - This item is not applicable[379](index=379&type=chunk) [Other Information](index=63&type=section&id=Item%205.%20Other%20Information) This section details recent changes in the company's executive leadership, including the termination of the interim CFO's consulting agreement, the designation of the CEO as principal financial officer, the extension of the principal accounting officer's employment, and the appointment of a new principal accounting officer [Termination of Interim CFO Consulting Agreement](index=79&type=section&id=Termination%20of%20Consulting%20Agreement%20with%20Interim%20Chief%20Financial%20Of%20icer) This section reports the termination of the interim Chief Financial Officer's consulting agreement, effective November 4, 2021 - On **November 4, 2021**, the consulting agreement with Danforth Advisors, LLC, for interim Chief Financial Officer Tim Cunningham's services, was terminated effective immediately[380](index=380&type=chunk) - The termination was not the result of any dispute or disagreement with the company or its Board of Directors[380](index=380&type=chunk) [Designation of Principal Financial Officer](index=79&type=section&id=Designation%20of%20Principal%20Financial%20Of%20icer) This section announces the designation of the Chief Executive Officer as the principal financial officer, effective immediately - Effective immediately, Kevin S. Boyle, Sr., the company's Chief Executive Officer, was designated as its principal financial officer in addition to his role as principal executive officer, with no additional compensation[381](index=381&type=chunk) [Extension of Principal Accounting Officer Employment](index=79&type=section&id=Extension%20of%20Employment%20of%20Principal%20Accounting%20Of%20icer) This section details the extension of the Principal Accounting Officer's employment, with a final departure date of November 9, 2021 - Kevin G. Lafond, Senior Vice President Finance, Chief Accounting Officer, and Treasurer, had his employment extended, with his last day with the company set for **November 9, 2021**, in connection with the company's workforce reduction[382](index=382&type=chunk) [Appointment of Principal Accounting Officer](index=79&type=section&id=Appointment%20of%20Principal%20Accounting%20Of%20icer) This section announces the appointment of Michael Wong as the new principal accounting officer, effective November 9, 2021 - Michael Wong, Vice President, Finance, was designated to serve as the principal accounting officer effective **November 9, 2021**[383](index=383&type=chunk) - Mr. Wong previously served as Director, Technical Accounting at McDermott International, Ltd., and Audit Senior Manager at Ernst & Young LLP, and is a licensed CPA in Texas and Canada[384](index=384&type=chunk) [Exhibits](index=65&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including corporate documents, loan agreements, employment contracts, and certifications - The exhibits include the Amended and Restated Certificate of Incorporation, Warrant to Purchase Shares of Common Stock, Loan and Security Agreement, Employment Agreement for Kevin S. Boyle, Sr., and various certifications[386](index=386&type=chunk) [Signatures](index=82&type=section&id=SIGNATURES) This section contains the required signatures of the principal executive and accounting officers, certifying the accuracy of the report - The report was signed by Kevin S. Boyle Sr., Chief Executive Officer (Principal Executive Officer), and Kevin G. Lafond, Chief Accounting Officer and Treasurer (Principal Accounting Officer), on **November 8, 2021**[389](index=389&type=chunk)

Financial Performance - For the six months ended June 30, 2021, the company reported a net loss of $44.2 million, with an accumulated deficit of approximately $808.3 million since its inception in 2003[138]. - The company has incurred net losses and negative cash flows from operations since inception, with no revenue generated from product sales[167]. - As of June 30, 2021, the accumulated deficit was approximately $808.3 million, indicating ongoing financial challenges[181]. - The company anticipates continued losses for the foreseeable future, impacting cash requirements significantly[181]. Research and Development - Research and development expenses for the three months ended June 30, 2021, increased by 13% to $13.57 million compared to $12.05 million in the same period of 2020[154]. - The increase in research and development expenses for the six months ended June 30, 2021, was primarily due to a $6.4 million increase in headcount and related costs, offset by a $7.3 million decrease in Controlled IL-12 program costs[155]. - The company is developing T cell receptor (TCR) therapies targeting neoantigens in solid tumors, with a Phase 1/2 clinical trial evaluating TCRs from its library[134]. - The FDA cleared the IND application for the Phase 1/2 clinical trial, with patient dosing anticipated in the second half of 2021[141]. - The Controlled IL-12 platform is designed to conditionally produce IL-12 to treat patients with solid tumors, utilizing a gene delivery system[137]. - The company is winding down its existing Controlled IL-12 clinical program for recurrent glioblastoma multiforme while seeking a partner for this program[152]. - The joint venture with Eden BioCell is focused on advancing CAR T cell therapies in Greater China, with two patients treated in a clinical trial[146]. - The estimated timelines for clinical trials are 1-2 years for Phase 1, 2-3 years for Phase 2, and 2-4 years for Phase 3[162]. Financial Resources and Capital - The company continues to seek additional financial resources to fund product development, with potential delays if sufficient capital is not obtained[139]. - A term loan of $25.0 million was secured on August 6, 2021, with an additional $25.0 million available upon meeting certain milestones[173]. - The company expects existing cash and the $25.0 million gross debt proceeds will fund operations into Q4 2022, with no committed sources of additional capital at this time[176]. - The company may need to curtail development efforts if adequate additional funds are not available when required[177]. Cash Flow and Expenses - Net cash used in operating activities for the six months ended June 30, 2021 was $36.8 million, an increase from $23.9 million for the same period in 2020, primarily due to a net loss of $44.2 million[178]. - Net cash used in investing activities was $2.6 million for the six months ended June 30, 2021, compared to $4.0 million for the same period in 2020[179]. - Net cash provided by financing activities was $1.0 million for the six months ended June 30, 2021, a significant decrease from $101.7 million in the same period of 2020[180]. - General and administrative expenses for the three months ended June 30, 2021 increased by 38% to $9.1 million compared to $6.6 million for the same period in 2020[164]. - General and administrative expenses for the six months ended June 30, 2021 increased by 38% to $17.3 million compared to $12.5 million for the same period in 2020[165]. - Working capital decreased to $75.8 million as of June 30, 2021, down from $112.2 million as of December 31, 2020[181]. - Total contractual obligations amounted to $11.5 million as of June 30, 2021, with $2.9 million due within one year[182]. - The company has commitments for operating leases totaling $7.1 million, with $1.2 million due within one year[182]. Operational Challenges - The ongoing COVID-19 pandemic has impacted business operations, potentially delaying clinical programs and timelines[140]. - Other income (expense), net for the three months ended June 30, 2021 was $(31,000), a decrease of 410% compared to $10,000 for the same period in 2020[166]. - The company is realigning resources towards the Sleeping Beauty program, which is expected to reduce cash expenditures on the Controlled IL-12 program[181]. - The company has no off-balance sheet arrangements as defined by SEC regulations[189].

| --- | --- | |--------------------------------------------------------------------------------------------------------------------|-------| | | | | | | | | | | | | | Vishay Precision Group PERFORMANCE THROUGH PRECISION VPG Second Fiscal Quarter 2021 Earnings — August 10, 2021 | | | PERFORMANCE THROUGH PRECISION | | Safe Harbor Statement From time to time, information provided by us, including but not limited to statements in this report, or other statements made by or on our behalf, may contain "forwardloo ...

Financial Data and Key Metrics Changes - The company ended the first half of 2021 with approximately $76.7 million in cash and announced a venture debt facility with Silicon Valley Bank for $50 million, with an immediate drawdown of $25 million, extending the cash runway into the fourth quarter of 2022 [10][11][12] Business Line Data and Key Metrics Changes - The company achieved key milestones in its TCR-T program, including the commissioning of a cGMP clinical production unit and completion of aseptic process validation, enabling the facility to be used for the Phase 1/2 TCR-T library trial [8][14] - The Phase 1/2 trial is targeting six solid tumor indications, including cholangiocarcinoma, pancreatic, ovarian, endometrial, colorectal, and lung cancer, with plans to expand the indications in the future [15][21] Market Data and Key Metrics Changes - The company is focused on establishing in-house cGMP clinical production capabilities to provide greater flexibility and control over clinical development, which is expected to mitigate risks and increase capacity for clinical trial activities [18][19] Company Strategy and Development Direction - The company is directing all efforts towards the TCR program and remains optimistic about its potential, emphasizing that success will depend on scientific and clinical data rather than operational challenges [9][12] - The company is also considering broader partnerships for the development of its CD19 RPM CAR-T cell therapy, with several parties expressing interest [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's position and progress, stating that the current market valuation does not reflect the company's potential and that continued execution is the best way to demonstrate its value [11][12] - The search for a permanent CEO is nearing completion, with an announcement expected soon [13] Other Important Information - The company plans to provide updates on its TCR-T library later in the year and has shared preclinical data that supports the efficacy of its TCR program [20][25] Q&A Session Summary Question: Can you discuss the current manufacturing process in Taiwan and any leverage from TCR-T experience? - The manufacturing process in Taiwan utilizes a rapid personalized manufacturing process (RPM) with Sleeping Beauty for genetic transfer, performed by the TriArm team at a cGMP facility [27][30] - Insights gained from the TCR process may help improve the CAR-T process, as the TCR process is more mature and has had more years of development [32]

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