Financial Performance - For the year ended December 31, 2023, the company generated a net loss of $73.4 million, with accumulated deficits reaching $209.0 million as of June 30, 2024[87]. - License revenue for the three months ended June 30, 2024 was $0, a decrease of $334,000 compared to $334,000 in the same period of 2023[121]. - For the six months ended June 30, 2024, the company reported a net loss of $32.5 million, an improvement of $9.6 million compared to a net loss of $42.0 million for the same period in 2023[130]. - The company expects to continue incurring significant losses and negative cash flows from operations for the foreseeable future, with an accumulated deficit of $209.0 million as of June 30, 2024[150]. Research and Development - The company has prioritized two key product candidates: VTP-300 for chronic hepatitis B in Phase 2 and VTP-1000 for celiac disease in preclinical stage[82]. - Interim data from the Phase 2b trial of VTP-300 showed nearly 20% of participants had undetectable HBsAg, with 76% eligible for NUC discontinuation[96]. - Research and development expenses are expected to increase as the company advances its product candidates through clinical development[105]. - The company has partnerships to advance three additional product candidates, including VTP-500 for MERS and VTP-400 for Zoster[84]. - Research and development expenses totaled $11.7 million for the three months ended June 30, 2024, compared to $13.5 million in 2023, reflecting a decrease of $1.9 million[122]. - Direct research and development expenses decreased to $6.4 million in Q2 2024 from $9.6 million in Q2 2023, a decline of $3.2 million[123]. - Research and development expenses for the six months ended June 30, 2024, were $22.8 million, slightly down from $23.4 million in 2023, a decrease of $0.6 million[131]. - Direct research and development expenses decreased to $12.3 million for the six months ended June 30, 2024, from $15.4 million in 2023, a reduction of $3.1 million[132]. - Indirect research and development expenses increased to $10.5 million for the six months ended June 30, 2024, compared to $7.9 million in 2023, an increase of $2.6 million[133]. Operating Expenses - Total operating expenses decreased to $18.9 million for the three months ended June 30, 2024, down from $26.7 million in 2023, a reduction of $7.8 million[121]. - Total operating expenses decreased to $36.0 million for the six months ended June 30, 2024, down from $48.6 million in 2023, reflecting a reduction of $12.6 million[130]. - General and administrative expenses were $7.2 million for the three months ended June 30, 2024, down from $13.1 million in 2023, a decrease of $5.9 million[125]. - General and administrative expenses significantly decreased to $13.2 million for the six months ended June 30, 2024, from $25.3 million in 2023, a reduction of $12.1 million[134]. Cash and Funding - As of June 30, 2024, the company had cash, cash equivalents, and restricted cash totaling $117.8 million[139]. - The company expects to fund its operating expenses and capital expenditure requirements into Q2 2026 with existing cash and equivalents of $117.8 million as of June 30, 2024[155][167]. - The company anticipates that existing cash resources will fund operations into the second quarter of 2026, based on current assumptions[89]. - Future capital requirements may significantly change based on the outcomes of product candidate developments, necessitating additional funds through equity offerings, debt financing, or collaborations[154]. Contingent Liabilities and Risks - The company recognized a contingent consideration liability related to the acquisition of Avidea, with potential additional payments of up to $40.0 million upon achieving certain milestones[120]. - The company faces potential contingent payment obligations upon achieving clinical, regulatory, and commercial milestones, though amounts and timing are uncertain as of June 30, 2024[160]. - A 10% weakening of the US dollar against the pound sterling could materially affect current and projected expenses denominated in pounds[166]. - The company is exposed to foreign currency exchange rate fluctuations, particularly with the euro, pound sterling, Swiss franc, and Australian dollar[164]. Strategic Plans - The company plans to pursue clinical and preclinical development of current product candidates and advance additional candidates into development[153]. - The company aims to establish manufacturing capabilities and scale-up production to support clinical trials and commercialization efforts[153]. - The company may need to relinquish rights to technologies or revenue streams if additional funds are raised through collaborations or licensing arrangements[156]. Accounting and Compliance - The company is classified as an emerging growth company, allowing it to delay the adoption of certain accounting standards[161][162]. - From April 2023, the SME cash rebate was reduced from an effective rate of 33.4% to 18.6%, impacting future claims for research and development tax credits[113]. Other Income - Other operating income was $0.6 million for the three months ended June 30, 2024, compared to nil in the same period of 2023, resulting from funding provided by CEPI[126]. - The company reported other operating income of $0.8 million for the six months ended June 30, 2024, compared to nil in 2023, due to funding from CEPI[135]. Interest Income - Interest income increased to $0.6 million for the three months ended June 30, 2024, compared to $0.5 million in 2023, an increase of $0.1 million[127].

Financial Performance - For the year ended December 31, 2023, the company generated a net loss of $73.4 million, following a net income of $5.3 million for the year ended December 31, 2022[84]. - For the three months ended March 31, 2024, total revenue was $0, a decrease of $468,000 compared to $468,000 in the same period of 2023[123]. - The net loss for the three months ended March 31, 2024, was $15.52 million, an improvement of $2.70 million compared to a net loss of $18.22 million in the same period of 2023[123]. - Interest income for the three months ended March 31, 2024, was $775,000, a decrease of $813,000 from $1.59 million in the same period of 2023[123]. - Other operating income for Q1 2024 was $0.2 million, attributed to funding from CEPI, while there was no such income in Q1 2023[130]. - Interest income decreased to $0.8 million in Q1 2024 from $1.6 million in Q1 2023, reflecting lower interest earned on short-term cash deposits[131]. - Research and development incentives fell to $0.6 million in Q1 2024 from $1.2 million in Q1 2023, related to UK corporation tax relief[132]. Cash Flow and Financial Position - As of March 31, 2024, the company had an accumulated deficit of $192.1 million and does not expect positive cash flows from operations in the foreseeable future[84]. - Net cash used in operating activities was $11.8 million in Q1 2024, compared to $3.2 million in Q1 2023, primarily due to a net loss of $15.5 million[138][139]. - As of March 31, 2024, the company had cash, cash equivalents, and restricted cash totaling $130.0 million, with gross proceeds from share issuances amounting to approximately $328.4 million since inception[134]. - The accumulated deficit reached $192.1 million as of March 31, 2024, with expectations of continued significant losses and negative cash flows for the foreseeable future[145]. - The company expects existing financial resources to fund operations into Q4 2025, although this is subject to change based on actual cash usage[150]. Research and Development - The Phase 1b/2 APOLLO trial of VTP-200 showed a highest hrHPV clearance rate of 60% at Month 12 in the highest dose group, compared to 33% in the placebo group[93]. - The highest cervical lesion clearance rate of 67% was observed in the highest dose group of the APOLLO trial, compared to 39% in the placebo group[94]. - The company received IND clearance from the FDA for VTP-1000 to progress to a first-in-human clinical trial in Celiac disease[90]. - Research and development expenses are expected to increase in the future as the company continues to advance its clinical programs[104]. - Direct research and development expenses totaled $5.84 million for the three months ended March 31, 2024, slightly up from $5.80 million in the same period of 2023[125]. - Indirect research and development expenses increased to $5.29 million for the three months ended March 31, 2024, compared to $4.02 million in the same period of 2023, an increase of $1.27 million[128]. Operating Expenses - Research and development expenses increased to $11.1 million for the three months ended March 31, 2024, up from $9.8 million in the same period of 2023, representing a $1.3 million increase[126]. - General and administrative expenses decreased to $5.99 million for the three months ended March 31, 2024, down from $12.14 million in the same period of 2023, a reduction of $6.14 million[123]. - The company expects general and administrative expenses to continue to rise as it expands operations in the UK and US and prepares for manufacturing and commercialization of product candidates[107]. - General and administrative expenses decreased to $6.0 million for Q1 2024 from $12.1 million in Q1 2023, primarily due to a foreign exchange gain of $1.2 million compared to a loss of $3.5 million in the prior year[129]. - The company reported total operating expenses of $17.12 million for the three months ended March 31, 2024, down from $21.95 million in the same period of 2023, a decrease of $4.83 million[123]. Financing and Future Outlook - The company anticipates financing future cash needs through public or private equity offerings, debt financings, collaborations, and licensing arrangements[86]. - Future capital requirements will depend on various factors, including the success of product candidates and the ability to generate revenue, with potential needs for additional financing[149]. - The company is classified as an emerging growth company, allowing it to delay the adoption of certain accounting standards[155]. Geopolitical and Market Risks - The company has no operations or suppliers based in Israel, Gaza, Ukraine, Belarus, or Russia, minimizing the impact of geopolitical conflicts on its business[98][99]. - The company is subject to foreign currency exchange rate fluctuations, particularly with the euro, pound sterling, Swiss franc, and Australian dollar[158]. - A hypothetical 10% weakening of the US dollar against the pound sterling would have resulted in an immaterial change to expenses for the three months ended March 31, 2024[160]. - The company does not currently face significant market risk related to interest rate changes, as it has no significant interest-bearing liabilities[161]. - A hypothetical 10% relative change in interest rates would not have materially impacted the company's financial statements[162].

Financial Performance - For the year ended December 31, 2022, the company generated net income of $5.3 million, primarily due to revenues from AstraZeneca sales of Vaxzevria and an agreement with OUI[312]. - For the year ended December 31, 2023, the company incurred net losses of $73.4 million, with an accumulated deficit of $176.6 million as of December 31, 2023[312][325]. - The company expects to incur losses for at least the next several years and does not anticipate achieving profitability or positive cash flows from operations in the foreseeable future[312][324]. - As of December 31, 2023, the company had cumulative carryforward tax losses of approximately $92.7 million, up from $39.6 million in 2022[447]. - The company is subject to U.K. corporate taxation and has not paid any U.K. corporation tax due to generated losses since inception[447]. Cash and Funding Requirements - As of December 31, 2023, the company's cash and cash equivalents were $142.1 million, which is expected to support operations into the fourth quarter of 2025 without additional financing[325]. - The company may need to raise substantial additional funding in the future to support ongoing operations and product development[332]. - The company anticipates future capital requirements will depend on the scope and costs of preclinical development and clinical trials for product candidates[334]. - The company may need to pursue additional financing through public or private equity offerings, debt financings, or collaborations to support operations[335]. - Recent volatility in capital markets may affect the company's ability to access new capital, potentially harming liquidity and growth opportunities[336]. Operational and Development Challenges - The company plans to expand operational, financial, and management systems, and increase personnel to support clinical development and commercialization efforts[317]. - The company faces significant translational risk as promising preclinical results may not be replicated in clinical trials, impacting revenue generation[318]. - The company anticipates increased operating expenses and cash requirements as it continues its preclinical and clinical development activities[332]. - The company may evaluate acquisitions and strategic partnerships in the future, which could increase capital requirements and dilute shareholders[320]. - The company has paused the development of its HPV cancer candidate VTP-1100 to prioritize other pipeline candidates[349]. Clinical Development Risks - The company may experience significant delays or inability to commercialize product candidates if clinical trials do not meet safety and efficacy profiles[349]. - The company is facing potential delays in clinical trials due to regulatory reviews and requirements, as seen with the HBV002 clinical trial in South Korea[352]. - Clinical trials may require larger participant numbers than anticipated, and enrollment may be slower or have higher dropout rates than expected[357]. - The company may encounter significant delays or increased costs if clinical trials produce negative or inconclusive results, leading to additional trials or abandonment of research[353]. - The company’s product candidates are based on a novel approach, making it difficult to predict development timelines and costs, which could lead to significant delays or unanticipated costs[363]. Regulatory and Compliance Issues - Regulatory authorities may impose extensive post-approval requirements for novel immunotherapies, requiring significant time and resources for compliance[365]. - The company faces risks related to the financial services industry, including potential liquidity issues and defaults by financial institutions[337]. - Compliance with FDA and foreign regulatory authority regulations is critical, and any failure could result in delays or termination of clinical programs[421]. - The marketing authorization process is lengthy and unpredictable, with no current product candidates having received approval[424]. - The FDA requires 6 months' notice for any changes in marketing status of approved drugs, with non-compliance potentially leading to product withdrawal from the market[454]. Market and Competitive Landscape - The company may face substantial competition from various sources, including major pharmaceuticals and biotechnology companies, which could impact its market position[383]. - Product candidates will compete with existing and new therapies, and key features such as safety and efficacy will affect competitiveness[385]. - The market opportunities for certain oncology product candidates may be limited to patients ineligible for or who have failed prior treatments, affecting profitability[375]. - The company must demonstrate safety, potency, purity, and efficacy through lengthy and expensive clinical trials, with a high risk of failure[388]. - The company may not be able to maintain market acceptance of its products over time if new, more effective treatments are introduced[396]. Intellectual Property and Legal Risks - The company relies heavily on in-licensed patents and does not own any issued patents for its product candidates, which could adversely affect its competitive position[491]. - The patent prosecution process is expensive and time-consuming, and failure to identify patentable aspects in time could jeopardize patent protection[493]. - The company may face significant challenges in protecting its trade secrets, which could harm its competitive position if disclosed[501]. - The interpretation and enforcement of intellectual property laws are uncertain, which could affect the company's ability to protect its inventions and technologies[492]. - The risk of non-compliance with data protection laws could lead to government enforcement actions and significant fines, impacting the company's operations and financial results[489]. Data Protection and Privacy Compliance - The company must comply with the GDPR and other data protection laws, which impose strict requirements on the processing of personal data, potentially increasing compliance costs[475]. - The CCPA and CPRA impose new privacy compliance obligations that could significantly affect the company's data collection practices and increase exposure to regulatory enforcement[481]. - New state privacy laws in the U.S. may broaden the scope of compliance requirements, impacting operational practices and increasing potential liability for the company[482]. - The company faces increasing compliance costs and legal risks due to the complexity of privacy laws across different jurisdictions, which may require additional resources for compliance programs[484]. - In the EU and UK, potential fines for non-compliance with data protection laws can reach up to €20 million or 4% of annual global revenue, whichever is greater[486].

Financial Performance - For the nine months ended September 30, 2023, the company incurred a net loss of $56.2 million, with an accumulated deficit of $159.3 million[85]. - Revenue for the three and nine months ending September 30, 2023 was $Nil and $0.8 million, respectively, compared to $6.2 million and $38.2 million for the same periods in 2022[101]. - Revenue from licenses, grants, and services was $0 for the three months ended September 30, 2023, compared to $6,165,000 for the same period in 2022, a decrease of $6,165,000[131]. - The net loss for the three months ended September 30, 2023, was $14,110,000, compared to a net income of $8,221,000 in 2022, a decrease of $22,331,000[131]. - For the nine months ended September 30, 2023, revenue was $0.8 million, a decrease of 97.9% from $38.2 million in 2022[144]. - General and administrative expenses for the nine months ended September 30, 2023, were $26.2 million, compared to a gain of $13.0 million in 2022, reflecting a significant shift due to foreign exchange impacts[148][149]. - The company does not expect positive cash flows from operations in the foreseeable future, anticipating continued net negative cash flows as it progresses clinical development[155]. - For the nine months ended September 30, 2023, net cash used in operating activities was $31.3 million, primarily due to a net loss of $56.2 million[158]. - The company had an accumulated deficit of $159.3 million as of September 30, 2023, and expects to continue incurring significant losses and negative cash flows[163]. Expenses - Research and development expenses increased to $15,144,000 for the three months ended September 30, 2023, up from $9,744,000 in 2022, an increase of $5,400,000[131]. - Total operating expenses for the three months ended September 30, 2023, were $16,105,000, compared to a loss of $1,071,000 in 2022, resulting in a change of $17,176,000[131]. - Total research and development expenses for the three months ended September 30, 2023, were $15.1 million, an increase of 55.4% from $9.7 million in 2022[135]. - Direct research and development expenses increased to $11.6 million in Q3 2023 from $6.7 million in Q3 2022, with a notable increase of $2.5 million for VTP-300 HBV due to clinical trial costs[136]. - General and administrative expenses were $961,000 for the three months ended September 30, 2023, compared to a gain of $10,815,000 in 2022, a change of $11,776,000[131]. - General and administrative expenses for Q3 2023 were $1.0 million, significantly lower than a gain of $10.8 million in Q3 2022, primarily due to a foreign exchange gain[138][139]. Cash Flow and Financing - As of September 30, 2023, the company had cash and cash equivalents of $160.3 million, with total gross proceeds from share issuances amounting to approximately $327.6 million since inception[153]. - Cash used in investing activities for the nine months ended September 30, 2023, was $5.6 million, primarily for capital expenditures related to a new office[160]. - Cash provided by financing activities for the nine months ended September 30, 2023, was $1.8 million, mainly from the issuance of ordinary shares[161]. - The effect of foreign exchange on cash and cash equivalents resulted in a gain of $1.0 million for the nine months ended September 30, 2023[162]. - The company expects existing cash and cash equivalents will fund operating expenses into the second quarter of 2025[170]. Product Development - The company has five product candidates in its pipeline, including VTP-300 and VTP-200, both in Phase 2 clinical trials[78]. - The company has partnerships to advance three additional product candidates in MERS, Zoster, and NSCLC[79]. - The company plans to pursue clinical and preclinical development of current product candidates and expand operational capabilities[166]. - The company expects general and administrative expenses to continue to increase as it expands operations in the UK and US and prepares for manufacturing and commercialization of product candidates[106]. Corporate Actions - The company completed its IPO on May 4, 2021, raising net proceeds of $102.8 million from the sale of 6,500,000 ADSs at $17.00 per ADS[81]. - The company announced a name change to Barinthus Biotherapeutics plc on November 6, 2023, reflecting its expanded focus beyond vaccines[96]. - The company has filed a Registration Statement for the potential future issuance of ordinary shares amounting to up to $200.0 million[84]. - The company acquired Avidea for an upfront amount of $32.8 million, with potential additional payments of up to $40 million based on milestone achievements[127]. - The fair value of contingent consideration related to the Avidea acquisition is reassessed at each reporting date, impacting general and administrative expenses[127]. Geopolitical Considerations - The company has no operations or suppliers based in Israel, Gaza, Ukraine, Belarus, or Russia, minimizing the impact of geopolitical conflicts on its business[97][98].

Financial Performance - For the six months ended June 30, 2023, the company incurred a net loss of $42.0 million, with an accumulated deficit of $145.2 million[81]. - The company recognized $0.3 million and $0.8 million in revenue for the three and six months ended June 30, 2023, respectively, compared to $17.1 million and $32.1 million for the same periods in 2022[79]. - Revenue for the three and six months ending June 30, 2023, was $0.3 million and $0.8 million, respectively, compared to $17.1 million and $32.1 million for the same periods in 2022, indicating a significant decline in revenue[104]. - The net loss for the three months ended June 30, 2023, was $23.8 million, compared to a net income of $15.7 million for the same period in 2022, representing a decrease of $39.5 million[133]. - For the six months ended June 30, 2023, revenue was $0.8 million, a significant decrease of $31.3 million from $32.1 million in the same period of 2022[145]. Operating Expenses - Total operating expenses for the three months ended June 30, 2023, were $26.7 million, an increase of $22.8 million compared to $3.8 million in the same period of 2022[133]. - Total operating expenses for the six months ended June 30, 2023, were $48.6 million, an increase of $30.4 million compared to $18.3 million in the same period of 2022[144]. - Research and development expenses for the three months ended June 30, 2023, were $13.5 million, up from $9.7 million in the same period of 2022, reflecting an increase of $3.8 million[136]. - Research and development expenses for the six months ended June 30, 2023, were $23.4 million, an increase of 14.4% from $20.4 million in the same period of 2022[147]. - General and administrative expenses for the six months ended June 30, 2023, were $25.3 million, compared to a gain of $2.2 million in 2022, largely due to a foreign exchange loss of $7.7 million[150][151]. Cash Flow and Funding - As of June 30, 2023, the company had cash and cash equivalents of $173.0 million, with gross proceeds from share issuances totaling approximately $329.0 million since inception[155]. - Net cash used in operating activities was $20.1 million for the six months ended June 30, 2023, compared to $15.0 million in 2022[160][161]. - The company anticipates continued significant losses and negative cash flows from operations for the foreseeable future, with an accumulated deficit of $145.2 million as of June 30, 2023[165]. - Future funding requirements will be substantial to support ongoing research, development, and commercialization efforts, with potential needs for additional financing[167][168]. - The company expects its existing cash and cash equivalents to fund operating expenses and capital expenditures into Q2 2025[172]. Research and Development - The company has a broad pipeline including VTP-300 for chronic hepatitis B, VTP-200 for HPV, and VTP-850 for prostate cancer, among others[77]. - VTP-200 showed a response in 26 of 29 women receiving varying doses, with an average of over 1,000 spot-forming units per million peripheral blood mononuclear cells[85]. - VTP-300 demonstrated durable reductions in Hepatitis B Surface Antigen (HBsAg) in participants, with some achieving non-detectable levels eight months post-final dose[90][95]. - Interim data from the Phase 2b clinical trial (HBV003) is expected in the fourth quarter of 2023, with over 60% of the 120 participants enrolled to date[98]. - The company plans to modify enrollment criteria in the ongoing HBV003 study to focus on patients with HBV surface antigen levels of less than 200 IU/mL[98]. Economic and Market Conditions - Global economic conditions and inflationary pressures could adversely affect the company's future financing capability and operating costs[102]. - The company has assessed the impact of the Ukraine crisis as minimal, with no operations or suppliers based in affected regions[101]. - A hypothetical 10% weakening of the US dollar against the pound sterling would have increased expenses by approximately $2.7 million for the three months ended June 30, 2023[183]. - The company is subject to foreign currency exchange rate fluctuations, particularly with the euro, pound sterling, Swiss franc, and Australian dollar[181]. - The company faces significant operating costs in the UK, which exposes it to currency exchange rate risks[183]. Acquisitions and Contingent Obligations - The company acquired Avidea for an upfront amount of $32.8 million, with an additional contingent consideration of up to $40.0 million based on milestone achievements[130]. - Goodwill related to the acquisition of Avidea was $12.2 million as of June 30, 2023, with no impairment losses recognized during the period[132]. - The company has contingent payment obligations tied to clinical, regulatory, and commercial milestones, but the amounts and timing are uncertain as of June 30, 2023[177]. Tax and Regulatory Considerations - The company benefits from the UK research and development tax credit regime, with potential cash rebates of up to 33.35% of qualifying expenditures[113]. - The SME program has seen a reduction in the additional deduction from 130% to 86% and the cash rebate from 33.35% to 18.6% as of April 2023[115]. - The company is classified as an emerging growth company and may delay the adoption of certain accounting standards[178].

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 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, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-40367 VACCITECH PLC (Exact Name of Registrant as Specified in its Charter) | England and Wales | Not Applicable ...

Financial Performance - The company reported a net income of $5.3 million for the year ended December 31, 2022, following a net loss of $51.1 million for the year ended December 31, 2021[302]. - As of December 31, 2022, the company had an accumulated deficit of $103.2 million[302]. - The company does not expect to achieve profitability or positive cash flows from operations in the foreseeable future[302]. - The company has not yet generated any material revenue from its product candidates and relies on successful completion of clinical development and marketing authorization to generate revenue[313]. - The company is in the early stages of development and has incurred significant losses since inception, with expectations of continued losses for several years[302]. - As of December 31, 2022, the company had cash and cash equivalents of $194.4 million, which is expected to support operations into the first quarter of 2025 without additional financing[324]. - The company anticipates an increase in expenses related to planned operations and expects to finance future cash needs through public or private equity offerings, debt financings, collaborations, and licensing arrangements[327]. - The company may need to raise substantial additional funding in the future to support ongoing research and development activities, particularly for preclinical and clinical trials[330]. - The company has several product candidates in early stages of development, including VTP-300, VTP-200, VTP-850, VTP-600, VTP-1100, and VTP-1000, which require extensive preclinical and clinical testing[346]. Clinical Development and Regulatory Challenges - The company is engaged in ongoing preclinical studies and clinical trials for its product candidates, which may require substantial investment and regulatory approvals[314]. - The company has not yet demonstrated the ability to successfully complete clinical trials beyond Phase 2b or to manufacture a commercial-scale product[321]. - The company anticipates that unforeseen expenses and complications may arise as it transitions from a research-focused entity to one capable of supporting commercial activities[322]. - The success of the company's product candidates is uncertain, and commercial revenues may not be generated for many years, necessitating continued reliance on additional financing[334]. - The company may face significant limitations on its ability to invest in operations if it cannot secure adequate financing on favorable terms[344]. - The company faces risks related to clinical trial delays, regulatory approvals, and the need for substantial investment in marketing and manufacturing[348]. - The company has experienced delays in its HBV002 clinical trial in South Korea due to additional regulatory review[349]. - The company may encounter significant delays or inability to complete clinical trials due to unforeseen events, including adverse safety issues or regulatory changes[350]. - The company’s ability to generate revenues is contingent upon successful completion of clinical trials and obtaining marketing authorizations from regulatory authorities[357]. - The company’s product candidates may face increased regulatory scrutiny and public perception challenges due to adverse events reported in related products, such as Vaxzevria[353]. - The company is dependent on its regional partner, CanSino Biologics, for conducting a Phase 1 clinical trial of VTP-400 for herpes zoster prevention[406]. - The regulatory pathway for product candidates is complex and may involve significant costs and time, with the potential for failure at any stage[389]. - The FDA, EMA, and other regulatory authorities have substantial discretion in the approval process, which may affect the marketing authorization of product candidates[431]. Market and Competitive Landscape - The biotechnology and pharmaceutical industries are characterized by intense competition, with many competitors having significantly greater financial resources and expertise in research and development[384]. - Product candidates will compete against existing therapies and new therapies, including antivirals, immune modulators, and various vaccine technologies[385]. - Market acceptance of product candidates is crucial for revenue generation, and factors influencing acceptance include safety, efficacy, and competitive advantages over alternative treatments[395]. - The company currently lacks marketing and sales capabilities, which may hinder revenue generation if product candidates are approved[400]. - The company may face increased regulatory scrutiny and potential delays in marketing approval due to adverse developments in the biopharmaceutical industry[380]. - The company may not be able to secure sufficient manufacturing capacity due to competition for limited resources among contract manufacturers[420]. Financial and Tax Considerations - As of December 31, 2022, the company had cumulative carryforward tax losses of approximately $39.6 million, down from $40.9 million in 2021[450]. - The UK corporate tax legislation limits the use of loss carryforwards to £5.0 million plus an incremental 50% of UK taxable profits each year[450]. - Recent changes to the UK R&D tax relief legislation may reduce the R&D cash rebate rate under the SME Program and introduce restrictions on relief for subcontracted R&D activities[453]. - The company may benefit from the UK's "patent box" regime, allowing certain profits from patented products to be taxed at an effective rate of 10%[454]. - Changes in tax laws and regulations could materially affect the company's financial condition and results of operations[448]. - The company may face increased tax liabilities if tax authorities disagree with its tax positions or interpretations[449]. Compliance and Regulatory Risks - Compliance with Good Clinical Practice (GCP) regulations is essential, as failure to comply may result in unreliable clinical data and delays in marketing authorization[408]. - The company is subject to various healthcare fraud and abuse laws, which could result in significant penalties if not complied with[473]. - Environmental, health, and safety regulations pose risks that could lead to fines or penalties, adversely affecting business success[478]. - Compliance with GDPR and UK GDPR imposes strict requirements on data protection, including mandatory data breach notifications and impact assessments for high-risk processing[482]. - The complexity of varying privacy laws across jurisdictions may lead to increased legal risks and operational challenges for the company[490]. Strategic Partnerships and Collaborations - The company may pursue acquisitions or strategic partnerships, which could increase capital requirements and dilute shareholders[317]. - Collaborations and strategic alliances may require significant non-recurring charges and could dilute existing shareholders[411]. - The company faces significant competition in establishing strategic partnerships, which may delay the development and commercialization of its product candidates[412].