Can-Fite(CANF) - 2024 Q4 - Annual Report

Financial Performance - The company has incurred net losses of approximately $7.9 million in 2024, $7.6 million in 2023, and $10.1 million in 2022, with an accumulated deficit of approximately $166.4 million as of December 31, 2024[40]. - The company anticipates continuing to incur substantial operating losses for the foreseeable future due to ongoing research and development activities[40]. - The company has incurred significant losses in connection with its research and development efforts since inception[219]. - The company has not declared or paid any cash dividends on its ordinary shares and does not expect to do so in the foreseeable future[193]. Cash and Capital Requirements - As of December 31, 2024, the company had cash and cash equivalents of $4.8 million and short-term deposits of $3.1 million, and raised approximately $5.0 million in gross proceeds in August 2024[42]. - The company has entered into an At The Market Offering Agreement, resulting in approximately $3.06 million in gross proceeds as of March 31, 2025[42]. - The company may need to raise additional capital in the future, which could be costly or difficult to obtain and may dilute current shareholders' ownership interests[42]. - The company’s future capital requirements will depend on various factors, including the progress of clinical trials and regulatory reviews[44]. Product Development and Pipeline - The current product pipeline includes three molecules: Piclidenoson, Namodenoson, and CF602, with Piclidenoson being the most advanced[32]. - The company has not yet commercialized any products or technologies and may never achieve profitability[50]. - The company has not yet achieved market acceptance for its product candidates, which is critical for future profitability[51]. - The company is conducting pivotal Phase III trials for Piclidenoson in psoriasis and Namodenoson in advanced liver cancer, with patient enrollment ongoing[219]. Regulatory Challenges - The company may face challenges in obtaining regulatory approvals for its product candidates, which could impact its ability to commercialize products[50]. - The company has not received regulatory approval for any of its product candidates, which may significantly impact its ability to commercialize products and generate revenue[53]. - Regulatory authorities may require additional pre-clinical testing or clinical trials, delaying the approval process and impacting revenue generation[54]. - The FDA requires completion of clinical trials to establish safety and efficacy before approving a New Drug Application (NDA), and significant delays in testing could increase product development costs[122]. Competition and Market Risks - The company faces significant competition from larger pharmaceutical and biotechnology companies, which have greater financial resources and experience in drug development[77]. - The competitive environment and pricing policies from government and third-party payors could limit the commercial viability of the company's products[52]. - The commercial success of approved products will depend on acceptance by the medical community, influenced by factors such as clinical safety, efficacy, and convenience[130]. Intellectual Property and Legal Risks - The company faces uncertainties regarding patent protection, which could affect competitive positioning and market exclusivity[102]. - Litigation related to intellectual property rights could incur significant costs and impact operational capabilities[107]. - The Brazilian drug regulatory agency, ENVISA, can nullify patents based on public interest, and Indian patent law does not allow patent protection for new uses of pharmaceuticals[113]. Operational and Compliance Risks - The company does not currently have sales, marketing, or distribution capabilities, which could materially adversely affect its business and results of operations[70]. - The company is dependent on third parties for the supply of materials needed for manufacturing, and any issues could delay clinical trials and regulatory approvals[74]. - Compliance with healthcare and data privacy laws is critical, as violations can lead to severe penalties and operational disruptions[157]. Management and Governance - Key management and technical personnel are crucial for the company's success, and failure to retain them could adversely affect operations[75]. - The company amended its articles of association to establish a staggered board, complicating shareholder efforts to replace board members[187]. - As a foreign private issuer, the company is permitted to follow certain home country corporate governance practices, which may provide less protection to investors compared to domestic issuers[205]. Economic and Geopolitical Factors - Inflation has increased costs for commodities, labor, and materials, adversely impacting financial condition and operations[182]. - Political instability in Israel, including recent military conflicts, may adversely affect business conditions and the company's financial performance[169]. - Geopolitical developments and global supply chain disruptions contribute to economic uncertainty, affecting financing costs and availability[181].