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Altamira Therapeutics (CYTOF) Risk Analysis
Risk Overview Q4, 2023
Source: the company's latest filing for the period ended Dec 31, 2023, filed Apr 10, 2024
Risk Change Over Time
- Debt & Financing - Risk 1We expect that we will need substantial additional funding before we can expect to become profitable from out-licensing our RNA delivery platforms and product candidates, and there is substantial doubt about our ability to continue as a going concern. If we are unable to raise capital when needed, we could be forced to delay, reduce or eliminate our research and development programs.
We expect our research and development expenses to remain significant as we continue to develop our RNA delivery platforms and advance or initiate the pre-clinical and clinical development of AM-401, AM-411 or any other product candidate. We expect our total additional cash need in 2024 to be in the range of CHF 6.5 to 7.5 million. As of December 31, 2023, our cash and cash equivalents were CHF 0.6 million. Our assumptions may prove to be wrong, and we may have to use our capital resources sooner than we currently expect. To the extent that we will be unable to generate sufficient cash proceeds from the planned divestiture or partnering of our AM-125 development program and from our 49% stake in our associated company Altamira Medica AG or other partnering activities, we will need substantial additional financing to meet these funding requirements. These factors raise substantial doubt about the Company's ability to continue as a going concern. The financial statements included in this report have been prepared on a going concern basis, which contemplates the continuity of normal activities and realization of assets and settlement of liabilities in the normal course of business. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. The lack of a going concern assessment may negatively affect the valuation of the Company's investments in its subsidiaries and result in a revaluation of these holdings. The board of directors will need to consider the interests of our creditors and take appropriate action to restructure the business if it appears that we are insolvent or likely to become insolvent. Our future funding requirements will depend on many factors, including but not limited to: - the scope, rate of progress, results and cost of our nonclinical testing and other related activities;- the cost of sourcing key ingredients for our RNA delivery programs and of manufacturing our product candidates and any products that we may develop;- the scope of the further development of our RNA delivery platforms and the number and characteristics of product candidates that we pursue;- the terms and timing of any collaborative, licensing, and other arrangements that we may establish, including any required milestone and royalty payments thereunder. We expect that we will require additional funding to continue the research and development program for our RNA delivery platforms and our product candidates AM-401 and AM-411. We also expect to continue to incur additional costs associated with operating as a public company. Additional funds may not be available on a timely basis, on favorable terms, or at all, and such funds, if raised, may not be sufficient to enable us to continue to implement our long-term business strategy. If we are not able to raise capital when needed, we could be forced to delay, reduce or eliminate our research and development programs, which could materially harm our business, prospects, financial condition and operating results. This could then result in bankruptcy, or the liquidation of the Company.
- Corporate Activity and Growth - Risk 2We may seek to form additional strategic alliances in the future with respect to our RNA delivery platforms and drug product candidates, and if we do not realize the benefits of such alliance, our business, financial condition, commercialization prospects and results of operations may be materially adversely affected.
The development programs for our RNA delivery platforms and product candidates will require substantial additional cash to fund expenses and may require expertise, such as strategic business development expertise, which we do not currently possess. For example, we currently do not intend to continue the development of our AM-401 and AM-411 product candidates beyond the clearance by regulatory agencies for testing in humans or phase 1 clinical trials. Therefore, in addition to our relationship with WU, we may decide to enter into strategic alliances, or create joint ventures or collaborations with pharmaceutical or biopharmaceutical companies for the further development of those product candidates or out-license rights to third parties to use our RNA delivery platform for the development of their own drug products. We face significant competition in seeking appropriate collaborators. Collaborations are complex and time-consuming to negotiate and document. Any delays in entering into new strategic partnership agreements related to our RNA delivery platforms or product candidates could delay their further development and reduce their competitiveness. We may also be restricted under existing and future collaboration agreements from entering into strategic partnerships or collaboration agreements on certain terms with other potential collaborators. We may not be able to negotiate collaborations on acceptable terms, or at all, for any of our existing or future RNA delivery platforms and product candidates because the potential partner may consider that our research and development pipeline is insufficiently developed to justify a collaborative effort, or that our product candidates and programs do not have the requisite potential to demonstrate safety and efficacy in the target population. If we are unsuccessful in establishing and maintaining a collaboration with respect to a particular RNA delivery platform or product candidate, we may have to curtail the development of that RNA delivery platform or product candidate, reduce the scope of or delay its development program or one or more of our other development programs, delay its potential commercialization, or increase our expenditures and undertake development or commercialization activities at our own expense for which we have not budgeted. If we elect to increase our expenditures to fund development or commercialization activities on our own, we may need to obtain additional capital, which may not be available to us on acceptable terms or at all. If we do not have sufficient funds, we will not be able to out-license our RNA delivery programs or product candidates to market and generate licensing revenue. Even if we are successful in establishing a new strategic partnership or entering into a collaboration agreement, we cannot be certain that, following such a strategic transaction or license, we will be able to progress the development of the applicable RNA delivery platforms or product candidates as envisaged, or that we will achieve the revenues that would justify such transaction.
- Corporate Activity and Growth - Risk 3If we fail to maintain our current strategic relationship with Washington University, our business, commercialization prospects and financial condition may be materially adversely affected.
We have an exclusive license agreement with Washington University located in St. Louis, Missouri ("WU"). Under this agreement with WU, we are given an exclusive, worldwide, royalty-bearing license (with the right to sublicense) under certain patent rights owned or controlled by WU to research, develop, make, have made, sell, offer for sale, use and import pharmaceutical products covered under such patent rights for all fields of use. Such licensed products may include drug products formulated as nanoparticles, comprising a peptide for delivery as well as a therapeutic nucleotide, for intracellular delivery. These intellectual property rights have been the basis of our research and development of AM-401 and AM-411. A good relationship with WU is important for our business prospects. If our relationship with WU was to deteriorate substantially or WU challenges our use of their intellectual property or our calculations of the payments we owe under our agreements, our business, financial condition, commercialization prospects and results of operations could be materially adversely affected.
Risk Highlights Q4, 2023
Risk Word Cloud
Risk Factors Full Breakdown - Total Risks 41
- Innovation / R&D - Risk 1ChangedWe are working to reposition our company around RNA delivery technology and intend to divest or partner our AM-125 development program. We cannot give any assurance that this repositioning will be successful and that we will be able to divest or partner our AM-125 program at attractive conditions and within a reasonable period of time.
In June 2021 we acquired Trasir Therapeutics Inc. ("Trasir") whose main asset is the proprietary peptide polyplex platform OligoPhore™ / SemaPhore™ that can engage any type of RNA in rapid self-assembly and is designed to allow for RNA delivery to extrahepatic tissues using systemic or local administration. We announced on that occasion our intention to strategically reposition the Company to focus on the development of RNA delivery technology while in the medium term evaluating opportunities to partner or divest our legacy assets. These included primarily our Bentrio nasal spray for the protection against airborne allergens and viruses and AM-125 for the treatment of vertigo. On November 21, 2023 we completed the partial spin-off of our Bentrio business through the sale of a 51% stake in the Company's subsidiary Altamira Medica AG. Any sale or partnering process is time consuming and requires substantial management time and attention, which may have an effect on our business and results of operations. Valuation of assets in one or several partial divestiture or partnering transactions depends on a variety of factors such as the valuation of comparable assets, interest for the type of assets and conditions on capital markets. We can provide no assurances that we will successfully sell or partner our AM-125 development program, or that we will do so in accordance with our expected timeline. Additionally, any decisions made regarding our deployment or use of any sales or out-licensing proceeds we receive in any sale or partnering transaction involves risks and uncertainties. As a result, our decisions with respect to such proceeds may not lead to increased long-term shareholder value. If a sale or the out-licensing of the AM-125 development program at what we consider to be a reasonable price is not available, we may decide to cease efforts to divest or partner the AM-125 development program.
- Innovation / R&D - Risk 2The OligoPhore™ and SemaPhore™ platforms and the AM-401 and AM-411 programs are still in preclinical development. If our development programs are unsuccessful, or we are unable to out-license the platforms or programs, or we experience significant delays in doing so, our business, financial condition and results of operations will be materially adversely affected.
We have invested a significant portion of our efforts and financial resources in the acquisition and development of OligoPhore™, SemaPhore™ and AM-401 and AM-411, which are still in preclinical development. Our ability to generate product revenues from the out-licensing of these RNA delivery platforms and drug product candidates, will depend heavily on successful development, obtaining regulatory approval or clearance and eventual commercialization of these product candidates. The success of AM-401 or AM-411 and our other product candidates will depend on several factors, including the following: - completing nonclinical studies that demonstrate the efficacy and safety of our product candidates;- receiving IND or equivalent regulatory clearance from competent regulatory authorities for clinical testing;- acceptance of our RNA delivery platforms and drug product candidates by potential collaboration partners or licensees;- competing effectively with other platform technologies or therapeutics; and - qualifying for, maintaining, enforcing and defending our intellectual property rights and claims. If we do not achieve one or more of these factors in a timely manner or at all, we could experience significant delays or an inability to successfully out-license OligoPhore™ / SemaPhore™, AM-401 or AM-411, which would materially adversely affect our business, financial condition and results of operations.
- Innovation / R&D - Risk 3ChangedDrug development involves a lengthy and expensive process with uncertain timelines and uncertain outcomes, and results of earlier in vitro and in vivo studies may not be predictive of future results in humans. In addition, clinical trials with our product candidates may be prolonged or delayed, and therefore we may be unable to out-license our RNA delivery platforms or product candidates on a timely basis or at all.
To obtain the requisite regulatory approvals or clearance to test any of our product candidates in humans, we must demonstrate through extensive pre-clinical studies that our products are likely to be safe and effective in humans. The results of pre-clinical studies of our product candidates may not be predictive of the results of future clinical trials in humans. For example, positive results generated to date in pre-clinical studies for our product candidates do not ensure that clinical trials will demonstrate similar results. A number of companies in the biopharmaceutical industry have suffered significant setbacks in early-stage clinical trials due to adverse safety profiles, notwithstanding promising results in pre-clinical studies. We may decide to seek out-licensing partners for our RNA delivery platforms or product candidates after obtaining regulatory approvals or clearance for testing them in humans or only after conducting one or several early stage clinical trials. If we decide to conduct clinical trials, we will need to ensure that they are conducted in accordance with FDA, EMA and comparable foreign regulatory authorities' legal requirements, regulations or guidelines, and are subject to oversight by these governmental agencies and Institutional Review Boards, or IRBs, at the medical institutions where the clinical trials are conducted. In addition, clinical trials must be conducted with supplies of our RNA delivery platforms or product candidates produced under applicable current good manufacturing practices (cGMP) and other requirements. We depend on medical institutions and clinical research organizations, or CROs, to conduct our clinical trials in compliance with current good clinical practice, or cGCP, standards. To the extent the CROs fail to enroll participants for our clinical trials, fail to conduct the trials to cGCP standards or are delayed for a significant time in the execution of trials, including achieving full enrollment, we may be affected by increased costs, program delays or both, which may harm our business. The completion of clinical trials may be delayed, suspended or terminated as a result of many factors, including but not limited to: - the delay or refusal of regulators or IRBs to authorize us to commence a clinical trial at a prospective trial site and changes in regulatory requirements, policies and guidelines;- delays or failure to reach agreement on acceptable terms with prospective CROs and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites;- delays in patient enrollment and variability in the number and types of patients available for clinical trials;- the inability to enroll a sufficient number of patients in trials to ensure adequate statistical power to detect statistically significant treatment effects;- negative or inconclusive results, which may require us to conduct additional pre-clinical or clinical trials or to abandon projects that we expect to be promising;- safety or tolerability concerns could cause us to suspend or terminate a trial if we find that the participants are being exposed to unacceptable health risks;- regulators or IRBs requiring that we or our investigators suspend or terminate clinical research for various reasons, including noncompliance with regulatory requirements or safety concerns, among others;- lower than anticipated retention rates of patients and volunteers in clinical trials;- our CROs or clinical trial sites failing to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all, deviating from the protocol or dropping out of a trial;- delays relating to adding new clinical trial sites;- difficulty in maintaining contact with patients after treatment, resulting in incomplete data;- errors in survey design, data collection and translation;- delays in establishing the appropriate dosage levels;- the quality or stability of the product candidate falling below acceptable standards;- the inability to produce or obtain sufficient quantities of the RNA delivery platform component or product candidate to complete clinical trials; and - exceeding budgeted costs due to difficulty in accurately predicting costs associated with clinical trials. Our product development costs will increase if we experience delays in pre-clinical testing and clinical trials or if we are required to conduct additional studies or trials or other testing beyond the studies, trials and testing that we currently contemplate or conduct and we may be required to obtain additional funds to complete such additional studies and trials. We cannot assure you that our pre-clinical studies or clinical trials will begin as planned or be completed on schedule, if at all, or that we will not need to restructure our studies or trials after they have begun. Significant study or trial delays also could shorten any periods during which we or potential licensees of ours may have the exclusive right to commercialize our product candidates or to use our RNA delivery platforms for their own product candidates or allow competitors to bring products to market before our potential licensees do or shorten any periods during which our potential licensees have the exclusive right to commercialize our product candidates or use our RNA delivery platforms for their own product candidates, which may harm our business and results of operations.
- Innovation / R&D - Risk 4ChangedIf serious adverse, undesirable or unacceptable side effects are identified during the development of our RNA delivery platforms or product candidates or following approval, if any, we may need to abandon our development of such product candidates, the commercial profile of any approved label may be limited, or we may be subject to other significant negative consequences following marketing approval, if any.
If our RNA delivery platforms or product candidates are associated with serious adverse, undesirable or unacceptable side effects, we or our potential licensees may need to abandon their development or limit development to certain uses or sub-populations in which such side effects are less prevalent, less severe or more acceptable from a risk-benefit perspective. Many compounds that initially showed promise in pre-clinical or early-stage testing have later been found to cause side effects that restricted their use and prevented further development of the compound for larger indications. Additionally, if one or more of our product candidates or potential licensee's product candidates incorporating one of our RNA delivery platforms receives marketing approval, and we or others later identify undesirable side effects caused by such products, a number of potentially significant negative consequences could result, including: - regulatory authorities may withdraw approvals of such product;- regulatory authorities may require additional warnings on the label;- we may be required to create a medication guide outlining the risks of such side effects for distribution to patients;- we or our potential licensees could be sued and held liable for harm caused to patients; and - our reputation and interest from the biopharmaceutical industry in our RNA delivery platforms or product candidates may suffer. Any of these events could prevent us or our potential licensees from achieving or maintaining market acceptance of the particular product candidate, if approved, or of our RNA delivery technology and could significantly harm our business, results of operations and prospects.
- Innovation / R&D - Risk 5ChangedOur product candidates are still in the development-stage and we have a limited operating history and a history of operating losses. We anticipate that we will continue to incur losses for the foreseeable future.
We are a biopharmaceutical company with our product candidates still in the development stage and a limited operating history. Since inception, we have incurred significant operating losses. We incurred net losses (defined as net loss attributable to owners of the Company) of CHF 3.9 million, CHF 26.5 million, and CHF 17.1 million for the years ended December 31, 2023, 2022 and 2021, respectively. The 2022 net loss included a one-time non-cash write-off of capitalized development expenditures for our AM-125 project in the amount of CHF 12.4 million based on the impairment test performed under IFRS. As of December 31, 2023, we had an accumulated deficit of CHF 18.0 million. Our losses have resulted principally from expenses incurred in research and development of our product candidates, pre-clinical and clinical research and general and administrative expenses that are required for maintaining our business infrastructure and operating as a publicly listed company. Although we lowered our operating expenses significantly in 2023 in the context of our repositioning to become a provider of RNA delivery technology, we still expect to continue to incur significant operating losses in the future as we continue our research and development efforts for our RNA delivery platforms and product candidates. We expect our total additional cash need in 2024 to be in the range of CHF 6.5 to 7.5 million. To date, we have financed our operations through an initial public offering and follow-on offerings of our common shares, private placements of equity securities and short- and long-term loans. Biopharmaceutical product development is a highly speculative undertaking and involves a substantial degree of risk. It may be several years, if ever, before we begin to generate meaningful revenues from the out-licensing of our RNA delivery platforms or product candidates or from income generated from our residual ownership in the Bentrio business. Our failure to become and remain profitable would decrease the value of the Company and could impair our ability to raise capital, expand our business and/or continue our operations.
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