F-1: TC BioPharm Seeks $5 Million in Public Offering to Advance Cancer Immunotherapy Pipeline

TC BioPharm is launching a public offering of American Depositary Shares (ADSs) and warrants to raise capital for its clinical-stage immunotherapy programs.

Summary

• TC BioPharm (Holdings) PLC is offering 1,501,501 American Depositary Shares (ADSs) along with Series H warrants to purchase an equal number of ADSs.
• The offering also includes pre-funded warrants for certain purchasers who would otherwise exceed ownership limits.
• The assumed public offering price is $3.33 per ADS and warrant, based on the closing price on August 14, 2024.
• Series H warrants will have an exercise price determined through negotiation and will expire one year after issuance.
• The company intends to use the net proceeds to advance its preclinical and clinical pipeline, and for continuing operating expenses and working capital.
• TC BioPharm is a clinical-stage biopharmaceutical company focused on developing allogeneic gamma delta T (GD-T) cell therapies for cancer and viral infections.
• The company's lead product candidate, OmnImmune, is in Phase 2b-into-pivotal (Phase 3) clinical studies for the treatment of acute myeloid leukemia (AML).
• TC BioPharm has a GMP-compliant manufacturing facility and a portfolio of patents covering GD-T cell products and CAR-T modifications.
• The company has faced challenges with Nasdaq compliance, including minimum stockholders' equity and bid price requirements.
• Recent developments include the exercise of pre-funded warrants, issuances of ADSs and grants of options, and letters of intent for potential acquisitions.

Sentiment

Score: 4

Explanation: The document presents a mixed sentiment. While it highlights the company's innovative technology and clinical progress, it also acknowledges significant financial challenges, including ongoing losses and doubts about its ability to continue as a going concern. The need for additional funding and Nasdaq compliance issues further dampen the outlook.

Positives

• TC BioPharm has a GMP-compliant manufacturing facility, allowing for in-house control of manufacturing and reduced costs.
• The company has a strong intellectual property portfolio covering GD-T cell products and CAR-T modifications.
• OmnImmune has been granted Orphan Drug Designation by the FDA for Acute Myeloid Leukemia (AML).
• Clinical trials have provided evidence of drug toleration and some preliminary evidence of clinical benefit.
• The company has a highly knowledgeable and experienced management team with extensive industry experience and expertise in the United States and in Europe.

Negatives

• The company has generated operating losses since inception and expects to continue to generate losses.
• There is substantial doubt about the company's ability to continue as a going concern.
• The company has faced challenges with Nasdaq compliance, including minimum stockholders' equity and bid price requirements.
• The company has a limited operating history and no approved products.
• The company relies on third parties for aspects of product development and commercialization.

Risks

• The company may never achieve or maintain profitability.
• The company will continue to require financing to continue to implement its business plan and sustain operations.
• GD-T cell therapies are a novel approach to treating cancers and infectious diseases, which have development risks and will require the company to obtain regulatory approvals for development, testing, commercialization, manufacturing and distribution.
• Enrolling patients in clinical trials may be difficult for many reasons, including high screen failure, GD-T cell proliferation capacity, timing, proximity and availability of clinical sites, perceived risks, and publicity about the success or lack of success in the methods of treatment.
• The company is heavily dependent on the success of its lead product candidate (OmnImmune).
• The company faces substantial competition: others may discover, develop and/or commercialize competing products before or more successfully than TCB.
• The company operates internationally and is subject to a wide array of regulation of the United Kingdom, European Union and United States.
• Protecting the company's intellectual property is paramount in its ability to be able to commercialize its products and generate revenues and investment return for its stockholders.
• The company currently has a limited number of employees, and its future success depends on its ability to retain key executives and to attract, retain and motivate qualified personnel at all levels.
• The company incurs substantial costs as a result of operating as a public company in the United States, and its management is required to devote substantial time to required SEC compliance and corporate governance practices.
• If the company fails to maintain proper and effective internal controls, its ability to produce accurate financial statements on a timely basis could be impaired, which would adversely affect its business and its stock price.
• If the company fails to meet the requirements for continued listing on the Nasdaq Capital Market or Nasdaq, its ADSs could be delisted from trading, which would decrease the liquidity of its ADSs and its ability to raise additional capital.
• The price of the ADSs has been, and is likely to continue to be, highly volatile, which could result in substantial losses for purchases of ADSs in this offering.
• The company has broad discretion in the use of the net proceeds from this offering and any exercise of the Warrants and consequently may not use them effectively.
• Purchasers who purchase the company's securities in this offering pursuant to a securities purchase agreement may have rights not available to purchasers that purchase without the benefit of a securities purchase agreement.
• Unstable market and economic factors could adversely affect the company's business, financial condition or results of operations.

Future Outlook

The company intends to use the net proceeds of this offering to advance its preclinical and clinical pipeline, and for continuing operating expenses and working capital.

Management Comments

• TCB believes that unmodified GD-Ts have the potential to treat all blood cancers.
• TCB believes that solid cancers are more difficult to treat than blood cancers and may require the addition of a CAR chimeric antigen receptor (i) to help therapeutic cells to navigate into diseased cancerous tissue and (ii) to retain therapeutic cells in-situ at the lesion for maximal efficacy (increased persistence).
• TCB believes that we have introduced a step-change to our manufacturing platform by implementing a freeze-thaw process that will allow product to be shipped from cleanroom to patient without any shelf-life issue.
• TCB believes it has certain identified strengths.
• We believe that existing and future collaborations will provide us with experience in scale-up and automation, and post-authorization sales and marketing.

Industry Context

TC BioPharm operates in the competitive biopharmaceutical industry, specifically focusing on cell-based immunotherapies. The company's focus on gamma delta T cells and CAR-T technology places it among companies developing novel approaches to cancer treatment. The industry is characterized by high research and development costs, lengthy regulatory approval processes, and intense competition.

Comparison to Industry Standards

• TC BioPharm's focus on allogeneic GD-T cell therapies distinguishes it from companies primarily developing autologous CAR-T cell therapies, such as Novartis (Kymriah) and Gilead Sciences (Yescarta).
• The company's co-stimulatory CAR-T platform aims to address safety concerns associated with conventional CAR-T therapies, which have been linked to cytokine release syndrome (CRS) and neurotoxicity.
• TC BioPharm's strategy of retaining control of key business elements, such as product manufacture and clinical research, contrasts with companies that outsource these activities to contract manufacturing organizations (CMOs) and contract research organizations (CROs).
• The company's focus on developing allogeneic therapies aims to reduce manufacturing costs and simplify supply chains compared to autologous therapies, which require personalized manufacturing for each patient.
• TC BioPharm's approach to targeting solid tumors with CAR-T technology aligns with industry efforts to expand the application of cell-based immunotherapies beyond hematological malignancies.

Legal Proceedings

• The holder filed a claim in the English courts on June 19, 2023 asserting that notice was provided such that the Company should have paid it the value of the Note in cash, rather than by settling it through the issuance of Ordinary Shares and listed warrants.
• The holder is demanding payment of the face value of the Note, together with interest, (approximately $860,000).
• The litigation process is ongoing and is not expected to conclude until 2025 or later.
• The Company is contesting the claim in its entirety and believes that it acted correctly, under the terms of the Note and has accounted for the transaction on that basis, and that no further amounts are payable to the holder.

Stakeholder Impact

• Shareholders: Dilution from the offering and potential volatility in ADS price.
• Employees: Uncertainty due to financial instability and potential restructuring.
• Customers: Potential for new therapies, but also risk of delays or discontinuation.
• Suppliers: Risk of payment delays or contract renegotiations.
• Creditors: Increased risk due to financial instability.

Next Steps

• Advance preclinical and clinical pipeline.
• Continue operating expenses and working capital.
• Initiate patient dosing in upcoming clinical trials.
• Formulate and implement potential funding initiatives to ensure adequate working capital.
• Continue to execute its business plan and is looking into various options available to regain compliance with Nasdaqs continued listing standards and maintain its continued listing on the Nasdaq Capital Market.

Key Dates

Keywords

TC BioPharm, ADS, warrants, public offering, immunotherapy, gamma delta T cells, OmnImmune, AML, clinical trials, biopharmaceutical