10-K: Tharimmune, Inc. Reports Full Year 2023 Results and Provides Pipeline Update

Tharimmune, Inc., a clinical-stage biotechnology company, released its 2023 annual report, highlighting progress in its pipeline and financial position.

Summary

• Tharimmune, Inc. is a clinical-stage biotech company focused on developing treatments for inflammatory and immunologic conditions.
• The company's lead product, TH104, is a transmucosal buccal film for treating chronic pruritis, with an approved IND application.
• TH104 has a dual mechanism of action affecting both mu-opioid and kappa opioid receptors and inhibits interleukin-17.
• The company is also developing bispecific antibodies and Picobodies targeting HER2, HER3, and PD-1 for cancer treatment.
• TH3215, a bispecific antibody against HER2 and HER3, is expected to enter IND-enabling studies in 2024.
• TH0059, a HER2/HER3 bispecific ADC, and TH1940, a PD-1 Picobody, are planned to progress into IND-enabling studies in 2025.
• The company reported a net loss of $9.3 million for 2023 and $8.5 million for 2022.
• As of December 31, 2023, the company had cash of $10.9 million.
• Management has expressed substantial doubt about the company's ability to continue as a going concern without additional capital.
• The company is planning a phase 2 proof-of-concept trial for TH104 in PBC patients over approximately 12 months after aligning with the FDA on trial design.

Sentiment

Score: 4

Explanation: The document presents a mixed picture. While there is progress in the pipeline and some positive clinical data, the going concern warning and the need for substantial additional capital raise concerns. The company is still in the early stages of development and faces significant risks.

Positives

• The company has an approved IND for TH104, which is a significant milestone.
• The company is advancing multiple novel therapeutic candidates, including bispecific antibodies and Picobodies.
• The company has a clear strategy for developing its pipeline, including strategic collaborations.
• The company has completed multiple phase 1 ex-US trials for TH104 showing predictable pharmacokinetic profiling with favorable safety and tolerability.
• The company has identified alternate sources of supply and other contract manufacturers that can produce materials for pre-clinical and clinical trial requirements.

Negatives

• The company has incurred significant losses since inception and expects to incur losses in the future.
• Management has expressed substantial doubt about the company's ability to continue as a going concern.
• The company is dependent on third parties for manufacturing and clinical trials.
• The company faces significant competition in the pharmaceutical and biotechnology industries.
• The company has a limited operating history and has not generated any revenue.

Risks

• The company has a limited operating history and has not generated any revenue.
• The company has incurred significant losses since inception and expects to incur losses in the future.
• The company will require substantial additional capital to finance its operations.
• Management has expressed substantial doubt about the company's ability to continue as a going concern.
• The company is substantially dependent on the success of its product candidates.
• Any delays in clinical trials could result in increased costs and delay or limit the ability to generate revenue.
• The outcome of pre-clinical testing and early clinical trials may not be predictive of the success of later clinical trials.
• The company relies on third parties to manufacture its product candidates and conduct its pre-clinical studies and clinical trials.
• The company may not be successful in commercializing its drug candidates even if they are approved.
• The company may not be able to protect its intellectual property and proprietary rights.

Future Outlook

The company intends to complete a phase 1 pharmacokinetic trial for TH104 in 2Q24 and a phase 2 proof-of-concept in PBC patients over approximately 12 months after aligning with FDA on trial design. The company also plans to submit INDs for TH3215, TH0059 and TH1940 in 2025.

Management Comments

• Management has performed an analysis and concluded that there is a substantial doubt about our ability to continue as a going concern.
• Management believes that TH104 may also be used for treating chronic pruritogenic conditions associated with cholestatic liver disease as well as other liver related and non-liver related diseases.

Industry Context

The company operates in the competitive biotechnology and pharmaceutical industries, facing competition from major multinational companies, established biotech firms, and emerging startups. The company is focused on developing novel treatments in inflammatory and immunologic conditions with high unmet needs, including chronic pruritis and various cancers.

Comparison to Industry Standards

• The company's focus on novel targets like HER2, HER3, and PD-1 aligns with current trends in cancer immunotherapy.
• The development of bispecific antibodies and ADCs is a common strategy in the industry for enhancing therapeutic efficacy.
• The company's approach to chronic pruritis with TH104, targeting opioid receptors and IL-17, is a novel approach compared to existing treatments.
• The company's financial position, with a net loss of $9.3 million and cash of $10.9 million, is typical for a clinical-stage biotech company, but the going concern warning is a concern.
• The company's reliance on third-party manufacturers and CROs is standard practice in the industry, but it introduces risks related to supply chain and clinical trial execution.
• The company's pipeline is at an early stage compared to larger pharmaceutical companies with approved products and late-stage clinical programs.

Management Changes

Related Party Transactions

• The company entered into convertible promissory note agreements with related parties, which were converted into common stock upon completion of the IPO.
• The company had amounts due to the founder and CEO that totaled $200,000 at December 31, 2021, which was paid in full in April 2022.
• The company issued unsecured promissory notes in the aggregate principal amount of approximately $139,000 to three related-party investors, which were repaid in full on January 21, 2022.
• The founder and CEO exercised options to purchase up to 9,621 shares of the company's common stock at a weighted-average exercise price of $2.53 per share for a total of approximately $24,000.

Stakeholder Impact

• Shareholders face the risk of dilution from future equity offerings.
• Employees may be affected by the company's financial instability and potential restructuring.
• Patients may benefit from the development of new treatments for unmet medical needs.
• Suppliers and creditors may be affected by the company's financial instability and potential inability to pay its obligations.

Next Steps

• Complete a phase 1 pharmacokinetic trial for TH104 in 2Q24.
• Initiate a phase 2 proof-of-concept trial for TH104 in PBC patients over approximately 12 months after aligning with the FDA on trial design.
• Advance TH3215 into IND-enabling studies in 2024.
• Progress TH0059 and TH1940 into IND-enabling studies in 2025.
• Pursue strategic collaboration opportunities to maximize the value of the pipeline.

Key Dates

Keywords

TH104, pruritis, bispecific antibodies, HER2, HER3, PD-1, cancer, immunooncology, clinical trials, biotechnology, pharmaceutical, IND, Picobodies, ADC, PBC