UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 2.02 Results of Operations and Financial Condition.
On November 14, 2024, HCW Biologics Inc. issued a press release announcing its financial results for the quarter ended September 30, 2024. The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information set forth in this Item 2.02 (including Exhibit 99.1) is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing, except as expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. |
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Description |
99.1 |
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104 |
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Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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HCW BIOLOGICS INC. |
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Date: |
November 14, 2024 |
By: |
/s/ Hing C. Wong |
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Hing C. Wong |
Exhibit 99.1
HCW Biologics Reports Third Quarter 2024
Financial Results and Business Highlights
Miramar, FL– November 14, 2024 – HCW Biologics Inc. (the “Company” or “HCW Biologics”) (NASDAQ: HCWB), a clinical-stage biopharmaceutical company focused on discovering and developing novel immunotherapies to lengthen healthspan by disrupting the link between inflammation and age-related diseases, today reported financial results and recent business highlights for its third quarter ended September 30, 2024.
Dr. Hing C. Wong, Founder and CEO of HCW Biologics, stated, “In the third quarter 2024, the Company expanded our product portfolio and possible disease indications that may be treated with our immunotherapeutic compounds, consisting of compounds constructed using two different platforms. Our expanded portfolio now includes constructs with immune-cell engagers targeting tissue factor and other cell-surface antigens associated with diseased cells and multifunctional immunotherapeutic fusions which improve the performance of immune checkpoint inhibitors.”
Business Highlights
Third Quarter 2024 Financial Results
Financial Guidance
ImmunityBio and its affiliates initiated legal proceedings against the Company and Dr. Hing C. Wong, the Company’s Founder and Chief Executive Officer, on December 31, 2022. Ultimately, legal proceedings against Company and Dr. Wong were consolidated in the arbitration before JAMS (“Arbitration”). As reported in the Company’s Form 8-K filed on July 18, 2024, the parties entered into a confidential Settlement Agreement and Release (the “Settlement Agreement”). The Settlement Agreement includes mutual general releases by and among the parties thereto. No party is required to make any monetary payments to any other party or person under the Settlement Agreement and each party agreed to bear its own expenses incurred in connection with the matter. Remediation activities are substantially complete, and the parties agreed to the stipulation and dismissal of the Arbitration. With the execution of the Settlement Agreement, the Company resolved the attendant uncertainties for the outcome of the arbitration and additional complexities. However, the Company incurred substantial legal fees in its defense and for the defense of Dr. Wong. As of September 30, 2024, the Company reported $14.4 million in obligations for legal fees within accounts payable on its condensed balance sheet. The Company is engaged in discussions with the law firms involved with this matter to arrange a reasonable payment plan with respect to those legal fees.
As of September 30, 2024, the Company believes that substantial doubt exists regarding its ability to continue as a going concern for at least 12 months from the issuance date of the condensed interim financial statements, without additional funding or financial support. The Company launched a multi-faceted financing plan in the third quarter of 2024 to raise the capital required through equity financings and business development transactions to fund the future product development and operations of the Company.
A major objective of the financing strategy is to regain compliance with Listing Rules of the Nasdaq Stock Market LLC (“Nasdaq”). We were notified by Nasdaq staff that we are not in compliance with continued listing requirements on the Nasdaq Global Market. The Company was granted a period of 180 calendar days by Nasdaq in which to comply. The first deadline is currently scheduled for December 16, 2024. The Company intends to take all reasonable measures available to regain compliance with the continued listing requirements for the Nasdaq Global Market, and will utilize our right to appeal to Nasdaq to extend our deadline to regain compliance based on a solid financial plan to do so.
About HCW Biologics:
HCW Biologics is a clinical-stage biopharmaceutical company focused on discovering and developing novel immunotherapies to lengthen healthspan by disrupting the link between chronic, low-grade inflammation, and age-related diseases, such as cancer, cardiovascular, diabetes, neurodegenerative, and autoimmune diseases, as well as other inflammatory conditions such as long-haul COVID-19. The Company has combined a deep understanding of disease-related immunology with its expertise in advanced protein engineering to develop two drug discovery platforms, each with a novel backbone which is used to generate designer, novel multi-functional fusion molecules with immunotherapeutic properties. The Company’s legacy drug discovery platform is its TOBI™ (Tissue factOr-Based fusIon) discovery platform, has a Tissue-Factor based backbone. It was used to create HCW Biologics’ molecules, HCW9218, HCW9302, HCW9206 and HCW9201. The Company’s second drug discovery platform uses a unique protein-based backbone differentiated from Tissue Factor. Immunotherapeutics created with the Company’s two distinct drug discovery platforms have different characteristics and mechanisms of action, expanding the various pathways for treating senescence-associated disorders. The University of Pittsburgh Medical Center has agreed to include HCW9218 in an Investigator-sponsored Phase 2 clinical trial in patients with metastatic, advanced stage ovarian cancer in combination with neoadjuvant chemotherapy (NCT05145569).
Forward Looking Statements:
Statements in this press release contain “forward-looking statements” that are subject to substantial risks and uncertainties. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements contained in this press release may be identified by the use of words such as “anticipate,” “expect,” “believe,” “will,” “may,” “should,” “estimate,” “project,” “outlook,” “forecast” or other similar words and include: the Company’s ability to develop new immunotherapeutic treatments for non-oncology or oncology indications; timing of initiation of studies for age-related diseases; the Company’s ability to continue as a going concern and that after considering the elements of the Company’s financing plan that were probable to occur within a year of the date of issuance, the Company concluded that substantial doubt was not alleviated in its going concern analysis; the Company’s cash runway; the Company’s expectations regarding future purchases of licensed molecules by Wugen; the Company’s ability to finalize the license of a preclinical molecule; the issuance of the IND for HCW9302; the Company’s future capital-raising plans and ability to continue with clinical development efforts until they are achieved, if at all; that the Company may receive feedback from the FDA on the IND application for HCW9302 which may not be given on a timely basis, or the Company may be required to change the design of the clinical protocol in order to address the feedback, potentially resulting in delays and increased costs; and Company’s ability to pay legal fees incurred in connection with the arbitration with ImmunityBio and its affiliates. Forward-looking statements are based on the Company’s current expectations and are subject to inherent uncertainties, risks and assumptions that are difficult to predict. Further, certain forward-looking statements are based on assumptions as to future events that may not prove to be accurate. Factors that could cause actual results to differ include, but are not limited to, the risks and uncertainties that are described in the section titled “Risk Factors” in the annual report on Form 10-K/A filed with the United States Securities and Exchange Commission (the “SEC”) on May 15, 2024, the latest Form 10-Q filed with the SEC on August 14, 2024, and in other filings filed from time to time with the SEC. Forward-looking statements contained in this press release are made as of this date, and the Company undertakes no duty to update such information except as required under applicable law.
Company Contact:
Rebecca Byam
CFO
HCW Biologics Inc.
rebeccabyam@hcwbiologics.com
HCW Biologics Inc.
Condensed Statements of Operations
(Unaudited)
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Three Months Ended |
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Nine Months Ended |
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2023 |
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2024 |
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2023 |
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2024 |
Revenues: |
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Revenues |
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$ 853,102 |
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$ 426,423 |
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$ 1,517,792 |
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$ 2,171,988 |
Cost of revenues |
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(678,325) |
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(341,138) |
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(1,210,077) |
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(1,291,546) |
Total revenues |
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174,777 |
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85,285 |
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307,715 |
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880,442 |
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Operating expenses: |
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Research and development |
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1,667,442 |
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1,186,913 |
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5,539,919 |
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5,339,383 |
General and administrative |
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1,509,936 |
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1,639,152 |
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5,106,674 |
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4,799,437 |
Legal Expenses |
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2,075,279 |
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949,455 |
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4,610,091 |
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15,761,531 |
Reserve for credit losses |
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— |
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— |
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— |
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1,300,000 |
Total operating expenses |
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5,252,657 |
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3,775,520 |
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15,256,684 |
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27,200,351 |
Loss from operations |
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(5,077,880) |
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(3,690,235) |
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(14,948,969) |
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(26,319,909) |
Interest expense |
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(95,514) |
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(223,363) |
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(284,465) |
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(383,029) |
Other income, net |
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234,753 |
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11,310 |
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919,688 |
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52,397 |
Net loss |
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$ (4,938,641) |
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$ (3,902,288) |
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$ (14,313,746) |
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$(26,650,541) |
HCW Biologics Inc.
Condensed Balance Sheets
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December 31, |
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September 30, |
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2023 |
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2024 |
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Unaudited |
ASSETS |
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Current assets: |
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Cash and cash equivalents |
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$ 3,595,101 |
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$ 998,221 |
Accounts receivable, net |
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1,535,757 |
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651,840 |
Prepaid expenses |
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1,042,413 |
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356,156 |
Other current assets |
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230,916 |
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88,131 |
Total current assets |
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6,404,187 |
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2,094,348 |
Investments |
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1,599,751 |
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1,599,751 |
Property, plant and equipment, net |
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20,453,184 |
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22,833,904 |
Other assets |
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56,538 |
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28,476 |
Total assets |
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$ 28,513,660 |
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$ 26,556,479 |
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) |
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Liabilities |
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Current liabilities: |
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Accounts payable |
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$ 6,167,223 |
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$ 22,666,107 |
Accrued liabilities and other current liabilities |
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2,580,402 |
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1,182,502 |
Total current liabilities |
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8,747,625 |
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23,848,609 |
Debt, net |
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6,304,318 |
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12,677,494 |
Total liabilities |
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15,051,943 |
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36,526,103 |
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Stockholders’ equity (deficit): |
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Common stock: |
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Common, $0.0001 par value; 250,000,000 shares authorized |
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3,603 |
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3,782 |
Additional paid-in capital |
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83,990,437 |
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87,209,457 |
Accumulated deficit |
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(70,532,323) |
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(97,182,863) |
Total stockholders’ equity (deficit) |
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13,461,717 |
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(9,969,624) |
Total liabilities and stockholders’ equity (deficit) |
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$ 28,513,660 |
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$ 26,556,479 |