0000950170-24-127198 | 10-Q | XBRL Viewer

Income Taxes	9 Months Ended
Sep. 30, 2024
Income Tax Disclosure [Abstract]
Income Taxes	7. Income Taxes The Company computes its quarterly income tax expense/(benefit) by using a forecasted annual effective tax rate and adjusts for any discrete items arising during the quarter. The Company did not have a provision for income taxes (current or deferred tax expense) as of December 31, 2023 and September 30, 2024. The Company will continue to maintain a 100% valuation allowance on total deferred tax assets. The Company believes it is more likely than not that the related deferred tax assets will not be realized. As a result, the Company’s effective tax rate will remain at 0.00% because no items either estimated or discrete items would impact the tax provision.

Preferred Stock - Additional Information (Detail) - shares	Sep. 30, 2024	Dec. 31, 2023
Class of Stock [Line Items]
Preferred Stock, Shares Authorized	10,000,000	10,000,000
Preferred Stock, Shares Issued	0	0

Condensed Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Cash flows from operating activities:
Net Income (Loss)	$ (26,650,541)	$ (14,313,746)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	501,882	860,634
Stock-based compensation	716,940	742,477
Unrealized loss (gain) on investments, net	0	(248,445)
Realized loss (gain) on investments, net	0	(15,625)
Changes in the carrying amount of right-of-use asset	(418)	(1,045)
Changes in operating assets and liabilities:
Accounts receivable	883,917	(292,383)
Deposit for interest reserve	0	(5,250,000)
Prepaid expenses and other assets	829,043	(251,008)
Accounts payable and other liabilities	12,383,171	392,802
Operating lease liability	(56,541)	(242,990)
Net cash used in operating activities	(11,392,547)	(18,619,329)
Cash flows from investing activities:
Purchases of property and equipment	(148,205)	(2,486,950)
Proceeds for sale or maturities of short-term investments	0	10,000,000
Net cash provided by (used in) investing activities	(148,205)	7,513,050
Cash flows from financing activities:
Proceeds from issuance of common stock	2,502,260	9,697
Proceeds from issuance of debt	6,530,000	0
Offering costs	0	0
Debt repayment	(88,388)	(8,981)
Net cash provided by financing activities	8,943,872	716
Net (decrease) increase in cash and cash equivalents	(2,596,880)	(11,105,563)
Cash and cash equivalents at the beginning of the period	3,595,101	22,326,356
Cash and cash equivalents at the end of the period	998,221	11,220,793
Supplemental disclosure of cash flow information:
Cash paid for interest, net of amounts capitalized	340,988	284,465
Noncash operating, investing and financing activities:
Capital expenditures accrued, but not yet paid	1,910,698	2,095,724
Purchases of property and equipment included in accounts payable and other liabilities	$ 829,207	$ 0

Organization and Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Oct. 31, 2024	Mar. 31, 2024	Dec. 31, 2023	Aug. 15, 2022
Revenue recognized	$ 426,423	$ 853,102	$ 2,171,988	$ 1,517,792
Investment impairment charges			0
Legal fees incurred but not yet paid	14,400,000		14,400,000
Accrued Legal Fees	35,000		35,000
Cash and cash equivalents	998,221		998,221				$ 3,595,101
Loss contingency loss in period	1,300,000		1,300,000
Research and development			94,500,000
Common Stock Value	3,782		3,782				3,603
Senior Secured Notes [Member]
Debt instrument, face amount	6,500,000		6,500,000
Senior Secured Notes [Member] \| Subsequent Event [Member]
Total issuance of Secured Notes					$ 375,000
Secured debt					375,000
Senior Secured Notes [Member] \| Subsequent Event [Member] \| New Financing Plan [Member]
Total issuance of Secured Notes					6,900,000
Secured debt					$ 6,900,000
Cogent Bank Member
Proceeds to purchase								$ 6,500,000
Maximum [Member] \| Senior Secured Notes [Member]
Debt instrument, face amount						$ 10,000,000
Wugen License
Revenue recognized	426,423	$ 853,102	2,200,000	$ 1,500,000
Investments	1,600,000		1,600,000				$ 1,600,000
Surety Bond
Total issuance of Secured Notes	8,000,000		8,000,000
Loss contingency loss in period			1,300,000
Secured debt	$ 8,000,000		$ 8,000,000

Organization and Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2024
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed balance sheet as of September 30, 2024, the condensed statements of operations, and condensed statements of changes in stockholders’ equity (deficit) for the three and nine-month periods ended September 30, 2023 and 2024 and the condensed statements of cash flows for the nine months ended September 30, 2023 and 2024, and all related disclosures contained in the accompanying notes have been prepared in accordance with accounting principles that are generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and pursuant to Article 10 of Regulation S-X of the Securities Act of 1933, as amended (the “Securities Act”). Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. These unaudited condensed interim financial statements include only normal and recurring adjustments that the Company believes are necessary to fairly state the Company’s financial position and the results of its operations and cash flows. The results for the three and nine-month periods ended September 30, 2024 are not necessarily indicative of the results expected for the full fiscal year or any subsequent interim period. The condensed interim balance sheet at December 31, 2023 has been derived from the audited financial statements at that date but does not include all disclosures required by U.S. GAAP for complete financial statements. Because all of the disclosures required by U.S. GAAP for complete financial statements are not included herein, these unaudited condensed interim financial statements and the notes accompanying them should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2023, which appear in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on May 15, 2024 (the “Annual Report”) and in other filings with the SEC.
Reclassification of Prior Period Presentation of Legal Expenses	Reclassification of Prior Period Presentation of Legal Expenses Certain prior period amounts have been reclassified to distinguish between General and administrative expenses in the ordinary course of business and legal expenses incurred in connection with the arbitration and Settlement Agreement described in Notes 1. Reclassification of legal expenses incurred in connection with legal proceedings impacts the consolidated interim statements of operations. There is no effect on reporting results of operations from prior periods.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Management must apply significant judgment in this process. The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could differ from estimates.
Fair Value Measurements	Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820, Fair Value Measurement (“Topic 820”), establishes a fair value hierarchy for those instruments measured at fair value that distinguishes between fair value measurements based on market data (observable inputs) and those based on the Company’s own assumptions (unobservable inputs). This hierarchy maximizes the use of observable inputs and minimizes the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: Level 1: Observable inputs such as quoted prices in active markets; Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and Level 3: Unobservable inputs in which there is little or no market data, which require a reporting entity to develop its own assumptions. Fair value measurements are classified based on the lowest level of input that is significant to the measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment, which may affect the valuation of the assets and liabilities and their placement within the fair value hierarchy levels. The determination of the fair values takes into account the market for the Company’s financial assets and liabilities, the associated credit risk, and other factors as required. The Company considers active markets as those in which transactions for the assets or liabilities occur in sufficient frequency and volume to provide pricing information on an ongoing basis.
Revenue Recognition	Revenue Recognition The Company accounts for revenues in accordance with ASC 606, Revenue from Contracts with Customers (“Topic 606”). To determine revenue recognition for arrangements that fall within the scope of Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that it will collect the consideration it is entitled to in exchange for the goods or services transferred to the customer. At contract inception, the Company assesses the goods or services promised within each contract, determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. To date, the Company's revenues have been generated solely from transactions with Wugen. The Wugen License includes licenses of intellectual property, cost reimbursements, upfront signing fees, milestone payments and royalties on future licensee’s product sales. In addition, the Company and Wugen have an agreement for supply of materials, from which the Company also recognizes revenues. License Grants: For out-licensing arrangements that include a grant of a license to the Company’s intellectual property, the Company considers whether the license grant is distinct from the other performance obligations included in the arrangement. For licenses that are distinct, the Company recognizes revenues from nonrefundable, upfront payments and other consideration allocated to the license when the license term has begun and the Company has provided all necessary information regarding the underlying intellectual property to the customer, which generally occurs at or near the inception of the arrangement. Milestone and Contingent Payments: At the inception of the arrangement and at each reporting date thereafter, the Company assesses whether it should include any milestone and contingent payments or other forms of variable consideration in the transaction price using the most likely amount method. If it is probable that a significant reversal of cumulative revenue would not occur upon resolution of the uncertainty, the associated milestone value is included in the transaction price. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of each such milestone and any related constraint and, if necessary, adjusts its estimate of the overall transaction price. Since milestone and contingent payments may become payable to the Company upon the initiation of a clinical study or filing for or receipt of regulatory approval, the Company reviews the relevant facts and circumstances to determine when the Company should update the transaction price, which may occur before the triggering event. When the Company updates the transaction price for milestone and contingent payments, the Company allocates the changes in the total transaction price to each performance obligation in the agreement on the same basis as the initial allocation. Any such adjustments are recorded on a cumulative catch-up basis in the period of adjustment, which may result in recognizing revenue for previously satisfied performance obligations in such period. The Company’s licensees will generally pay milestones payments subsequent to achievement of the triggering event. Materials Supply: The Company provides clinical and research grade materials so that licensees may develop products based on the licensed molecules. The Company plans to enter into commercialization supply agreements when licensees enter the commercial stage of their company. The amounts billed are recognized as revenue as the performance obligations are satisfied by the Company, once the Company determines that a contract exists. On June 18, 2021, the Company entered into a master services agreement for the supply of materials for clinical development of licensed products. To meet all the criteria to qualify as a contract under Topic 606, the Company must enter into statements-of-work for purchases of clinical and research grade materials. The Company has determined that the manufacturing of the clinical and research materials supplied by the Company each represents a single performance obligation that is satisfied over time. The Company recognizes revenue using an input method based on the costs incurred relative to the total expected cost, which determines the extent of the Company's progress toward completion. As part of the accounting for these arrangements, the Company must develop estimates and assumptions that require judgement to determine the progress towards completion. The Company reviews its estimate of the progress toward completion based on the best information available to recognize the cumulative progress toward completion as of the end of each reporting period, and makes revisions to such estimates, if facts and circumstances change during each reporting period. For the three and nine months ended September 30, 2023, the Company recognized $853,102 and $1.5 million in revenue related to the sale of development supply materials to Wugen, respectively. For the three and nine months ended September 30, 2024, the Company recognized $426,423 and $2.2 million in revenue related to sale of development supply materials to Wugen, respectively.
Investments	Investments The Company holds a minority interest in Wugen which is accounted for using the measurement alternative whereby the investment is recorded at cost less impairment, adjusted for observable price changes in orderly transactions for an identical or similar investment of the same investee. No impairment has been recognized. As of September 30, 2024 and December 31, 2023, the Company included $1.6 million for the investment in Wugen in Investments in the accompanying condensed interim balance sheets. The Company used its equity interest in Wugen to collateralize the Secured Notes. See Note 3. Debt, Net.
Operating Leases	Operating Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in Other assets, Accrued liabilities and other current liabilities, and Other liabilities on its condensed interim balance sheets. Operating lease Right of Use (“ROU”) assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. The Company has a lease agreement with lease and non-lease components, which are accounted for separately. For short-term leases with a term of one year or less, the Company uses the practical expedient and does not record an ROU asset or lease liability for such short-term leases.
Net Loss Per Share	Net Loss Per Share Basic loss per share of common stock is computed by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during each period. Diluted loss per share of common stock includes the effect, if any, from the potential exercise of stock options and unvested shares of restricted stock, which would result in the issuance of incremental shares of common stock. For diluted net loss per share, the weighted-average number of shares of common stock is the same for basic net loss per share due to the fact that when a net loss exists, dilutive securities are not included in the calculation as the impact is anti-dilutive.

- Definition

Disclosure of accounting policy for investment in financial asset.

+ References + Details

Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

6. Fair Value of Financial Instruments

The carrying amount of the Company’s financial instruments, including cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, U.S. government-backed securities with maturity dates up to one year, accounts payable and accrued liabilities, approximate fair value due to their short-term maturities.

Money market funds included in cash and cash equivalents and U.S. government-backed securities are measured at fair value based on quoted prices in active markets, which are considered Level 1 inputs. No transfers between levels occurred during the periods presented. The following table presents the Company’s assets, which were measured at fair value at December 31, 2023 and September 30, 2024:


	At December 31, 2023:
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	1,626,129	$	—	$	—	$	1,626,129
Total	$	1,626,129	$	—	$	—	$	1,626,129


	At September 30, 2024:
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	83,814	$	—	$	—	$	83,814
Total	$	83,814	$	—	$	—	$	83,814

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References

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+ Details

Organization and Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Summary of Significant Accounting Policies

1. Organization and Summary of Significant Accounting Policies

Organization

HCW Biologics Inc. (the “Company”) is a 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. The Company believes age-related low-grade chronic inflammation, or “inflammaging,” is a significant contributing factor to several chronic diseases and conditions, such as cancer, cardiovascular disease, diabetes, neurodegenerative diseases, and autoimmune diseases. The Company is located in Miramar, Florida and was incorporated in the state of Delaware in April 2018.

Liquidity and Going Concern

In accordance with FASB Accounting Standards Codification (“ASC”) 205-40, Presentation of Financial Statements – Going Concern (“Topic 205-40”), management is required to evaluate whether there are conditions and events, considered in the aggregate that raise substantial doubt about the Company’s ability to continue as a going concern for at least 12 months from the issuance date of the Company’s condensed interim financial statements. This evaluation does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented or are not within control of the Company as of the date the financial statements are issued. When substantial doubt exists under this methodology, management evaluates whether the mitigating effect of its plans sufficiently alleviates substantial doubt about the Company’s ability to continue as a going concern. The mitigating effect of management’s plans, however, is only considered if both (1) it is probable that the plans will be effectively implemented within one year after the date that the financial statements are issued, and (2) it is probable that the plans, when implemented, will mitigate the relevant conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued.

As of September 30, 2024, the Company had not generated any revenue from commercial product sales of its internally developed immunotherapeutic products for the treatment of cancer and other age-related diseases. During its development activities, the Company has sustained operating losses and expects to continue to incur operating losses for the foreseeable future. Since inception to September 30, 2024, the Company incurred cumulative net losses of $94.5 million. These losses reflects the events reported in the Form 8-K filed on May 1, 2024 with the Securities and Exchange Commission (“SEC”), involving a scheme that resulted in the misdirection of approximately $1.3 million held in Company accounts to a fraudulent account controlled by a third party. The Company has pursued relief through insurance claims and has reported the crime to legal authorities. Management expects to incur additional losses in the future to conduct product research and development and recognizes the need to raise additional capital to fully implement its business plan. As of September 30, 2024, the Company had $1.0 million in cash and cash equivalents.

On August 15, 2022, the Company entered into a loan and security agreement (the “2022 Loan Agreement”) with Cogent Bank, pursuant to which it received $6.5 million in proceeds to purchase a building that will become the Company's new headquarters. The loan is secured by a first priority lien on the building. As of September 30, 2024, certain subcontractors have filed mechanics liens related to unpaid invoices issued in connection with the Company’s construction of its new manufacturing facilities and upgraded research laboratories. The 2022 Loan Agreement contains a provision for a discretionary default in the event that the Company fails to pay sums due in connection with construction of any improvements; however, as of the reporting date, the lender has not elected to do so. See Part I, Item 4. -- “Controls and Procedures.” As of September 30, 2024, the Company has reflected this loan as Short-term debt, net, to reflect that the lender has the right to accelerate the loan under a discretionary default provision. The Company continues to seek the financing required to complete the construction project, with the cooperation of the lender and lien holders.

To date, the Company has funded operations primarily through the sale of stock, issuance of senior secured notes and revenues generated from the Company’s exclusive worldwide license with Wugen, Inc. (“Wugen”), pursuant to which Wugen licensed limited rights to develop, manufacture, and commercialize cell therapy treatments for cancer based on two of the Company’s internally-developed multi-cytokine fusion protein molecules, and its manufacturing and supply arrangement with Wugen. In the three months ended September 30, 2023 and 2024, the Company recognized revenues generated from the supply of clinical and research grade material to Wugen of $853,102 and $426,423, respectively. In the nine months ended September 30, 2023 and 2024, the Company recognized revenues generated from the supply of clinical and research grade material to Wugen of $1.5 million and $2.2 million, respectively.

The Company launched a financing plan in the third quarter of 2024. The plan includes several capital-raising activities, such as issuance of secured notes, equity financings, as well as business development transactions, such as license agreements with guaranteed minimum payments. Through October 31, 2024, the Company issued an aggregate of $6.9 million in secured notes. On

September 25, 2024, the Company entered into a nonbinding term sheet with a party interested in licensing one of the Company’s preclinical molecules. The Company expects to close this license transaction in the fourth quarter of 2024. The proposed license agreement includes guaranteed minimum payments which are expected within the first year of the term. On November 13, 2024, we entered into an engagement letter with the Maxim Group to act as the exclusive placement agent for a multi-step equity financing. If the Company is not successful in raising additional capital through these activities, management intends to revise its business plan. If such revisions are insufficient, the Company may have to curtail or cease operations.

The Company has received written notices from the Listing Qualifications Staff of the Nasdaq Stock Market LLC (“Nasdaq”) informing the Company it is not in compliance with continued listing requirements on the Nasdaq Global Market for the market value of listed securities. Under Nasdaq Listing Rules, the Company has a period of 180 calendar days from the date of notice in which to regain compliance, and its first deadline is currently scheduled for December 16, 2024. The Company intend to take all reasonable measures available to us to regain compliance with the continued listing requirements for the Nasdaq Global Market, including utilizing the right to appeal to Nasdaq to extend the deadline to regain compliance based on a solid financial plan to do so. While the Company is exercising diligent efforts to maintain the listing of its common stock on Nasdaq, there can be no assurance that the Company will be able to regain or maintain compliance with the applicable continued listing standards set forth in the Nasdaq Listing Rules.

As of September 30, 2024, the conclusion of a going concern assessment was that there is substantial doubt about the Company’s ability to continue as a going concern. The Company considered its financing plans for the next 12 months, along with expected continuing operating losses and the burden of expenses incurred in connection with past legal proceedings. Management concluded that there were no mitigating circumstances which alleviated the substantial doubt over its ability to continue as a going concern.

As reported in the Company’s Form 8-K filed on July 18, 2024 and further described in Part II, Item 1. – “Legal Proceedings” below, as of July 13, 2024, the Company and Dr. Hing C. Wong, the Company’s Founder and Chief Executive Officer, entered into a confidential Settlement Agreement and Release (the “Settlement Agreement”) with ImmunityBio and its affiliates. 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 will bear its own expenses incurred in connection with the matter. The Company has substantially completed remediation procedures required to be in compliance with the terms of the Settlement Agreement.

The Company entered into the Settlement Agreement to avoid the costs, disruption and distraction of further litigation. In the accompanying condensed balance sheet as of September 30, 2024, the Company reported a balance of $14.4 million for legal fees incurred but not yet paid that were included within Accounts payable and an accrual of $35,000 for accrued legal fees within Accrued liabilities and other current liabilities. 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. With the execution of the Settlement Agreement, the Company resolved the attendant uncertainties for the outcome of the arbitration and additional complexities, and it launched its new financing plan.

The accompanying interim financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described above. The Company believes that substantial doubt exists regarding its ability to continue as a going concern for at least 12 months from the date of issuance of the Company’s condensed interim financial statements and that the substantial doubt that existed in its going concern analysis was not alleviated.

Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed balance sheet as of September 30, 2024, the condensed statements of operations, and condensed statements of changes in stockholders’ equity (deficit) for the three and nine-month periods ended September 30, 2023 and 2024 and the condensed statements of cash flows for the nine months ended September 30, 2023 and 2024, and all related disclosures contained in the accompanying notes have been prepared in accordance with accounting principles that are generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and pursuant to Article 10 of Regulation S-X of the Securities Act of 1933, as amended (the “Securities Act”). Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. These unaudited condensed interim financial statements include only normal and recurring adjustments that the Company believes are necessary to fairly state the Company’s financial position and the results of its operations and cash flows. The results for the three and nine-month periods ended September 30, 2024 are not necessarily indicative of the results expected for the full fiscal year or any subsequent interim period. The condensed interim balance sheet at December 31, 2023 has been derived from the audited financial statements at that date but does not include all disclosures required by

U.S. GAAP for complete financial statements. Because all of the disclosures required by U.S. GAAP for complete financial statements are not included herein, these unaudited condensed interim financial statements and the notes accompanying them should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2023, which appear in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on May 15, 2024 (the “Annual Report”) and in other filings with the SEC.

Reclassification of Prior Period Presentation of Legal Expenses

Certain prior period amounts have been reclassified to distinguish between General and administrative expenses in the ordinary course of business and legal expenses incurred in connection with the arbitration and Settlement Agreement described in Notes 1. Reclassification of legal expenses incurred in connection with legal proceedings impacts the consolidated interim statements of operations. There is no effect on reporting results of operations from prior periods.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Management must apply significant judgment in this process. The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could differ from estimates.

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820, Fair Value Measurement (“Topic 820”), establishes a fair value hierarchy for those instruments measured at fair value that distinguishes between fair value measurements based on market data (observable inputs) and those based on the Company’s own assumptions (unobservable inputs). This hierarchy maximizes the use of observable inputs and minimizes the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:

Level 1: Observable inputs such as quoted prices in active markets;

Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

Level 3: Unobservable inputs in which there is little or no market data, which require a reporting entity to develop its own assumptions.

Fair value measurements are classified based on the lowest level of input that is significant to the measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment, which may affect the valuation of the assets and liabilities and their placement within the fair value hierarchy levels. The determination of the fair values takes into account the market for the Company’s financial assets and liabilities, the associated credit risk, and other factors as required. The Company considers active markets as those in which transactions for the assets or liabilities occur in sufficient frequency and volume to provide pricing information on an ongoing basis.

Revenue Recognition

The Company accounts for revenues in accordance with ASC 606, Revenue from Contracts with Customers (“Topic 606”). To determine revenue recognition for arrangements that fall within the scope of Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that it will collect the consideration it is entitled to in exchange for the goods or services transferred to the customer.

At contract inception, the Company assesses the goods or services promised within each contract, determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. To date, the Company's revenues have been generated solely from transactions with Wugen. The Wugen License includes

licenses of intellectual property, cost reimbursements, upfront signing fees, milestone payments and royalties on future licensee’s product sales. In addition, the Company and Wugen have an agreement for supply of materials, from which the Company also recognizes revenues.

License Grants:

For out-licensing arrangements that include a grant of a license to the Company’s intellectual property, the Company considers whether the license grant is distinct from the other performance obligations included in the arrangement. For licenses that are distinct, the Company recognizes revenues from nonrefundable, upfront payments and other consideration allocated to the license when the license term has begun and the Company has provided all necessary information regarding the underlying intellectual property to the customer, which generally occurs at or near the inception of the arrangement.

Milestone and Contingent Payments:

At the inception of the arrangement and at each reporting date thereafter, the Company assesses whether it should include any milestone and contingent payments or other forms of variable consideration in the transaction price using the most likely amount method. If it is probable that a significant reversal of cumulative revenue would not occur upon resolution of the uncertainty, the associated milestone value is included in the transaction price. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of each such milestone and any related constraint and, if necessary, adjusts its estimate of the overall transaction price. Since milestone and contingent payments may become payable to the Company upon the initiation of a clinical study or filing for or receipt of regulatory approval, the Company reviews the relevant facts and circumstances to determine when the Company should update the transaction price, which may occur before the triggering event. When the Company updates the transaction price for milestone and contingent payments, the Company allocates the changes in the total transaction price to each performance obligation in the agreement on the same basis as the initial allocation. Any such adjustments are recorded on a cumulative catch-up basis in the period of adjustment, which may result in recognizing revenue for previously satisfied performance obligations in such period. The Company’s licensees will generally pay milestones payments subsequent to achievement of the triggering event.

Materials Supply:

The Company provides clinical and research grade materials so that licensees may develop products based on the licensed molecules. The Company plans to enter into commercialization supply agreements when licensees enter the commercial stage of their company. The amounts billed are recognized as revenue as the performance obligations are satisfied by the Company, once the Company determines that a contract exists.

On June 18, 2021, the Company entered into a master services agreement for the supply of materials for clinical development of licensed products. To meet all the criteria to qualify as a contract under Topic 606, the Company must enter into statements-of-work for purchases of clinical and research grade materials. The Company has determined that the manufacturing of the clinical and research materials supplied by the Company each represents a single performance obligation that is satisfied over time. The Company recognizes revenue using an input method based on the costs incurred relative to the total expected cost, which determines the extent of the Company's progress toward completion. As part of the accounting for these arrangements, the Company must develop estimates and assumptions that require judgement to determine the progress towards completion. The Company reviews its estimate of the progress toward completion based on the best information available to recognize the cumulative progress toward completion as of the end of each reporting period, and makes revisions to such estimates, if facts and circumstances change during each reporting period.

For the three and nine months ended September 30, 2023, the Company recognized $853,102 and $1.5 million in revenue related to the sale of development supply materials to Wugen, respectively. For the three and nine months ended September 30, 2024, the Company recognized $426,423 and $2.2 million in revenue related to sale of development supply materials to Wugen, respectively.

Investments

The Company holds a minority interest in Wugen which is accounted for using the measurement alternative whereby the investment is recorded at cost less impairment, adjusted for observable price changes in orderly transactions for an identical or similar investment of the same investee. No impairment has been recognized. As of September 30, 2024 and December 31, 2023, the Company included $1.6 million for the investment in Wugen in Investments in the accompanying condensed interim balance sheets. The Company used its equity interest in Wugen to collateralize the Secured Notes. See Note 3. Debt, Net.

Operating Leases

The Company determines if an arrangement is a lease at inception. Operating leases are included in Other assets, Accrued liabilities and other current liabilities, and Other liabilities on its condensed interim balance sheets. Operating lease Right of Use (“ROU”) assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over

the lease term at commencement date. As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. The Company has a lease agreement with lease and non-lease components, which are accounted for separately. For short-term leases with a term of one year or less, the Company uses the practical expedient and does not record an ROU asset or lease liability for such short-term leases.

Net Loss Per Share

Basic loss per share of common stock is computed by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during each period. Diluted loss per share of common stock includes the effect, if any, from the potential exercise of stock options and unvested shares of restricted stock, which would result in the issuance of incremental shares of common stock. For diluted net loss per share, the weighted-average number of shares of common stock is the same for basic net loss per share due to the fact that when a net loss exists, dilutive securities are not included in the calculation as the impact is anti-dilutive.

Accrued Liabilities and Other Current Liabilities - Additional Information (Detail) - USD ($)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Payables And Accruals [Line Items]
Accrued liabilities and other current liabilities	$ 1,056,716		$ 1,056,716		$ 2,580,402
Accounts Payable and Accrued Liabilities, Current	1,200,000		1,200,000		2,600,000
Legal Fees	949,455	$ 2,075,279	15,761,531	$ 4,610,091
Accrued Expenses Current [Member]
Payables And Accruals [Line Items]
short term lease liability					28,500
Accounts Payable and Accrued Liabilities [Member]
Payables And Accruals [Line Items]
Salaries and Employee Benefits	90,000		90,000
Construction expenses					392,000
Manufacturing expenses			49,000		105,000
Construction in progress	422,000		422,000
Legal Fees			170,000		1,100,000
Property taxes	104,000		104,000
Clinical expenses	117,000		117,000		262,000
Bonus payable	57,000		57,000		365,000
Salary expense					160,000
Current portion of long term debt	$ 126,000		$ 126,000		119,000
Other liabilities					$ 68,500

Condensed Statements of Operations (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Revenues:
Revenues	$ 426,423	$ 853,102	$ 2,171,988	$ 1,517,792
Cost of revenues	(341,138)	(678,325)	(1,291,546)	(1,210,077)
Net revenues	85,285	174,777	880,442	307,715
Operating expenses:
Research and development	1,186,913	1,667,442	5,339,383	5,539,919
General and administrative	1,639,152	1,509,936	4,799,437	5,106,674
Legal expenses	949,455	2,075,279	15,761,531	4,610,091
Nonoperating loss	0	0	1,300,000	0
Total operating expenses	3,775,520	5,252,657	27,200,351	15,256,684
Loss from operations	(3,690,235)	(5,077,880)	(26,319,909)	(14,948,969)
Interest expense	(223,363)	(95,514)	(383,029)	(284,465)
Other (expense) income, net	11,310	234,753	52,397	919,688
Net loss	$ (3,902,288)	$ (4,938,641)	$ (26,650,541)	$ (14,313,746)
Net loss per share, basic	$ (0.1)	$ (0.14)	$ (0.71)	$ (0.4)
Net loss per share, diluted	$ (0.1)	$ (0.14)	$ (0.71)	$ (0.4)
Weighted average shares outstanding, basic	37,823,394	35,926,921	37,623,459	35,907,123
Weighted average shares outstanding, diluted	37,823,394	35,926,921	37,623,459	35,907,123

Cover Page - shares	9 Months Ended
Cover Page - shares	Sep. 30, 2024	Nov. 11, 2024
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Sep. 30, 2024
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q3
Entity Registrant Name	HCW Biologics Inc.
Entity Central Index Key	0001828673
Current Fiscal Year End Date	--12-31
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	82-5024477
Entity Address, Address Line One	2929 N
Entity Address, Address Line Two	Commerce Parkway
Entity Address, City or Town	Miramar
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33025
City Area Code	954
Local Phone Number	842–2024
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Shell Company	false
Title of 12(b) Security	Common Stock
Trading Symbol	HCWB
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		37,823,394
Entity File Number	001-40591

Commitments and Contingencies

9 Months Ended

Sep. 30, 2024

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

8. Commitments and Contingencies

Operating Leases

As of March 1, 2022, the Company entered a two-year lease, comprised of two operating leases, for approximately 12,250 square feet of space located in Miramar, Florida. Upon the commencement of those leases, the Company used its incremental borrowing rate of 6.0% to determine the amounts to recognize for a ROU asset and a lease liability.

On March 1, 2024, the Company entered a one-year lease for the same space, which expires on February 28, 2025. If a lease has a term that is 12 months or less in duration, the lease qualifies for a short-term lease exemption under ASC 842-20-25-2. The Company elected to take advantage of this exemption, and it will account for this lease on a straight-line basis over the lease term and will not recognize a ROU asset and a lease liability as a result. The remaining lease payments under the new short-term lease are $114,510. The Company has no obligations under financing leases.

For the three months ended September 30, 2023 and 2024, rent expense recognized by the Company was $42,400 and $49,500, respectively, of which $22,200 and $25,900, respectively, are included in research and development in the accompanying condensed interim statements of operations. For the nine months ended September 30, 2023 and 2024, rent expense recognized by the Company was $127,200 and $146,400, respectively, of which $66,600 and $75,300, respectively are included in research and development in the accompanying condensed interim statements of operations.

Contractual Commitments

The Company has commitments with a third-party manufacturing organization to supply us with clinical grade materials. As of September 30, 2024, it is under contract for obligations of $12,500 it expects to pay during the year ending December 31, 2024. As of December 31, 2023 and September 30, 2024, the Company had commitments to fund $4.4 million and $2.5 million, respectively, in construction costs related to the buildout of its new headquarters and manufacturing facility.

Project Financing

On January 10, 2024 (the “Termination Date”), the Company exercised its right to terminate its credit agreement (the “Credit Agreement”), dated April 21, 2023, with Prime Capital Ventures, LLC (the “Lender”), as permitted under the terms of the Credit Agreement. These funds were intended to finance the construction and renovation of the Company’s new headquarters (the “Property”). The termination followed repeated delays in funding and related concerns. There were no borrowings under the Credit Agreement as of the Termination Date, and the Company did not incur any penalties as a result of such termination under the terms of the Agreement. Upon exercising its right to terminate the Agreement, the Company was entitled to receive the return of the $5.3 million that the Company placed on deposit to establish an interest reserve account with the Lender. However, the Lender defaulted on its obligation to return the interest reserve deposit. Given the uncertainty of when or if funds will be recovered from the Lender, the Company recognized a reserve for a credit loss for $5.3 million as of December 31, 2023. The Company intends to pursue all available remedies to recover these funds, including legal actions, receivership and insurance.

The Company continues to seek financing to complete the construction and renovation of its Property, where it intends to build a new headquarters, including a biologics manufacturing facility, upgraded research laboratory facilities, vivarium, and upgraded office and common areas.

Nonoperating Loss

As reported in the Company’s Form 8-K filed on May 1, 2024 with the SEC, the Company became aware that it was the victim of a criminal scheme involving the impersonation of a purchaser upon the default on a legally binding commitment to purchase $8.0 million of secured notes from the Company. The scheme resulted in the misdirection of approximately $1.3 million held in Company accounts to a fraudulent account controlled by a third party. The Company is pursuing all available remedies to recover this loss. Given the limited success that these efforts have had to date for the recovery of funds, the Company recognized a loss of $1.3 million in the three- and nine-month periods ended September 30, 2024.

Legal

Legal Proceedings

From time to time, the Company is a party to or otherwise involved in legal proceedings, including suits, assessments, regulatory actions and investigations generally arising out of the normal course of business. In addition, the Company enters into agreements that may include indemnification provisions, pursuant to which the Company agrees to indemnify, hold harmless and defend the indemnified parties for losses suffered or incurred by the indemnified party. When the Company believes that the outcome of such a matter will result in a liability that is probable to be incurred and result in a potential loss, or range of loss, that can be reasonably estimated, the Company will accrue a liability and make the appropriate disclosure in the footnotes to the financial statements.

Arbitration, Settlement and General Release

On December 23, 2022, Altor BioScience, LLC and NantCell, Inc. (“Altor/NantCell”) initiated an arbitration against Dr. Hing C. Wong, the Company’s Founder and Chief Executive Officer, in California alleging breach of contract and fiduciary duty, among other claims. On that same date, Altor/NantCell filed a lawsuit against the Company in federal court alleging misappropriation of trade secrets, inducement of breach of contract and breach of fiduciary duty, among other claims against the Company. On April 26, 2023, the parties stipulated that Altor/NantCell’s action against the Company would be consolidated with the Altor/NantCell arbitration demand against Dr. Wong. On April 27, 2023, the Court approved the parties’ stipulation and ordered the parties to arbitration. On May 1, 2023, Altor/NantCell filed a demand against the Company before JAMS. On May 3, 2023, Altor/NantCell dismissed the federal court action without prejudice and the Court ordered the case dismissed without prejudice and closed the case. Altor/NantCell’s proceeding against the Company proceeded in arbitration before JAMS and consolidated with the arbitration Altor/NantCell initiated against Dr. Wong (the “Arbitration”). On March 26, 2024, Altor/NantCell filed a complaint (the “Complaint”) against the Company in the Chancery Court of the State of Delaware for the contribution of legal fees and expenses advanced to Dr. Wong.

As reported in the Company’s Form 8-K filed on July 18, 2024 and described in Part II, Item 1. – “Legal Proceedings” below, as of July 13, 2024, the Company and Dr. Hing C. Wong, the Company’s Founder and Chief Executive Officer, entered into a confidential Settlement Agreement and Release (the “Settlement Agreement”) with Altor BioScience, LLC (“Altor”), NantCell, Inc. (“NantCell”), and ImmunityBio, Inc. (the parent of Altor and NantCell, together with Altor and NantCell, “ImmunityBio”), to resolve the previously disclosed Arbitration before JAMS brought by Altor and NantCell as well as the Complaint Altor filed against the Company in the Chancery Court of the State of Delaware for the contribution of legal fees and expenses advanced to Dr. Wong. 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 will bear its own expenses incurred in

connection with the matter. The Company has substantially completed remediation procedures required to be in compliance with the terms of the Settlement Agreement. The Settlement Agreement provides that, upon completion of these procedures, the parties mutually agreed to stipulate that the Arbitration and Complaint should be dismissed.

As of the filing date, the parties to the Settlement Agreement are working together to finalize the notices and related final documentation to obtain dismissal of the Arbitration and Complaint.

Other Matters

Inflationary Cost Environment, Banking Crisis, Supply Chain Disruption and the Macroeconomic Environment

The Company’s operations have been affected by many headwinds, including inflationary pressures, rising interest rates, ongoing global supply chain disruptions resulting from increased geopolitical tensions such as the war in the Middle East, the conflict between Russia and Ukraine, China-Taiwan relations, financial market volatility and currency movements. The Company has been impacted by inflation, and may continue to be so, when procuring materials required for the buildout of our new headquarters, the costs for recruiting and retaining employees and other employee-related costs. Management employs a number of strategies to effectively navigate these issues, including product redesign, alternate sourcing, and establishing contingencies in budgeting and timelines. Future developments in these and other areas present material uncertainty and risk with respect to the Company's clinical trials, IND-enabling activities, buildout of the new headquarters, as well as the Company's financial condition and results of operations. The extent and duration of such events and conditions, and resulting disruptions to our operations, are highly unpredictable.

Debt, Net - Additional Information (Details) - USD ($)	9 Months Ended
Debt, Net - Additional Information (Details) - USD ($)	Sep. 30, 2024	Mar. 31, 2024	Dec. 31, 2023	Aug. 15, 2022
Line of Credit Facility [Line Items]
Debt	$ 6,462,769		$ 6,304,318
Wugen License
Line of Credit Facility [Line Items]
Pledged collateral percentage	5.60%
Senior Secured Notes [Member]
Line of Credit Facility [Line Items]
Maturity date	Aug. 30, 2026
Principal amount	$ 6,500,000
Interest rate	9.00%
Penalty percentage	5.00%
Senior Secured Notes [Member] \| Collateral Pledged
Line of Credit Facility [Line Items]
Principal amount	$ 10,000,000
Senior Secured Notes [Member] \| Maximum [Member]
Line of Credit Facility [Line Items]
Principal amount		$ 10,000,000
Senior Secured Notes [Member] \| Chief Executive Officer [Member]
Line of Credit Facility [Line Items]
Accredited investors principal amount	2,400,000
Senior Secured Notes [Member] \| Chief Financial Officer
Line of Credit Facility [Line Items]
Accredited investors principal amount	220,000
Senior Secured Notes [Member] \| Chairman of Board Of Directors [Member]
Line of Credit Facility [Line Items]
Accredited investors principal amount	140,000
Senior Secured Notes [Member] \| Board Of Directors
Line of Credit Facility [Line Items]
Accredited investors principal amount	60,000
Senior Secured Notes [Member] \| Senior Vice President [Member]
Line of Credit Facility [Line Items]
Accredited investors principal amount	25,000
Senior Secured Notes [Member] \| Board Of Directors Audit Chair
Line of Credit Facility [Line Items]
Accredited investors principal amount	$ 25,000
Cogent Bank Member
Line of Credit Facility [Line Items]
Proceeds to purchase				$ 6,500,000
Line Of credit facility frequency of payments	The interest-only period was one year followed by 48 months of equal payments of principal and interest
Maturity date	Aug. 15, 2027
Credit facility interest rate during period	5.75%
Debt, current portion	$ 6,300,000

Condensed Balance Sheets (Unaudited) - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 998,221	$ 3,595,101
Accounts receivable, net	651,840	1,535,757
Prepaid expenses	356,156	1,042,413
Other current assets	88,131	230,916
Total current assets	2,094,348	6,404,187
Investments	1,599,751	1,599,751
Property, plant and equipment, net	22,833,904	20,453,184
Other assets	28,476	56,538
Total assets	26,556,479	28,513,660
Current liabilities:
Accounts payable	22,666,107	6,167,223
Accrued liabilities and other current liabilities	1,056,716	2,580,402
Short-term debt, net	6,340,511
Total current liabilities	30,063,334	8,747,625
Debt, net	6,462,769	6,304,318
Total Liabilities	36,526,103	15,051,943
Commitments and contingencies (Note 8)
Stockholders' equity (deficit):
Common Stock Value	3,782	3,603
Additional paid-in capital	87,209,457	83,990,437
Accumulated deficit	(97,182,863)	(70,532,323)
Total stockholders' equity (deficit)	(9,969,624)	13,461,717
Total liabilities and stockholders' equity (deficit)	$ 26,556,479	$ 28,513,660

Net Loss Per Share - Summary of Basic and Diluted Net Income (Loss) Per Common Share (Detail) - USD ($)	3 Months Ended						9 Months Ended
	Sep. 30, 2024	Jun. 30, 2024	Mar. 31, 2024	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2024	Sep. 30, 2023
Numerator:
Net Income (Loss)	$ (3,902,288)	$ (15,280,191)	$ (7,468,061)	$ (4,938,641)	$ (4,304,420)	$ (5,070,686)	$ (26,650,541)	$ (14,313,746)
Denominator:
Weighted average shares outstanding, basic	37,823,394			35,926,921			37,623,459	35,907,123
Weighted average shares outstanding, diluted	37,823,394			35,926,921			37,623,459	35,907,123
Net loss per share, basic	$ (0.1)			$ (0.14)			$ (0.71)	$ (0.4)
Net loss per share, diluted	$ (0.1)			$ (0.14)			$ (0.71)	$ (0.4)

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

+ References

+ Details

- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

+ References

+ Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

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+ Details

Condensed Statements of Changes in Stockholders' Equity (Deficit) (Unaudited) - USD ($)	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Deficit [Member]
Beginning balance (in shares) at Dec. 31, 2022		35,876,440
Beginning balance , Value at Dec. 31, 2022	$ 37,428,506	$ 3,588	$ 82,962,964	$ (45,538,046)
Issuance of Common Stock upon exercise of stock options, Shares		10,195
Issuance of Common Stock upon exercise of stock options , Value	1,901	$ 1	1,900
Stock-based compensation , Value	259,206		259,206
Net Income (Loss)	(5,070,686)			(5,070,686)
Ending balance (in shares) at Mar. 31, 2023		35,886,635
Ending balance , Value at Mar. 31, 2023	32,618,927	$ 3,589	83,224,070	(50,608,732)
Beginning balance (in shares) at Dec. 31, 2022		35,876,440
Beginning balance , Value at Dec. 31, 2022	37,428,506	$ 3,588	82,962,964	(45,538,046)
Net Income (Loss)	(14,313,746)
Ending balance (in shares) at Sep. 30, 2023		35,927,321
Ending balance , Value at Sep. 30, 2023	23,866,933	$ 3,593	83,715,133	(59,851,793)
Beginning balance (in shares) at Mar. 31, 2023		35,886,635
Beginning balance , Value at Mar. 31, 2023	32,618,927	$ 3,589	83,224,070	(50,608,732)
Issuance of Common Stock upon exercise of stock options, Shares		40,086
Issuance of Common Stock upon exercise of stock options , Value	7,712	$ 4	7,708
Stock-based compensation , Value	263,423		263,423
Net Income (Loss)	(4,304,420)			(4,304,420)
Ending balance (in shares) at Jun. 30, 2023		35,926,721
Ending balance , Value at Jun. 30, 2023	28,585,642	$ 3,593	83,495,201	(54,913,152)
Issuance of Common Stock upon exercise of stock options, Shares		600
Issuance of Common Stock upon exercise of stock options , Value	84		84
Stock-based compensation , Value	219,848		219,848
Net Income (Loss)	(4,938,641)			(4,938,641)
Ending balance (in shares) at Sep. 30, 2023		35,927,321
Ending balance , Value at Sep. 30, 2023	23,866,933	$ 3,593	83,715,133	(59,851,793)
Beginning balance (in shares) at Dec. 31, 2023		36,025,104
Beginning balance , Value at Dec. 31, 2023	13,461,717	$ 3,603	83,990,437	(70,532,323)
Issuance of Common Stock upon exercise of stock options, Shares		12,572
Issuance of Common Stock upon exercise of stock options , Value	2,255	$ 1	2,254
Issuance of Common Stock upon equity subscription,Shares.		1,785,718
Issuance of Common Stock upon equity subscription	2,500,005	$ 178	2,499,827
Stock-based compensation , Value	244,685		244,685
Net Income (Loss)	(7,468,061)			(7,468,061)
Ending balance (in shares) at Mar. 31, 2024		37,823,394
Ending balance , Value at Mar. 31, 2024	8,740,601	$ 3,782	86,737,203	(78,000,384)
Beginning balance (in shares) at Dec. 31, 2023		36,025,104
Beginning balance , Value at Dec. 31, 2023	13,461,717	$ 3,603	83,990,437	(70,532,323)
Net Income (Loss)	(26,650,541)
Ending balance (in shares) at Sep. 30, 2024		37,823,394
Ending balance , Value at Sep. 30, 2024	(9,969,624)	$ 3,782	87,209,457	(97,182,863)
Beginning balance (in shares) at Mar. 31, 2024		37,823,394
Beginning balance , Value at Mar. 31, 2024	8,740,601	$ 3,782	86,737,203	(78,000,384)
Stock-based compensation , Value	239,821		239,821
Net Income (Loss)	(15,280,191)			(15,280,191)
Ending balance (in shares) at Jun. 30, 2024		37,823,394
Ending balance , Value at Jun. 30, 2024	(6,299,769)	$ 3,782	86,977,024	(93,280,575)
Stock-based compensation , Value	232,433		232,433
Net Income (Loss)	(3,902,288)			(3,902,288)
Ending balance (in shares) at Sep. 30, 2024		37,823,394
Ending balance , Value at Sep. 30, 2024	$ (9,969,624)	$ 3,782	$ 87,209,457	$ (97,182,863)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

- Definition

Amount of equity (deficit) attributable to parent. Excludes temporary equity and equity attributable to noncontrolling interest.

+ References

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+ Details

Debt, Net

9 Months Ended

Sep. 30, 2024

Debt Disclosure [Abstract]

Debt, Net

3. Debt, Net

Cogent Bank Loan

On August 15, 2022, the Company entered into the 2022 Loan Agreement with Cogent Bank, pursuant to which it received $6.5 million in proceeds to purchase a building that will become the Company's new headquarters. The loan is secured by a first priority lien on the building. The interest-only period was one year followed by 48 months of equal payments of principal and interest beginning on September 15, 2023 based on a 25-year amortization rate. The unamortized balance is due on August 15, 2027 (the “Maturity Date”), and bears interest at a fixed per annum rate equal to 5.75%. Upon the Maturity Date, a final payment of unamortized principal will be due. The Company has the option to prepay the outstanding balance of the loan prior to the Maturity Date without penalty.

As of September 30, 2024, certain subcontractors have filed mechanics liens related to unpaid invoices issued in connection with the Company’s construction of its new manufacturing facilities and upgraded research laboratories. The 2022 Loan Agreement contains a provision for a discretionary default in the event that the Company fails to pay sums due in connection with construction of any improvements; however, as of the reporting date, the lender has not elected to do so. As of September 30, 2024, the Company has reflected this loan as Short-term debt, net, to reflect that the lender has the right to accelerate the loan under a discretionary default provision. As of September 30, 2024, $6.3 million is included in Short-term debt, net in the accompanying condensed interim balance sheet.

Senior Secured Notes

On March 31, 2024, the Company entered into a Note Purchase Agreement with the Purchasers (as defined in the Note Purchase Agreement), pursuant to which the Company may issue secured notes up to an aggregate principal amount up to $10.0 million (“Secured Notes”).

As of September 30, 2024, the Company received $6.5 million in funding from the issuance of Secured Notes, which is included within Debt, Net on the accompanying condensed interim balance sheet. Investors included Dr. Hing C. Wong, Founder and Chief Executive Officer, who invested $2.4 million; Rebecca Byam, Chief Financial Officer, who invested $220,000; Lee Flowers, Senior Vice President of Business Development, who invested $25,000; Scott T. Garrett, the Chairman of the Company’s board of directors, who invested $140,000; Gary M. Winer, a member of our board of directors, who invested $60,000; Rick S. Greene, a member of the board of directors, who invested $25,000, as well as unrelated parties.

As of July 2, 2024, existing investors in Secured Notes unanimously agreed to an Amended and Restated Note Purchase Agreement and related documents (“Amended and Restated Note Purchase Agreement”). On September 30, 2024, existing investors approved an amendment to the Amended and Restated Note Purchase Agreement which extended the last closing date to October 31, 2024. No other terms were changed. Under the terms of the Amended and Restated Note Purchase Agreement, the Secured Notes continue to bear interest at a rate of 9% per annum, payable quarterly in arrears. The Secured Notes will mature on August 30, 2026 (the “Maturity Date”), on which date the principal balance, accrued but unpaid interest and other amounts owed under the terms of the Amended and Restated Note Purchase Agreement shall be due and payable. The Company pledged its equity ownership interest in Wugen, which was equivalent to a 5.6% ownership stake in that company as of September 30, 2024 (“Pledged Collateral”). The Pledged Collateral will be held and released according to the terms of the Escrow Agreement, as security for the Secured Notes.

If the Company elects to prepay the Senior Notes on or before December 31, 2024, there is a 5% prepayment penalty. The Secured Notes have a Mandatory Prepayment provision, according to which the Company is required to prepay the Secured Notes before the Maturity Date under certain circumstances. In the event of a Mandatory Prepayment, Secured Notes may receive a bonus payment based on the gross proceeds of the sale of the Pledged Collateral. If the Secured Notes are repaid on the Maturity Date, holders will receive a fixed bonus payment in addition to payment of outstanding principal and accrued and unpaid interest. If a bonus payment is paid, then there is no prepayment penalty. The Amended and Restated Note Purchase Agreement also contains default provisions, according to which, following an event of default, the Company may be required to distribute the Pledged Collateral to the Purchasers on a pro rata basis based on a $10.0 million issuance of Secured Notes, in full satisfaction of the indebtedness evidenced by the Secured Notes.

As of September 30, 2024, the fair value of the embedded derivative, which incorporated the likelihood of certain events occurring, was immaterial. Thus, as of September 30, 2024, the Company did not recognize the embedded derivative in the accompanying condensed financial statements.

The Company accounts for the bonus payment to be paid if the Secured Notes are repaid on the Maturity Date by accreting the bonus payment to the full amount due on the Maturity Date, utilizing the effective interest rate method. As of September 30, 2024, the Company did not recognize accretion of the bonus payment, which was not considered material to the accompanying condensed financial statements.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

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+ Details

Subsequent Events - Additional Information (Details) - Subsequent Event [Member] - Senior Secured Notes [Member]	Oct. 31, 2024 USD ($)
Subsequent Event [Line Items]
Secured debt	$ 375,000
Dr. Wong [Member]
Subsequent Event [Line Items]
Accredited investors principal amount	$ 0

Preferred Stock	9 Months Ended
Preferred Stock	Sep. 30, 2024
Equity [Abstract]
Preferred Stock	4. Preferred Stock As of December 31, 2023 and September 30, 2024, the Company had 10,000,000 shares of preferred stock authorized and no such shares issued.

Condensed Balance Sheets (Parenthetical) (Unaudited) - $ / shares	Sep. 30, 2024	Dec. 31, 2023
Condensed Balance Sheets [Line Items]
Common Stock, Par or Stated Value Per Share	$ 0.0001	$ 0.0001
Common Stock, Shares Authorized	250,000,000	250,000,000
Common Stock, Shares, Issued	37,823,394	36,025,104

Net Loss Per Share - Summary of Outstanding Potentially Dilutive Securities (Detail) - shares	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities	1,788,137	1,869,492
Common Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities	1,788,137	1,869,492

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Sep. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false
Rule 10b5-1 Arrangement Modified	false
Non-Rule 10b5-1 Arrangement Modified	false

Fair Value of Financial Instruments - Summary of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Detail) - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Assets:
Assets	$ 83,814	$ 1,626,129
Money Market Funds [Member]
Assets:
Assets	83,814	1,626,129
Level 1 [Member]
Assets:
Assets	83,814	1,626,129
Level 1 [Member] \| Money Market Funds [Member]
Assets:
Assets	83,814	1,626,129
Level 2 [Member]
Assets:
Assets	0	0
Level 2 [Member] \| Money Market Funds [Member]
Assets:
Assets	0	0
Level 3 [Member]
Assets:
Assets	0	0
Level 3 [Member] \| Money Market Funds [Member]
Assets:
Assets	$ 0	$ 0

Pay vs Performance Disclosure - USD ($)	3 Months Ended						9 Months Ended
Pay vs Performance Disclosure - USD ($)	Sep. 30, 2024	Jun. 30, 2024	Mar. 31, 2024	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2024	Sep. 30, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ (3,902,288)	$ (15,280,191)	$ (7,468,061)	$ (4,938,641)	$ (4,304,420)	$ (5,070,686)	$ (26,650,541)	$ (14,313,746)

Commitments and Contingencies - Additional Information (Detail)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2024 USD ($)	Sep. 30, 2023 USD ($)	Sep. 30, 2024 USD ($)	Sep. 30, 2023 USD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2024 USD ($)	Mar. 01, 2024	Jan. 10, 2024 USD ($)	Mar. 01, 2022 ft²
Operating Leased Assets [Line Items]
Area of land \| ft²									12,250
Lease term							1 year		2 years
Lease termination date			Feb. 28, 2025
Operating Lease, Weighted Average Discount Rate, Percent									6.00%
Short-term lease			$ 114,510
Operating Leases, Rent Expense	$ 49,500	$ 42,400	146,400	$ 127,200
Commitment fund			2,500,000		$ 4,400,000
Deposit for interest reserve								$ 5,300,000
Deposit for credit loss reserve					$ 5,300,000
Loss contingency loss in period	1,300,000		1,300,000
Surety Bond [Member]
Operating Leased Assets [Line Items]
Loss contingency loss in period			1,300,000
Secured debt	8,000,000		8,000,000
Forecast Member
Operating Leased Assets [Line Items]
Future payment obligations						$ 12,500
Research and Development Expense [Member]
Operating Leased Assets [Line Items]
Operating Leases, Rent Expense	$ 25,900	$ 22,200	$ 75,300	$ 66,600