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Organization and Description of Business
12 Months Ended
Dec. 31, 2022
Organization and Description of Business [Abstract]  
Organization and Description of Business

1. Organization and Description of Business

 

Description of the Business

 

Humanigen, Inc. (the “Company” or “Humanigen”) was incorporated on March 15, 2000 in California and reincorporated as a Delaware corporation in September 2001. Effective August 7, 2017, the Company changed its legal name to Humanigen, Inc.

 

The Company is a clinical stage biopharmaceutical company, developing its portfolio of proprietary Humaneered® anti-inflammatory immunology and immuno-oncology monoclonal antibodies. The Company’s proprietary, patented Humaneered technology platform is a method for converting existing antibodies (typically murine) into engineered, high-affinity human antibodies designed for therapeutic use, particularly with acute and chronic conditions. Humanigen has developed or in-licensed targets or research antibodies, typically from academic institutions, and then applied its Humaneered technology to optimize them. The Company’s lead product candidate, lenzilumab, (“LENZ®”), and its other product candidate, ifabotuzumab (“iFab”), are Humaneered monoclonal antibodies. The Company’s Humaneered antibodies are closer to human antibodies than chimeric or conventionally humanized antibodies and have a high affinity for their target. In addition, the Company believes its Humaneered antibodies offer further important advantages, such as high potency, a slow off-rate and a lower likelihood to induce an inappropriate immune response or infusion related reactions.

 

In July 2022, topline results from the Accelerating COVID-19 Therapeutic Interventions and Vaccines-5 (“ACTIV-5”) and Big Effect Trial, in the “B” arm of the trial (“BET-B”), referred to as the ACTIV-5/BET-B trial, were released. The study was sponsored and funded by the National Institutes of Health (“NIH”) and evaluated lenzilumab in combination with remdesivir, compared to placebo and remdesivir, in hospitalized COVID-19 patients. The topline results showed the trial did not achieve statistical significance on the primary endpoint, although the topline results did indicate that lenzilumab demonstrated a positive trend in mortality. A global group of leading institutions and research networks has indicated interest in including lenzilumab in their large-scale, multinational studies of COVID-19, pending an uptick in ICU admissions. Tocilizumab and baricitinib demonstrated mortality benefit following inclusion in REMAP-CAP and RECOVERY, despite having failed to do so in smaller studies.

 

Pursuant to the Company’s previously reported strategic realignment plan, the Company is developing lenzilumab in chronic myelomonocytic leukemia (“CMML”), a rare blood cancer, for which the PREACH-M study is already underway, and is continuing its plans for the RATinG study in acute graft versus host disease (“aGvHD”) that occurs in patients undergoing bone marrow transplant, as these studies are majority funded by its partners. The Company anticipates the first patient dosing in the RATinG study to occur in the second quarter of 2023. These studies are majority funded by the Company’s partners. A leading network of centers, The Mayo Clinics, is currently progressing with an investigator-initiated trial (“IIT”) of lenzilumab in combination with CAR-T therapies. The Company is also developing iFab, an EpAh-3 targeted monoclonal antibody, currently in Phase 1 development, as part of an antibody drug conjugate (“ADC”), for certain solid tumors. Under the realignment plan, the Company has deemphasized the deployment of resources for the development of lenzilumab for COVID-19 and currently does not plan to pursue regulatory pathways, unless further data from ACTIV-5/BET-B or a future large-scale study merit such an approach. The Named Patient program in select European Countries has been terminated. With the exception of the one lenzilumab batch in process, the Company has discontinued the manufacturing of lenzilumab and is consolidating the remaining inventory of lenzilumab bulk drug substance and drug product in a central location for potential future use.

 

See Management’s Discussion and Analysis of Financial Condition and Results of Operations included in Item 7 of this Annual Report on Form 10-K for additional information regarding the business.

 

Liquidity and Going Concern

 

The Consolidated Financial Statements for the years ended December 31, 2022 and 2021 were prepared on the basis of a going concern, which contemplates that the Company will be able to realize assets and discharge liabilities in the normal course of business. However, the Company has incurred net losses since its inception, and has negative operating cash flows and its total liabilities exceed total assets. These conditions raised substantial doubt about the Company’s ability to continue as a going concern.

 

As of December 31, 2022, the Company had cash and cash equivalents of $10.2 million. Considering the Company’s current cash resources and its current and expected levels of operating expenses for the next twelve months, which includes combined accounts payable and accrued expenses recorded in the Company’s consolidated balance sheets as of December 31, 2022 of $55.3 million, certain of which are in dispute, and manufacturing commitments of $2.6 million for 2023, with no significant commitments thereafter (see Note 7 below), the Company requires additional capital to fund the Company’s planned operations. The Company intends to seek to defer payments, negotiate lower amounts or pursue other courses of action for certain amounts owed to manufacturing and other partners at December 31, 2022. In order to remain a going concern and execute its strategic realignment plan, the Company must successfully renegotiate these amounts owed, and settle disputes, including current and potential future arbitration and litigation. The Company recently engaged SC&H Capital, an affiliate of SC&H Group, (“SC&H”), to advise the Company on exploration of strategic options to maximize value around its development pipeline. The Company has not set a timetable for the conclusion of its review of strategic alternatives, and there can be no assurance that this process will result in any transaction. The Company also may seek to raise such additional capital through public or private equity offerings, including under the Controlled Equity OfferingSM Sales Agreement (the “Sales Agreement”) with Cantor Fitzgerald & Co. (“Cantor”), grant financing, convertible and other debt financings, collaborations, strategic alliances, or licensing arrangements involving LENZ and iFab. Additional funds may not be available when the Company needs them on terms that are acceptable to the Company, or at all. If adequate funds are not available, the Company may be required to delay or reduce the scope of or eliminate one or more of its research or development programs and may not be able to continue as a going concern. In addition, if the Company raises additional funds through collaborations, strategic alliances, or licensing arrangements with third parties, the Company may have to relinquish rights to its technologies, future revenue streams or product candidates or to grant licenses on terms that may not be favorable to the Company. While management believes its realignment plans and its plans to raise additional funds will alleviate the conditions that raise substantial doubt about the Company’s ability to continue as a going concern, these plans are not entirely within the Company’s control and cannot be assessed as being probable of occurring.