10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

OR

☐  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from         to        

Commission File Number: 001-39580

Immunome, Inc.

(Exact name of registrant as specified in its charter)

Delaware	77-0694340
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
665 Stockton Drive, Suite 300 Exton, PA	19341
(Address of principal executive offices)	(Zip Code)

(610) 321-3700

(Registrant’s telephone number, including area code)

Not applicable.

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, $0.0001 par value	IMNM	The Nasdaq Capital Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒	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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ☐    No  ☒

There were 12,127,385 shares of the registrant’s common stock outstanding as of May 9, 2022.

IMMUNOME, INC.

Quarterly Report on Form 10-Q for the Quarterly Period ended March 31, 2022

Table of Contents

		Page
	PART I – FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)
	-    Condensed Balance Sheets as of March 31, 2022 and December 31, 2021	3
	-    Condensed Statements of Operations for the Three Months Ended March 31, 2022 and 2021	4
	-    Condensed Statements of Changes in Stockholders’ Equity for the Three Months Ended March 31, 2022 and 2021	5
	-    Condensed Statements of Cash Flows for the Three Months Ended March 31, 2022 and 2021	6
	-    Notes to Condensed Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	17
Item 3.	Quantitative and Qualitative Disclosures about Market Risk.	27
Item 4.	Controls and Procedures.	27
	PART II – OTHER INFORMATION
Item 1.	Legal Proceedings.	28
Item 1A.	Risk Factors.	28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	28
Item 3.	Defaults Upon Senior Securities.	28
Item 4.	Mine Safety Disclosures.	28
Item 5.	Other Information.	28
Item 6.	Exhibits.	29
	SIGNATURES

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

IMMUNOME, INC.

Condensed Balance Sheets

(In thousands, except share data)

(unaudited)

	March 31, 2022		December 31, 2021
Assets
Current assets:
Cash and cash equivalents	$	42,879	$	49,229
Prepaid expenses and other current assets		3,424		7,409
Total current assets		46,303		56,638
Property and equipment, net		753		855
Operating right-of-use asset, net		190		—
Restricted cash		100		100
Deferred offering costs		382		332
Total assets	$	47,728	$	57,925
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	3,890	$	3,077
Accrued expenses and other current liabilities		5,817		6,651
Total current liabilities		9,707		9,728
Other long-term liabilities		147		12
Total liabilities		9,854		9,740
Commitments and contingencies (Note 6)
Stockholders’ equity:
Preferred stock, $0.0001 par value; 10,000,000 shares authorized; no shares issued or outstanding at March 31, 2022 and December 31, 2021		—		—
Common stock, $0.0001 par value; 200,000,000 shares authorized; 12,127,385 and 12,110,373 shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively		1		1
Additional paid-in capital		128,631		127,289
Accumulated deficit		(90,758)		(79,105)
Total stockholders’ equity		37,874		48,185
Total liabilities and stockholders’ equity	$	47,728	$	57,925

The accompanying notes are an integral part of these unaudited condensed financial statements.

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IMMUNOME, INC.

Condensed Statements of Operations

(In thousands, except share and per share data)

(unaudited)

	Three Months Ended March 31,
	2022		2021
Operating expenses:
Research and development	$	8,078	$	1,979
General and administrative		3,576		1,918
Total operating expenses		11,654		3,897
Loss from operations		(11,654)		(3,897)
Interest income (expense), net		1		(1)
Net loss	$	(11,653)	$	(3,898)
Per share information:
Net loss per share of common stock, basic and diluted	$	(0.96)	$	(0.37)
Weighted-average common shares outstanding, basic and diluted		12,122,903		10,640,870

The accompanying notes are an integral part of these unaudited condensed financial statements.

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IMMUNOME, INC.

Condensed Statements of Changes in Stockholders’ Equity

(In thousands, except share data)

(unaudited)

	Stockholders’ equity
	Common stock			Additional
				paid-in		Accumulated
	Shares	Amount		capital		deficit		Total
Balance at January 1, 2022	12,110,373	$	1	$	127,289	$	(79,105)	$	48,185
Share-based compensation expense	—		—		1,310		—		1,310
Exercise of stock options	17,012		—		32		—		32
Net loss	—		—		—		(11,653)		(11,653)
Balance at March 31, 2022	12,127,385	$	1	$	128,631	$	(90,758)	$	37,874
	Stockholders’ equity
	Common stock			Additional
				paid-in		Accumulated
	Shares	Amount		capital		deficit		Total
Balance at January 1, 2021	10,634,245	$	1	$	95,738	$	(54,394)	$	41,345
Share-based compensation expense	—		—		325		—		325
Exercise of common stock warrants	11,666		—		105		—		105
Exercise of stock options	14,270		—		6		—		6
Net loss	—		—		—		(3,898)		(3,898)
Balance at March 31, 2021	10,660,181	$	1	$	96,174	$	(58,292)	$	37,883

The accompanying notes are an integral part of these unaudited condensed financial statements.

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IMMUNOME, INC.

Condensed Statements of Cash Flows

(In thousands)

(unaudited)

	Three Months ended March 31,
	2022		2021
Cash flows from operating activities:
Net loss	$	(11,653)	$	(3,898)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		111		176
Amortization of right-of-use asset		25		—
Share-based compensation		1,310		325
Deferred rent		(12)		(1)
Changes in operating assets and liabilities:
Prepaid expenses and other assets		3,985		(1,703)
Accounts payable		788		1,771
Accrued expenses and other current liabilities		(912)		(205)
Other long term liabilities		(18)
Net cash used in operating activities		(6,376)		(3,535)
Cash flows from investing activities:
Purchases of property and equipment		(6)		(31)
Net cash used in investing activities		(6)		(31)
Cash flows from financing activities:
Proceeds from exercise of stock options		32		6
Proceeds from exercise of common stock warrants		—		105
Payment of equipment loan payable		—		(35)
Net cash provided by financing activities		32		76
Net decrease in cash and cash equivalents and restricted cash		(6,350)		(3,490)
Cash and cash equivalents and restricted cash at beginning of period		49,329		39,866
Cash and cash equivalents and restricted cash at end of period	$	42,979	$	36,376
Supplemental disclosures of cash flow information:
Operating lease right-of-use asset and lease liability recorded upon adoption of ASC 842	$	215	$	—
Offering costs included in accrued expenses and other liabilities	$	25	$	—
Offering costs included in accounts payable	$	25	$	—
Fixed assets included in accrued expenses and other current liabilities	$	3	$	—
Cash paid for interest	$	—	$	2

The accompanying notes are an integral part of these unaudited condensed financial statements.

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IMMUNOME, INC.

Notes to Condensed Financial Statements

(Unaudited)

1. Nature of the business and basis of presentation

Organization

Immunome, Inc. (“the Company” or “Immunome”) was incorporated as a Pennsylvania corporation on March 2, 2006 and was converted to a Delaware corporation on December 2, 2015. The Company is a biopharmaceutical company utilizing our proprietary human memory B cell platform to discover and develop first-in-class antibody therapeutics designed to change the way diseases are currently being treated. The Company’s primary focus areas are oncology and infectious disease, including COVID-19.

Since its inception, the Company has devoted substantially all its resources to research and development, raising capital, building its management team and extending its intellectual property portfolio. The Company is subject to risks and uncertainties common to early-stage companies in the biotechnology industry including, but not limited to, risks associated with the successful research, development and manufacturing of product candidates, uncertain results of preclinical and clinical testing, development of new technological innovations and products by competitors, dependence on key personnel and third-party vendors, protection of proprietary technology, compliance with government regulations, regulatory approval of product candidates and the ability to secure additional capital to fund operations.

Liquidity

The Company has incurred net losses since inception, including net losses of $11.7 million and $3.9 million for the three months ended March 31, 2022 and 2021, respectively, and it expects to generate losses from operations and negative operating cash flows for the foreseeable future primarily due to research and development costs for its potential product candidates. As of March 31, 2022, the Company had an accumulated deficit of $90.8 million.

On October 1, 2021 the Company entered into an Open Market Sale Agreement (“ATM Agreement”) with Jefferies Group LLC, which provides that, upon the terms and subject to the conditions and limitations in the ATM Agreement, the Company may elect, from time to time, to offer and sell shares of common stock under the registration statement having an aggregate offering price of up to $75.0 million through Jefferies Group LLC acting as sales agent. The Company has not yet sold any shares under the ATM Agreement.

The Company had cash and cash equivalents of $42.9 million at March 31, 2022. The Company expects that its cash will enable it to fund its operating expenses and capital expenditure requirements for at least 12 months from the filing date of this Quarterly Report on Form 10-Q; however; more funding will be necessary beyond this point to fund additional research and development, clinical development and operations in order to pursue the Company’s growth strategy. 

If the Company cannot obtain the necessary funding, it will need to delay, scale back or eliminate some or all of its research and development programs or enter into collaborations with third parties to commercialize potential products or technologies that it might otherwise seek to develop or commercialize independently (or enter into these collaborations sooner than it might otherwise have intended to do); consider other various strategic alternatives, including a merger or sale of the Company; or cease operations. If the Company engages in collaborations, it may receive lower consideration upon commercialization of such products than if it had not entered into such arrangements or if it entered into such arrangements at later stages in the product development process. Additionally, volatility in the capital markets and general economic conditions in the United States may be a significant obstacle to raising the required funds.

Operations of the Company are subject to certain risks and uncertainties including various internal and external factors that will affect whether and when the Company’s product candidates become approved drugs and how significant their market share will be, some of which are outside of the Company’s control. The length of time and cost of

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developing and commercializing these product candidates and/or failure of them at any stage of the drug approval process will materially affect the Company’s financial condition and future operations. On March 11, 2020, the World Health Organization characterized the novel COVID-19 virus as a global pandemic. Although there is significant uncertainty as to the likely effects this disease may have in the future, there has not been a significant impact to the Company’s operations or financial statements to date.

2. Summary of significant accounting policies

Basis of presentation

The accompanying financial statements have been prepared in accordance with accounting principles generally accepted (“GAAP”) in the United States. Any reference in these notes to applicable guidance is meant to refer to GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) promulgated by the Financial Accounting Standards Board (“FASB”).

Unaudited interim results

These unaudited condensed financial statements and accompanying notes should be read in conjunction with the Company’s annual financial statements and the notes thereto included in the Company’s Form 10-K filed with the Securities and Exchange Commission on March 28, 2022. The accompanying condensed financial statements as of March 31, 2022 and for the three months ended March 31, 2022 and 2021 are unaudited but include all adjustments that management believes to be necessary for a fair presentation of the periods presented. Interim results are not necessarily indicative of results for a full year. Balance sheet amounts as of December 31, 2021 have been derived from the audited financial statements as of that date.

Use of estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and expenses. The Company bases its estimates and assumptions on historical experience when available and on various factors that it believes to be reasonable under the circumstances. Significant estimates and assumptions reflected in these condensed financial statements include, but are not limited to, the expected volatility used to estimate fair value of stock options and accrued research and development expenses. Estimates and assumptions are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ from these estimates.

Segment and geographic information

Operating segments are defined as components of an entity about which separate discrete information is available for evaluation by the chief operating decision maker (“CODM”), or decision-making group, in deciding how to allocate resources and in assessing performance. The CODM is the Company’s Chief Executive Officer. The Company views its operations as and manages its business in one operating segment operating exclusively in the United States.

Fair value of financial instruments

ASC Topic 820, Fair Value Measurement (“ASC 820”), establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the assets or liability and are developed based on the best information available in the circumstances. ASC 820 identifies fair value as the price that would be received to sell an asset or paid to transfer a liability, in an orderly transaction between market

8

participants at the measurement date. As a basis for considering market participant assumptions in fair value measurements, ASC 820 establishes a three-tiered value hierarchy that distinguishes between the following:

Level 1 — Quoted market prices in active markets for identical assets or liabilities.

Level 2 — Inputs other than Level 1 inputs that are either directly or indirectly observable, such as quoted market prices, interest rates and yield curves.

Level 3 — Unobservable inputs for the asset or liability (i.e. supported by little or no market activity). Level 3 inputs include management’s own assumptions about the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk).

To the extent the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgement. Accordingly, the degree of judgement exercised by the Company in determining fair value is greatest for instruments categorized as Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

Cash and cash equivalents are Level 1 assets as of March 31, 2022 and December 31, 2021.

Restricted cash

Restricted cash represents collateral provided for a letter of credit issued as a security deposit in connection with the Company’s lease of its corporate facilities. This lease expires in 2024 at which time the cash will be released from restriction. Restricted cash was $100,000 at both March 31, 2022 and December 31, 2021. The following table provides a reconciliation of the components of cash and cash equivalents and restricted cash reported in the Company’s condensed balance sheets to the total of the amount presented in the condensed statements of cash flows:

(in thousands)	March 31, 2022		December 31, 2021
Cash and cash equivalents	$	42,879	$	49,229
Restricted cash		100		100
	$	42,979	$	49,329

Equity issuance costs

The Company capitalizes costs that are directly associated with the ATM agreement until such financings are consummated, at which time such costs are recorded against the gross proceeds from the applicable financing. If a financing is abandoned, deferred offering costs are expensed.

Deferred offering costs were $0.4 million and $0.3 million as of March 31, 2022 and December 31, 2021, respectively, on the condensed balance sheet.

Government contract funding

The Company accounts for amounts received under its U.S. Department of Defense expense reimbursement contract as contra-research and development expenses in the condensed statements of operations.

Research and development costs

Research and development costs are charged to expense as incurred. Research and development costs consist of costs incurred in performing research and development activities, including salaries and bonuses, share-based compensation, employee benefits, facilities costs, laboratory supplies, depreciation and amortization, preclinical and clinical development expenses, including manufacture and testing of clinical supplies, consulting and other contracted services. Additionally, under the terms of the license agreements described in Note 6, the Company is obligated to make future payments should certain development and regulatory milestones be achieved. No such costs have been incurred

9

for the three months ended March 31, 2022 and 2021. Costs for certain research and development activities are recognized based on the terms of the individual arrangements, which may differ from the timing of receipt of invoices and payment of invoices and are reflected in the financial statements as a prepaid or accrued expense.

Net loss per share

Basic net loss per share of common stock is computed by dividing the net loss by the weighted average number of common shares outstanding for the period. Diluted net loss per share of common stock is computed by adjusting net loss to reallocate undistributed earnings based on the potential impact of dilutive securities. Diluted net loss per share of common stock is computed by dividing the diluted net loss by the weighted average number of common shares outstanding for the period, including potential dilutive common shares assuming the dilutive effect of common stock equivalents.

The following potentially dilutive securities outstanding as of March 31, 2022 and 2021 have been excluded from the computation of diluted weighted-average shares of common stock outstanding, as they would be anti-dilutive:

	March 31,
	2022	2021
Stock options(1)	2,009,844	1,636,069
Common stock warrants(1)	1,303,112	1,023,530
	3,312,956	2,659,599

(1) Represents common stock equivalents.

In periods in which the Company reports a net loss per share of common stock, diluted net loss per share of common stock is the same as basic net loss per share of common stock since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive. The Company reported a net loss per share of common stock for the three months ended March 31, 2022 and 2021.

Leases

Effective January 1, 2022, the Company adopted ASC Topic (ASC 842) using the modified retrospective approach by applying the new standard to all leases existing on the adoption date. The results for reporting periods beginning after January 1, 2022 are presented in accordance with ASC 842, while prior period amounts are not adjusted and continue to be reported under the accounting standards that were in effect prior to January 1, 2022.

At the inception of an arrangement, the Company determines whether an arrangement contains a lease based on facts and circumstances present in the arrangement. An arrangement is or contains a lease if the arrangement conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Typically, lessees are required to recognize leases with a term greater than one year on the balance sheet as an operating or finance lease liability and right-of-use asset. Right-of-use assets represent the Company’s right to use an underlying asset during the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. The Company has elected the practical expedient to not to recognize leases with a term of 12 months or less. The Company does not have any financing leases as of March 31, 2022.

Operating lease liabilities and their corresponding right-of-use assets are recorded based on their present value of lease payments over the remaining lease term. Options to extend the lease term are included in the Company’s assessment of the lease term only if there is a reasonable assessment that the Company will renew. Leases are discounted to its present value using either the interest rate implicit in the Company’s lease or its incremental borrowing rate, which reflects the fixed rate in which the Company could borrow on a collateralized basis the amount of lease payments in the same currency, for a similar term, in a similar economic environment.

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Recently adopted accounting standards

On January 1, 2022, the Company adopted Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), which establishes ASC 842 and supersedes the lease accounting guidance under ASC 840. The standard generally requires lessees to recognize operating and finance lease liabilities and corresponding right-of-use (ROU) assets on the balance sheet and provide enhanced disclosures on the amount, timing, and uncertainty of cash flows arising from lease arrangements. The Company adopted ASC 842 using the modified retrospective approach. The Company elected the package of practical expedients available for existing contracts, which allowed the Company to carry forward our historical assessments of lease identification, lease classification, and initial direct costs. The Company also elected a policy to not apply the recognition requirements of ASC 842 for short-term leases with a term of 12 months of less.

As of January 1, 2022, the effective date, the Company identified one operating lease arrangement relating to the Company’s headquarters facility and one short-term lease relating to laboratory equipment. The adoption of ASC 842 resulted in a recognition of an ROU asset and lease liability of $0.2 million on the Company’s balance sheet relating to the leases as of January 1, 2022. The adoption of the standard did not have a material effect on the Company’s condensed statements of operations and condensed statements of cash flows (Note 7).

Recently issued accounting pronouncements

In November 2021, the FASB issued ASU Topic 832, Disclosures by Business Entities about Government Assistance (“Topic 832”). This standard requires annual disclosures about transactions with a government that have been accounted for by analogizing to a grant or contribution accounting model to increase transparency about the types of transactions, the accounting for the transactions, and the effect of the transactions on an entity’s financial statements. The effective date of Topic 832 is for financial statements issued for annual periods beginning after December 15, 2021. The Company is currently evaluating the effect Topic 832 will have on its financial statements and related disclosures.

3. U.S. Department of Defense (“DoD”) expense reimbursement contract

In July 2020, the Company entered into an Other Transaction Authority for Prototype Agreement (“the OTA Agreement”) with the DoD to fund the Company’s efforts in developing an antibody cocktail therapeutic to treat COVID-19. The amount of funding being made available to the Company under this expense reimbursement contract was $13.3 million. In May 2021, the Company and the DoD amended the OTA, pursuant to which the DoD award was increased from $13.3 million to $17.6 million. Under the agreement, the DoD shall pay the Company, upon submission of proper invoices, within 30 calendar days of receipt of request for payment.

The Company recorded contra-research and development expense of $0.6 million and $4.0 million for the three months ended March 31, 2022 and 2021, respectively, in the statements of operations. The Company had an expense reimbursement receivable balance of $0 and $2.7 million due from the DoD in prepaid expenses and other current assets as of March 31, 2022 and December 31, 2021, respectively, in the accompanying condensed balance sheet.

Costs that have been reimbursed by the DoD but not yet expensed by the Company are recorded as a deferred research obligation liability for the period. The Company has a deferred research obligation liability of $0.6 million and $2.0 million as of March 31, 2022 and December 31, 2021, respectively. This amount is included in accrued expenses and other liabilities in the accompanying condensed balance sheet. DoD reimbursable services that have been performed but not yet billed are recorded as an unbilled receivable in prepaid expenses and other current assets in the accompanying condensed balance sheet. The Company had an unbilled receivable from the DoD of $0.8 million and $1.6 million as of March 31, 2022 and December 31, 2021, respectively.

As of March 31, 2022, the Company has the potential for $0.2 million of remaining expense reimbursement under the OTA Agreement.

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4. Prepaid expenses and other assets

Prepaid expenses and other assets consisted of the following:

(in thousands)	March 31, 2022		December 31, 2021
Prepaid insurance	$	1,422	$	2,019
Research and development advance payments		636		586
Unbilled reimbursement receivable from DoD		795		1,638
Other prepaids and short-term deposits		571		492
Reimbursement receivable from DoD		—		2,674
	$	3,424	$	7,409

5. Accrued expenses and other liabilities

Accrued expenses and other liabilities consisted of the following:

(in thousands)	March 31, 2022		December 31, 2021
Research and development	$	3,972	$	2,840
Compensation and related benefits		842		1,246
Professional fees		357		227
Deferred research obligations		585		2,021
Short-term operating lease liability and other liabilities		61		317
	$	5,817	$	6,651

6. Commitments and contingencies

Employment agreements

The Company entered into employment agreements (the “Employment Agreements”) with key personnel providing for compensation and severance in certain circumstances, as defined in the respective Employment Agreements. The Employment Agreements may be terminated by either the Company or the employees in accordance with the respective Employment Agreements (subject to the payment of severance upon certain terminations) and provide for annual pay adjustments and bonuses at the discretion of the Board of Directors.

Employee benefit plan

The Company maintains a defined-contribution plan under Section 401(k) of the Internal Revenue Code (the “401(k) Plan”). The 401(k) Plan covers all employees who meet defined minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pre-tax basis. The Company assumes all administrative costs of the 401(k) Plan and makes matching contributions as defined in the 401(k) Plan document. The Company made matching contributions of $0.1 million to the 401(k) Plan for the three months ended March 31, 2022 and 2021, respectively.

Legal proceedings

The Company is not a party to any material litigation and does not have contingency reserves established for any litigation liabilities. At each reporting date, the Company evaluates whether a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies.

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License Agreements

The Company entered into various license agreements to further discover, develop and commercialize certain technologies and treatments. The Company may need to pay developmental and regulatory milestone payments of up to approximately $2.6 million, if any. In addition, the Company may need to pay royalty rates on net product sales and certain commercial milestone payments of up to approximately $1.5 million, if any.

7. Leases

Effective January 1, 2022, the Company adopted ASC Topic (ASC 842) using the modified retrospective approach by applying the new standard to all leases existing on the adoption date. The results for reporting periods beginning after January 1, 2022 are presented in accordance with ASC 842, while prior period amounts are not adjusted and continue to be reported under the accounting standards that were in effect prior to January 1, 2022.

In May 2017, the Company entered into a 62-month office and laboratory space lease commencing on July 1, 2017 for approximately 11,000 square feet of space in Exton, Pennsylvania. The Company has an option to extend the lease for up to two additional five-year terms. In December 2021, the Company extended the lease for an additional eighteen-month term ending in March 2024.

Beginning July 2021, the Company leased laboratory equipment on a month-to-month basis. In April 2022, the Company exercised the purchase option under the lease agreement to purchase the leased laboratory equipment. The Company elected the practical expedient to recognize short-term leases under ASC 840.

Supplemental balance sheet information related to leases as of March 31, 2022 was as follows (in thousands):

Operating leases:
Operating lease right-of-use assets	$	190
Operating lease liability	$	46
Operating lease liability, net of current portion		147
Total operating lease liability	$	193

Operating lease liability and operating lease liability, net of current portion is included in accrued expenses and other current liabilities and other long-term liabilities, respectively, in the accompanying condensed balance sheet.

Supplemental lease expense related to leases was as follows:

Lease Cost (in thousands)	Statements of Operations Classification		Three Months Ended March 31, 2022
Operating lease cost	General and administrative Research and development	$	60
Short-term lease cost	General and administrative Research and development		53
Total lease expense		$	113

Under ASC 840, rent expense for the three months ended March 31, 2021 was approximately $0.1 million.

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Other information related to the operating lease where the Company is the lessee was as follows:

	Three Months Ended March 31, 2022
Weighted-average remaining lease term	2.0 years
Weighted-average discount rate	9.0%

Supplemental cash flow information related to the operating lease was as follows (in thousands):

		Three Months Ended March 31, 2022
Cash paid for operating lease liability	$	57

As of March 31, 2022, minimum rental commitments under the operating lease were as follows (in thousands):

Years ending December 31,	Amount
2022 (represents remaining nine months in 2022)	$	177
2023		246
2024		63
Total lease payments		486
Less imputed interest		(293)
Present value of lease liability	$	193

8. Common stock

Common stock

The holders of common stock are entitled to one vote for each share of common stock. Subject to the approval of the holders of a majority in interest of the Company’s stockholders entitled to vote thereon, the holders of common stock shall be entitled to receive dividends out of legally available funds. In the event of any voluntary or involuntary liquidation, dissolution, or winding up of the Company, the holders of common stock are entitled to share ratably in the remaining assets of the Company available for distribution.

Warrants to acquire shares of common stock

At March 31, 2022, common stock warrants outstanding were as follows:

Warrants	Exercise Price per Share	Expiration Date
803,112	$ 9.00	June 2, 2023
500,000	$ 45.00	April 28, 2024

9. Share-based compensation

In July 2008, the Board of Directors adopted the 2008 Equity Incentive Plan ("the 2008 Plan”) which provided for the grant of qualified incentive stock options and non-qualified stock options, restricted stock or other awards to the Company’s employees, officers, directors, advisors, and outside consultants for the issuance or purchase of shares of the Company’s common stock. The 2008 Plan was replaced in July 2018 with the 2018 Equity Incentive Plan (the 2018 Plan and collectively with the 2008 Plan, the Prior Plans). At the time that the 2008 Plan was terminated, there were 388,748

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shares available for grant that were transferred to the 2018 Plan. On September 24, 2020, the 2018 Plan was terminated and replaced with the 2020 Equity Incentive Plan (2020 Plan). Additionally, the number of shares of our common stock reserved for issuance under the 2020 Plan will automatically increase on January 1 of each year, beginning on January 1, 2021 and continuing through and including January 1, 2030, by 4% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by the Company’s Board of Directors. As of March 31, 2022, there were 1,836,212 shares available for future issuance under the 2020 Plan.

The Company also adopted the 2020 Employee Stock Purchase Plan (“ESPP”) on September 18, 2020 which provides for the grant of purchase rights to purchase shares of the Company’s common stock to eligible employees, as defined by the ESPP. The maximum number of shares of common stock that may be issued under the ESPP will not exceed 125,000 shares of common stock, plus the number of shares of common stock that are automatically added on January 1 of each calendar year for a period of up to ten years, commencing on the first January 1 following the year in which an IPO occurs and ending on, and including, January 1, 2030, in an amount equal to the lesser of (i) 1% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year, and (ii) 1,000,000 shares of common stock. No shares of common stock have been issued under the ESPP as of March 31, 2022.

The 2020 Plan and the ESPP are administered by the Board of Directors subject to the Board’s right to delegate to a committee. The exercise prices, vesting and other restrictions are determined at the discretion of the Board of Directors. Stock options awarded under the Prior Plans and the 2020 Plan generally expire 10 years after the grant date unless the Board of Directors sets a shorter term. Vesting periods for awards under the Prior Plans and the 2020 Plan are determined at the discretion of the Board of Directors. Stock options granted to employees, officers, members of the Board of Directors and consultants of the Company typically vest over one to four years. Certain options provide for accelerated vesting if there is a change in control, as defined in the Prior Plans and the 2020 Plan.

Share-based compensation expense recorded as research and development and general and administrative expenses in the condensed statements of operations is as follows (in thousands):

	Three Months Ended March 31,
(In thousands)	2022		2021
Research and development	$	445	$	171
General and administrative		865		154
	$	1,310	$	325

Unrecognized compensation cost related to unvested options was $12.1 million as of March 31, 2022 and will be recognized over an estimated weighted average period of 3.5 years.

Stock options

The weighted average assumptions used in the Black-Scholes option-pricing model for stock options granted were:

	Three Months Ended March 31,
	2022			2021
Expected volatility		83.5	%		83.5	%
Risk-free interest rate		1.7	%		1.1	%
Expected term (in years)		6.08			6.10
Expected dividend yield		—			—
Fair value of common stock	$	10.58		$	31.83

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A summary of option activity under the Plans and 2020 Plan during the three months ended March 31, 2022 is as follows:

				Weighted
		Weighted		average
		average		remaining
	Number of	exercise price		contractual
	shares	per share		term (years)
Outstanding at January 1, 2022	2,005,756	$	11.26	8.50
Granted	21,100		10.58	9.82
Forfeited	—		—	—
Exercised	(17,012)		1.87	8.11
Outstanding at March 31, 2022	2,009,844		11.33	8.27
Exercisable at March 31, 2022	779,707		5.40	7.57
Vested or expected to vest at March 31, 2022	2,009,844		11.33	8.27

The weighted-average grant date fair value per share of stock options granted during the three months ended March 31, 2022 and 2021 was $7.52 and $22.46, respectively. The aggregate intrinsic value of stock options exercised during the three months ended March 31, 2022 was $0.1 million. The aggregate intrinsic value of stock options outstanding at March 31, 2022 is $4.0 million.

10. Related party transactions

License agreements

The Company has entered into license agreements with certain stockholders of the Company. Expenses with these related parties were de minimis for the three months ended March 31, 2022 and 2021, respectively. In addition, amounts owed to these related parties were de minimis as of March 31, 2022 and December 31, 2021.

Broadband services agreement

In November 2015, the Company entered into a management services agreement (MSA) with BCM Advisory Partners LLC and Broadband Capital Partners LLC (collectively Broadband Capital). Certain directors of the Company are principals of Broadband Capital. Under the Broadband MSA, the Company engages Broadband Capital as a consultant for advice in connection with senior management matters related to the Company’s business, administration and policies in exchange for a cash fee to Broadband Capital of $20,000 per month. The Broadband MSA was amended and/or restated in July 2016, January 2017, June 2018, March 2020 and August 2020. In June 2021, the Company extended the Broadband MSA to continue through June 2022. The Company recorded $0.1 million during each of the three months ended March 31, 2022 and 2021, respectively, related to the Broadband MSA, which is included in general and administrative expenses in the condensed statements of operations. There were no amounts due to Broadband Capital as of March 31, 2022 and December 31, 2021.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations, as well as other sections in this Quarterly Report on Form 10-Q, should be read in conjunction with our unaudited interim financial statements and related notes thereto included elsewhere herein. In addition to historical financial information, some of the information contained in the following discussion and analysis contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts, including express or implied statements regarding Immunome’s beliefs and expectations regarding the advancement of its platform and programs, execution of its regulatory, research, clinical and strategic plans and anticipated upcoming milestones for its platform and programs, including expectations regarding, among other things, the timing and results of its preclinical studies and clinical trials, clinical plans, general regulatory actions, the translation of preclinical data into clinical safety and efficacy, the therapeutic potential and benefits of our product candidates, the possible need and demand for its product candidates, are forward-looking statements. These statements involve known and unknown risks, uncertainties, assumptions and other important factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplates,” “believes,” “estimates,””should,””seek,”“predicts,” “potential” or “continue” or the negative of these terms or other similar expressions. The forward-looking statements in this Quarterly Report on Form 10-Q are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events, financial trends and other matters that we believe may affect our business, financial condition and results of operations. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q and are subject to a number of risks, uncertainties and assumptions that are difficult to predict. Factors that could cause actual results to differ include, but are not limited to, those risks and uncertainties associated with: the impact of the COVID-19 pandemic on Immunome’s business, operations, strategy, goals and anticipated milestones; the fact that research and development data are subject to differing interpretations and assessments; Immunome’s ability to execute on its strategy, including with respect to its R&D efforts, IND submissions and other regulatory filings, timing of these filings and the timing and nature of governmental authority feedback regarding the same, initiation and completion of any clinical studies, confirmatory testing and other anticipated milestones as and when anticipated; the effectiveness of Immunome’s product candidates, including the possibility that further preclinical data and any clinical trial data may be inconsistent with the data used for advancing the product candidates and that further variants of concern could emerge; Immunome’s ability to fund operations and raise capital; Immunome’s reliance on vendors; the competitive landscape; and the additional risks and uncertainties set forth more fully under the caption “Risk Factors” in Immunome’s Annual Report on Form 10-K filed with the United States Securities and Exchange Commission (“SEC”) on March 28, 2022, and elsewhere in Immunome’s filings and reports with the SEC. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Moreover, we operate in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for us to predict all risk factors and uncertainties. In addition, we may discuss our current and potential future product candidates that have not yet undergone clinical trials or been approved for marketing by the U.S. Food and Drug Administration or other governmental authority, including expectations about their therapeutic potential and benefits thereof. No representation is made as to the safety or effectiveness of these current or potential future product candidates for the use for which such product candidates are being studied. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.

Overview

Since our inception in 2006, we have devoted substantially all our resources to research and development, raising capital, building our management team and building our intellectual property portfolio. To date, we have financed our operations primarily through sales of our common stock, Series A convertible preferred stock and warrants, warrant exercises, the issuance of convertible promissory notes, and the Paycheck Protection Program loan (“PPP loan”) that was forgiven in May 2021. In addition, in July 2020, the Company entered into an Other Transaction Authority for Prototype

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Agreement (OTA Agreement), with the Department of Defense (DoD) to fund the Company’s efforts in developing an antibody cocktail therapeutic to treat COVID-19. The amount of funding available to the Company under this expense reimbursement contract was $13.3 million. In May 2021, the Company and the DoD amended the OTA Agreement, pursuant to which the DoD award was increased from $13.3 million to $17.6 million.

To date, we have not generated any revenue from product sales and do not expect to generate revenue from the sale of products for the foreseeable future. Since inception we have incurred significant operating losses. Our net losses for the three months ended March 31, 2022 and 2021 were $11.7 million and $3.9 million, respectively. The remaining available expense reimbursement under the OTA Agreement is $0.2 million as of March 31, 2022.

As of March 31, 2022, we had a cash balance of $42.9 million. We expect to continue to incur losses for the foreseeable future. We expect to continue to incur significant expenses and increasing operating losses in connection with ongoing research and development activities related to our portfolio of programs as we continue our IMM-BCP-01 clinical development and IMM-ONC-01 preclinical development of product candidates, and plan to file an IND for ONC-01 later in 2022. We also plan to perform research activities as we seek to discover and develop additional product candidates; carry out maintenance, expansion, enforcement, defense, and protection of our intellectual property portfolio; and hire research and development, clinical and administrative personnel. If we cannot obtain the necessary funding on favorable terms, if at all, we will need to delay, scale back or eliminate some or all of our research and development programs. We may also need to consider other various strategic alternatives, including a merger or sale of the Company; or cease operations. If we engage in collaborations, we may receive lower consideration upon commercialization of such products than if we had not entered into such arrangements or if we entered into such arrangements at later stages in the product development process. We currently have no sources of revenue, and our ability to continue to fund our future business plans is dependent on our ability to raise capital to fund our present and future business plans. Additionally, volatility in the capital markets, the competitive landscape and general economic conditions in the United States may be a significant obstacle to raising the required funds.

We expect to continue to incur significant expenses and increasing operating losses in connection with ongoing development activities, particularly if and as we:

● continue research and development activities, including pre-clinical and clinical development;

● pursue regulatory approvals and implement other regulatory strategies for our current and future product candidates;

● take additional steps to advance our discovery engine and our existing and future pipeline;

● obtain, maintain, expand and protect our intellectual property portfolio;

● hire additional research and development, clinical and administrative personnel;

● scale up and expand our clinical and regulatory capabilities; and

● add operational, financial and management information systems and infrastructure to support our research and development programs, and any future commercialization efforts.

As a result of these anticipated expenditures and potential unanticipated expenditures, we will need substantial additional financing to support our continuing operations and pursue our growth strategy. Until such time as we generate significant revenue from product sales, if ever, we expect to finance our operations through a combination of equity offerings, debt financings, collaborations, strategic alliances and licensing arrangements. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of any stockholder will be or could be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our stockholders. Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making

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acquisitions or capital expenditures or declaring dividends. If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or drug candidates, or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings or other arrangements when needed, we may be required to delay, limit, reduce or terminate our research, product development or future commercialization efforts, or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves. We may be unable to raise additional funds or enter into such other agreements when needed on favorable terms or at all. The inability to raise capital as and when needed would have a negative impact on our financial condition and our ability to pursue our business strategy.

Through March 31, 2022, we raised an aggregate of $125.1 million in gross proceeds from sales of our common stock, Series A convertible preferred stock and warrants, warrant and stock option exercises, the issuance of convertible promissory notes, and the PPP loan. On October 1, 2021, we entered into an Open Market Sale Agreement (“ATM Agreement”) with Jefferies Group LLC, which provides that, upon the terms and subject to the conditions and limitations in the ATM Agreement, the Company may elect, from time to time, to offer and sell common shares having an aggregate offering price of up to $75.0 million through Jefferies Group LLC acting as sales agent. The Company has not yet sold any shares under the ATM Agreement.

We expect that our cash as of March 31, 2022 will be sufficient to fund our operations at least 12 months from the filing date of this Quarterly Report on Form 10-Q, including our planned Phase 1b studies for IMM-BCP-01 and IMM-ONC-01. We have based these estimates on assumptions that may prove to be imprecise, and we may exhaust our available capital resources sooner than we currently expect. See “— Liquidity and capital resources.” Due to the numerous risks and uncertainties associated with the research and development of our programs, we are unable to estimate the amounts of increased capital outlays and operating expenses associated with completing the research and development of our product candidates.

Our Lead Discovery Programs

SARS-CoV-2 (“IMM-BCP-01”)

We are actively developing an antibody cocktail, comprising a combination of three effective anti-viral antibodies derived from the B cells of COVID-19 patients that exhibit high neutralizing titers. IMM-BCP-01 targets non-overlapping regions of the Spike protein of SARS-CoV-2 which include highly conserved, subdominant epitopes. The cocktail promotes both ACE2 and non-ACE2 dependent neutralization and induces natural viral clearance mechanisms such as antibody dependent cellular cytotoxicity, complement activation and phagocytosis in pre-clinical testing. If successful in clinical testing, we expect that our antibody cocktail product candidate could be used both as a treatment for individuals who have contracted SARS-CoV-2 and as a prophylactic to offer protection against the virus for individuals who are at risk of contracting SARS-CoV-2. We are conducting this program in collaboration with the DoD, which has asserted that this platform may be of strategic importance, due to its potential use in the current COVID-19 pandemic as well as in future viral outbreaks. The IMM-BCP-01 program is broadly focused on the emerging variants of SARS-CoV-2. We submitted an IND application for the IMM-BCP-01 program to the US FDA, and following a clinical hold which was resolved in Q1 2022, we received clearance to proceed with our Ph1b clinical trial for the treatment of SARS-CoV-2. Patient recruitment efforts are underway.

Oncology (“IMM-ONC-01”)

Our lead oncology program is focused on IL-38, which we believe is a novel, tumor-derived immune checkpoint capable of promoting evasion of the immune system. IL-38 was identified as the target of an antibody isolated from a hybridoma library generated from the memory B cells of a patient with squamous head and neck cancer. Query of public and proprietary databases of cancer gene expression revealed over-expression of IL-38 in multiple solid tumors. Further, a correlation with low levels of tumor-infiltrating T cells, a hallmark of immune suppression in some of these patients’ tumors, and high IL-38 expression was also observed, suggesting a role for IL-38 as an immune checkpoint. Data obtained from preclinical testing indicated that blocking IL-38 function using inhibitory antibodies increased the immune response to the tumor and resulted in anti-tumor activity in select animal models, suggesting that anti-IL-38

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antibodies could have therapeutic utility as single agents or in combination with other therapeutic modalities. Our recent analysis further confirms IL-38 expression is frequently elevated in samples of specific patient tumor subtypes, such as head and neck and gastroesophogeal cancers. We believe that this information will help guide the selection of patient cohorts for clinical testing, thereby improving the probability of clinical success. We plan to submit our IND application for the IMM-ONC-01 program with the FDA in the second half of 2022.

Other Programs and Platform

In addition to the already described lead discovery programs, we will continue to invest in our proprietary discovery engine to expand our pipeline. The high output of antibody-target pairs resulting from our discovery engine may provide us with additional insights into the immune response against cancer and infectious diseases. We intend to continue to invest in this platform, to evaluate novel antibody-target pairs and to develop a pipeline of antibody therapeutics as single agents or in combination with other therapeutics or technologies to yield product candidates, such as Antibody-Drug Conjugates (ADCs). We anticipate that our discovery engine has the ability to advance one to two programs into IND-enabling studies per year.

We also intend to continue to explore additional strategic partnerships and collaborations to expand our opportunities and capabilities. We intend to continue to form strategic partnerships with government agencies and with other third parties to accelerate our research and development efforts, as exemplified by our other transaction authority for prototype agreement with the DoD related to COVID-19. The insights we obtain may also enable strategic partnerships with other entities, including pharmaceutical and biotechnology companies. We also intend to continue collaborating with various vendors, manufacturers, and other service providers to complement the capabilities needed to continue to develop and commercialize our products.

Additionally, we plan to expand our intellectual property estate and infrastructure needed to discover and advance our platform and product candidates. We may in-license or acquire complementary intellectual property as needed or required, and we may continue to build our know-how and trade secrets. We may pursue both therapeutic and diagnostic applications of our antibodies through composition of matter and/or method of use patents. While our initial focus areas are in oncology and infectious disease, we may invest in intellectual property in other therapeutic areas as well.

COVID-19 Pandemic

In response to the COVID-19 pandemic, we have taken, and continue to take, proactive measures to prioritize health and safety, including of our employees and other personnel. These measures included establishing a work-from-home policy for our employees, other than those performing or supporting business-critical operations and implementing stringent safety measures designed to comply with applicable federal, state and local guidelines. We have begun to implement a back-to-work policy; our approach to transitioning back to the office is tailored to the role of each team member and evolves as the specific conditions associated with the COVID-19 pandemic continue to evolve. We will continue to monitor guidance and regulations from the Centers for Disease Control and local health authorities and will adjust our onsite rules and policies in accordance with this guidance and regulations.

We have also taken, and continue to take, proactive measures to maintain business continuity in the face of the COVID-19 pandemic. Communication throughout our organization has remained active during the pandemic. In addition, as part of our vendor management processes, we have ongoing dialogues with third-party service providers, which are intended to ensure that they continue to meet our criteria for business continuity.

The effect of the ongoing COVID-19 pandemic on our projected research and development timelines and activities is uncertain. Notwithstanding the measures taken, the future impact of COVID-19, including its variants, on our industry, the healthcare system and our current and future operations and financial condition will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others. See “Risk Factors” in our Annual Report on Form 10-K filed with the SEC on March 28, 2022 and elsewhere in our filings with the SEC for a discussion of the potential adverse impact of COVID-19 on our business, results of operations and financial condition.

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Components of our results of operations

Research and development expenses

Research and development expenses consist of costs incurred in performing research and development activities, which include:

● personnel-related expenses, including salaries, bonuses, benefits and share-based compensation for employees engaged in research and development functions;

● expenses incurred in connection with the advancement of our programs, including under agreements with consultants, contractors, contract research organizations and other third-party vendors and suppliers;

● expenses to conduct future clinical trials including regulatory and quality assurance;

● the cost of developing and validating our manufacturing process for use in our preclinical studies and future clinical trials;

● laboratory supplies and research materials and other infrastructure-related expenses; and

● facilities, depreciation and amortization and other expenses which include direct and allocated expenses.

We expense research and development costs as incurred. Advance payments that we make for goods or services to be received in the future for use in research and development activities are recorded as prepaid expenses. The prepaid amounts are expensed as the benefits are consumed.

Research and development activities are central to our business model. We expect that our research and development expenses will increase substantially in connection with our planned preclinical and future clinical development activities.

In July 2020, we entered into an Other Transaction Authority for Prototype Agreement (the “OTA Agreement”) with the DoD to fund our efforts in developing Biosynthetic Convalescent Plasma (BCP) to treat COVID-19. The OTA Agreement was modified in May 2021 to increase such funding. In connection with the OTA Agreement, we record expense reimbursements received from the DoD as contra-research and development expenses in the same period the underlying expenses are incurred.

General and administrative expenses

General and administrative expenses consist primarily of salaries and other related costs, including share-based compensation for personnel in our executive, business development, and administrative functions. General and administrative expenses also include legal fees relating to intellectual property and corporate matters, professional fees for accounting, auditing, tax and consulting services, insurance costs, travel, direct and allocated facility related expenses and other operating costs.

We anticipate that our general and administrative expenses will increase in the future to support increased and progressed research and development activities.

Interest income (expense), net

Interest income (expense), net consists of interest expense related to our capital lease obligations and equipment loans payable, offset by interest income earned on our cash.

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Results of operations

The ultimate extent of the impact of any epidemic, pandemic, outbreak, or other public health crisis on our results of operations will depend on future developments, which are highly uncertain, including new information that may emerge concerning the severity of COVID-19 and its variants or other public health crisis and actions taken to contain or prevent the further spread, among others. Accordingly, we cannot fully predict the extent to which our business and results of operations will be affected by the pandemic.

Comparison of the three months ended March 31, 2022 and 2021

	Three Months Ended March 31,
	2022		2021		Change
	(in thousands)
Operating expenses:
Research and development	$	8,078	$	1,979	$	6,099
General and administrative		3,576		1,918		1,658
Total operating expenses		11,654		3,897		7,757
Loss from operations		(11,654)		(3,897)		(7,757)
Interest income (expense), net		1		(1)		2
Net loss	$	(11,653)	$	(3,898)	$	(7,755)

Research and development expenses

Research and development expenses were $8.1 million and $2.0 million, net of DoD reimbursement for the three months ended March 31, 2022 and 2021, respectively.

Research and development expenses increased by $6.1 million for the three months ended March 31, 2022. This increase is primarily as a result of $1.8 million increase in outsourced research and raw materials relating to the oncology program. Personnel-related costs increased by $0.9 million due to incremental headcount. In addition, contra-research and development expense reduced by $3.4 million for the three months ended March 31, 2022 as a result of a decrease in reimbursable BCP-01 related expenses through the DoD agreement. Contra-research and development expenses offsets the expenses recognized in the period for the DoD Agreement.

Research and development expenses are expected to increase in the future as we continue our current research programs, initiate new research programs, continue our preclinical development of product candidates and conduct future clinical trials for our programs and product candidates.

General and administrative expenses

General and administrative expenses increased by $1.7 million to $3.6 million for the three months ended March 31, 2022 from $1.9 million for the three months ended March 31, 2021. The increase was primarily a result of a $1.3 million increase in personnel-related costs due to an increase in headcount and stock-based compensation and a $0.3 million increase in professional fees and insurance.

Interest income (expense), net

Interest expense consists of interest related to equipment loan payables. Interest income consists of interest earned on our cash balances held with financial institutions.

Liquidity and capital resources

Since our inception, we have incurred significant operating losses. We expect to incur significant expenses and operating losses for the foreseeable future as continue our preclinical development of product candidates and conduct future clinical trials for our product candidates. Through March 31, 2022, we raised an aggregate of $125.1 million in

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gross proceeds from sales of our common stock, Series A convertible preferred stock and warrants, warrant and stock option exercises, the issuance of convertible promissory notes, and the PPP loan that was forgiven in May 2021. As of March 31, 2022, we had $42.9 million in cash. The Company filed a shelf registration statement on Form S-3, which was declared effective by the SEC on October 14, 2021, pursuant to which the Company may issue from time-to-time securities with an aggregate value of up to $200.0 million. In October 2021 the Company entered into an Open Market Sale Agreement (“ATM Agreement”) with Jefferies Group LLC, which provides that, upon the terms and subject to the conditions and limitations in the ATM Agreement, the Company may elect, from time to time, to offer and sell common shares under the registration statement having an aggregate offering price of up to $75.0 million through Jefferies Group LLC acting as sales agent. The Company has not yet sold any shares under the ATM Agreement.

We will need to raise additional capital before we exhaust our current cash to continue to fund our research and development, including our plans for clinical and preclinical trials and new product development, as well as to fund operations generally. As and if necessary, we will seek to raise additional funds through a combination of equity offerings, debt financings, collaborations, strategic alliances and licensing arrangements. We can give no assurances that we will be able to secure such additional sources of funds to support our operations, or, if such funds are available to us, that such additional financing will be sufficient to meet our needs.

Cash flows

The following table summarizes our sources and uses of cash for the three months ended March 31, 2022 and 2021:

	Three Months Ended March 31,
	2022		2021
	(in thousands)
Cash used in operating activities	$	(6,376)	$	(3,535)
Cash used in investing activities		(6)		(31)
Cash provided by financing activities		32		76
Net decrease in cash and restricted cash	$	(6,350)	$	(3,490)

Operating activities

Net cash used in operating activities for the three months ended March 31, 2022 was $6.4 million, consisting primarily of our net loss of $11.7 million and decreases of accrued expenses and other liabilities of $0.9 million, offset by net noncash charges of $1.4 million for stock compensation expense, depreciation and amortization of right-of-use asset, decreases in prepaid expenses and other assets of $4.0 million, and increases in accounts payable of $0.8 million.

Net cash used in operating activities for the three months ended March 31, 2021 was $3.5 million, consisting primarily of our net loss of $3.9 million, an increase in prepaid expenses and other assets of $1.7 million and a decrease in accrued expenses and other liabilities of $0.2 million. These uses of cash were offset by noncash charges of depreciation and amortization expense $0.2 million and share-based compensation expense of $0.3 million and an increase in accounts payable of $1.8 million due to our growth in expenditures.

Investing activities

During the three months ended March 31, 2022 and 2021, we used $6,000 and $31,000, respectively, for the purchase of property and equipment.

Financing activities

During the three months ended March 31, 2022, financing activities provided $32,000 from exercise of stock options.

During the three months ended March 31, 2021, financing activities provided $0.1 million from the exercise of common stock warrants and stock options, offset by $35,000 for payments related to our equipment loan.

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Funding requirements

Our operating expenses are expected to increase substantially as we continue to advance our portfolio of programs.

Specifically, our expenses will increase if and as we:

● further develop our discovery engine;

● continue our research and development programs for our current and any future product candidates from our current programs;

● seek to identify additional research programs and additional product candidates;

● initiate non-clinical testing and clinical trials for our product candidates;

● maintain, expand, enforce, defend, and protect our intellectual property portfolio and provide reimbursement of third-party expenses related to our patent portfolio;

● seek marketing approvals for any of our product candidates that successfully complete clinical trials;

● ultimately establish a sales, marketing, and distribution infrastructure to commercialize any medicines for which we may obtain marketing approval;

● hire additional personnel including research and development, clinical and administrative personnel;

● add operational, financial, and management information systems and personnel, including personnel to support our product development;

● acquire or in-license products, intellectual property, and technologies; and

● continue to operate as a public company.

We expect that our existing cash at March 31, 2022 will enable us to fund our current and planned operating expenses and capital expenditures at least 12 months from the filing date of this Quarterly Report on Form 10-Q. The Company will need additional financing to support its continuing operations and pursue its development strategy. We have based these estimates on assumptions that may prove to be imprecise, and we may exhaust our available capital resources sooner that we currently expect. Because of the numerous risks and uncertainties associated with the development of our programs, we are unable to estimate the amounts of increased capital outlays and operating expenses associated with completing the research and development of our product candidates.

Our future funding requirements will depend on many factors including:

● the costs of continuing to develop our discovery engine;

● the costs of acquiring licenses, should we choose to do so, for the expansion of product development;

● the scope, progress, results, and costs of discovery, preclinical development, laboratory testing, manufacturing and clinical trials for current and future product candidates;

● the costs of preparing, filing, and prosecuting patent applications, maintaining and enforcing our intellectual property and proprietary rights, and defending intellectual property-related claims and the success of our intellectual property portfolio;

24

● the costs, timing, and outcome of regulatory review of the product candidates we may develop;

● the costs of future activities, including product sales, medical affairs, marketing, manufacturing, distribution, coverage and reimbursement for any product candidates for which we receive regulatory approval;

● the success of our license agreements and our collaborations;

● our ability to establish and maintain additional collaborations on favorable terms, if at all;

● the achievement of milestones or occurrence of other developments that trigger payments under any additional collaboration agreements we obtain;

● the extent to which we acquire or in-license products, intellectual property, and technologies; and

● the costs of operating as a public company.

Until such time, if ever, as we can generate substantial product revenues, we expect to finance our cash needs through a combination of equity offerings, debt financings, collaborations, strategic alliances, and licensing arrangements. We do not have any committed external source of funds. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of any purchaser will be or could be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common stockholders. Debt financing and equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making acquisitions or capital expenditures or declaring dividends. If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or drug candidates, or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings or other arrangements when needed, we may be required to delay, limit, reduce or terminate our research, product development or future commercialization efforts, or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves. If we are unable to raise additional funds through equity or debt financings when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

Critical accounting policies and use of estimates

Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which we have prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, and expenses and the disclosure of contingent assets and liabilities in our financial statements. We base our estimates on historical experience, known trends and events and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions.

While our significant accounting policies are described in more detail in Note 2 to our audited financial statements appearing in our Annual Report filed on Form 10-K with the SEC on March 28, 2022, we believe that the following accounting policies are the most critical to the judgments and estimates used in the preparation of our financial statements.

25

Share-based compensation

We recognize the grant-date fair value of share-based awards issued as compensation expense on a straight-line basis over the requisite service period, which is generally the vesting period of the award. The fair value of stock options is estimated at the time of grant using the Black-Scholes option pricing model, which requires the use of inputs and assumptions such as the fair value of the underlying common stock, exercise price of the option, expected term, risk-free interest rate, expected volatility and dividend yield.

The inputs and assumptions used to estimate the fair value of share-based payment awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and management uses different inputs and assumptions, our share-based compensation expense could be materially different for future awards.

Expected volatility is a subjective assumption that is estimated. The expected volatility was based on the historical stock volatility of several of our comparable publicly traded companies over a period of time equal to the expected term of the options, as we do not have sufficient trading history to use the volatility of our own common stock.

Accrued research and development expenses

As part of the process of preparing our financial statements, we are required to estimate our accrued research and development expenses. This process involves reviewing open contracts and purchase orders and communicating with personnel to identify services that have been performed on our behalf and estimating the level of service performed and the associated cost incurred for the service when we have not yet been invoiced or otherwise notified of actual costs. The majority of our service providers invoice us on a pre-determined schedule or when contractual milestones are met. We make estimates of our accrued expenses as of each balance sheet date in the financial statements based on facts and circumstances known to us at that time. We periodically confirm the accuracy of these estimates with the service providers and make adjustments, if necessary. Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and may result in reporting amounts that are too high or too low in any particular period. To date, there have not been any material adjustments to our prior estimates of accrued research and development expenses.

Recently Adopted Accounting Standards

On January 1, 2022, the Company adopted Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), which establishes ASC 842 and supersedes the lease accounting guidance under ASC 840. The standard generally requires lessees to recognize operating and finance lease liabilities and corresponding right-of-use (ROU) assets on the balance sheet and provide enhanced disclosures on the amount, timing, and uncertainty of cash flows arising from lease arrangements. The Company adopted ASC 842 using the modified retrospective approach. The Company elected the package of practical expedients available for existing contracts, which allowed the Company to carry forward our historical assessments of lease identification, lease classification, and initial direct costs. The Company also elected a policy to not apply the recognition requirements of ASC 842 for short-term leases with a term of 12 months of less.

As of January 1, 2022, the effective date, the Company identified one operating lease arrangement relating to the Company’s headquarter facility and a short-term lease relating to laboratory equipment. The adoption of ASC 842 resulted in a recognition of an ROU asset and lease liability of $0.2 million on the Company’s balance sheet relating to the leases as of January 1, 2022. The adoption of the standard did not have a material effect on the Company’s condensed statements of operations and condensed statements of cash flows.

Recently Issued Accounting Pronouncements

In November 2021, the FASB issued ASU Topic 832, Disclosures by Business Entities about Government Assistance (“Topic 832”). This standard requires annual disclosures about transactions with a government that have

26

been accounted for by analogizing to a grant or contribution accounting model to increase transparency about the types of transactions, the accounting for the transactions, and the effect of the transactions on an entity’s financial statements. The effective date of Topic 832 is for financial statements issued for annual periods beginning after December 15, 2021. The Company is currently evaluating the effect Topic 832 will have on its financial statements and related disclosures.

JOBS Act

We qualify as an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As an emerging growth company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to public companies, including reduced disclosure about our executive compensation arrangements, exemption from the requirements to hold non-binding advisory votes on executive compensation and golden parachute payments and exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting.

We may take advantage of these exemptions until the last day of the fiscal year following the fifth anniversary of our initial public offering or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company earlier if we have more than $1.07 billion in annual revenue, we have more than $700.0 million in market value of our stock held by non-affiliates (and we have been a public company for at least 12 months and have filed one annual report on Form 10-K) or we issue more than $1.0 billion of non-convertible debt securities over a three-year period. For so long as we remain an emerging growth company, we are permitted, and intend, to rely on exemptions from certain disclosure requirements that are applicable to other public companies that are not emerging growth companies. We may choose to take advantage of some, but not all, of the available exemptions. In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. This allows an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected not to “opt out” of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we will adopt the new or revised standard at the time private companies adopt the new or revised standard and will do so until such time that we either (i) irrevocably elect to “opt out” of such extended transition period or (ii) no longer qualify as an emerging growth company. Therefore, the reported results of operations contained in our financial statements may not be directly comparable to those of other public companies.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

The information under this item is not required to be provided by smaller reporting companies.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost benefit relationship of possible controls and procedures. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of March 31, 2022, our disclosure controls and procedures were effective to ensure the timely disclosure of required information in our SEC filings.

Changes in Internal Control Over Financial Reporting

No changes in our internal control over financial reporting occurred during the quarter ended March 31, 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

27

PART II — OTHER INFORMATION

Item 1. Legal Proceedings

We are not currently a party to any material legal proceedings. From time to time, we may become involved in legal proceedings arising in the ordinary course of our business.

Item 1A. Risk Factors

The information under this item is not required to be provided by smaller reporting companies.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

28

Item 6. Exhibits

EXHIBIT INDEX

Exhibit No.	Description of Exhibit
3.1	Amended and Restated Certificate of Incorporation of Immunome, Inc. (incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K filed October 6, 2020).
3.2 10.1*	Amended and Restated Bylaws of Immunome, Inc. (incorporated by reference to Exhibit 3.2 to our Current Report on Form 8-K filed October 6, 2020). Modification of Contract between the Company and the Department of Defense, United States of America, dated March 18, 2022 (portions of this exhibit (indicated by asterisks) have been redacted in compliance with Regulation S-K Item 601(b)(10)(iv)).
31.1*	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101	Interactive Data File (Form 10-Q for the Quarterly Period ended March 31, 2022 filed in XBRL). The financial information contained in the XBRL-related documents is "unaudited" and "unreviewed." The instance document does not appear in the interactive file because its XBRL tags are embedded within the Inline XBRL document.
104	Cover Page Interactive File (embedded within the Inline XBRL document).

* Filed or furnished herewith.

# Management contracts or compensatory plans or arrangements

29

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.

	IMMUNOME, INC.
	(Registrant)
Date: May 12, 2022	By:	/s/ Purnanand D. Sarma
	Name:	Purnanand D. Sarma, Ph. D.
	Title:	President and Chief Executive Officer
		(Principal Executive Officer)
Date: May 12, 2022	By:	/s/ Corleen M. Roche
	Name:	Corleen M. Roche
	Title:	Chief Financial Officer
		(Principal Financial Officer)

30

EX-10.1

EXHIBIT 10.1

CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED BECAUSE IMMUNOME, INC. HAS DETERMINED THIS INFROMATION (I) IS NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO IMMUNOME, INC. IF PUBLICLY DISCLOSED.

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT

1.CONTRACTIDCODE

PAGEOFPAGES

1

2

2.AMENDMENT/MODIFICATIONNO.

3.EFFECTIVEDATE 18-Mar-2022

4.REQUISITION/PURCHASEREQ.NO. SEESCHEDULE

5.PROJECTNO.(Ifapplicable)

6.ISSUEDBY

CODE

W911SR

7.ADMINISTEREDBY(Ifotherthanitem6)

W911SR

ACC-APGEDGEWOOD8456BRIGADE STREET APGMD 21010

ACC-APGEDGEWOOD 110THOMASJOHNSONDRFREDERICK MD 21702

8. NAMEAND ADDRESSOFCONTRACTOR(No.,Street,County,StateandZipCode) IMMUNOME,INC. 665STOCKTONDRSTE300 EXTONPA19341-1139

9A.AMENDMENTOFSOLICITATION NO.

9B.DATED(SEEITEM11)

X

10A.MOD.OFCONTRACT/ORDERNO. W911QY2090019

X

10B.DATED(SEEITEM13) 03-Jul-2020

CODE4U3X6

FACILITYCODE

11.THISITEMONLYAPPLIESTOAMENDMENTSOFSOLICITATIONS

TheabovenumberedsolicitationisamendedassetforthinItem14.ThehouranddatespecifiedforreceiptofOfferis extended,isnotextended. Offermustacknowledge receiptofthisamendmentprior tothehour anddate specifiedinthe solicitationor asamendedbyone ofthe followingmethods:(a)By completing Items 8 and 15, and returningcopiesoftheamendment;(b)Byacknowledgingreceiptofthisamendmentoneachcopyoftheoffersubmitted;or (c)By separate letter or telegramwhich includes areferenceto the solicitation and amendment numbers.FAILURE OFYOURACKNOWLEDGMENTTO BERECEIVED ATTHE PLACE DESIGNATED FORTHE RECEIPTOFOFFERSPRIORTO THE HOURAND DATESPECIFIED MAY RESULTIN REJECTION OFYOUROFFER.Ifby virtueofthis amendment you desireto changean offeralready submitted,such changemay bemadeby telegramorletter,providedeachtelegramorlettermakesreferencetothesolicitationandthisamendment,andisreceivedpriortotheopeninghouranddatespecified.

12.ACCOUNTINGANDAPPROPRIATIONDATA(Ifrequired)

13.THISITEMAPPLIESONLYTOMODIFICATIONSOFCONTRACTS/ORDERS.ITMODIFIESTHE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.

A.THISCHANGEORDERISISSUEDPURSUANTTO:(Specifyauthority) THECHANGESSETFORTHINITEM14 AREMADEINTHECONTRACTORDER NO. IN ITEM 10A.

B.THEABOVENUMBEREDCONTRACT/ORDERISMODIFIEDTOREFLECTTHEADMINISTRATIVECHANGES(suchaschangesin payingoffice,appropriationdate,etc.)SETFORTHINITEM14,PURSUANTTOTHEAUTHORITYOFFAR 43.103(B).

C.THISSUPPLEMENTALAGREEMENTISENTERED INTOPURSUANTTOAUTHORITYOF:

X

D.OTHER(Specifytypeofmodificationand authority) InaccordancewithArticle5oftheagreement.

E. IMPORTANT:

Contractor

isnot,

X

isrequiredtosignthisdocumentandreturn1copies totheissuingoffice.

14.DESCRIPTIONOFAMENDMENT/MODIFICATION(OrganizedbyUCFsectionheadings,includingsolicitation/contractsubjectmatterwhere feasible.) ModificationControlNumber:rtotten221106 Thepurposeofthismodificationistoextendthecompletionfrom[***]to[***].Allothertermsandconditionsremainthesame and in full force and effect.

15A.NAMEANDTITLEOFSIGNER (Typeorprint) PurnanandD.Sarma,PresidentandCEO

16A.NAMEANDTITLEOFCONTRACTINGOFFICER(Typeorprint) TEL:[***]EMAIL:[***]

15B.CONTRACTOR/OFFEROR /s/PurnanandD.Sarma (Signatureofpersonauthorizedtosign)

15C.DATESIGNED 03/30/2022

16B.UNITEDSTATESOFAMERICA BY[***] (SignatureofContractingOfficer)

16C.DATESIGNED 03/31/2022

EXCEPTIONTOSF	30-105-04	STANDARDFORM30(Rev.10-83)
APPROVEDBYOIRM 11-84		Prescribedby GSA FAR(48CFR)53.243

W911QY2090019

(rtotten221106) Page2of2

SECTIONSF30BLOCK14CONTINUATIONPAGE

SUMMARY OF CHANGES

SECTIONSF30-BLOCK14CONTINUATIONPAGE

Thefollowinghavebeenaddedbyfulltext: P00003

A. Thepurposeofthismodificationistoextendthecompletiondatefrom[***],to[***].

B. The parties hereby agree that changes effected by this modification constitute both the considerationandtheequitableadjustmentdueunderanyclauseofthisagreementresulting from the incorporation of the changes identified in paragraph A.

C. Allothertermsandconditionsremainthesameandinfullforceandeffect.

SECTIONF-DELIVERIESORPERFORMANCE

ThefollowingDeliveryScheduleitemforCLIN0001hasbeenchangedfrom:

DELIVERY DATEQUANTITYSHIP TO ADDRESSDODAAC/ CAGE

[***]N/A

FOB:Destination

To:

DELIVERY DATEQUANTITYSHIP TO ADDRESSDODAAC/ CAGE

[***]N/A

FOB:Destination

(EndofSummaryof Changes)

EX-31.1

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Purnanand D. Sarma, Ph.D., certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2022 of Immunome, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

2
Date: May 12, 2022	By:	/s/ Purnanand D. Sarma
	Name:	Purnanand D. Sarma, Ph.D.
	Title:	President and Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Corleen Roche, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2022 of Immunome, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 12, 2022	By:	/s/ Corleen Roche
	Name:	Corleen Roche
	Title:	Chief Financial Officer (Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Immunome, Inc. (the “Company”) for the fiscal quarter ended March 31, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 12, 2022	By:	/s/ Purnanand D. Sarma
	Name:	Purnanand D. Sarma, Ph.D.
	Title:	President and Chief Executive Officer (Principal Executive Officer)

EX-32.2

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Immunome, Inc. (the “Company”) for the fiscal quarter ended March 31, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) the Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 12, 2022	By:	/s/ Corleen Roche
	Name:	Corleen Roche
	Title:	Chief Financial Officer (Principal Financial Officer)

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2022	May 09, 2022
Document and Entity Information [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2022
Current Fiscal Year End Date	--12-31
Document Transition Report	false
Entity File Number	001-39580
Entity Registrant Name	Immunome, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	77-0694340
Entity Address, Address Line One	665 Stockton Drive
Entity Address, Address Line Two	Suite 300
Entity Address, City or Town	Exton
Entity Address State Or Province	PA
Entity Address, Postal Zip Code	19341
City Area Code	610
Local Phone Number	321-3700
Title of 12(b) Security	Common Stock, $0.0001 par value
Trading Symbol	IMNM
Security Exchange Name	NASDAQ
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	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		12,127,385
Entity Central Index Key	0001472012
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q1
Amendment Flag	false

XML

Condensed Balance Sheets - USD ($)	Mar. 31, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 42,879,000	$ 49,229,000
Prepaid expenses and other current assets	3,424,000	7,409,000
Total current assets	46,303,000	56,638,000
Property and equipment, net	753,000	855,000
Operating right-of-use asset, net	190,000
Restricted cash	100,000	100,000
Deferred offering costs	382,000	332,000
Total assets	47,728,000	57,925,000
Current liabilities:
Accounts payable	3,890,000	3,077,000
Accrued expenses and other current liabilities	5,817,000	6,651,000
Total current liabilities	9,707,000	9,728,000
Other long-term liabilities	147,000	12,000
Total liabilities	9,854,000	9,740,000
Commitments and contingencies (Note 6)
Stockholders' equity (deficit):
Preferred stock, $0.0001 par value; 10,000,000 shares authorized; no shares issued or outstanding at March 31, 2022 and December 31, 2021
Common stock, $0.0001 par value; 200,000,000 shares authorized; 12,127,385 and 12,110,373 shares issued and outstanding at March 31, 2022 and December 31, 2021,	1,000	1,000
Additional paid-in capital	128,631,000	127,289,000
Accumulated deficit	(90,758,000)	(79,105,000)
Total stockholders' equity	37,874,000	48,185,000
Total liabilities and stockholders' equity	$ 47,728,000	$ 57,925,000

XML

Condensed Balance Sheets (Parentheticals) - $ / shares	Mar. 31, 2022	Dec. 31, 2021
Condensed Balance Sheets
Preferred stock par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized (in shares)	10,000,000	10,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	200,000,000	200,000,000
Common stock, shares issued (in shares)	12,127,385	12,110,373
Common stock, shares outstanding (in shares)	12,127,385	12,110,373

XML

Condensed Statements of Operations - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Operating expenses:
Research and development	$ 8,078	$ 1,979
General and administrative	3,576	1,918
Total operating expenses	11,654	3,897
Loss from operations	(11,654)	(3,897)
Other income (expenses):
Interest income (expense), net	1	(1)
Net loss	$ (11,653)	$ (3,898)
Per share information:
Net loss per share of common stock, Basic	$ (0.96)	$ (0.37)
Net loss per share of common stock, Diluted	$ (0.96)	$ (0.37)
Weighted average shares of common stock outstanding, Basic	12,122,903	10,640,870
Weighted average shares of common stock outstanding, Diluted	12,122,903	10,640,870

XML

Condensed Statements of Changes in Stockholders Equity - USD ($) $ in Thousands	Common stock.	Additional paid-in capital	Accumulated deficit	Total
Balance at Dec. 31, 2020	$ 1	$ 95,738	$ (54,394)	$ 41,345
Balance (shares) at Dec. 31, 2020	10,634,245
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation expense		325		325
Exercise of common stock warrants		105		105
Exercise of common stock warrants (shares)	11,666
Exercise of stock options		6		6
Exercise of stock options (shares)	14,270
Net loss			(3,898)	(3,898)
Balance at Mar. 31, 2021	$ 1	96,174	(58,292)	37,883
Balance (shares) at Mar. 31, 2021	10,660,181
Balance at Dec. 31, 2021	$ 1	127,289	(79,105)	48,185
Balance (shares) at Dec. 31, 2021	12,110,373
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation expense		1,310		1,310
Exercise of stock options		32		32
Exercise of stock options (shares)	17,012
Net loss			(11,653)	(11,653)
Balance at Mar. 31, 2022	$ 1	$ 128,631	$ (90,758)	$ 37,874
Balance (shares) at Mar. 31, 2022	12,127,385

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Condensed Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Cash flows from operating activities:
Net loss	$ (11,653)	$ (3,898)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	111	176
Amortization of right-of-use asset	25
Share-based compensation	1,310	325
Deferred rent	(12)	(1)
Changes in operating assets and liabilities:
Prepaid expenses and other assets	3,985	(1,703)
Accounts payable	788	1,771
Accrued expenses and other current liabilities	(912)	(205)
Other long term liabilities	(18)
Net cash used in operating activities	(6,376)	(3,535)
Cash flows from investing activities:
Purchases of property and equipment	(6)	(31)
Net cash used in investing activities	(6)	(31)
Cash flows from financing activities:
Proceeds from exercise of stock options	32	6
Proceeds from sale of common stock and common stock warrants		105
Payment of equipment loan payable		(35)
Net cash provided by financing activities	32	76
Net increase in cash and cash equivalents and restricted cash	(6,350)	(3,490)
Cash and cash equivalents and restricted cash at beginning of year	49,329	39,866
Cash and cash equivalents and restricted cash at end of year	42,979	36,376
Supplemental disclosures of cash flow information:
Operating lease right-of-use asset and lease liability recorded upon adoption of ASC 842	215
Offering costs included in accrued expenses and other liabilities	25
Offering costs included in accounts payable	25
Fixed assets included in accrued expenses and other current liabilities	$ 3
Cash paid for interest		$ 2

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Nature of the business and basis of presentation

3 Months Ended

Mar. 31, 2022

Nature of the business and basis of presentation

Nature of the business and basis of presentation

IMMUNOME, INC.

Notes to Condensed Financial Statements

(Unaudited)

1. Nature of the business and basis of presentation

Organization

Immunome, Inc. (“the Company” or “Immunome”) was incorporated as a Pennsylvania corporation on March 2, 2006 and was converted to a Delaware corporation on December 2, 2015. The Company is a biopharmaceutical company utilizing our proprietary human memory B cell platform to discover and develop first-in-class antibody therapeutics designed to change the way diseases are currently being treated. The Company’s primary focus areas are oncology and infectious disease, including COVID-19.

Since its inception, the Company has devoted substantially all its resources to research and development, raising capital, building its management team and extending its intellectual property portfolio. The Company is subject to risks and uncertainties common to early-stage companies in the biotechnology industry including, but not limited to, risks associated with the successful research, development and manufacturing of product candidates, uncertain results of preclinical and clinical testing, development of new technological innovations and products by competitors, dependence on key personnel and third-party vendors, protection of proprietary technology, compliance with government regulations, regulatory approval of product candidates and the ability to secure additional capital to fund operations.

Liquidity

The Company has incurred net losses since inception, including net losses of $11.7 million and $3.9 million for the three months ended March 31, 2022 and 2021, respectively, and it expects to generate losses from operations and negative operating cash flows for the foreseeable future primarily due to research and development costs for its potential product candidates. As of March 31, 2022, the Company had an accumulated deficit of $90.8 million.

On October 1, 2021 the Company entered into an Open Market Sale Agreement (“ATM Agreement”) with Jefferies Group LLC, which provides that, upon the terms and subject to the conditions and limitations in the ATM Agreement, the Company may elect, from time to time, to offer and sell shares of common stock under the registration statement having an aggregate offering price of up to $75.0 million through Jefferies Group LLC acting as sales agent. The Company has not yet sold any shares under the ATM Agreement.

The Company had cash and cash equivalents of $42.9 million at March 31, 2022. The Company expects that its cash will enable it to fund its operating expenses and capital expenditure requirements for at least 12 months from the filing date of this Quarterly Report on Form 10-Q; however; more funding will be necessary beyond this point to fund additional research and development, clinical development and operations in order to pursue the Company’s growth strategy. 

If the Company cannot obtain the necessary funding, it will need to delay, scale back or eliminate some or all of its research and development programs or enter into collaborations with third parties to commercialize potential products or technologies that it might otherwise seek to develop or commercialize independently (or enter into these collaborations sooner than it might otherwise have intended to do); consider other various strategic alternatives, including a merger or sale of the Company; or cease operations. If the Company engages in collaborations, it may receive lower consideration upon commercialization of such products than if it had not entered into such arrangements or if it entered into such arrangements at later stages in the product development process. Additionally, volatility in the capital markets and general economic conditions in the United States may be a significant obstacle to raising the required funds.

Operations of the Company are subject to certain risks and uncertainties including various internal and external factors that will affect whether and when the Company’s product candidates become approved drugs and how significant their market share will be, some of which are outside of the Company’s control. The length of time and cost of

developing and commercializing these product candidates and/or failure of them at any stage of the drug approval process will materially affect the Company’s financial condition and future operations. On March 11, 2020, the World Health Organization characterized the novel COVID-19 virus as a global pandemic. Although there is significant uncertainty as to the likely effects this disease may have in the future, there has not been a significant impact to the Company’s operations or financial statements to date.

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Summary of significant accounting policies

3 Months Ended

Mar. 31, 2022

Summary of significant accounting policies

Summary of significant accounting policies

2. Summary of significant accounting policies

Basis of presentation

The accompanying financial statements have been prepared in accordance with accounting principles generally accepted (“GAAP”) in the United States. Any reference in these notes to applicable guidance is meant to refer to GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) promulgated by the Financial Accounting Standards Board (“FASB”).

Unaudited interim results

These unaudited condensed financial statements and accompanying notes should be read in conjunction with the Company’s annual financial statements and the notes thereto included in the Company’s Form 10-K filed with the Securities and Exchange Commission on March 28, 2022. The accompanying condensed financial statements as of March 31, 2022 and for the three months ended March 31, 2022 and 2021 are unaudited but include all adjustments that management believes to be necessary for a fair presentation of the periods presented. Interim results are not necessarily indicative of results for a full year. Balance sheet amounts as of December 31, 2021 have been derived from the audited financial statements as of that date.

Use of estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and expenses. The Company bases its estimates and assumptions on historical experience when available and on various factors that it believes to be reasonable under the circumstances. Significant estimates and assumptions reflected in these condensed financial statements include, but are not limited to, the expected volatility used to estimate fair value of stock options and accrued research and development expenses. Estimates and assumptions are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ from these estimates.

Segment and geographic information

Operating segments are defined as components of an entity about which separate discrete information is available for evaluation by the chief operating decision maker (“CODM”), or decision-making group, in deciding how to allocate resources and in assessing performance. The CODM is the Company’s Chief Executive Officer. The Company views its operations as and manages its business in one operating segment operating exclusively in the United States.

Fair value of financial instruments

ASC Topic 820, Fair Value Measurement (“ASC 820”), establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the assets or liability and are developed based on the best information available in the circumstances. ASC 820 identifies fair value 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. As a basis for considering market participant assumptions in fair value measurements, ASC 820 establishes a three-tiered value hierarchy that distinguishes between the following:

Level 1 — Quoted market prices in active markets for identical assets or liabilities.

Level 2 — Inputs other than Level 1 inputs that are either directly or indirectly observable, such as quoted market prices, interest rates and yield curves.

Level 3 — Unobservable inputs for the asset or liability (i.e. supported by little or no market activity). Level 3 inputs include management’s own assumptions about the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk).

To the extent the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgement. Accordingly, the degree of judgement exercised by the Company in determining fair value is greatest for instruments categorized as Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

Cash and cash equivalents are Level 1 assets as of March 31, 2022 and December 31, 2021.

Restricted cash

Restricted cash represents collateral provided for a letter of credit issued as a security deposit in connection with the Company’s lease of its corporate facilities. This lease expires in 2024 at which time the cash will be released from restriction. Restricted cash was $100,000 at both March 31, 2022 and December 31, 2021. The following table provides a reconciliation of the components of cash and cash equivalents and restricted cash reported in the Company’s condensed balance sheets to the total of the amount presented in the condensed statements of cash flows:

(in thousands)	March 31, 2022		December 31, 2021
Cash and cash equivalents	$	42,879	$	49,229
Restricted cash		100		100
	$	42,979	$	49,329

Equity issuance costs

The Company capitalizes costs that are directly associated with the ATM agreement until such financings are consummated, at which time such costs are recorded against the gross proceeds from the applicable financing. If a financing is abandoned, deferred offering costs are expensed.

Deferred offering costs were $0.4 million and $0.3 million as of March 31, 2022 and December 31, 2021, respectively, on the condensed balance sheet.

Government contract funding

The Company accounts for amounts received under its U.S. Department of Defense expense reimbursement contract as contra-research and development expenses in the condensed statements of operations.

Research and development costs

Research and development costs are charged to expense as incurred. Research and development costs consist of costs incurred in performing research and development activities, including salaries and bonuses, share-based compensation, employee benefits, facilities costs, laboratory supplies, depreciation and amortization, preclinical and clinical development expenses, including manufacture and testing of clinical supplies, consulting and other contracted services. Additionally, under the terms of the license agreements described in Note 6, the Company is obligated to make future payments should certain development and regulatory milestones be achieved. No such costs have been incurred

for the three months ended March 31, 2022 and 2021. Costs for certain research and development activities are recognized based on the terms of the individual arrangements, which may differ from the timing of receipt of invoices and payment of invoices and are reflected in the financial statements as a prepaid or accrued expense.

Net loss per share

Basic net loss per share of common stock is computed by dividing the net loss by the weighted average number of common shares outstanding for the period. Diluted net loss per share of common stock is computed by adjusting net loss to reallocate undistributed earnings based on the potential impact of dilutive securities. Diluted net loss per share of common stock is computed by dividing the diluted net loss by the weighted average number of common shares outstanding for the period, including potential dilutive common shares assuming the dilutive effect of common stock equivalents.

The following potentially dilutive securities outstanding as of March 31, 2022 and 2021 have been excluded from the computation of diluted weighted-average shares of common stock outstanding, as they would be anti-dilutive:

	March 31,
	2022	2021
Stock options(1)	2,009,844	1,636,069
Common stock warrants(1)	1,303,112	1,023,530
	3,312,956	2,659,599

(1) Represents common stock equivalents.

In periods in which the Company reports a net loss per share of common stock, diluted net loss per share of common stock is the same as basic net loss per share of common stock since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive. The Company reported a net loss per share of common stock for the three months ended March 31, 2022 and 2021.

Leases

Effective January 1, 2022, the Company adopted ASC Topic (ASC 842) using the modified retrospective approach by applying the new standard to all leases existing on the adoption date. The results for reporting periods beginning after January 1, 2022 are presented in accordance with ASC 842, while prior period amounts are not adjusted and continue to be reported under the accounting standards that were in effect prior to January 1, 2022.

At the inception of an arrangement, the Company determines whether an arrangement contains a lease based on facts and circumstances present in the arrangement. An arrangement is or contains a lease if the arrangement conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Typically, lessees are required to recognize leases with a term greater than one year on the balance sheet as an operating or finance lease liability and right-of-use asset. Right-of-use assets represent the Company’s right to use an underlying asset during the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. The Company has elected the practical expedient to not to recognize leases with a term of 12 months or less. The Company does not have any financing leases as of March 31, 2022.

Operating lease liabilities and their corresponding right-of-use assets are recorded based on their present value of lease payments over the remaining lease term. Options to extend the lease term are included in the Company’s assessment of the lease term only if there is a reasonable assessment that the Company will renew. Leases are discounted to its present value using either the interest rate implicit in the Company’s lease or its incremental borrowing rate, which reflects the fixed rate in which the Company could borrow on a collateralized basis the amount of lease payments in the same currency, for a similar term, in a similar economic environment.

Recently adopted accounting standards

On January 1, 2022, the Company adopted Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), which establishes ASC 842 and supersedes the lease accounting guidance under ASC 840. The standard generally requires lessees to recognize operating and finance lease liabilities and corresponding right-of-use (ROU) assets on the balance sheet and provide enhanced disclosures on the amount, timing, and uncertainty of cash flows arising from lease arrangements. The Company adopted ASC 842 using the modified retrospective approach. The Company elected the package of practical expedients available for existing contracts, which allowed the Company to carry forward our historical assessments of lease identification, lease classification, and initial direct costs. The Company also elected a policy to not apply the recognition requirements of ASC 842 for short-term leases with a term of 12 months of less.

As of January 1, 2022, the effective date, the Company identified one operating lease arrangement relating to the Company’s headquarters facility and one short-term lease relating to laboratory equipment. The adoption of ASC 842 resulted in a recognition of an ROU asset and lease liability of $0.2 million on the Company’s balance sheet relating to the leases as of January 1, 2022. The adoption of the standard did not have a material effect on the Company’s condensed statements of operations and condensed statements of cash flows (Note 7).

Recently issued accounting pronouncements

In November 2021, the FASB issued ASU Topic 832, Disclosures by Business Entities about Government Assistance (“Topic 832”). This standard requires annual disclosures about transactions with a government that have been accounted for by analogizing to a grant or contribution accounting model to increase transparency about the types of transactions, the accounting for the transactions, and the effect of the transactions on an entity’s financial statements. The effective date of Topic 832 is for financial statements issued for annual periods beginning after December 15, 2021. The Company is currently evaluating the effect Topic 832 will have on its financial statements and related disclosures.

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U.S. Department of Defense (DoD) expense reimbursement contract

3 Months Ended

Mar. 31, 2022

U.S. Department of Defense (DoD) expense reimbursement contract

U.S. Department of Defense (DoD) expense reimbursement contract

3. U.S. Department of Defense (“DoD”) expense reimbursement contract

In July 2020, the Company entered into an Other Transaction Authority for Prototype Agreement (“the OTA Agreement”) with the DoD to fund the Company’s efforts in developing an antibody cocktail therapeutic to treat COVID-19. The amount of funding being made available to the Company under this expense reimbursement contract was $13.3 million. In May 2021, the Company and the DoD amended the OTA, pursuant to which the DoD award was increased from $13.3 million to $17.6 million. Under the agreement, the DoD shall pay the Company, upon submission of proper invoices, within 30 calendar days of receipt of request for payment.

The Company recorded contra-research and development expense of $0.6 million and $4.0 million for the three months ended March 31, 2022 and 2021, respectively, in the statements of operations. The Company had an expense reimbursement receivable balance of $0 and $2.7 million due from the DoD in prepaid expenses and other current assets as of March 31, 2022 and December 31, 2021, respectively, in the accompanying condensed balance sheet.

Costs that have been reimbursed by the DoD but not yet expensed by the Company are recorded as a deferred research obligation liability for the period. The Company has a deferred research obligation liability of $0.6 million and $2.0 million as of March 31, 2022 and December 31, 2021, respectively. This amount is included in accrued expenses and other liabilities in the accompanying condensed balance sheet. DoD reimbursable services that have been performed but not yet billed are recorded as an unbilled receivable in prepaid expenses and other current assets in the accompanying condensed balance sheet. The Company had an unbilled receivable from the DoD of $0.8 million and $1.6 million as of March 31, 2022 and December 31, 2021, respectively.

As of March 31, 2022, the Company has the potential for $0.2 million of remaining expense reimbursement under the OTA Agreement.

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Prepaid expenses and other assets

3 Months Ended

Mar. 31, 2022

Prepaid expenses and other assets

Prepaid expenses and other assets

4. Prepaid expenses and other assets

Prepaid expenses and other assets consisted of the following:

(in thousands)	March 31, 2022		December 31, 2021
Prepaid insurance	$	1,422	$	2,019
Research and development advance payments		636		586
Unbilled reimbursement receivable from DoD		795		1,638
Other prepaids and short-term deposits		571		492
Reimbursement receivable from DoD		—		2,674
	$	3,424	$	7,409

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Accrued expenses and other liabilities

3 Months Ended

Mar. 31, 2022

Accrued expenses and other liabilities

Accrued expenses and other liabilities

5. Accrued expenses and other liabilities

Accrued expenses and other liabilities consisted of the following:

(in thousands)	March 31, 2022		December 31, 2021
Research and development	$	3,972	$	2,840
Compensation and related benefits		842		1,246
Professional fees		357		227
Deferred research obligations		585		2,021
Short-term operating lease liability and other liabilities		61		317
	$	5,817	$	6,651

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Commitments and contingencies

3 Months Ended

Mar. 31, 2022

Commitments and contingencies

Commitments and contingencies

6. Commitments and contingencies

Employment agreements

The Company entered into employment agreements (the “Employment Agreements”) with key personnel providing for compensation and severance in certain circumstances, as defined in the respective Employment Agreements. The Employment Agreements may be terminated by either the Company or the employees in accordance with the respective Employment Agreements (subject to the payment of severance upon certain terminations) and provide for annual pay adjustments and bonuses at the discretion of the Board of Directors.

Employee benefit plan

The Company maintains a defined-contribution plan under Section 401(k) of the Internal Revenue Code (the “401(k) Plan”). The 401(k) Plan covers all employees who meet defined minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pre-tax basis. The Company assumes all administrative costs of the 401(k) Plan and makes matching contributions as defined in the 401(k) Plan document. The Company made matching contributions of $0.1 million to the 401(k) Plan for the three months ended March 31, 2022 and 2021, respectively.

Legal proceedings

The Company is not a party to any material litigation and does not have contingency reserves established for any litigation liabilities. At each reporting date, the Company evaluates whether a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies.

License Agreements

The Company entered into various license agreements to further discover, develop and commercialize certain technologies and treatments. The Company may need to pay developmental and regulatory milestone payments of up to approximately $2.6 million, if any. In addition, the Company may need to pay royalty rates on net product sales and certain commercial milestone payments of up to approximately $1.5 million, if any.

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Leases

3 Months Ended

Mar. 31, 2022

Leases

Leases

7. Leases

Effective January 1, 2022, the Company adopted ASC Topic (ASC 842) using the modified retrospective approach by applying the new standard to all leases existing on the adoption date. The results for reporting periods beginning after January 1, 2022 are presented in accordance with ASC 842, while prior period amounts are not adjusted and continue to be reported under the accounting standards that were in effect prior to January 1, 2022.

In May 2017, the Company entered into a 62-month office and laboratory space lease commencing on July 1, 2017 for approximately 11,000 square feet of space in Exton, Pennsylvania. The Company has an option to extend the lease for up to two additional five-year terms. In December 2021, the Company extended the lease for an additional eighteen-month term ending in March 2024.

Beginning July 2021, the Company leased laboratory equipment on a month-to-month basis. In April 2022, the Company exercised the purchase option under the lease agreement to purchase the leased laboratory equipment. The Company elected the practical expedient to recognize short-term leases under ASC 840.

Supplemental balance sheet information related to leases as of March 31, 2022 was as follows (in thousands):

Operating leases:
Operating lease right-of-use assets	$	190
Operating lease liability	$	46
Operating lease liability, net of current portion		147
Total operating lease liability	$	193

Operating lease liability and operating lease liability, net of current portion is included in accrued expenses and other current liabilities and other long-term liabilities, respectively, in the accompanying condensed balance sheet.

Supplemental lease expense related to leases was as follows:

Lease Cost (in thousands)	Statements of Operations Classification		Three Months Ended March 31, 2022
Operating lease cost	General and administrative Research and development	$	60
Short-term lease cost	General and administrative Research and development		53
Total lease expense		$	113

Under ASC 840, rent expense for the three months ended March 31, 2021 was approximately $0.1 million.

Other information related to the operating lease where the Company is the lessee was as follows:

	Three Months Ended March 31, 2022
Weighted-average remaining lease term	2.0 years
Weighted-average discount rate	9.0%

Supplemental cash flow information related to the operating lease was as follows (in thousands):

		Three Months Ended March 31, 2022
Cash paid for operating lease liability	$	57

As of March 31, 2022, minimum rental commitments under the operating lease were as follows (in thousands):

Years ending December 31,	Amount
2022 (represents remaining nine months in 2022)	$	177
2023		246
2024		63
Total lease payments		486
Less imputed interest		(293)
Present value of lease liability	$	193

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Common stock

3 Months Ended

Mar. 31, 2022

Common stock

Common stock

8. Common stock

Common stock

The holders of common stock are entitled to one vote for each share of common stock. Subject to the approval of the holders of a majority in interest of the Company’s stockholders entitled to vote thereon, the holders of common stock shall be entitled to receive dividends out of legally available funds. In the event of any voluntary or involuntary liquidation, dissolution, or winding up of the Company, the holders of common stock are entitled to share ratably in the remaining assets of the Company available for distribution.

Warrants to acquire shares of common stock

At March 31, 2022, common stock warrants outstanding were as follows:

Warrants	Exercise Price per Share	Expiration Date
803,112	$ 9.00	June 2, 2023
500,000	$ 45.00	April 28, 2024

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Share-based compensation

3 Months Ended

Mar. 31, 2022

Share-based compensation

Share-based compensation

9. Share-based compensation

In July 2008, the Board of Directors adopted the 2008 Equity Incentive Plan ("the 2008 Plan”) which provided for the grant of qualified incentive stock options and non-qualified stock options, restricted stock or other awards to the Company’s employees, officers, directors, advisors, and outside consultants for the issuance or purchase of shares of the Company’s common stock. The 2008 Plan was replaced in July 2018 with the 2018 Equity Incentive Plan (the 2018 Plan and collectively with the 2008 Plan, the Prior Plans). At the time that the 2008 Plan was terminated, there were 388,748

shares available for grant that were transferred to the 2018 Plan. On September 24, 2020, the 2018 Plan was terminated and replaced with the 2020 Equity Incentive Plan (2020 Plan). Additionally, the number of shares of our common stock reserved for issuance under the 2020 Plan will automatically increase on January 1 of each year, beginning on January 1, 2021 and continuing through and including January 1, 2030, by 4% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by the Company’s Board of Directors. As of March 31, 2022, there were 1,836,212 shares available for future issuance under the 2020 Plan.

The Company also adopted the 2020 Employee Stock Purchase Plan (“ESPP”) on September 18, 2020 which provides for the grant of purchase rights to purchase shares of the Company’s common stock to eligible employees, as defined by the ESPP. The maximum number of shares of common stock that may be issued under the ESPP will not exceed 125,000 shares of common stock, plus the number of shares of common stock that are automatically added on January 1 of each calendar year for a period of up to ten years, commencing on the first January 1 following the year in which an IPO occurs and ending on, and including, January 1, 2030, in an amount equal to the lesser of (i) 1% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year, and (ii) 1,000,000 shares of common stock. No shares of common stock have been issued under the ESPP as of March 31, 2022.

The 2020 Plan and the ESPP are administered by the Board of Directors subject to the Board’s right to delegate to a committee. The exercise prices, vesting and other restrictions are determined at the discretion of the Board of Directors. Stock options awarded under the Prior Plans and the 2020 Plan generally expire 10 years after the grant date unless the Board of Directors sets a shorter term. Vesting periods for awards under the Prior Plans and the 2020 Plan are determined at the discretion of the Board of Directors. Stock options granted to employees, officers, members of the Board of Directors and consultants of the Company typically vest over one to four years. Certain options provide for accelerated vesting if there is a change in control, as defined in the Prior Plans and the 2020 Plan.

Share-based compensation expense recorded as research and development and general and administrative expenses in the condensed statements of operations is as follows (in thousands):

	Three Months Ended March 31,
(In thousands)	2022		2021
Research and development	$	445	$	171
General and administrative		865		154
	$	1,310	$	325

Unrecognized compensation cost related to unvested options was $12.1 million as of March 31, 2022 and will be recognized over an estimated weighted average period of 3.5 years.

Stock options

The weighted average assumptions used in the Black-Scholes option-pricing model for stock options granted were:

	Three Months Ended March 31,
	2022			2021
Expected volatility		83.5	%		83.5	%
Risk-free interest rate		1.7	%		1.1	%
Expected term (in years)		6.08			6.10
Expected dividend yield		—			—
Fair value of common stock	$	10.58		$	31.83

A summary of option activity under the Plans and 2020 Plan during the three months ended March 31, 2022 is as follows:

				Weighted
		Weighted		average
		average		remaining
	Number of	exercise price		contractual
	shares	per share		term (years)
Outstanding at January 1, 2022	2,005,756	$	11.26	8.50
Granted	21,100		10.58	9.82
Forfeited	—		—	—
Exercised	(17,012)		1.87	8.11
Outstanding at March 31, 2022	2,009,844		11.33	8.27
Exercisable at March 31, 2022	779,707		5.40	7.57
Vested or expected to vest at March 31, 2022	2,009,844		11.33	8.27

The weighted-average grant date fair value per share of stock options granted during the three months ended March 31, 2022 and 2021 was $7.52 and $22.46, respectively. The aggregate intrinsic value of stock options exercised during the three months ended March 31, 2022 was $0.1 million. The aggregate intrinsic value of stock options outstanding at March 31, 2022 is $4.0 million.

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Related party transactions

3 Months Ended

Mar. 31, 2022

Related party transactions

Related party transactions

10. Related party transactions

License agreements

The Company has entered into license agreements with certain stockholders of the Company. Expenses with these related parties were de minimis for the three months ended March 31, 2022 and 2021, respectively. In addition, amounts owed to these related parties were de minimis as of March 31, 2022 and December 31, 2021.

Broadband services agreement

In November 2015, the Company entered into a management services agreement (MSA) with BCM Advisory Partners LLC and Broadband Capital Partners LLC (collectively Broadband Capital). Certain directors of the Company are principals of Broadband Capital. Under the Broadband MSA, the Company engages Broadband Capital as a consultant for advice in connection with senior management matters related to the Company’s business, administration and policies in exchange for a cash fee to Broadband Capital of $20,000 per month. The Broadband MSA was amended and/or restated in July 2016, January 2017, June 2018, March 2020 and August 2020. In June 2021, the Company extended the Broadband MSA to continue through June 2022. The Company recorded $0.1 million during each of the three months ended March 31, 2022 and 2021, respectively, related to the Broadband MSA, which is included in general and administrative expenses in the condensed statements of operations. There were no amounts due to Broadband Capital as of March 31, 2022 and December 31, 2021.

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Summary of significant accounting policies (Policies)

3 Months Ended

Mar. 31, 2022

Summary of significant accounting policies

Basis of presentation

Basis of presentation

The accompanying financial statements have been prepared in accordance with accounting principles generally accepted (“GAAP”) in the United States. Any reference in these notes to applicable guidance is meant to refer to GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) promulgated by the Financial Accounting Standards Board (“FASB”).

Unaudited Interim Results

Unaudited interim results

These unaudited condensed financial statements and accompanying notes should be read in conjunction with the Company’s annual financial statements and the notes thereto included in the Company’s Form 10-K filed with the Securities and Exchange Commission on March 28, 2022. The accompanying condensed financial statements as of March 31, 2022 and for the three months ended March 31, 2022 and 2021 are unaudited but include all adjustments that management believes to be necessary for a fair presentation of the periods presented. Interim results are not necessarily indicative of results for a full year. Balance sheet amounts as of December 31, 2021 have been derived from the audited financial statements as of that date.

Use of estimates

Use of estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and expenses. The Company bases its estimates and assumptions on historical experience when available and on various factors that it believes to be reasonable under the circumstances. Significant estimates and assumptions reflected in these condensed financial statements include, but are not limited to, the expected volatility used to estimate fair value of stock options and accrued research and development expenses. Estimates and assumptions are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ from these estimates.

Segment and geographic information

Segment and geographic information

Operating segments are defined as components of an entity about which separate discrete information is available for evaluation by the chief operating decision maker (“CODM”), or decision-making group, in deciding how to allocate resources and in assessing performance. The CODM is the Company’s Chief Executive Officer. The Company views its operations as and manages its business in one operating segment operating exclusively in the United States.

Fair value of financial instruments

Fair value of financial instruments

ASC Topic 820, Fair Value Measurement (“ASC 820”), establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the assets or liability and are developed based on the best information available in the circumstances. ASC 820 identifies fair value 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. As a basis for considering market participant assumptions in fair value measurements, ASC 820 establishes a three-tiered value hierarchy that distinguishes between the following:

Level 1 — Quoted market prices in active markets for identical assets or liabilities.

Level 2 — Inputs other than Level 1 inputs that are either directly or indirectly observable, such as quoted market prices, interest rates and yield curves.

Level 3 — Unobservable inputs for the asset or liability (i.e. supported by little or no market activity). Level 3 inputs include management’s own assumptions about the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk).

To the extent the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgement. Accordingly, the degree of judgement exercised by the Company in determining fair value is greatest for instruments categorized as Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

Cash and cash equivalents are Level 1 assets as of March 31, 2022 and December 31, 2021.

Restricted Cash

Restricted cash

Restricted cash represents collateral provided for a letter of credit issued as a security deposit in connection with the Company’s lease of its corporate facilities. This lease expires in 2024 at which time the cash will be released from restriction. Restricted cash was $100,000 at both March 31, 2022 and December 31, 2021. The following table provides a reconciliation of the components of cash and cash equivalents and restricted cash reported in the Company’s condensed balance sheets to the total of the amount presented in the condensed statements of cash flows:

(in thousands)	March 31, 2022		December 31, 2021
Cash and cash equivalents	$	42,879	$	49,229
Restricted cash		100		100
	$	42,979	$	49,329

Equity issuance costs

Equity issuance costs

The Company capitalizes costs that are directly associated with the ATM agreement until such financings are consummated, at which time such costs are recorded against the gross proceeds from the applicable financing. If a financing is abandoned, deferred offering costs are expensed.

Deferred offering costs were $0.4 million and $0.3 million as of March 31, 2022 and December 31, 2021, respectively, on the condensed balance sheet.

Government contract funding

Government contract funding

The Company accounts for amounts received under its U.S. Department of Defense expense reimbursement contract as contra-research and development expenses in the condensed statements of operations.

Research and development costs

Research and development costs

Research and development costs are charged to expense as incurred. Research and development costs consist of costs incurred in performing research and development activities, including salaries and bonuses, share-based compensation, employee benefits, facilities costs, laboratory supplies, depreciation and amortization, preclinical and clinical development expenses, including manufacture and testing of clinical supplies, consulting and other contracted services. Additionally, under the terms of the license agreements described in Note 6, the Company is obligated to make future payments should certain development and regulatory milestones be achieved. No such costs have been incurred

for the three months ended March 31, 2022 and 2021. Costs for certain research and development activities are recognized based on the terms of the individual arrangements, which may differ from the timing of receipt of invoices and payment of invoices and are reflected in the financial statements as a prepaid or accrued expense.

Net loss per share

Net loss per share

Basic net loss per share of common stock is computed by dividing the net loss by the weighted average number of common shares outstanding for the period. Diluted net loss per share of common stock is computed by adjusting net loss to reallocate undistributed earnings based on the potential impact of dilutive securities. Diluted net loss per share of common stock is computed by dividing the diluted net loss by the weighted average number of common shares outstanding for the period, including potential dilutive common shares assuming the dilutive effect of common stock equivalents.

The following potentially dilutive securities outstanding as of March 31, 2022 and 2021 have been excluded from the computation of diluted weighted-average shares of common stock outstanding, as they would be anti-dilutive:

	March 31,
	2022	2021
Stock options(1)	2,009,844	1,636,069
Common stock warrants(1)	1,303,112	1,023,530
	3,312,956	2,659,599

(1) Represents common stock equivalents.

In periods in which the Company reports a net loss per share of common stock, diluted net loss per share of common stock is the same as basic net loss per share of common stock since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive. The Company reported a net loss per share of common stock for the three months ended March 31, 2022 and 2021.

Leases

Leases

Effective January 1, 2022, the Company adopted ASC Topic (ASC 842) using the modified retrospective approach by applying the new standard to all leases existing on the adoption date. The results for reporting periods beginning after January 1, 2022 are presented in accordance with ASC 842, while prior period amounts are not adjusted and continue to be reported under the accounting standards that were in effect prior to January 1, 2022.

At the inception of an arrangement, the Company determines whether an arrangement contains a lease based on facts and circumstances present in the arrangement. An arrangement is or contains a lease if the arrangement conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Typically, lessees are required to recognize leases with a term greater than one year on the balance sheet as an operating or finance lease liability and right-of-use asset. Right-of-use assets represent the Company’s right to use an underlying asset during the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. The Company has elected the practical expedient to not to recognize leases with a term of 12 months or less. The Company does not have any financing leases as of March 31, 2022.

Operating lease liabilities and their corresponding right-of-use assets are recorded based on their present value of lease payments over the remaining lease term. Options to extend the lease term are included in the Company’s assessment of the lease term only if there is a reasonable assessment that the Company will renew. Leases are discounted to its present value using either the interest rate implicit in the Company’s lease or its incremental borrowing rate, which reflects the fixed rate in which the Company could borrow on a collateralized basis the amount of lease payments in the same currency, for a similar term, in a similar economic environment.

Recent Accounting Pronouncements

Recently adopted accounting standards

On January 1, 2022, the Company adopted Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), which establishes ASC 842 and supersedes the lease accounting guidance under ASC 840. The standard generally requires lessees to recognize operating and finance lease liabilities and corresponding right-of-use (ROU) assets on the balance sheet and provide enhanced disclosures on the amount, timing, and uncertainty of cash flows arising from lease arrangements. The Company adopted ASC 842 using the modified retrospective approach. The Company elected the package of practical expedients available for existing contracts, which allowed the Company to carry forward our historical assessments of lease identification, lease classification, and initial direct costs. The Company also elected a policy to not apply the recognition requirements of ASC 842 for short-term leases with a term of 12 months of less.

As of January 1, 2022, the effective date, the Company identified one operating lease arrangement relating to the Company’s headquarters facility and one short-term lease relating to laboratory equipment. The adoption of ASC 842 resulted in a recognition of an ROU asset and lease liability of $0.2 million on the Company’s balance sheet relating to the leases as of January 1, 2022. The adoption of the standard did not have a material effect on the Company’s condensed statements of operations and condensed statements of cash flows (Note 7).

Recently issued accounting pronouncements

In November 2021, the FASB issued ASU Topic 832, Disclosures by Business Entities about Government Assistance (“Topic 832”). This standard requires annual disclosures about transactions with a government that have been accounted for by analogizing to a grant or contribution accounting model to increase transparency about the types of transactions, the accounting for the transactions, and the effect of the transactions on an entity’s financial statements. The effective date of Topic 832 is for financial statements issued for annual periods beginning after December 15, 2021. The Company is currently evaluating the effect Topic 832 will have on its financial statements and related disclosures.

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Summary of significant accounting policies (Tables)

3 Months Ended

Mar. 31, 2022

Summary of significant accounting policies

Schedule of reconciliation of the components of cash and restricted cash reported in balance sheet

(in thousands)	March 31, 2022		December 31, 2021
Cash and cash equivalents	$	42,879	$	49,229
Restricted cash		100		100
	$	42,979	$	49,329

Schedule of potentially dilutive securities have been excluded from the computation of diluted weighted-average shares of common stock outstanding, as they would be anti-dilutive

The following potentially dilutive securities outstanding as of March 31, 2022 and 2021 have been excluded from the computation of diluted weighted-average shares of common stock outstanding, as they would be anti-dilutive:

	March 31,
	2022	2021
Stock options(1)	2,009,844	1,636,069
Common stock warrants(1)	1,303,112	1,023,530
	3,312,956	2,659,599

(1) Represents common stock equivalents.

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Prepaid expenses and other assets (Tables)

3 Months Ended

Mar. 31, 2022

Prepaid expenses and other assets

Schedule of prepaid expenses and other current assets

(in thousands)	March 31, 2022		December 31, 2021
Prepaid insurance	$	1,422	$	2,019
Research and development advance payments		636		586
Unbilled reimbursement receivable from DoD		795		1,638
Other prepaids and short-term deposits		571		492
Reimbursement receivable from DoD		—		2,674
	$	3,424	$	7,409

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Accrued expenses and other liabilities (Tables)

3 Months Ended

Mar. 31, 2022

Accrued expenses and other liabilities

Schedule of accrued expenses and other liabilities

(in thousands)	March 31, 2022		December 31, 2021
Research and development	$	3,972	$	2,840
Compensation and related benefits		842		1,246
Professional fees		357		227
Deferred research obligations		585		2,021
Short-term operating lease liability and other liabilities		61		317
	$	5,817	$	6,651

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Leases (Tables)

3 Months Ended

Mar. 31, 2022

Leases

Supplemental balance sheet information

Supplemental balance sheet information related to leases as of March 31, 2022 was as follows (in thousands):

Operating leases:
Operating lease right-of-use assets	$	190
Operating lease liability	$	46
Operating lease liability, net of current portion		147
Total operating lease liability	$	193

Supplemental lease expense

Lease Cost (in thousands)	Statements of Operations Classification		Three Months Ended March 31, 2022
Operating lease cost	General and administrative Research and development	$	60
Short-term lease cost	General and administrative Research and development		53
Total lease expense		$	113

Schedule of other information related to the operating lease

	Three Months Ended March 31, 2022
Weighted-average remaining lease term	2.0 years
Weighted-average discount rate	9.0%

Supplemental cash flow information

Supplemental cash flow information related to the operating lease was as follows (in thousands):

		Three Months Ended March 31, 2022
Cash paid for operating lease liability	$	57

Schedule of future minimum lease payments under operating lease

As of March 31, 2022, minimum rental commitments under the operating lease were as follows (in thousands):

Years ending December 31,	Amount
2022 (represents remaining nine months in 2022)	$	177
2023		246
2024		63
Total lease payments		486
Less imputed interest		(293)
Present value of lease liability	$	193

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Common stock (Tables)

3 Months Ended

Mar. 31, 2022

Common stock

Schedule of warrants outstanding

At March 31, 2022, common stock warrants outstanding were as follows:

Warrants	Exercise Price per Share	Expiration Date
803,112	$ 9.00	June 2, 2023
500,000	$ 45.00	April 28, 2024

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Share-based compensation (Tables)

3 Months Ended

Mar. 31, 2022

Share-based compensation

Schedule of Stock-based compensation expense

Share-based compensation expense recorded as research and development and general and administrative expenses in the condensed statements of operations is as follows (in thousands):

	Three Months Ended March 31,
(In thousands)	2022		2021
Research and development	$	445	$	171
General and administrative		865		154
	$	1,310	$	325

Weighted average assumptions used in option-pricing

The weighted average assumptions used in the Black-Scholes option-pricing model for stock options granted were:

	Three Months Ended March 31,
	2022			2021
Expected volatility		83.5	%		83.5	%
Risk-free interest rate		1.7	%		1.1	%
Expected term (in years)		6.08			6.10
Expected dividend yield		—			—
Fair value of common stock	$	10.58		$	31.83

Summary of option activity

A summary of option activity under the Plans and 2020 Plan during the three months ended March 31, 2022 is as follows:

				Weighted
		Weighted		average
		average		remaining
	Number of	exercise price		contractual
	shares	per share		term (years)
Outstanding at January 1, 2022	2,005,756	$	11.26	8.50
Granted	21,100		10.58	9.82
Forfeited	—		—	—
Exercised	(17,012)		1.87	8.11
Outstanding at March 31, 2022	2,009,844		11.33	8.27
Exercisable at March 31, 2022	779,707		5.40	7.57
Vested or expected to vest at March 31, 2022	2,009,844		11.33	8.27

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Nature of the business and basis of presentation (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021	Oct. 01, 2021
Net loss	$ (11,653)	$ (3,898)
Accumulated deficit	(90,758)		$ (79,105)
Cash and cash equivalents	$ 42,879		$ 49,229
Open Market Sale | Maximum
Securities aggregate price				$ 75,000

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Summary of significant accounting policies - Narrative (Details)	3 Months Ended
	Mar. 31, 2022 USD ($) segment	Jan. 01, 2022 USD ($)	Dec. 31, 2021 USD ($)
Summary of significant accounting policies
Number of operating segments | segment	1
Restricted cash	$ 100,000		$ 100,000
Deferred offering costs	400,000		$ 300,000
Operating right-of-use asset, net	$ 190,000	$ 200,000
Operating lease liability		$ 200,000

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Summary of significant accounting policies - Components of cash and restricted cash (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
Summary of significant accounting policies
Cash and cash equivalents	$ 42,879	$ 49,229
Restricted cash	100	100
Cash and restricted cash	$ 42,979	$ 49,329	$ 36,376	$ 39,866

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Summary of significant accounting policies - Anti-dilutive (Details) - shares	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Earnings Per Share, Diluted, Other Disclosures [Abstract]
Anti-dilutive securities	3,312,956	2,659,599
Stock options
Earnings Per Share, Diluted, Other Disclosures [Abstract]
Anti-dilutive securities	2,009,844	1,636,069
Common stock warrants
Earnings Per Share, Diluted, Other Disclosures [Abstract]
Anti-dilutive securities	1,303,112	1,023,530

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U.S. Department of Defense (DoD) expense reimbursement contract (Details) - Other Transaction Authority for Prototype Agreement - USD ($) $ in Millions	1 Months Ended	3 Months Ended
	Jul. 31, 2020	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021	May 31, 2021
Unusual or Infrequent Item, or Both [Line Items]
Grants Receivable	$ 13.3				$ 17.6
Payment period of reimbursement contract	30 days
Contra-research and development expense		$ 0.6	$ 4.0
Prepaid expenses and other current assets		0.0		$ 2.7
Deferred research obligation liability		0.6		2.0
Grant expected to be received		0.8		$ 1.6
Grants receivable current		$ 0.2

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Prepaid expenses and other assets (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Prepaid expenses and other assets
Prepaid insurance	$ 1,422	$ 2,019
Research and development advance payments	636	586
Unbilled reimbursement receivable from DoD	795	1,638
Other prepaids and short term deposits	571	492
Reimbursement receivable from DoD		2,674
Prepaid expenses and other assets	$ 3,424	$ 7,409

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Accrued expenses and other liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Accrued expenses and other liabilities
Research and development	$ 3,972	$ 2,840
Compensation and related benefits	842	1,246
Professional fees	357	227
Deferred research obligations	585	2,021
Short-term operating lease liability and other liabilities	61	317
Accrued expenses and other liabilities	$ 5,817	$ 6,651

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Commitments and contingencies (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Commitments and contingencies
Defined contribution	$ 0.1	$ 0.1
Product development and regulatory approval milestone payments	2.6
Commercial milestone payments	$ 1.5

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Leases (Details) - Office and laboratory space	1 Months Ended
	Dec. 31, 2021	May 31, 2017 ft² item
Lessee, Lease, Description [Line Items]
Lease term		62 months
Area | ft²		11,000
Number of extension | item		2
Period of extension	18 months	5 years

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Leases - Balance Sheet related information (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Jan. 01, 2022
Lessee, Lease, Description [Line Items]
Operating right-of-use asset, net	$ 190	$ 200
Operating lease liability		$ 200
Office and laboratory space
Lessee, Lease, Description [Line Items]
Operating right-of-use asset, net	190
Operating lease liability	46
Operating lease liability, net of current portion	147
Operating lease liability	$ 193

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Leases - Lease expense (Details) - Office and laboratory space - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Lessee, Lease, Description [Line Items]
Total lease expense	$ 113
Rent expenses		$ 100
General, Administrative, Research and Development
Lessee, Lease, Description [Line Items]
Operating lease cost	60
Short-term lease cost	$ 53

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Leases - Additional lease related information (Details) - Office and laboratory space	Mar. 31, 2022
Lessee, Lease, Description [Line Items]
Weighted-average remaining lease term	2 years
Weighted-average discount rate	9.00%

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Leases - Cash flow information (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($)
Office and laboratory space
Lessee, Lease, Description [Line Items]
Cash paid for operating lease liability	$ 57

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Leases - Lease maturity (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Jan. 01, 2022
Lessee, Lease, Description [Line Items]
Operating lease liability		$ 200
Office and laboratory space
Lessee, Lease, Description [Line Items]
2020 (represents three remaining months)	$ 177
2022	246
2023	63
Total lease payments	486
Less imputed interest	(293)
Operating lease liability	$ 193

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Common stock (Details)	3 Months Ended
	Mar. 31, 2022 Vote
Common stock
Common stock voting right	1

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Common stock - Warrants (Details) - Warrants	Mar. 31, 2022 $ / shares shares
Exercise Price $9.00
Class of Warrant or Right [Line Items]
Warrants outstanding | shares	803,112
Exercise price | $ / shares	$ 9.00
Exercise Price $45.00
Class of Warrant or Right [Line Items]
Warrants outstanding | shares	500,000
Exercise price | $ / shares	$ 45.00

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Share-based compensation - Plans (Details) - shares	3 Months Ended
	Mar. 31, 2022	Jul. 31, 2018
2018 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares available for grant		388,748
2020 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Threshold Percentage Of Total Number Of Common Stock Outstanding	4.00%
Shares available for future issuance	1,836,212
Employee Stock Purchase Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee Stock Purchase Plan, Threshold Period For Which Common Stock Is Automatically Added To Arrive At Authorized Shares	10 years
Number of common shares added in authorized	1,000,000
Awards granted	0
Authorized stock options	125,000
Percentage of outstanding capital stock	1.00%
The Plans
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expiration period	10 years
The Plans | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	4 years
The Plans | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	1 year

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Share-based compensation - Costs (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 1,310	$ 325
Unrecognized compensation cost	$ 12,100
Recognition period	3 years 6 months
Research and development
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 445	171
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 865	$ 154

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Share-based compensation - Assumptions (Details) - $ / shares	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Share-based compensation
Expected volatility	83.50%	83.50%
Risk-free interest rate	1.70%	1.10%
Expected term (in years)	6 years 29 days	6 years 1 month 6 days
Fair value of common stock	$ 10.58	$ 31.83

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Share-based compensation - Option Activity and Restricted Stock (Details) - The Plans - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		12 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Options, Beginning balance	2,005,756
Options, Granted	21,100
Options, Exercised	(17,012)
Options, Ending balance	2,009,844		2,005,756
Options, Exercisable	779,707
Options, Vested or expected to vest	2,009,844
Weighted Average Exercise price
Beginning price	$ 11.26
Granted	10.58
Exercised	1.87
Ending price	11.33		$ 11.26
Exercisable	5.40
Vested or expected to vest	$ 11.33
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Weighted Average Remaining Contractual Term	8 years 3 months 7 days		8 years 6 months
Weighted Average Remaining Contractual Term, Granted	9 years 9 months 25 days
Weighted Average Remaining Contractual Term, Exercised	8 years 1 month 9 days
Weighted Average Remaining Contractual Term, Exercisable	7 years 6 months 25 days
Weighted Average Remaining Contractual Term, Vested or expected to vest	8 years 3 months 7 days
Weighted average grant date fair value	$ 7.52	$ 22.46
Intrinsic value, exercised	$ 0.1
Intrinsic value, outstanding	$ 4.0

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Related party transactions (Details) - Broadband services agreement - USD ($)	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021	Nov. 30, 2015
Related Party Transaction [Line Items]
Due to related party	$ 0		$ 0
Monthly cash fee payment				$ 20,000
Related party transaction, expenses	$ 100,000	$ 100,000