F-1/A 1 formf-1a.htm

 

As filed with the U.S. Securities and Exchange Commission on March 27, 2023

 

Registration No. 333-268456

 

 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Amendment No. 4 to

FORM F-1

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

 

CytoMed Therapeutics Limited

(Exact Name of Registrant as Specified in its Charter)

 

Not Applicable

(Translation of Registrant’s name into English)

 

Singapore

 

2834

 

Not Applicable

(State or Other Jurisdiction of

Incorporation or Organization)

 

(Primary Standard Industrial

Classification Code Number)

 

(I.R.S. Employer

Identification Number)

 

 

1 Commonwealth Lane

#08-22

Singapore 149544

+65 6250 7738

(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)

 

Puglisi & Associates
850 Library Ave, Suite 204
Newark, DE 19711
(302)-738-6680

(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service)

 

Copies to:

 

Richard I. Anslow, Esq.

Lijia Sanchez, Esq.

Ellenoff Grossman & Schole LLP

1345 Avenue of the Americas

New York, NY 10105

Tel: (212) 370-1300

Fax: (212) 370-7889

 

Richard A. Friedman, Esq.

Stephen A. Cohen, Esq.

Sean F. Reid, Esq.

Sheppard, Mullin, Richter & Hampton LLP

30 Rockefeller Plaza

New York, NY 10112

Tel: (212) 653-8700

Fax: (212) 653-8701

 

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement.

 

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☒

 

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

 

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

 

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933:

Emerging growth company ☒

 

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, 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 7(a)(2)(B) of the Securities Act. ☐

 

† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

 

The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to such Section 8(a), may determine.

 

 

 

 

 

 

The information in this Prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This Prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any state where the offer or sale is not permitted.

 

Subject to Completion dated March 27, 2023

 

 

PRELIMINARY PROSPECTUS

 

2,412,369 ORDINARY SHARES

 

CYTOMED THERAPEUTICS LIMITED

 

We are offering ordinary shares. This is the initial public offering of ordinary shares of CytoMed Therapeutics Limited. We are offering, on a firm commitment basis, 2,412,369 ordinary shares. The offering price of our ordinary shares in this offering is expected to be between U.S.$4.00 and U.S.$5.00 per share. Prior to this offering, there has been no public market for our ordinary shares.

 

We have applied to list our ordinary shares on the Nasdaq Capital Market (“Nasdaq”) under the symbol “GDTC”. There is no assurance that our application will be approved, and if our application is not approved, this offering will not be completed.

 

We are an “emerging growth company” as defined in the Jumpstart Our Business Act of 2012, as amended, and, as such, will be subject to reduced public company reporting requirements.

 

Investing in our ordinary shares is highly speculative and involves a high degree of risk. Before buying any shares, you should carefully read the discussion of material risks of investing in our ordinary shares in “Risk Factors” beginning on page 26 of this Prospectus.

 

Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this Prospectus. Any representation to the contrary is a criminal offense.

 

      PER SHARE       TOTAL  
Initial public offering Price   U.S.$                     U.S.$                    
Underwriting discounts and commissions(1)   U.S.$       U.S.$    
Proceeds, before expenses, to us   U.S.$       U.S.$    

 

(1) We have agreed to issue, on the closing date of this offering, warrants, or the representative’s warrants, to the representative of the underwriters, The Benchmark Company, LLC, in an amount equal to 5% of the aggregate number of ordinary shares sold by us in this offering, excluding any shares issued pursuant to exercise of the underwriter’s over-allotment option. For a description of other terms of the representative’s warrants and a description of the other compensation to be received by the underwriters, see “Underwriting” beginning on page 181.

 

We expect our total cash expenses for this offering (including cash expenses payable to our underwriters for their out-of-pocket expenses) to be approximately U.S.$1.31 million, exclusive of the above discounts. In addition, we will pay additional items of value in connection with this offering that are viewed by the Financial Industry Regulatory Authority, or FINRA, as underwriting compensation. These payments will further reduce proceeds available to us before expenses. See “Underwriting.”

 

This offering is being conducted on a firm commitment basis. The underwriters are obligated to take and pay for all of the shares if any such shares are taken. We have granted the underwriters an option for a period of 45 days after the closing of this offering to purchase up to 15% of the total number of our ordinary shares to be offered by us pursuant to this offering (excluding shares subject to this option), solely for the purpose of covering over-allotments, at the initial public offering price less the underwriting discounts. If the underwriters exercise the option in full, the total underwriting discounts payable will be U.S.$873,880.56 based on an assumed initial public offering price of U.S.$4.50 per ordinary share (the midpoint of the price range set forth on the cover page of this Prospectus), and the total gross proceeds to us, before underwriting discounts and expenses, will be U.S.$12,484,008.00.

 

The underwriters expect to deliver the ordinary shares against payment as set forth under the section titled “Underwriting” on or about         , 2023.

 

The Benchmark Company Axiom Capital Management, Inc.

 

The date of this Prospectus is         , 2023.

 

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Explanatory Note

 

As of the date of this Prospectus, the registrant is a public company limited by shares known as CytoMed Therapeutics Limited. On January 19, 2023, the registrant converted from a private company limited by shares incorporated in Singapore, known as CytoMed Therapeutics Pte. Ltd. to a public company limited by shares pursuant to the provisions of the Singapore Companies Act.

 

Effective on January 17, 2023, the registrant implemented a 1-for-380.83 reverse split of its ordinary shares pursuant to which the shareholders received one (1) ordinary share for every 380.83 ordinary shares held as of such date.

 

References to “the date of this Prospectus” in this draft Prospectus shall refer to the date of confidential submission of this draft Prospectus.

 

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TABLE OF CONTENTS

 

Page
About This Prospectus 6
Presentation of Financial Information 7
Exchange Rates 8
Market and Industry Data 9
Trademarks 10
Summary 11
The Offering 24
Summary of Consolidated Financial Information 25
Risk Factors 26
Cautionary Statement Regarding Forward-Looking Statements 73
Use of Proceeds 74
Dividend Policy 75
Capitalization 76
Dilution 77
Selected Consolidated Financial Information 79
Management’s Discussion and Analysis of Financial Condition and Results of Operations 80
Business 89
Regulation 123
Management 139
Certain Relationships and Related Party Transactions 153
Principal Shareholders 155
Description of Share Capital 156
Shares Eligible for Future Sale 173
Tax Considerations 174
Underwriting 181
Expenses of the Offering 184
Legal Matters 185
Experts 186
Change in Registrant’s Certifying Accountant 186
Service of Process and Enforcement of Civil Liabilities 187
Where You Can Find More Information 188
Index to the Consolidated Financial Statements F-1

 

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Neither we nor the underwriters have authorized anyone to provide any information or to make any representations other than those contained in this Prospectus or in any free writing prospectuses prepared by or on behalf of us or to which we have referred you. We and the underwriters take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This Prospectus is an offer to sell only the shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this Prospectus or in any applicable free writing prospectus is current only as of its date, regardless of its time of delivery or any sale of our ordinary shares. Our business, financial condition, results of operations and prospects may have changed since that date.

 

You should rely only on the information contained in this Prospectus or in any related free-writing prospectus. We have not authorized anyone to provide you with information different from that contained in this Prospectus. We are offering to sell, and seeking offers to buy, ordinary shares in our Company only in jurisdictions where such offers and sales are permitted. The information contained in this Prospectus is current only as of the date of this Prospectus, regardless of the time of delivery of this Prospectus or of any sale of the ordinary shares.

 

For investors outside the United States: Neither we nor the underwriters have done anything that would permit this offering or possession or distribution of this Prospectus in any jurisdiction, other than the United States, where action for that purpose is required. Persons outside the United States who come into possession of this Prospectus must inform themselves about, and observe any restrictions relating to, the offering of the ordinary shares and the distribution of this Prospectus outside the United States.

 

We are incorporated under the laws of Singapore as a company with limited liability, and as of the date of this Prospectus a majority of our outstanding securities are owned by non-U.S. residents. Under the rules of the U.S. Securities and Exchange Commission, or the SEC, we currently qualify for treatment as a “foreign private issuer.” As a foreign private issuer, we will not be required to file periodic reports and financial statements with the Securities and Exchange Commission, or the SEC, as frequently or as promptly as domestic registrants whose securities are registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act.

 

Until          , 2023 (25 days after the date of this Prospectus), all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to their unsold allotments or subscriptions.

 

5

 

 

ABOUT THIS PROSPECTUS

 

“CytoMed”, “CytoMed Therapeutics”, the “Company”, “we”, “our”, “ours”, “us”, “our Group” and similar terms refer to CytoMed Therapeutics Limited and/or its subsidiaries (where applicable).

 

For investors outside of the United States: We have not done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside of the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the ordinary shares and the distribution of this prospectus outside of the United States.

 

For investors in Singapore: This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, our ordinary shares were not offered or sold or caused to be made the subject of an invitation for subscription or purchase and will not be offered or sold or caused to be made the subject of an invitation for subscription or purchase, and this prospectus or any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of our ordinary shares, has not been circulated or distributed, nor will it be circulated or distributed, whether directly or indirectly, to any person in Singapore other than (i) to an institutional investor (as defined in Section 4A of the Securities and Futures Act 2001 of Singapore, as modified or amended from time to time (“SFA”)) pursuant to Section 274 of the SFA, (ii) to a relevant person (as defined in Section 275(2) of the SFA) pursuant to Section 275(1) of the SFA, or any person pursuant to Section 275(1A) of the SFA, and in accordance with the conditions specified in Section 275 of the SFA and (where applicable) Regulation 3 of the Securities and Futures (Classes of Investors) Regulations 2018, or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

 

Where our ordinary shares are subscribed or purchased under Section 275 of the SFA by a relevant person which is:

 

(a) a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or

 

(b) a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary of the trust is an individual who is an accredited investor, securities or securities-based derivatives contracts (each term as defined in Section 2(1) of the SFA) of that corporation or the beneficiaries’ rights and interest (howsoever described) in that trust shall not be transferred within six months after that corporation or that trust has acquired the ordinary shares pursuant to an offer made under Section 275 of the SFA, except:

 

to an institutional investor or to a relevant person, or to any person arising from an offer referred to in Section 275(1A) of the SFA or Section 276(4)(c)(ii) of the SFA;
where no consideration is or will be given for the transfer;
where the transfer is by operation of law;
as specified in Section 276(7) of the SFA; or
as specified in Regulation 37A of the Securities and Futures (Offers of Investments) (Securities and Securities-based Derivatives Contracts) Regulations 2018.

 

Any reference to the SFA is a reference to the Securities and Futures Act 2001 of Singapore and a reference to any term as defined in the SFA or any provision in the SFA is a reference to that term as modified or amended from time to time including by such of its subsidiary legislation as may be applicable at the relevant time.

 

Notification under Section 309B(1)(c) of the SFA: The Company has determined, and hereby notifies all persons (including relevant persons (as defined in Section 309A(1) of the SFA)) that the ordinary shares are prescribed capital markets products (as defined in the Securities and Futures (Capital Markets Products) Regulations 2018) and Excluded Investment Products (as defined in MAS Notice SFA 04-N12: Notice on the Sale of Investment Products and MAS Notice FAA-N16: Notice on Recommendations on Investment Products).

 

By accepting this prospectus, the recipient hereof and thereof represents and warrants that such recipient is entitled to receive it in accordance with the restrictions set forth above and agrees to be bound by the limitations contained herein. Any failure to comply with these limitations may constitute a violation of law.

 

6

 

 

PRESENTATION OF FINANCIAL INFORMATION

 

Basis of Presentation

 

Unless otherwise indicated, all financial information contained in this Prospectus is prepared and presented in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). Certain differences exist between IFRS and generally accepted accounting principles in the United States (“U.S. GAAP”) which might be material to the financial information herein. We have not prepared a reconciliation of our consolidated financial statements and related footnote disclosures between IFRS and U.S. GAAP. Potential investors should consult their own professional advisers for an understanding of the differences between IFRS and U.S. GAAP and how these differences might affect the financial information herein.

 

All references in this Prospectus to “U.S. dollars”, “U.S.$” and “USD” refer to the currency of the United States of America, all references to “S$” or “Singapore dollars” or “SGD” refer to the currency of Singapore and all references to “RM” or “Malaysian Ringgit” or “Ringgit” refer to the currency of Malaysia.

 

Our financial year ends on December 31 of each year. References in this Prospectus to a financial year, such as “financial year 2020”, relate to our financial year ended on December 31 of that calendar year.

 

We have made rounding adjustments to some of the figures included in this Prospectus. Accordingly, numerical figures shown as totals in some tables may not be an arithmetic aggregation of the figures that precede them.

 

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EXCHANGE RATES

 

All translations from Singapore dollars to U.S. dollars and from U.S. dollars to Singapore dollars in this Prospectus are made at a rate of S$1.3903 to U.S.$1.00, the exchange rate in effect as of June 30, 2022 as set forth in the H.10 statistical release of the U.S. Board of Governors of the Federal Reserve System. Further, all translations from Malaysian Ringgit to U.S. dollars and from U.S. dollars to Malaysian Ringgit in this Prospectus are made at a rate of MYR 4.4075 to U.S.$1.00, the exchange rate in effect as of June 30, 2022 as set forth in the H.10 statistical release of the U.S. Board of Governors of the Federal Reserve System. We make no representation that any Singapore dollars amounts or U.S. dollars amounts could have been, or could be, converted into U.S. dollars or Singapore dollars, as the case may be, at any particular rate, or at all.

 

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MARKET AND INDUSTRY DATA

 

Certain market data and forecasts used throughout this Prospectus were obtained from internal company surveys, market research, consultant surveys, reports of governmental and international agencies and industry publications and surveys. Industry publications and third-party research, surveys and reports generally indicate that their information has been obtained from sources believed to be reliable. This information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. Our estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed under the section titled “Risk Factors” in this Prospectus. The industry in which we operate is also subject to a high degree of uncertainty and risks due to a variety of factors, including those described under the section titled “Risk Factors” in this Prospectus. These factors could cause results to differ materially from those expressed in the estimates made by the independent parties and by us in this Prospectus.

 

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TRADEMARKS

 

“CYTOMED THERAPEUTICS”, the CytoMed Therapeutics logo, and other trademarks, trade names or service marks of CytoMed Therapeutics Limited appearing in this Prospectus are the property of CytoMed Therapeutics Limited. All other trademarks, trade names and service marks appearing in this Prospectus are the property of their respective owners. Solely for convenience, the trademarks and trade names in this Prospectus may be referred to without the ® and ™ symbols, but such references should not be construed as any indicator that their respective owners will not assert their rights thereto.

 

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PROSPECTUS SUMMARY

 

This summary only highlights the more detailed information appearing elsewhere in this Prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire Prospectus carefully, including the information under the section titled “Risk Factors” and our financial statements and the related notes in this Prospectus, before investing.

 

 

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DEFINITIONS

 

Unless otherwise stated in this Prospectus or the context otherwise requires, references to:

 

γδ TCR” are to gamma delta T-cell receptor;
   
A*STAR” are to the Agency for Science, Technology and Research of Singapore;
   
ACCA” are to the Association of Chartered Certified Accountants;
   
ACRA” are to the Accounting and Corporate Regulatory Authority of Singapore;
   
ACRA Code” are to the Code of Professional Conduct and Ethics for Public Accountants and Accounting Entities;
   
ACTRIS” are to the Advanced Cell Therapy and Research Institute, Singapore;
   
Advertisement Regulations” are to the Health Products (Advertisement of Specified Health Products) Regulations 2016 enacted under the HPA (as defined below);
   
ANGELICA Trial” are to the Phase I trial to evaluate allogeneic NKG2DL-targeting chimeric antigen receptor-grafted gamma delta T cells (CTM-N2D) in subjects with advanced solid tumours or haematological malignancies;
   
 

ASX” are to the Australian Securities Exchange Ltd;

   
ATPL” are to Accelerate Technologies Pte. Ltd. (formerly known as ETPL);
   
BAS” are to building automated system;
   
BCMA” are to B-cell maturation antigen;
   
BMR” are to batch manufacturing records;
   
BNM” are to the Central Bank of Malaysia or Bank Negara Malaysia;
   
Board” or “Board of Directors” are to the board of directors of the Company;
   
CAR” are to chimeric antigen receptor;
   
CAR-T” are to chimeric antigen receptor-modified T cells;
   
CDCR” are to the Control of Drugs and Cosmetics Regulations 1984 of Malaysia, as amended;
   
cGMP” are to current good manufacturing practice, a system for ensuring that products are consistently produced and controlled according to quality standards;

 

 

12

 

 

 

cGMP Facility” are to the Company’s current good manufacturing practice and processing facility located at 12 Jalan Permas 9/16, Bandar Baru Permas Jaya, 81750 Johor, Malaysia;
   
CGTP” are to Cell and Gene Therapy Products;
   
Clean Air Regulations” are to the Environmental Quality (Clean Air) Regulations 2014 of Malaysia;
   
  “Clinical Study Agreement” are to the Investigator-Initiated Clinical Study Agreement entered into between the Company and National University Hospital Singapore on March 10, 2023.
   
Clinical Trials Regulations” are to the Health Products (Clinical Trials) Regulations of 2016 enacted under the HPA (as defined below), which governs clinical trials of therapeutic products and applicable CTGTP (as defined below) that are not observational trials within Singapore;
   
Code” are to the Internal Revenue Code of 1986 of the United States of America;
   
Comptroller” are to the comptroller of income tax in Singapore;
   
Contract Manufacturing Organization” or “CMO” are to companies that provide drug development and drug manufacturing services to the companies in the pharmaceutical industry on a contract basis;
   
Contract Research Organization” or “CRO” are to companies that provide research support to the companies in pharmaceutical and biotechnology industries on a contract basis;
   
COVID-19” are to the worldwide novel coronavirus disease pandemic;
   
 CRIS” are to the Consortium for Clinical Research and Innovation Singapore, a wholly-owned subsidiary of the Ministry of Health Singapore;
   
CRM” are to clinical research materials, which refer to any registered or unregistered therapeutic product, medicinal product, medicinal device, applicable CTGTP or placebo, that is manufactured, imported or supplied for the purpose of being used in clinical research, by way of administration to a trial participant in accordance with the research protocol or for a clinical purpose;
   
CRM Regulations” are to the Health Products (Clinical Research Materials) Regulations of 2016 enacted under the HPA (as defined below), which govern the import, manufacture and supply of clinical research materials for use in clinical research studies within Singapore;
   
CRS” are to cytokine release syndrome;
   
 

CTA” are to Clinical Trial Authorization, which is required prior to the initiation of a clinical trial of a therapeutic product;

   
  CTGT” are to cell, tissue and gene therapy;
     
CTGTP” are to cell, tissue and gene therapy products;
   
CTGTP Regulations” are to the Health Products (Cell, Tissue and Gene Therapy Products) Regulations of 2021 enacted under the HPA (as defined below), which provide for regulating the manufacture, import, supply, presentation, registration, duties, and obligations of manufacturers, importers and other persons carrying out such activities as related to CTGTP in Singapore;
   
CTIL” are to Clinical Trial Import License in Malaysia;
   
CTM-N2D” are to CAR-gamma delta T cell proprietary product developed by our Group;
   
CTM-GDT” are to allogeneic gamma delta T cell proprietary product developed by our Group;
   
CTX” are to Clinical Trial Exemption in Malaysia;

 

 

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CytoMed Malaysia” are to CytoMed Therapeutics (Malaysia) Sdn Bhd, a company incorporated on December 18, 2013 in Malaysia (Company No. 201301044786 (1074609-M)) with its registered address at Room 503, 5th Floor, Merlin Tower, Jalan Meldrum, 80000 Johor Bahru, Johor, Malaysia, the manufacturing arm of the Group where a PIC/S GMP laboratory is located and which manufacturing capacity includes stem cells and cancer living medicine;
   
CytoMed Therapeutics”, “CytoMed” or “Company” are to CytoMed Therapeutics Limited, a company incorporated on March 9, 2018 in Singapore (Company Registration Number: 201808327H) with its registered address at 1 Commonwealth Lane, #08-22, Singapore 149544;
   
Director” are to the directors of the Company;
   
Director General” are to the Director General of Environmental Quality as referred to in the EQA;
   
DNA” are to deoxyribonucleic acid, a large complex macromolecule containing the genetic code and which is typically found in the nucleus of a human cell;
   
DTC” are to Depository Trust Company;
   
ECEG 2016” are to the Ethical Code and Ethical Guidelines (2016 edition) published by the SMC;
   
 EIS” are to the Employment Insurance System in Malaysia;
   
EISA” are to the Employment Insurance System Act 2017 of Malaysia;
   
EPFA” are to the Employee Provident Fund Act 1991 of Malaysia;
   
ESSA” are to the Employees’ Social Security Act 1969 of Malaysia;
   
ETPL” are to Exploit Technologies Pte Ltd (now known as ATPL);
   
EQA” are to the Environmental Quality Act 1974 of Malaysia;
   
Exchange Act” are to the Securities Exchange Act of 1934 in the United States of America, as amended;
   
FDA” are to the United States Food and Drug Administration;
   
Federal Reserve System” are to the central bank of the United States of America;
   
Financial Institution” is defined in the FX Notices as a person carrying out a financial business regulated under the laws administered by BNM and any person carrying out any other financial business as may be specified by BNM;
   
Financial Instrument” is defined in the FX Notices and FSA to include any agreement, including an option, a swap, futures or forward contract, whose market price, value, delivery or payment obligations is derived from, referenced to or based on, but not limited to, securities, commodities, assets, rates (including interest rates or exchange rates) or indices;
   
FMA” are to the Factories and Machinery Act 1967 of Malaysia;
   
Foreign Exchange Notices” or “FX Notices” are to the notices issued by the BNM under the FSA and IFSA, which local and foreign investors are subject to;

 

 

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FRS” or “SFRS(I) 9” are to the Singapore Financial Reporting Standard or the Singapore Financial Reporting Standard (International) 9, respectively;
   
FSA” are to the Financial Services Act 2013 of Malaysia;
   
gamma delta T-iPSCs” are to gamma delta T cells converted into iPSCs;
   
GCP” or “Good Clinical Practice” are to good clinical practice;
   
GMP” are to good manufacturing practice;
   
Group”, “We”, “Us” and “Our” are to the Company and its subsidiaries;
   
GST” means goods and services tax imposed pursuant to the Goods and Services Tax Act 1993 of Singapore;
   
Guidelines on CGTPs” are to the Guidelines For Registration of Cell and Gene Therapy Products of Malaysia, issued under regulation 29 of the CDCR and effective on January 1, 2021;
   
GvHD” are to graft versus host disease;
   
HCS Bill” are to the Healthcare Services Bill, which was passed in the Singapore Parliament on January 6, 2020;
   
HCSA” are to the upcoming Healthcare Services Act of Singapore, which will be implemented in phases. As of the date of this Prospectus, the phased implementation of the HCSA commenced from January 3, 2022, with all phases targeted to be implemented in Singapore by end- 2023;
   
Health Products Act” or “HPA” are to the Health Products Act 2007 of Singapore that regulates the manufacture, import, supply, presentation and advertisement of health products and of active ingredients used in the manufacture of health products within Singapore;
   
Health Sciences Authority” or “HSA” are to the statutory board under the Ministry of Health Singapore;
   
hESCs” are to human embryonic stem cells;
   
HME 2016” are to the Handbook on Medical Ethics (2016 edition) issued by the SMC;
   
HPA Order 2021” are to the Health Products Act (Amendment of First Schedule) Order 2021 of Singapore enacted under the HPA, an order in which a new category of health products, namely cell, tissue or gene therapy product, is included in the First Schedule of the HPA;
   
hPSCs” are to human pluripotent stem cells;
   
HSA Act” are to Health Sciences Authority Act 2001 of Singapore;
   
 

Human Biomedical Research Act” or “HBRA” are to the Human Biomedical Research Act 2015 of Singapore that regulates the conduct of human biomedical research, further regulates certain restricted human biomedical research, and prohibits certain types of human biomedical research;

   

 

 

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IASB” are to International Accounting Standards Board;
   
ICA” are to the Industrial Co-ordination Act 1975 of Malaysia, as amended;
   
IFRS” are to the international financial reporting standards as adopted by the International Accounting Standards Board;
   
IFSA” are to the Islamic Financial Services Act 2013 of Malaysia, as amended;
   
IL-2” are to interleukin-2;
   
IMCB” are to the Institute of Molecular and Cell Biology, a research institute of A*STAR launched on January 23, 1985 to develop and support the biomedical research and development capabilities in Singapore;
   
Incentive Plan” are to the 2023 Equity Incentive Plan of the Company, adopted on January 18, 2023 and to be effective upon the consummation of this offering;
   
Income Tax Act” are to the Income Tax Act 1947 of Singapore;
   
iPSC” are to induced pluripotent stem cells;
   
iPSC-gdNKT” are to iPSC-derived gamma delta natural killer T cell product developed by our Group;
   
IRAS” are to the Inland Revenue Authority of Singapore;
   
ISAs” are to the International Standards on Auditing;
   
ISCA” are to the Institute of Singapore Chartered Accountants;
   
JOBS Act” are to the Jumpstart Our Business Startups Act of 2012 of the United States, as amended;
   
Johor Bahru By-Laws” are to the Trade, License, Business and Industrial (MBJB) By-Laws 2016 of Malaysia;
   
JSE” are to the Johannesburg Stock Exchange;
   
K562 cells” are to the human myelogenous leukemia cell line;
   
 K562 Cell License for NK cell expansion” are to the license granted pursuant to the license agreement entered into between the Company and ATPL in December 2020;
   
 Know-How License” are to the license granted pursuant to the license agreement entered into between Puricell and ATPL in October 2020;
   
 

LMC” are to the Landmark Medical Centre Sdn Bhd, a licensed private hospital located in Johor Bahru, Malaysia;

   
Lower-tier PFIC” are to an entity in which a PFIC owns equity interests in;
   
MA” are to the Medicines Act 1975 of Singapore;
   
Malaysian Ringgit” or “RM” or “Ringgit” are to the currency of Malaysia;
   
Management” or our “Management Team” are to our executive officers and Directors;
   
Marketing Authorization Application” or “MAA” are to an application submitted by a drug manufacturer seeking marketing authorization, that is permission from a medical regulatory authority to bring a medicinal product to the market;
   
Medicare” are to the national health insurance program in the United States of America;
   
 

mDR Convertible Loan” are to the convertible loan provided by mDR Limited to the Company pursuant to the convertible loan agreement dated December 10, 2019, as amended by the supplemental agreements dated December 31, 2021, January 3, 2022 and January 3, 2023, entered into between the Company and mDR Limited;

   
mGFP-γδ T” are to the gamma delta T cells subjected to electroporation using mRNA encoding mGFP;
   
Ministry of Health Malaysia” or “MOH Malaysia” are to the Ministry of Health of the Malaysian Government;
   
Ministry of Health Singapore” or “MOH Singapore” are to the Ministry of Health of the Singapore Government;
   
MITI” are to the Ministry of International Trade and Industry of Malaysia;

 

 

16

 

 

 

mRNA” are to messenger RNA, a type of RNA that acts as a messenger that is read by ribosomes to build proteins;
   
MSCs” are to mesenchymal stem cells;
   
Nasdaq” are to The Nasdaq Stock Market LLC;
   
Nasdaq Listing Rules” are to the listing requirements of Nasdaq, as amended, modified or supplemented from time to time;
   
NDA” are to the new drug application to the HSA and/or other relevant health and regulatory authorities, through which formal proposal is made to the HSA and/or other relevant health and regulatory authorities for approval of a new drug;
   
NEOs” are to the Company’s named executive officers, being CHOO Chee Kong, Dr. ZENG Jieming and Dr. TAN Wee Kiat as at the date of this Prospectus;
   
NK cells” are to natural killer cells, a type of immune cell found in the human body;
   
NKG2D” are to natural killer group 2D receptor, a type of receptor typically found on the NK cell;
   
NKG2DL” are to natural killer group 2D ligands, a type of ligand typically expressed by tumor cells, enabling NK cells to activate and kill tumor cells;
   
NKG2Dz-γδT” are to gamma delta T cells grafted with NKG2DL-targeting CAR;
   
NKT” are to natural killer T cells;
   
 NOL” means net operating loss;
   
NPCB” are to the National Pharmaceutical Control Bureau, Ministry of Health Malaysia;
   
NPRA” are to the National Pharmaceutical Regulatory Authority, Ministry of Health Malaysia;
   
Occupational Safety and Health Laws” are to the legislation, regulation and rules in respect of occupational safety and health in Malaysia;
   
OECD” are to the Organization for Economic Co-operation and Development;
   
 

off-the-shelf” are to the manufacturing of the stated cell therapies in quantities, which utilizes either donor blood cells or iPSCs as starting materials, but not the limited patient’s own blood cells and no matching is required between such donor and recipient of the product;

   
one-tier system” are to the one-tier corporate tax system in Singapore;
   
OSHA” are to Occupational Safety and Health Act 1994 of Malaysia;
   
PA 1952” are to the Poisons Act 1952 of Malaysia;
   
PAg” are to phosphoantigen, a type of small molecule that stimulates gamma delta T cells expressing Vγ9 and Vδ2 molecules;
   
 Patent License” are to the license granted pursuant to the license agreement entered into between the Company and ETPL in June 2018, as varied by an addendum entered into in December 2020, second addendum entered into in September 2021, and third addendum entered into effective as of October 18, 2022;
   
PCID Regulations” are to the Prevention and Control of Infectious Diseases (Importation and Exportation of Human Remains, Human Tissues and Pathogenic Organisms or Substances) Regulations 2005 of Malaysia, as amended;
   
PDPA Malaysia” are to the Personal Data Protection Act 2010 of Malaysia;
   
PDPA Singapore” are to the Personal Data Protection Act 2012 of Singapore;
   
PFIC” are to passive foreign investment company;
   
PHFSA” are to the Private Healthcare Facilities and Services Act 1998 of Malaysia;
   
PHMCA” are to the Private Hospitals and Medical Clinics Act 1980 of Singapore;

 

 

17

 

 

 

PIC/S” are to the pharmaceutical inspection co-operation scheme;
   
Prospectus” are to this prospectus of the Company dated March 27, 2023, as may be amended;
   
PTAB” are to the Patent Trial and Appeal Board;
   
Puricell” are to Puricell Lab Pte Ltd, a 95% owned subsidiary of the Company;
   
QA” are to quality assurance;
   
QC” are to quality control;
   
R&D” are to research and development;
   
 “REJA” are to the Reciprocal Enforcement of Judgments Act 1958 of Malaysia;
   
Resident” is defined in the FX Notices as, among others, a body corporate incorporated or established, or registered with or approved by any authority, in Malaysia;
   
RNA” are to ribonucleic acid, a biological macromolecule that functions to convert the genetic information of DNA into proteins;
   
Sarbanes-Oxley Act” are to the Sarbanes-Oxley Act of 2002, as amended;
   
scFv” are to single-chain variable fragment, a technique used to produce a functional antigen-binding fragment on a cellular level;
   
Scientific Advisory Board” or “SAB” are to the Company’s board of scientific advisors which provide the Company with on-going scientific advice;
   
  “Singapore National Healthcare Group Domain Specific Review Boards” are to the independent committee constituted of medical, scientific and nonscientific members who are empowered by the National Healthcare Group Chief Executive Officer, to review research involving patients, staff, premises, or facilities of National Healthcare Group institutions and all other institutions under its oversight.
   
 SEC” are to the Securities and Exchange Commission of the United States of America;
   
Securities Act” are to the Securities Act of 1933 of the United States of America, as amended;
   
SFRS(I)” are to the Singapore Financial Reporting Standard (International);
   
SGX-ST” are to the Singapore Exchange Securities Trading Limited;
   
 SIC” are to the Securities Industry Council of Singapore;
   
 SID” are to the Singapore Institute of Directors;
   
 Singapore Companies Act” are to the Companies Act 1967 of Singapore;
   
 Singapore Laboratory” are to the Company’s property located at 1 Commonwealth Lane, #08-22, Singapore 149544, with intended use as an office and research laboratory;
   
Singapore Medical Council” or “SMC” are to the statutory board under the Ministry of Health Singapore which regulates the practice of medicine in Singapore;
   
Singapore Take-over Code” are to the Singapore Code on Take-overs and Mergers;
   
SOCSO” are to the Social Security Organization Fund of Malaysia;
   
Stamp Duties Act” are to the Stamp Duties Act 1929 of Singapore;
   
TCR” or “TCRs” are to T cell receptors;
   
UK” are to the United Kingdom;
   
United States” or “U.S.” are to the United States of America;
   
“VStock” are to V Stock Transfer, LLC, the transfer agent and registrar of the Company;
   
U.S. Board of Governors” are to the governing body of the Federal Reserve System in the United States of America;
   
U.S. GAAP” are to generally accepted accounting principles in the United States of America; and

 

 

18

 

 

 

U.S. Holder” are to a person that is, for U.S. federal income tax purposes, a beneficial owner of ordinary shares and a citizen or individual resident of the United States, a corporation, or other entity taxable as a corporation, created or organized in or under the laws of the United States, any state therein or the District of Columbia, or an estate or trust the income of which is subject to U.S. federal income taxation regardless of its source.

 

Our Business

 

We are a pre-clinical biopharmaceutical company focused on harnessing our licensed proprietary technologies to create novel cell-based immunotherapies for the treatment of human cancers. The development of our novel technologies has been inspired by the clinical success of existing CAR-T in treating hematological malignancies as well as the current clinical limitations and commercial challenges in extrapolating the CAR-T principle into treatment of solid tumors.

 

We believe that the current development of CD19-targeting CAR-T cells in treating B-cell malignancies signifies that cellular immunotherapy is becoming one of the pillars in cancer care. However, we believe that it remains challenging to apply the current CAR-T principle into treatments of other type of cancers, in particular solid tumors, due to a variety of reasons, including (i) the reliance on the limited cell quality and quantity of patients, (ii) the lack of suitable surface cancer antigens and their recognition system, and (iii) the ability of cancer to escape because of a single antigen-targeting strategy. To this end, we have established two novel patient blood cell-independent platform technologies to manufacture “off-the-shelf” cell-based cancer immunotherapies, meaning the manufacturing of the stated cell therapies in quantities, which utilizes either donor blood cells or iPSCs as starting materials, but not the limited patient’s own blood cells and no matching is required between such donor and recipient of the product. Our two novel platforms depend on healthy donor blood cells and induced pluripotent stem cells as starting material. Such platform technologies and the resulting product candidates exploit the multiple antigen recognition systems of NK cells and gamma delta T cells in the human body and so as to recognize and treat a broad range of cancers. Built on proprietary platform technologies, we are developing three product candidates: CTM-N2D, iPSC-gdNKT and CTM-GDT. CTM-N2D is our lead product candidate and it consists of expanded gamma delta T cells grafted with NKG2DL-targeting CAR to enhance anti-cancer cytotoxicity. We submitted a CTA application for Phase I clinical trial to HSA, Singapore in December 2021 and, in July 2022, were granted a CTA relating to the use of our CTM-N2D for the ANGELICA Trial to be conducted with the National University Hospital Singapore, subject to conditions specified by the HSA. On January 6, 2023, the HSA acknowledged that we had submitted the relevant documents to meet the approval conditions and no further action was required. On March 10, 2023, we entered into the Clinical Study Agreement pursuant to which the ANGELICA Trial will be conducted by the National University Hospital Singapore to evaluate the safety of CTM-N2D in human subjects. We expect to expand our pipeline further in Phase II trials of CTM-N2D therapy for specific cancer indications. Our second product candidate, iPSC-gdNKT, utilizes iPSC as a starting material to generate gdNKT, which is a synthetic hybrid of a gamma delta T cell and a NK cell. The hybrid cell express receptors of both cells which potentially allow the gdNKT cells to recognize and treat a broad range of cancers. This product is currently undergoing pre-clinical development. Our third product candidate, CTM-GDT, consists of expanded allogeneic gamma delta T cells and exploits the potential of these cells to recognize and treat a broad range of cancers. We are looking to submit a CTX application for Phase I clinical trial to NPRA, Malaysia after 2023. We have also appointed an agent in the United States to prepare a Drug Master File for a potential research collaboration in the United States.

 

As of the date of this Prospectus, we are a holding company incorporated in Singapore which oversees our operations in Malaysia. We conduct our business activities primarily through our direct wholly-owned subsidiary in Malaysia, CytoMed Malaysia, but may be commencing more research and clinical trial activities in Singapore through CytoMed moving forward. Other than CytoMed Malaysia, our other subsidiaries have minimal operations as of the date of this Prospectus.

 

We have an operating cGMP Facility in Johor, Malaysia (which is near Singapore) which has been built in accordance with the international PIC/S GMP standards for the manufacture of cell therapy products and clinical trials. In addition, we have a well-trained operations team who conducts all essential cGMP activities including manufacture, quality control, quality assurance and documentation. We manufacture our product candidates in our cGMP Facility instead of engaging and relying on an external CMO.

 

Industry Overview

 

Our products are focused in the global immunotherapy market. Immunotherapy is the treatment of disease by promoting or inhibiting the immune responses and is gaining recognition and acceptance as an alternative therapy to treatment of cancer, in particular, in cancer patients who do not respond well to conventional cancer treatment, such as surgery, chemotherapy or radiation.

 

 

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Current CAR-T cell therapy to treat cancer

 

Currently, CAR-T cell therapy is a type of cancer treatment in which a patient’s T cells (a type of immune system cell) are modified in the laboratory so they may attack cancer cells. Typically, T cells are extracted from the patient’s blood. Subsequently, the gene for a special receptor that binds to a certain protein on the patient’s cancer cells is added to the T cells. Such special receptor is called a chimeric antigen receptor (CAR) and such modified T cells are called CAR-T cells. Large numbers of CAR-T cells are grown in the laboratory and given to the patient by infusion. CAR-T cells are being used to treat certain blood cancers, and are being studied in the treatment of other types of cancer.

 

CAR-T cell therapy market

 

Since the approval of the first CAR-T cell therapeutic treatment in 2017 by the FDA, there has been widespread research and an exponential increase in clinical trial activity in the field of immunotherapy. Between 2017 to 2022, there have been at least six (6) CAR-T products that have entered the market, including two (2) of the earliest CAR-T products - Kymriah® by Novartis International AG (NYSE:NVS) and Yescarta® by Gilead Sciences, Inc. (NASDAQ:GILD), which received the earliest approvals and have been commercially available since 2018, and have been infused into many patients worldwide.

 

However, all approved CAR-T cell therapies thus far have taken an autologous treatment approach. Autologous CAR-T products are expensive to produce because they are manufactured on a patient-by-patient basis, and can be hampered by a shortage of CAR-T cells or viral vectors. Hence, current CAR-T cell therapies have been usually recommended for end-stage cancer patients who have exhausted all conventional treatment options.

 

CAR-T cell therapy has been a game-changer in the cancer treatment industry, creating hope that it could usher in a new era of cancer treatment. However, the success stories have typically come from targeting CD19, which is now considered an antigen that holds the key to a limited range of blood cancers. CAR-T cell therapy treatment for other types of cancers, in particular, solid tumors, has been severely limited so far.

 

Cell Therapy Industry in Singapore and Malaysia

 

The cell therapy industry in Singapore and Malaysia is at a nascent stage, with only a handful of biopharmaceutical companies within the cellular immunotherapy space in the treatment of cancer. Singapore approved the first CAR-T therapy for cancer treatment in March 2021, Kymriah® by Novartis (Singapore) Pte Ltd. This is the first and only commercially approved CAR-T therapy in Singapore and is currently in use for certain specific forms of B-cell malignancies. As of the date of this Prospectus, Malaysia has not yet approved any CAR-T therapy for treatment of cancer for commercial use.

 

Singapore established ACTRIS in April 2020 to meet the potential demand of cell therapy process development and product manufacturing to enable clinical utility. ACTRIS is the national center for facilitating discovery, process development and manufacturing of cellular-based therapeutics in immunotherapy and regenerative medicine in Singapore. ACTRIS works with other government agencies such as A*STAR and other industry players, such as hospitals, universities, research organizations and clinicians. ACTRIS is a business unit under the CRIS.

 

We intend to capitalize on our close connections with A*STAR to tap on the latest developments and advances in cell-based therapeutics in the field of cancer treatment.

 

Business Strategies and Future Plans

 

We intend to focus on developing our two (2) “off-the-shelf, allogeneic” technology platforms centered on gamma delta T cells and iPSCs, respectively.

 

 

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Our aim is to be amongst the pioneers of cellular immunotherapy treatment for human cancer to serve the emerging economies within South-east Asia. We aim to strategically position ourselves as a bridge between the cutting-edge of cellular therapy in the U.S. and our origin amongst emerging economies in South-east Asia, with our headquarter in Singapore. We believe that the U.S. has the depth and breadth of expertise and experience to accelerate our R&D efforts in cellular therapy. We aim to establish our profile with like-minded biopharmaceutical companies, researchers, scientists and sources of investment capital within the U.S. In addition, we anticipate that cellular science will advance and gain more mainstream acceptance in the future. We are considering conducting research in regenerative medicine, in particular, stem cell application in an aging population in Asia. We believe we are well-placed with the necessary expertise, experience and resources to take advantage of such prospects.

 

Close connections with scientific and medical community

 

We have appointed immunotherapy industry advisors to our Scientific Advisory Board and our key executive officers have the relevant specialized technical and medical expertise in cellular therapy.

 

Our core technologies are licensed from A*STAR, Singapore’s lead public sector R&D agency. By working closely with research organizations and government bodies, we are continually kept abreast of the latest developments in the field of cellular therapy. We believe that our strategic positioning, experience and expertise will give us an edge to take advantage of the growing and developing cellular therapy market.

 

In addition, we intend to seek collaborations and/or enter into joint-ventures and out-licensing arrangements to jointly develop our two (2) novel “off-the-shelf” technology platforms with industry players using our infrastructure in Singapore and Malaysia so as to speed up commercialization of our product candidates.

 

Lower business and operating costs in South-east Asia

 

The relatively lower business and operating costs in South-east Asia should position us well to achieve our vision to develop our donor blood cell-based and iPSC-based platform technologies into “off-the-shelf” cancer immunotherapies with the ultimate goal to offer lower cost cell therapies as an alternate form of cancer treatment to patients.

 

We have invested in and completed construction of our own cGMP Facility which is fully equipped with state-of-the-art equipment, and which we believe is capable of handling the manufacturing for Phase I and Phase II clinical trials for our clinically-ready CAR T therapy, trade-named “CTM-N2D”. Our cGMP Facility has been audited by the NPRA in Malaysia, and the compliance standard of our cGMP Facility has been found to be satisfactory. We believe our proprietary product candidate, CTM-N2D, is clinically ready to commence clinical trials. On March 10, 2023, we entered into the Clinical Study Agreement pursuant to which the ANGELICA Trial will be conducted by the National University Hospital Singapore to evaluate the safety of CTM-N2D in human subjects, following the HSA’s acknowledgement on January 6, 2023 that we had submitted the relevant documents to meet the approval conditions of the CTA initially granted in July 2022 relating to the use of our CTM-N2D for the aforementioned trial by HSA, and no further action was required. We have already recruited a competent team of scientists and technicians and given the necessary training to manufacture the product for clinical trial. We target to recruit our first patient in second half of 2023. Our iPSC-gdNKT platform has been in the pre-clinical process development stage since fourth quarter of 2022, and is targeting to commence pre-clinical studies after 2024.

 

Summary of Risks Affecting Our Company

 

We are subject to numerous risks, including risks that may prevent us from achieving our business objectives or may adversely affect our business, financial condition, results of operations, cash flow and prospects. You should carefully consider the following risks, those risks described in “Risk Factors” and the other information in this Prospectus before deciding whether to invest in our ordinary shares:

 

 

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  We are a global business subject to complex economic, legal, political, tax, foreign currency and other risks associated with international operations, which risks may be difficult to adequately address.
     
  We do not have a long operating history and we do not currently have any product approved for commercial sale.  
     
  Our limited operating history may not provide an adequate basis to judge our future prospects and results of operation and may increase the risk of your investment.
     
  We may not be able to access the capital markets in the future.
     
  Our business depends upon the success of our CTM-N2D, iPSC-gdNKT and CTM-GDT product candidates.
     
  Our business, our industry and the economy are subject to the impact of the ongoing COVID-19 pandemic.
     
  We may not be able to obtain regulatory approval for our current or future product candidates.
     
  Our pre-clinical procedures and trials may experience delays or may not progress to clinical trials.
     
  The results of our clinical trials may not be successful.
     
  We may not be able to maintain our key personnel or attract, train and retain other highly qualified personnel.
     
  We rely on our cGMP Facility to produce our product candidates and it may not be sufficient to handle the large-scale manufacture and production of product candidates.
     
  Save for a registered trademark in relation to our name we currently own no other intellectual property rights and rely entirely on intellectual property rights we licensed from others for our main operations.
     
  We may encounter adverse developments or disputes concerning our licensed intellectual property rights or other proprietary rights.
     
  We rely on third-party intellectual property licensors and the terms of such licenses.
     
  We may not be able to successfully acquire or in-license additional product candidates on reasonable terms.
     
  We may be subject to adverse developments relating to our competitors and our industry.
     
  We may not realize market opportunities for our product candidates.
     
  We may be adversely impacted by government laws and regulations and liabilities thereunder which could impede our progress.
     
  There has been no public market for our ordinary shares prior to this offering and you may not be able to resell our ordinary shares at or above the price you paid (if at all).

 

Foreign Private Issuer Status

 

We are a foreign private issuer within the meaning of the rules under the Exchange Act. As such, we are exempt from certain provisions applicable to United States domestic public companies. For example:

 

  we are permitted to follow certain home country corporate governance practices in lieu of certain requirements under the Nasdaq listing standards. This may afford less protection to holders of our ordinary shares than U.S. regulations;
     
  we are not subject to proxy rules and are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company;
     
  we may lose our private foreign issuer status, which would require us to comply with the Exchange Act’s domestic reporting regime and cause us to incur additional legal, accounting and other expenses;
     
  for interim reporting, we are permitted to comply solely with our home country requirements, which are less rigorous than the rules that apply to domestic public companies;
     
  we are not required to provide the same level of disclosure on certain issues, such as executive compensation;
     
  we are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information;
     
  we are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; and
     
  we are not required to comply with Section 16 of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and establishing insider liability for profits realized from any “short-swing” trading transaction.

 

 

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Implications of Being an Emerging Growth Company

 

As a company with revenue of less than U.S.$1.235 billion for the previous financial year, we qualify as an “emerging growth company” under the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other requirements that are otherwise applicable generally to public companies. These provisions include exemption from the auditor attestation requirement under Section 404 of the Sarbanes-Oxley Act, or Section 404, in the assessment of the emerging growth company’s internal control over financial reporting. The JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financial accounting standards until such date that a private company is otherwise required to comply with such new or revised accounting standards.

 

We will remain an “emerging growth company” until the earliest of (i) the last day of our financial year during which we have total annual gross revenues of at least U.S.$1.235 billion; (ii) the last day of our financial year following the fifth anniversary of the consummation of this offering; (iii) the date on which we have, during the previous three year period, issued more than U.S.$1 billion in non-convertible debt; or (iv) the date on which we are deemed to be a “large accelerated filer” under the Exchange Act, which would occur if the market value of our ordinary shares that are held by non-affiliates exceeds U.S.$700 million as of the last business day of our most recently completed second financial quarter and we have been publicly reporting for at least 12 months. Upon ceasing to be an “emerging growth company”, we will not be entitled to the exemptions provided in the JOBS Act as set out above.

 

Our Corporate Information

 

As of the date of this Prospectus, the registrant is a public company limited by shares known as CytoMed Therapeutics Limited. On January 19, 2023, the registrant converted from a private company limited by shares incorporated in Singapore, known as CytoMed Therapeutics Pte. Ltd. to a public company limited by shares pursuant to the provisions of the Singapore Companies Act.

 

Effective on January 17, 2023, the registrant’s shareholders and directors approved a 1-for-380.83 reverse split of its ordinary shares pursuant to which the shareholders received one (1) ordinary share for every 380.83 ordinary shares held as of such date.

 

Our principal executive office in Singapore is located at 1 Commonwealth Lane, #08-22, Singapore 149544. Our telephone number is +65 6250 7738. Investors should submit any inquiries to the address and telephone number of our principal executive office. Our agent for service of process in the United States is Puglisi & Associates. Our website is located at https://www.cytomed.sg/. Information contained on, or that can be accessed through, our website is not a part of, and shall not be incorporated by reference into, this Prospectus.

 

 

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THE OFFERING

 

Securities offered by us

 

 

2,412,369 ordinary shares (or 2,774,224 ordinary shares if the underwriters exercise in full their option to purchase additional shares).(1)

 

     
Underwriters’ over-allotment option  

We have granted to the underwriters an option, exercisable for 45 days from the date of this Prospectus, to purchase up to 361,855 additional ordinary shares at the public offering price listed on the cover page of this Prospectus, less underwriting discounts and commissions.

 

Ordinary shares to be outstanding before and after this offering  

As of the date of this Prospectus, our issued and outstanding share capital consists of 8,527,450 ordinary shares.

 

Immediately after the offering, we will have 10,939,819 ordinary shares outstanding (or 11,301,674 ordinary shares if the underwriters exercise in full their option to purchase additional shares).

 

Listing  

We have applied to list our ordinary shares on the Nasdaq Capital Market, under the symbol “GDTC”. There is no assurance that such application will be approved, and if our application is not approved, this offering may not be completed.

 

Use of Proceeds

 

 

We estimate that the net proceeds to us from the offering will be approximately U.S.$9.31 million, based on the assumed initial public offering price of U.S.$4.50 per share after deducting estimated underwriting discounts and commissions and expenses of the offering that are payable by us. We intend to use the net proceeds from the offering for clinical trials, R&D, manufacturing expansion, working capital and general corporate purposes. Please refer to the section titled “Use of Proceeds”.

 

Lock-Up Agreements  

We have agreed with the underwriters, subject to certain exceptions, not to offer, pledge, sell, or dispose of, directly or indirectly, any of our ordinary shares or securities convertible into or exchangeable or exercisable for any of our ordinary shares during the 6-month period following the date of this Prospectus.

 

Members of our Board, our executive officers and all shareholders beneficially owning more than 5% of our ordinary shares (other than with respect to 416,666 ordinary shares) have agreed during the 12-month period following the date of this Prospectus to substantially similar lock-up provisions, subject to certain exceptions. Please refer to the sections titled “Shares Eligible for Future Sale” and “Underwriting” for more information.

 

Risk Factors  

Investing in our ordinary shares involves risks. Please refer to the section titled “Risk Factors” beginning on page 26 of this Prospectus for a discussion of factors you should carefully consider before deciding to invest in our ordinary shares.

 

The foregoing discussion and tables above are based on 8,527,450 ordinary shares outstanding as of the date hereof, and excludes:

 

  528,823 ordinary shares issuable upon the conversion of convertible loan, with a conversion price of U.S.$2.04 per share;
     
  1,279,117 ordinary shares reserved for future issuance under our Incentive Plan, which was adopted January 18, 2023 and to be effective upon the consummation of this offering, as well as any future increases in the number of ordinary shares reserved for issuance under our Incentive Plan.

 

Unless otherwise indicated, all information in this Prospectus assumes:

 

  no exercise by the underwriters of their option to purchase up to 361,855 additional ordinary shares from us to cover over-allotments and/or warrants to purchase up to 120,618 ordinary shares, if any; and
     
  an initial public offering price of U.S.$4.50 per share.

 

(1) Effective January 17, 2023, we implemented a 1-for-380.83 reverse split of our ordinary shares, pursuant to which shareholders received one (1) ordinary share for every 380.83 ordinary shares held as of that date.

 

 

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SUMMARY OF CONSOLIDATED FINANCIAL INFORMATION

 

The following summary of consolidated financial information as of December 31, 2020 and 2021 and June 30, 2022 and for the years ended December 31, 2020 and 2021 and for the six months ended June 30, 2021 and 2022 are derived from our audited consolidated financial statements and unaudited interim condensed consolidated financial statements, respectively, included elsewhere in this Prospectus. Our consolidated financial statements are prepared and presented in accordance with IFRS. Our historical results are not necessarily indicative of results expected for future periods. The following summary of consolidated financial information should be read in conjunction with the sections entitled “Presentation of Financial Information” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements of our Group, including the notes thereto, included elsewhere in this Prospectus. 

 

The following table presents our summary of consolidated statements of profit or loss and comprehensive loss data for the financial years ended December 31, 2020 and 2021 and for the six months ended June 30, 2021 and 2022:

 

   Year Ended December 31,   Six Months Ended June 30, 
   2020   2021   2021   2022 
   S$   S$   U.S.$   S$   S$   U.S.$ 
Other operating income   127,456    154,610    111,206    49,405    149,570    107,581 
Other (losses)/gains - net   (573,856)   3,185    2,291    (209,533)   (150,136)   (107,988)
R&D expenses   (1,038,091)   (1,090,623)   (784,452)   (522,881)   (604,043)   (434,470)
General and administrative expenses   (345,616)   (788,801)   (567,360)   (284,721)   (306,457)   (220,425)
Finance expenses   (105,519)   (117,696)   (84,655)   (57,668)   (62,042)   (44,625)
Share of results of associate   -    (212,578)   (152,901)   -    (22,283)   (16,027)
Loss before income tax   (1,935,626)   (2,051,903)   (1,475,871)   (1,025,398)   (995,391)   (715,954)
Income tax expenses   -    -    -    -    -    - 
Loss for the year/period   (1,935,626)   (2,051,903)   (1,475,871)   (1,025,398)   (995,391)   (715,954)
Other comprehensive income:                              
Foreign currency translation loss, net of tax   (6,616)   (22,628)   (16,275)   (25,669)   (37,208)   (26,763)
Total comprehensive loss   (1,942,242)   (2,074,531)   (1,492,146)   (1,051,067)   (1,032,599)   (742,717)
Loss for the year/period attributable to equity holders of the Company   (1,935,440)   (2,051,650)   (1,475,689)   (1,025,270)   (995,287)   (715,879)
Loss per share attributable to equity holders of the Company                              
Basic and diluted   (0.33)   (0.30)   (0.21)   (0.16)   (0.13)   (0.09)

 

The following table presents our summary of consolidated balance sheets data as of December 31, 2020 and 2021 and as of June 30, 2022:

 

   As of December 31,   As of June 30, 
   2020   2021   2022 
   S$   S$   U.S.$   S$   U.S.$ 
Cash and cash equivalents   885,272    2,512,768    1,807,357    1,487,161    1,069,669 
Property, plant and equipment   2,301,025    2,495,791    1,795,146    2,684,305    1,930,738 
Total assets   3,815,299    6,082,527    4,374,974    5,153,398    3,706,680 
Convertible loans   2,323,423    2,310,757    1,662,056    2,451,595    1,763,357 
Total liabilities   3,339,519    3,490,923    2,510,914    3,594,393    2,585,336 
Total equity   475,780    2,591,604    1,864,060    1,559,005    1,121,344 

 

 

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RISK FACTORS

 

An investment in our ordinary shares involves a high degree of risk. You should carefully consider the following risk factors, as well as all of the other information contained in this Prospectus, before making an investment decision. The risks described below are not the only ones facing us. The occurrence of any of the following risks, or of additional risks and uncertainties not presently known to us or that we currently believe to be immaterial, could significantly harm our business, financial condition, results of operations and growth prospects. In such case, the trading price of shares of our ordinary shares could decline, and you may lose part or all of your investment.

 

RISKS RELATED TO OUR FINANCIAL POSITION

 

We do not have a long operating history and we do not currently have any product approved for commercial sale.

 

We are a pre-clinical biopharmaceutical development stage company and we do not have any products approved for commercial sale as of the date of this Prospectus. We are focused on developing human cells as therapeutics and our technologies are new and unproven. Since our incorporation in 2018, we have invested most of our resources in developing our product candidates, building our intellectual property portfolio, developing our supply chain, conducting business planning, constructing our centralized cGMP Facility, hiring and training staff, raising capital and providing general and administrative support for these operations. Consequently, we do not have a meaningful operating history upon which our business and prospects may be evaluated, and predictions about our future success or viability may not be as accurate as they could be if we had a longer operating history or a history of successfully developing and commercializing drug products. We have not yet demonstrated our ability to overcome many of the risks and uncertainties frequently encountered by companies in the rapidly evolving biopharmaceutical clinical trial industry. If we do not successfully address these risks, our business, financial condition, results of operations and growth prospects will be materially and adversely affected. At present time, we manufacture limited quantities of cells for researchers and institutions on a non-profit, cost recovery basis for the purpose of research.

 

We have incurred losses since our incorporation and we expect to incur significant losses for the foreseeable future, which raise substantial doubt on our ability to continue as a going concern. Our ability to continue as a going concern is dependent on being able to obtain sufficient additional funding to finance our operations.

 

Since our incorporation in 2018, we have incurred losses. As of December 31, 2020, 2021 and June 30, 2022, we have accumulated losses of S$3.02 million, S$5.07 million and S$6.06 million (approximately U.S.$4.36 million), respectively. As the Group has accumulated losses and net cash outflows from operating activities, our certifying accountant, WWC, P.C. had raised substantial doubt about our ability to continue as a going concern. Given that we will continue to invest most of our resources in developing our product candidates, we expect to continue to incur increasing losses for the foreseeable future. In addition, we anticipate a substantial increase in our expenses if, and as, we seek to:

 

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  initiate clinical development of our proprietary product candidates, CTM-N2D, iPSC-gdNKT and CTM-GDT;
  advance additional product candidates to clinical trials, including CTM-N2D, iPSC-gdNKT and CTM-GDT;
  discover and develop additional product candidates;
  establish and validate our own clinical-scale and commercial-scale cGMP facilities;
  initiate or develop a MAA, or equivalent in the relevant countries, for CTM-N2D, iPSC-gdNKT and CTM-GDT and/or seek marketing approvals for any of our other product candidates that successfully complete clinical trials;
  engage, on an as needed basis, third-party contractors including CROs and CMOs to conduct clinical trials;
  maintain, expand and protect our intellectual property portfolio;
  acquire or in-license other product candidates and technologies;
  incur additional costs associated with operating as a public company; and
  increase our employee headcount and related expenses to support these activities.

 

We may not be successful in any or all of these activities and even if we are successful, we may not generate revenues that are significant enough to generate profit. If we seek additional financing to fund our business activities in the future and there remains substantial doubt about our ability to continue as a going concern, investors or other financing sources may be unwilling to provide additional funding to us on commercially reasonable terms or at all. Further, if we are unable to continue as a going concern, we may have to discontinue operations and liquidate our assets and may receive less than the value at which those assets are carried on our audited financial statements, which would cause our shareholders to lose all or a part of their investment.

 

We will require additional capital, which, if available, may cause dilution to our shareholders, restrict our operations and/or require us to relinquish rights to our product candidates.

 

As of the date of this Prospectus, we have financed our operations primarily from private equity financing and issuance of convertible loans. We intend to use the proceeds from this offering to, among other uses, advance CTM-N2D, iPSC-gdNKT and CTM-GDT through clinical development. Developing pharmaceutical products and conducting pre-clinical studies and clinical trials are expensive. As of December 31, 2020, 2021, and June 30, 2022, we had cash and cash equivalents of S$885,272, S$2.51 million and S$1.49 million (approximately U.S.$.1.07 million), respectively. Our R&D expenses increased from S$1.04 million for the financial year ended December 31, 2020 to S$1.09 million (approximately U.S.$784,452) for the financial year ended December 31, 2021 and increased from S$522,881 for six months ended June 30, 2021 to S$604,043 (approximately U.S.$434,470) for the six months ended June 30, 2022. During the period from April to June 2021, the Company raised an aggregate of S$4 million (approximately U.S.$2.88 million) gross proceeds from the sale of our equities. The Company raised capital in an aggregate of S$1.22 million (approximately U.S.$879,415) between September and October 2022. In future, we will require additional cash funding to continue to execute our strategic plan and fund operations from time to time.

 

Until and unless we can achieve substantial revenue from our products to offset our expenses, we expect to finance our operations through the proceeds from this offering, a combination of equity offerings and debt financings, and potentially through additional license and development agreements or strategic partnerships with third parties. We may not be able to obtain sufficient financing or financing on terms which are reasonable to us. In addition, market volatility resulting from the COVID-19 pandemic or other factors could adversely impact our ability to obtain sufficient financing as and when needed. We have no commitments for any additional financing, and will likely be required to raise such financing through the sale of additional securities, which, in the case of equity securities, may occur at prices lower than the offering price of our ordinary shares in this offering. If we sell equity or equity-led securities, our current shareholders, including investors in this offering, may be diluted, and the terms may include liquidation or other preferences that are senior to or otherwise adversely affect the rights of our shareholders. Moreover, if we obtain debt financing, we may need to allocate a significant percentage of our operating cash flow to paying principal and interest on such debt and we may need to comply with operating restrictions, such as limitations on incurring additional debt, which could hinder our future ability to acquire, sell or license intellectual property rights. This consequently could impede our business operations. Furthermore, the issuance of additional securities, whether equity or debt, by us, or the possibility of such issuance, may cause the market price of our ordinary shares to decline.

 

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If we obtain additional financing through licensing or collaboration arrangements with third parties, we may have to relinquish valuable rights to our product candidates, or grant licenses on terms that are not favorable to our business and operations. In addition, we may seek additional capital due to favorable market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans.

 

Our efforts to obtain additional financing for our business operations may also divert our time and attention from our day-to-day activities, which may impair or delay the development of our product candidates. In addition, our cash flow requirements may fluctuate as a result of factors currently unknown to us including, but not limited to, any unforeseen costs we may incur as a result of pre-clinical study or clinical trial delays due to the COVID-19 pandemic amongst other causes, and we may need to seek additional financing sooner than anticipated. If we are unable to obtain sufficient financing on a timely basis or at all, we may have to significantly curtail or stop one or more of our research or development programs.

 

Any acquisitions or strategic collaborations are capital intensive, may dilute our shareholders’ equity interest, cause us to incur debt or assume contingent liabilities and/or subject us to other risks.

 

From time to time, we may contemplate undertaking various acquisitions and strategic collaborations, including licensing or acquiring complementary drugs, intellectual property rights, technologies or businesses. Any potential acquisition or strategic partnership we may undertake involves several risks and challenges, including, but not limited to:

 

  increased operating expenditure and cash flow requirements;
  taking on clinical trial indebtedness or contingent or unknown liabilities;
  assimilation of operations, intellectual property and drugs of an acquired company, including difficulties associated with integrating new personnel;
  the diversion of our management’s time and focus from our existing drug programs and initiatives in pursuing such a strategic partnership, merger or acquisition;
  retention of key employees, the loss of key personnel, and uncertainties in maintaining crucial business relationships;
  risks and uncertainties associated with the other party to such a transaction, including the prospects of that party and their existing drugs or product candidates and regulatory approvals; and
  our inability to generate revenue from acquired drugs, intellectual property rights, technologies, and/or businesses sufficient to meet our objectives in undertaking the acquisition or even to offset the associated acquisition and maintenance costs.

 

If we undertake acquisitions or strategic partnerships, we may issue securities which will dilute our shareholders’ equity interests, take on debt obligations, incur significant one-off expenditures or acquire intangible assets that could result in substantial future amortization expense. Moreover, we may not identify suitable acquisition or strategic partnership opportunities, and this inability could impair our growth or limit access to technology or drugs that may be important to the development of our business.

 

Our business and the business and operations of our research partners and/or other third parties with whom we conduct business are subject to the effects of health epidemics, including the current ongoing COVID-19 pandemic globally, in regions where we or third parties on which we rely have business operations.

 

The outbreak of the contagious disease, COVID-19, which was declared as a pandemic by the World Health Organization, has disrupted economic activity and business operations worldwide. Our headquarter is located in Singapore, which is subject to the ministerial advisories on work-from-home measures, restrictions on workplace capacity and other safe management measures which may change from time to time to mitigate the impact of the COVID-19 pandemic. Our cGMP Facility is located in Johor, Malaysia, which, as of the date of this Prospectus, is no longer subject to COVID-19 restrictions, save for the standard operating procedure on matters such as operating hours, ventilation, hand hygiene, premise cleanliness, COVID-19 screening test, case management of symptomatic individuals, confirmed cases of COVID-19 and close contacts, and wearing of face masks, implemented by the Malaysian Government as part of Malaysia’s transition phase to endemic.

 

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Notwithstanding so, even if restrictions are lifted in the Singapore and/or Malaysia, similar or further restrictions could be subsequently implemented due to the constantly evolving COVID-19 situation. The effects of quarantines, stay-at-home, executive and similar government orders, or the perception that such orders, shutdowns or other restrictions on the conduct of business operations could occur, in Singapore, Malaysia and other countries, could negatively impact our business operations and the operations of third parties we rely on, vendors disrupt or delay the enrollment of patients in these sites. Furthermore, these restrictions may delay any regulatory reviews by the relevant regulatory and health authorities, including related to the clinical trial submission for our CTM-N2D, iPSC-gdNKT and CTM-GDT product candidates, the magnitude of which will depend, in part, on the length and severity of the restrictions and other limitations on our usual business operations.

 

In addition, the COVID-19 pandemic has significantly disrupted financial markets around the world and could continue to restrict the level of economic activity, and may limit our ability to access capital, which could adversely impact our liquidity now or in the future. A recession or market correction resulting from the spread of COVID-19 could materially affect our business and the value of our ordinary shares.

 

As a result of the COVID-19 pandemic or other pandemic, epidemic or outbreak of an infectious disease, we may experience disruptions that could severely impact our business, pre-clinical studies and clinical trials, including but not limited to:

 

  delay or difficulties in enrolling donors for our clinical trials;
  delays or difficulties in enrolling patients for our clinical trials;
  delays or difficulties in clinical site initiation, including difficulties in recruiting clinical site investigators and clinical site staff;
  diversion of healthcare resources away from the conduct of clinical trials, including the diversion of hospitals serving as our clinical trial sites and hospital staff supporting the conduct of our clinical trials;
  interruption of key clinical trial activities, such as clinical trial site data monitoring, due to limitations on travel imposed or recommended by federal or state governments, employers and others or interruption of clinical trial subject visits and study procedures, which may impact the integrity of subject data and clinical study endpoints;
  interruption or delays in the operations of the HSA and/or other relevant health and regulatory authorities, which may impact review and approval timelines;
  interruption of, or delays in receiving, supplies of our product candidates and other required materials from our contract manufacturing organizations due to staffing shortages, production slowdowns or stoppages and disruptions in delivery systems;
     
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  interruptions in pre-clinical studies due to restricted or limited operations at our cGMP Facility;
  increase in cost of operations due to rising logistical and shipping cost;
  increase in cost of operations due to rising consumable price;
  increase in costs of conducting clinical trials due to additional compliance requirements;
  limitations on employee resources that would otherwise be focused on the conduct of our pre-clinical studies and clinical trials, including because of sickness of employees or their families or the desire of employees to avoid contact with large groups of people; and
  interruption or delays to our discovery and clinical activities, which in turn, could cause us to fail to meet milestone deadlines required to maintain intellectual property licenses upon which we rely.

 

The full impact of the COVID-19 pandemic is highly uncertain as the COVID-19 pandemic is still evolving rapidly around the world as of the date of this Prospectus and there can be no assurance or certainty that the spread of COVID-19 will be contained in the near future. We are currently unable to determine the full extent of potential delays or impacts arising from the COVID-19 pandemic on our business, our clinical trials, healthcare systems or the global economy as a whole, but these delays could have a material adverse impact on our operations.

 

RISKS RELATED TO OUR BUSINESS IN THE BIOPHARMACEUTICAL INDUSTRY

 

Our business depends upon the success of our CTM-N2D, iPSC-gdNKT and CTM-GDT product candidates in obtaining regulatory approval and being commercialized.

 

The success of our business depends on our ability to utilize our proprietary technologies to manufacture our product candidates obtain regulatory approval for such product candidates, and commercialize the approved products. Our product candidates have not yet been evaluated in humans and may never become commercialized. All our product candidates developed from our proprietary technology platforms will require significant additional clinical and non-clinical development, review and approval by the relevant health and regulatory authorities in the various jurisdictions, substantial capital and time investment, access to sufficient commercial manufacturing capacity and significant marketing efforts before they can be successfully commercialized. If any of our product candidates encounter safety or efficacy issues, developmental delays or regulatory issues or other roadblocks, it could impact the development plans for our other product candidates.

 

Our research on utilizing CTM-N2D, CTM-GDT and iPSC-gdNKT to treat cancer is novel, and we must overcome significant challenges such as obtaining required regulatory approvals in order to develop, commercialize and manufacture our product candidates.

 

Cell-based therapies are still considered novel and a new medical science in South-east Asia. The CTGTP Regulations in Singapore became effective on March 1, 2021. Malaysia’s CGTP regulations became effective on January 1, 2021. It can be expected that such regulations will be updated as more experience and expertise are gained by regulators, clinicians and the scientific community. Although future regulations may hinder or be detrimental to cell-based therapies, the medical community generally considers that such cellular “living” medicine has the potential to enhance patient treatment modalities for many diseases. Reflecting this, Singapore set up a national agency in April 2020 known as ACTRIS comprised of, inter alia, all the national universities, hospitals, research institutions and funding agencies in Singapore. More information on ACTRIS can be found in page 120 of this Prospectus.

 

Our R&D efforts are focused on utilizing CTM-N2D, iPSC-gdNKT and CTM-GDT as immunotherapies for cancers. To date, HSA has approved only one cell-based cancer therapy for commercialization (i.e. Kymriah® by Novartis (Singapore) Pte Ltd) and as far as we are aware, no gamma delta T cell-based therapy has been approved for commercial use by HSA and/or any other relevant regulatory authority in any of the key markets. The processes and requirements imposed by HSA and/or other relevant regulatory authorities in multiple jurisdictions may cause delays and additional costs in obtaining approvals for marketing authorization for our product candidates. Because our CTM-N2D, iPSC-gdNKT and CTM-GDT products are novel, and cell-based therapies are relatively new, regulatory agencies may lack the necessary experience to assess our product candidates. As such, this may increase the regulatory review process and period, including the time it takes for HSA and/or other relevant regulatory authorities to review our clinical trial application if and when submitted, such as the review of the Phase I clinical trial as described in paragraph “Development Status of CTM-N2D Therapy” in the section entitled “Business” which was submitted to the regulatory authorities in respect of CTM-N2D for the treatment of relapsed or refractory solid tumors of different types. Such regulatory delays may thereby increase our development costs and cause further delays in the commercialization of our CTM-N2D, iPSC-gdNKT and CTM-GDT products. Additionally, commercializing novel immuno-oncology therapies will create significant challenges for us, including but not limited to:

 

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  educating medical personnel regarding the potential side-effect profile of our cell products and, as the clinical program progresses, on observed side effects with the immune-oncology therapy;
  training a sufficient number of medical personnel on how to properly handle and administer our cell products, especially in our planned solid tumor trial wherein the cells are given through a procedure by trained medical doctors;
  enrolling sufficient numbers of patients in clinical trials;
  developing a reliable and safe and an effective means of manufacturing our cell products;
  manufacturing our cells on a large scale and in a cost-effective manner;
  sourcing starting material suitable for clinical and commercial manufacturing; and
  establishing sales and marketing capabilities, as well as developing a manufacturing process and distribution network to support the commercialization of any approved products.

 

We must be able to overcome these challenges in order for us to develop, manufacture and commercialize our product candidates utilizing CTM-N2D, iPSC-gdNKT and CTM-GDT in each geographical market. As such, we remain open to exploring the possibility of conducting clinical trials in other countries.

 

Our pre-clinical studies may experience delays or may not progress to clinical trials, which would adversely affect our ability to obtain regulatory approvals or commercialize these programs on a timely basis or at all.

 

In order to obtain HSA and/or other relevant regulatory authority approval to market a new biological product we must demonstrate proof of safety, purity and potency or efficacy in humans. We will have to conduct adequate and well-controlled clinical trials in order to meet high safety standards and requirements. We cannot guarantee the timely completion or successful outcome of our pre-clinical testing and studies and cannot determine whether the regulatory authority will accept our proposed clinical programs or if the outcome of our pre-clinical testing and studies will ultimately support the further development of our programs. As a result, we cannot be certain that we can submit any clinical trial or similar applications for our pre-clinical programs on the timelines we expect, if at all, and we cannot be sure that submission of clinical trials or similar applications will result in the regulatory authority or other regulatory authorities allowing clinical trials to begin.

 

Conducting pre-clinical testing is a prolonged, time-consuming and costly process. The period of pre-clinical testing may vary substantially depending on the type, complexity and novelty of the program, and may often take several years or more for each program. Any delays in pre-clinical testing and studies conducted by us or potential future partners may cause us to incur additional operating expenses. The commencement and rate of completion of pre-clinical studies and clinical trials for a product candidate may be delayed by many factors, including, for example:

 

  inability to generate sufficient pre-clinical or other in vivo or in vitro data to support the commencement of clinical trials;
  delays in reaching a consensus with regulatory agencies on clinical trial design; and
  the relevant regulatory authorities not allowing us to rely on previous clinical trial findings of safety and efficacy for other similar but approved products and published scientific literature.

 

Moreover, as standards for pre-clinical assessment are constantly evolving and may change rapidly, even if an agreement with HSA and/or other relevant regulatory authorities on a pre-clinical trial proposal has been made, HSA and/or other relevant regulatory authorities may not accept the proposed clinical trial submission, in which case patient enrollment would be put on partial or complete hold and treatment of enrolled patients could be temporarily put on hold as the product candidate is re-assessed. Even if we commence clinical trials, we cannot guarantee the success of our clinical trials or development efforts.

 

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The results of pre-clinical studies and early-stage clinical trials may not be indicative of future results in future clinical trials. Initial success in any clinical trials may not be indicative of future results obtained at the completion of such trials in later stage trials.

 

The results of our pre-clinical studies may not be indicative of future results of clinical trials, and the results of any early-stage clinical trials we commence may not be indicative of the results of the later-stage clinical trials. For example, pre-clinical models as applied to cell therapy in oncology are not sufficiently representative of the clinical setting, and thus cannot always accurately predict clinical activity nor identify all potential risks, and may not provide sufficient guidance as to appropriate dose or administration regimen of a given therapy. In addition, initial success in clinical trials may not be indicative of results obtained when such trials are completed. Interim data from clinical trials that we may conduct are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient data become available. Preliminary data are required to undergo audit and verification procedures that may result in the final data being materially different from the preliminary data we previously announced. Negative differences between preliminary or interim data and final data could materially adversely affect the prospects of any product candidate that is impacted by such data updates.

 

Clinical trials involve a lengthy and costly process with an uncertain outcome, and we may encounter substantial delays due to a variety of reasons outside our control.

 

Pre-clinical and clinical trials are costly, time consuming and subject to substantial uncertainty in respect of the outcome. Due to scientific feasibility, safety, efficacy, changing standards of medical care and other variables, our product candidates may fail at any time during the trial. The results from pre-clinical testing or early clinical trials of a product candidate may not accurately indicate or ensure the outcome of later phases of clinical trials of our product candidates. HSA and/or other relevant regulatory authorities may suspend or terminate our clinical trials of any of our product candidate(s) at any time for various reasons, including, but not limited to, a perception that humans participating in such trials are exposed to unacceptable health risks or adverse side effects, or other adverse initial experiences or clinical trial findings. HSA and/or other relevant regulatory authorities may also require us to conduct additional pre-clinical studies or clinical trials due to negative or inconclusive results, or may fail to approve the raw materials, manufacturing processes or facilities of third-party manufacturers upon which we rely, and/or change their approval policies or regulations or their prior guidance to us during clinical development in a manner rendering our clinical data insufficient or unsuitable for approval. In addition, data obtained from our pre-clinical and clinical trials may not be deemed adequate to support the submission of the relevant regulatory filings in our key markets. We cannot guarantee that any pre-clinical studies or clinical trials that we may plan or initiate will be conducted as planned or completed on schedule, if at all.

 

We may fail at any stage in one or more of our clinical trials. We may face circumstances which prevent successful initiation, timely completion, or the desired results of our pre-clinical studies and clinical trials including, but not limited to:

 

  delays and challenges in obtaining requisite regulatory approvals to commence pre-clinical studies and clinical trials on humans;
  delays in reaching agreement on acceptable terms with prospective clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different trial sites;
  our ability to recruit sufficient patients for our clinical trials in a timely manner or at all;
  delays in sufficiently developing, characterizing or conducting a manufacturing process suitable for advanced clinical trials;
  delays in reaching an agreement with HSA and/or other relevant regulatory authorities on the planning, design or implementation of our pre-clinical studies and clinical trials;
  changes in regulatory requirements or guidance that may require us to amend or submit new clinical protocols, or the introduction of unanticipated requirements;

 

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  changes in the standard of care on which a clinical development plan was based, which consequently may require new or additional trials;
  lack of quality of our product candidates or other materials necessary to conduct pre-clinical studies or clinical trials of our product candidates;
  clinical trials of our product candidates may have negative or inconclusive results, and as such, we may, or HSA and/or other relevant regulatory authorities may require us, to conduct additional clinical trials or abandon product development programs;
  inability of enrolled patients in foreign countries to adhere to our clinical protocol and process due to differences in healthcare services or cultural customs, or additional administrative burdens associated with foreign regulatory schemes; and
  failure of ourselves or any third-party manufacturers, contractors or suppliers to comply with regulatory requirements, maintain adequate quality controls, or be able to provide sufficient product supply to conduct and complete pre-clinical studies or clinical trials of our product candidates.

 

In addition, the COVID-19 pandemic may increase the likelihood that we face such difficulties or delays in initiating, enrolling, conducting or completing our planned and ongoing pre-clinical studies and clinical trials, as applicable. If the COVID-19 pandemic continues to prevent or otherwise obstruct regulatory authorities’ conduct of regular inspections, reviews or other regulatory activities, HSA’s (or other relevant regulatory authorities) timely review and process our regulatory filings could be severely affected. If we experience delays in the initiation, enrollment or completion of any pre-clinical study or clinical trial of our product candidates, or if any pre-clinical studies or clinical trials of our product candidates are canceled, the commercial prospects of our product candidates may be materially and adversely affected, and our ability to generate product revenues from any of these product candidates will be delayed or not realized at all. In addition, any delays in completing our clinical trials may increase our costs and hold up our product candidate development and approval process.

 

Our business is highly reliant on the success of our product candidates, in particular CTM-N2D, iPSC-gdNKT and CTM-GDT, and we may fail to develop CTM-N2D, iPSC-gdNKT and CTM-GDT successfully or to obtain regulatory approval for them.

 

We cannot assure that CTM-N2D, iPSC-gdNKT and CTM-GDT will be safe and effective or will obtain the requisite approvals and licenses for commercialization, on a timely basis or at all. Although some of our employees have prior exposure to clinical trials, regulatory compliance and cGMP manufacturing, we have not previously completed any clinical trials or submitted a marketing approval application to HSA, or similar regulatory approval filings to comparable foreign authorities, for any product candidate, and we cannot be certain that CTM-N2D, iPSC-gdNKT and CTM-GDT will be successful in clinical trials or receive the requisite regulatory approvals for the development, commercialization and marketing of CTM-N2D, iPSC-gdNKT and CTM-GDT. HSA (or other relevant regulatory authorities) can delay, limit or refuse to grant approval of any of our product candidates for many reasons. For further details about such reasons, please refer to the risk factor entitled “Clinical trials involve a lengthy and costly process with an uncertain outcome, and we may encounter substantial delays due to a variety of reasons outside our control”. Any delay in obtaining, or inability to obtain, requisite regulatory approvals will delay or hinder our ability to successfully commercialize CTM-N2D, iPSC-gdNKT and CTM-GDT. This may have a material and adverse impact on our business, financial condition, results of operations and growth prospects.

 

Furthermore, as CTM-N2D is our lead product candidate and CTM-GDT is based on the same core proprietary technology, if any of our clinical trials of CTM-N2D encounter safety, efficacy or manufacturing problems, development delays, regulatory issues or other problems, our development plans for CTM-N2D and all of our other product candidates in our pipeline could be significantly hindered, which could materially and adversely affect our business, financial condition, results of operations and growth prospects.

 

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In the event we manage to obtain clinical proof-of-concept from our CTM-N2D Phase I trials for relapsed or refractory solid tumors of different types, we may develop CTM-N2D for additional indications. We may not be able to advance any of these clinical trial indications through the development process. Even if we receive regulatory approval to market CTM-N2D for the treatment of any of these additional clinical trial indications, any such additional clinical trial indications may not be successfully commercialized, widely accepted in the marketplace or found to be more effective than other commercially available alternatives. If we are unable to successfully develop and commercialize CTM-N2D for these additional clinical trial indications, our commercial opportunities will be limited.

 

Enrollment and retention of patients for clinical trials is costly and time-consuming and could be delayed, made more difficult or rendered impossible by multiple factors outside our control.

 

Identifying and qualifying suitable patients to participate in our clinical trials is vital to our development of our product candidates. We need the enrollment of a sufficient number of patients suitable to undergo such clinical trials, including patients who are suffering from the disease that the product candidate is intended to treat and who meet other eligibility criteria for any clinical trial of a new product candidate. The rate of patient enrollment, which is a pivotal factor in determining the timing of clinical trials, is dependent on many factors beyond our control, including:

 

  our ability to locate and set up clinical trial sites;
  the size and nature of the patient population;
  the design and eligibility criteria of the clinical trial;
  the physical proximity of patients to clinical sites;
  the patient referral practices and protocols of medical practitioners;
  changing medical practice patterns or guidelines related to the clinical trial indications we are investigating;
  competing clinical trials or approved therapies which are seen as an attractive alternative to patients and their medical practitioners;
  perceived risks and benefits of the product candidate under study, including as a result of adverse effects observed in similar or competing therapies;
  our ability to obtain and maintain consent to our clinical trials from patients which may be affected as a result of various reasons, including but not limited to, patients’ unwillingness to participate in our clinical trials due to the ongoing COVID-19 pandemic;
  the risk that enrolled patients will drop out of our clinical trial or die before completion of the clinical trial;
  our patients failing to complete a clinical trial or returning for post-treatment follow-up; and
  our ability to manufacture or obtain the requisite materials for a patient and clinical trial.

 

In addition, we will compete with many other ongoing clinical trials in sourcing for and recruiting patients for our expected clinical trials. Our clinical trials may also compete with other clinical trials for product candidates that are in a similar cellular immunotherapy area as our product candidates. This competition could reduce the number and profiles of available patients, as some patients may opt to enroll in a clinical trial conducted by one of our competitors instead of ours. Since the number of qualified clinical investigators is limited, we may conduct some of our clinical trials at the same clinical trial sites that some of our competitors use, which will reduce the number of patients who are available for our clinical trials at such clinical trial site. If we are unable to enroll a sufficient number of patients in our clinical trials in a timely manner, completion of our clinical trials may be delayed or may not be achieved, which would prevent us from commercializing our product candidates which in turn, could also cause us to fail to meet milestone deadlines required to maintain intellectual property licenses upon which we rely.

 

If any of our product candidates, or any competing product candidates, cause severe adverse effects (such as the development of severe or fatal cytokine release syndrome, neurotoxicity or graft-versus-host disease) we may be required to delay or discontinue further clinical development.

 

Our product candidates may have undesirable side effects that could result in us or HSA and/or other relevant regulatory authorities requiring us to interrupt, delay or discontinue clinical trials and could result in a more restrictive label than anticipated or the delay or denial of regulatory approvals. Our clinical trials may demonstrate a high and unacceptable level of severity and prevalence of side effects or unexpected characteristics.

 

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As of the date of this Prospectus, our evaluation of our product candidates is limited to pre-clinical studies. As such, there can be no guarantee that any toxicity, and/or other adverse events, will not occur in human subjects during clinical trials.

 

While scientific data suggests that gamma delta T cell-based therapies may be better-tolerated as compared to alpha beta T cell-based therapies due to biologic differences between these cell types, there can be no assurance that patients will not experience cytokine release syndrome, neurotoxicity, GvHD or other serious adverse events. Severe adverse events associated with our product candidates, CTM-N2D, iPSC-gdNKT and CTM-GDT may also develop, since targeting NKG2DLs is not yet a well-characterized modality. NKG2D targets multiple ligands, and the landscape of ligand expression is currently not fully understood. For example, there are risks that NKG2DLs may be expressed on either known or an as-yet-underappreciated population of healthy cells. Therefore, such cells may also be targeted by CTM-N2D, iPSC-gdNKT and CTM-GDT and lead to adverse events of unknown frequency and severity. Such adverse events may cause delays in completion of our clinical programs. If unacceptable side effects arise in the development of our product candidates such that there is no longer a positive benefit risk, our clinical trials may be suspended or terminated, or the regulatory authorities may deny approval of our product candidates for any or all targeted clinical trial indications. Treatment-related side effects could also affect patient enrollment or the successful completion clinical trial by enrolled patients or result in potential product liability claims. In addition, these side effects may not be adequately identified or managed by the relevant medical personnel, and inadequate training in identifying or managing the potential side effects of our product candidates could result in patient injury or death.

 

Public perception of cell-based immuno-oncology therapies for treating cancer may impact public perception of our company and product candidates, or our business and operations.

 

Our platform utilizes a relatively new technology involving the human T cells and utilization of those modified cells in other clinical trial individuals. Public perception of our product candidates may be influenced by claims, such as that cell-based immunotherapy is unsafe, unethical, or immoral and, consequently, the public or the medical community may not be ready to accept our product candidates. Negative public reaction to and scrutiny of cell-based immunotherapy in general could result in governments implementing tighter regulations and stricter labeling requirements of cell-based immunotherapy products, including any of our product candidates, and could result a drop in the demand for any products we may develop. Adverse public attitudes may also adversely impact our ability to enroll suitable patients for our clinical trials. More restrictive government regulations or negative public opinion could have an adverse effect on our business or financial condition and may delay or impair the development and commercialization of our product candidates or demand for any products we may develop.

 

We may not identify or develop other product candidates and may fail to capitalize on programs or product candidates that may present a greater commercial opportunity or for which there is a greater likelihood of success.

 

Our business is largely based on our ability to identify, develop and commercialize successful product candidates. A key element of our strategy is to discover and develop additional product candidates based upon our core proprietary technology platform through our internal research programs. We may also explore strategic collaborations for the discovery of new product candidates. Research programs to identify product candidates require substantial technical, financial and human resources, whether or not any product candidates are ultimately identified. In addition, targets for different cancers may require changes to our core proprietary technology platform, which may delay development or prevent the manufacture our product candidates. Our research programs may initially suggest positive results in identifying potential product candidates, but fail to produce successful product candidates for clinical development for many reasons, including without limitation the following:

 

  the research methodology(ies) and/or technology platform(s) we use may not be accurate in identifying potential product candidates;
  competitors may develop alternatives that render our product candidates obsolete or less attractive;

 

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  we may choose to discontinue development if we determine that clinical results do not show promise;
  product candidates we develop may nevertheless be covered by third parties’ patents or other exclusive rights;
  a product candidate may be shown to have harmful side effects or other characteristics that clinical trials indicate it is unlikely to be safe, effective or otherwise does not meet applicable regulatory criteria; and
  a product candidate may not be accepted as safe and effective by patients and/or the medical professionals.

 

Due to our limited resources, we have to focus our time and resources on the development of specific types of treatment, or treatment for a specific type of cancer, and we may forego or delay pursuing opportunities with certain programs or product candidates or for clinical trial indications which may be shown in the future to have greater commercial potential. Our estimates regarding the potential market for our product candidates may not be accurate, and if we do not correctly identify and accurately assess the commercial potential for a particular product candidate, we may relinquish valuable rights to that product candidate through strategic collaboration, licensing or other arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights to such product candidate. Alternatively, we may allocate internal resources to a product candidate in a therapeutic area in which it would have been more advantageous to enter into a partnering arrangement.

 

If any of these events occur, we may be forced to delay or discontinue our development efforts with respect to a particular product candidate or we may fail to develop a potentially successful product candidate.

 

Although we intend to design the clinical trials for our product candidates, we plan to rely on third parties to assist us in conducting our clinical trials.

 

Although we manufacture our product candidates in our cGMP Facility instead of engaging and relying on an external CMO, we rely on third parties such as CROs, CMOs and specialist medical professionals, including but not limited to oncologists and hematologists, to assist us in other aspects of conducting clinical trials for our product candidates. As a result, many important aspects of our clinical development, including their conduct and timing, will not be within our direct control. Our reliance on third parties to conduct future clinical trials will also result in less direct control over the management of data developed through clinical trials than would be the case if we were relying entirely upon our own staff. Communicating with external parties can also be challenging, potentially leading to gaps in expectations and difficulties in coordinating activities. External parties may:

 

  have staffing difficulties;
  fail to comply with contractual obligations;
  experience regulatory compliance issues;
  undergo changes in priorities or become financially distressed; and/or
  form relationships with other entities, some of which may be our competitors.

 

If third parties whom we contract with do not perform our clinical trials in a satisfactory manner, breach their obligations to us and/or fail to comply with applicable legislative and regulatory requirements, we would be unable to rely on clinical data collected by these third parties and may be required to repeat, extend the duration of, or increase the size of any clinical trials we conduct, which could significantly delay the development and/or commercialization of our product candidates and significantly increase our costs.

 

If any of our relationships with these third parties deteriorate or terminate, we may not be able to arrange with alternative third parties on commercially reasonable terms, or at all. If third parties do not successfully carry out their contractual duties or obligations or meet expected deadlines, if they need to be replaced or if the quality or accuracy of the clinical data they obtain are compromised due to the failure to adhere to our clinical protocols, regulatory requirements or for other reasons, any clinical trials such third parties are associated with may be extended, delayed or terminated, and we may not be able to obtain marketing approval for or successfully commercialize our product candidates. As a result, we believe that our financial results and the commercial prospects for our product candidates in the subject clinical trial would be materially and adversely affected, our costs could increase and our ability to generate revenue could be significantly delayed.

 

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If third parties that we may rely on for our clinical trials do not successfully satisfy their contractual obligations, comply with regulatory requirements or meet targeted timelines, we may not be able to obtain requisite marketing approval for or commercialize our product candidates.

 

We are unable to independently conduct clinical trials though we intend to design our clinical trials for our product candidates and manufacture our product candidates in our cGMP Facility instead of engaging and relying on an external CMO. We remain dependent on medical institutions, clinical investigators, contract laboratories, and other third parties, such as CROs and CMOs to conduct or otherwise support other aspects of our clinical trials for our product candidates. In particular, in clinical trials, we are largely dependent on these parties for execution of clinical trials for our product candidates and control only certain aspects of their activities. Nevertheless, we are responsible for ensuring that our clinical trials are conducted in compliance with the applicable protocol, legal and regulatory requirements and scientific standards, and our reliance on third parties will not relieve us of our regulatory responsibilities. For any violations of laws and regulations during the conduct of our clinical trials, we could be subject to untitled letters, warning letters or enforcement action that may include civil penalties up to and including criminal prosecution.

 

We and such third parties will be required to comply with the applicable legislations, regulations and other requirements in the relevant jurisdictions in conducting, monitoring, recording and reporting the results of clinical trials to ensure that the data and results are scientifically credible and accurate, and that the trial patients are adequately informed of the potential risks of participating in clinical trials and their rights are protected. These regulations are enforced by the relevant governmental and regulatory authorities through regular inspections of clinical trial sponsors, principal investigators and trial sites. If we and/or these third parties fail to comply with applicable Good Clinical Practice and other regulations of the relevant jurisdictions, the clinical data generated in our clinical trials may be perceived as unreliable and the governmental and regulatory authorities may require us to conduct additional clinical trials before approving our marketing application filings. We cannot guarantee that, upon inspection or review, the governmental or regulatory authorities will determine that any of our future clinical trials are in compliance with applicable legislations, regulations and other requirements. In addition, our clinical trials must be conducted with product candidates produced under cGMP regulations. Our failure or the failure of these third parties to comply with these regulations may require us to conduct clinical trials again, which would delay the marketing approval process and could also subject us to enforcement action. The COVID-19 pandemic and government measures taken in response have also had a significant impact on our third-party contractors, and we expect that they will face further disruption, which may affect our commencement and execution of our pre-clinical studies and clinical trials.

 

As a result, we do not have direct control over several crucial aspects of our clinical development, including their conduct and timing. Our reliance on third parties to conduct future clinical trials will also result in limited direct control over the management of data developed through clinical trials than would be the case if we were relying entirely upon our own staff. Working with external parties can also be challenging, which may potentially lead to mistakes as well as difficulties in coordinating activities. External parties may:

 

  have staffing difficulties;
  fail to comply with contractual obligations;
  experience legal and/or regulatory compliance issues;
  undergo changes in priorities or become financially distressed; and/or
  form relationships with other entities, some of which may be our competitors, which may undermine our clinical development.

 

If third parties do not satisfactorily conduct our clinical trials, breach their contractual obligations to us and/or violate regulatory requirements, we cannot rely on clinical data collected by these third parties and may have to repeat, extend the duration of, or increase the size of any clinical trials we conduct, which could significantly delay commercialization and involve significantly greater expenditures.

 

If any of our relationships with these third parties deteriorate or terminate, we may not be able to enter into arrangements with alternative third parties on commercially reasonable terms, or at all. If third parties do not successfully carry out their contractual obligations or meet targeted timelines, if they have to be replaced with alternative third parties or if the quality or accuracy of the clinical data they obtain are compromised due to any breach of our clinical protocols, regulatory requirements or for other reasons, any clinical trials such third parties are associated with may be extended, delayed or terminated, and we may not be able to obtain the requisite marketing approval for or successfully commercialize our product candidates. As a result, we believe that our financial results and the commercial prospects for our product candidates in the clinical trials would be adversely affected, and our costs will be increased thereby affecting our ability to commercialize our products and to generate revenues.

 

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If we fail to successfully compete with academic institutions and other biopharmaceutical companies that are developing similar product candidates or alternatives to cellular immunotherapy product candidates, our business will be materially and adversely affected.

 

The field of immunotherapy for treatment of cancers is characterized by intense and dynamic competition to develop new technologies and proprietary therapies. Any product candidates that we developed or are in the process of developing will have to compete with existing therapies and new therapies that may from time to time become available in the future. We face competition from various sources, including well-funded biopharmaceutical companies, established biopharmaceutical companies, as well as public and private research institutions. The areas of competition include relevant scientific and management human resources, funding for product development, establishing clinical study sites and clinical subjects participating in the trials.

 

Our known biopharmaceutical competitors working on allogeneic CAR-T therapies currently include Allogene Therapeutics, Inc. (NASDAQ:ALLO), Astellas Pharma Inc. (TSE:4503.T), Bristol-Myers Squibb (NYSE:BMY), Celyad Oncology SA (NASDAQ:CYAD), Fate Therapeutics, Inc. (NASDAQ:FATE), Gilead Sciences, Inc. (NASDAQ:GILD), NANTKWEST, INC.(NASDAQ:NK), Novartis International AG (NYSE:NVS), Surface Oncology, Inc. (NASDAQ:SURF), Takeda Pharmaceutical Company Limited (NYSE:TAK) and numerous other biopharmaceutical companies.

 

We are aware of the recent developments of our potential competitors for allogeneic CAR gamma delta T- cell therapy. Based on publicly disclosed information, in June 2022 Acepodia Biotech, Inc. announced FDA clearance of Investigational New Drug application for an Anti-CD20 armed allogeneic gamma delta T-cell therapy to treat non-Hodgkin’s Lymphoma, at the same time that Immatics N.V. (NASDAQ: IMTX) and Bristol Myers Squibb (NYSE: BMY) announced the expanded strategic alliance to develop multiple allogeneic off-the-shelf TCR-T and/or CAR-T gamma delta cell therapy programs. In April 2022, Adicet Bio, Inc. (NASDAQ: ACET) received FDA fast track designation for gamma-delta T-cell therapy for advanced lymphoma which subsequently reported emerging positive Phase I safety and efficacy data for relapsed or refractory B-cell Non-Hodgkin’s Lymphoma in June 2022. In addition, numerous academic institutions are conducting pre-clinical and clinical research in these areas, as well as with other white blood cell types including gamma delta T cells.

 

Our existing competitors in the field of gamma delta T cell therapy are listed in Table 2 of the section entitled “Competition” in this Prospectus. We are aware of the recent development of our potential competitor for allogeneic gamma delta T- cell therapy. Based on publicly disclosed information, in March 2022, FDA granted Orphan Drug Designation to TC BioPharm (Holdings) PLC (NASDAQ: TCBP) investigative allogeneic unmodified gamma delta T-cell product, for use as a potential therapeutic option in patients with relapsed/refractory acute myeloid leukemia. As of date of this Prospectus, we are not aware of any approved Phase III trial for gamma delta T cell-based cancer immunotherapy. Our gamma delta T cell product candidate may also face competition from other cell-based immunotherapy approaches derived from NK cells and T cells.

 

Our existing competitors in the field of iPSC-derived immune cells include Fate Therapeutics, Inc. (NASDAQ:FATE), Takeda-CiRA joint program (Takeda Pharmaceutical Company Limited (NYSE:TAK), Centre for iPS Cell Research and Application, Kyoto University) and Century Therapeutics, Inc. (NASDAQ:IPSC). As of the date of this Prospectus, Takeda-CiRA joint program is in its pre-clinical stage, while Fate Therapeutics, Inc. (NASDAQ:FATE) has various ongoing Phase I clinical trials for iPSC-derived NK cells.

 

Many of our existing or potential competitors may have greater financial and other resources, larger teams of R&D staffs, and more experienced capabilities in researching, developing and testing products than we do. Many of these companies also have more experience in conducting clinical trials, obtaining relevant regulatory approvals, and manufacturing, marketing and distributing therapeutic products. Smaller or pre-clinical stage companies like us may successfully compete by establishing collaborative relationships with larger pharmaceutical companies or academic institutions. Accordingly, our competitors may be more successful than us in obtaining approval for treatments and achieving widespread market acceptance. Our competitors’ treatments may be more clinically effective, or more effectively marketed, than any treatment we may commercialize and they may render our treatments obsolete or non-competitive before we can recover the expenses of developing and commercializing any of our treatments.

 

Mergers and acquisitions in the industry may result in even greater resources being concentrated in a smaller number of our competitors. These competitors also compete with us in recruiting and retaining qualified scientific and management personnel, establishing clinical study sites and subjects for clinical studies. Other small or early-stage companies may also prove to be strong competitors, particularly those with collaborative arrangements with large and established companies.

 

We anticipate that we will face intense and increasing competition as new therapies enter the market and advanced technologies become available from time to time. We expect that any treatments which we develop and commercialize will need to compete on, among other things, efficacy, safety, convenience of administration and delivery, price, the level of generic competition and the availability of reimbursement from government and other third-party payors.

 

Our ability to commercialize our proprietary cell products could be reduced or eliminated if our competitors develop and commercialize products that are potentially more suitable, more effective, have a better safety profile, are more convenient or are less expensive than our products. Our competitors also may obtain relevant regulatory approvals for their products more rapidly than we may be able to obtain approval for ours, which could result in our competitors obtaining a head start and establishing a frontrunner position before we are ready to commercialize. If we are not able to compete effectively against our existing and potential competitors, our business, financial condition, results of operations and growth prospects may be materially and adversely affected. Please refer to the section entitled “Competition” for further details.

 

We will need to increase the size of our organization, and we may experience difficulties in managing growth.

 

As of the date of this Prospectus, we have twenty-seven (27) full-time employees. We are required to continue expanding our managerial, operational, quality, manufacturing, finance, sales and other resources in order to manage our operations and clinical trials, continue our development activities and eventually commercialize our product candidates. Our existing management and personnel, systems and facilities may not be sufficient to manage and support our future growth. Our growth strategy requires that we:

 

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  discover new product candidates, develop the process and analytical methods for clinical trials and submissions and applications to the relevant regulatory authorities, complete the required clinical trial studies for each, and receive approval from the regulatory authorities to initiate clinical trials for such product candidates;
  manage our clinical trials effectively;
  identify, recruit, retain, incentivize and integrate additional employees;
  continue to maintain and renew qualification of our in-house clinical cGMP Facility; and
  continue to improve our operational, financial and management controls, reports systems and procedures.

 

If we are unable to attract skilled employees, increase the size of our organization or manage our future growth effectively, it will impair our ability to execute our business strategy and our business, financial condition, results of operations and growth prospects will be materially and adversely affected.

 

If we fail to attract and retain senior management, clinical, and key scientific personnel, we may be unable to successfully develop our product candidates, conduct our clinical trials and commercialize our product candidates.

 

Our business is partially reliant on our continued ability to attract, retain and motivate highly qualified management, clinical and scientific personnel. Our senior management is crucial for our business and operations. The loss of any of our senior management could delay, hinder or prevent the successful development of our product pipeline, initiation or completion of our planned clinical trials or the commercialization of our future product candidates. We have employment and/or service agreements with all of our senior management team members.

 

Competition for qualified and experienced personnel in the biopharmaceuticals field is high due to the limited number of individuals with the skillset and experience required by our clinical trial industry. We will need to hire additional personnel to manage and support the expansion of our clinical development and any commercial activities we may commence. We may not be able to attract and retain suitable and qualified personnel on acceptable terms, or at all. If we cannot employ and retain the requisite qualified personnel for the operation of our business, our operation, financial condition, results of operations and growth prospects would be materially and adversely affected. In addition, to the extent we hire personnel from competitors, we may be subject to allegations that they have been improperly solicited or that they have divulged proprietary or other confidential information, or that their former employers have intellectual property rights to their research output.

 

We may incur substantial liabilities as a result of product liability lawsuits, if any, against us and this could limit commercialization of any product candidate that we may develop.

 

We face an inherent risk of product liability exposure related to the testing of our product candidates in clinical trials and may face an even greater risk if we commercialize any product candidate that we may develop. If we cannot successfully defend ourselves against claims that any such product candidates caused injuries, we could incur substantial liabilities. Regardless of merit or eventual outcome, liability claims may result in:

 

  decreased demand for any product candidate that we may develop;
  loss of revenue;
  substantial monetary awards to trial participants or patients;
  significant time and costs to defend the related litigation;
  withdrawal of clinical trial participants;
  increased insurance costs;
  the inability to commercialize any product candidate that we may develop; and
  loss of reputation and significant negative publicity and media attention.

 

Any such outcomes could materially and adversely affect our business, financial condition, results of operations and growth prospects.

 

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Currently, we have no insurance coverage, and even if we obtain insurance policies, they may be inadequate, may not cover all of our potential liabilities and may potentially expose us to unrecoverable risks.

 

As of the date of this Prospectus, we do not have any insurance coverage for potential liabilities arising from our business as we have not begun commercialization nor clinical trials. We do not carry insurance for all categories of risk that our business may encounter. We anticipate that we will need to obtain appropriate product or clinical trial liability insurance coverage each time we commence a clinical trial and if we successfully commercialize any product candidate. Our license agreements include broad obligations to indemnify our licensors against losses, damages, costs, or expenses or claims for compensation arising of the products we are developing or licensed cell line we will use in connection with our product. Insurance availability, coverage terms and pricing continue to vary with market conditions. We will endeavor to obtain appropriate insurance coverage for insurable risks that we identify from time to time. However, we may fail to accurately predict, assess or quantify insurable risks. We may not be able to obtain appropriate insurance coverage and insurers may not respond as we intend to cover insurable events that may occur. Any significant uninsured liability may require us to pay substantial amounts, which would materially and adversely affect our business, financial condition, results of operations and growth.

 

In addition, although we are dependent on certain key management personnel, we do not have any key man life insurance policies in place in respect of any such individual. Therefore, if any of our key management personnel passes away or becomes disabled, we will not receive any compensation to assist with the absence of such key management personnel. The loss of such key management personnel could materially and adversely affect our business, financial condition, results of operations and growth prospects.

 

Moving forward, we intend to maintain a Directors’ and officers’ insurance policy pursuant to which our Directors and officers are insured against liability for actions taken in their capacities as Directors and officers. Although we intend to maintain such insurance, any such claim that may be brought could result in a court judgment or settlement in an amount that is not covered, in whole or in part, by our insurance, or that is in excess of the limits of the insurance coverage. Moreover, in future, we may not be able to maintain insurance coverage, which is already high, at a reasonable cost or in sufficient amounts to protect us against losses.

 

Our business involves the use of biohazardous materials and we and any third-party manufacturers and suppliers we may engage are subject to laws and regulations governing the use, manufacture, storage, handling and disposal of these biohazardous materials.

 

Our R&D activities and those of any third-party manufacturers and suppliers we may engage involve the controlled storage, use and disposal of biohazardous materials. We and our manufacturers and suppliers may thus be subject to laws and regulations governing the use, manufacture, storage, handling and disposal of these biohazardous materials. In some cases, these biohazardous materials and various wastes resulting from their use are stored at our manufacturers’ facilities pending their use and disposal.

 

We cannot completely prevent the risk of contamination despite our best efforts, and any contamination could result in an obstruction of our R&D efforts and business operations, environmental damage resulting in costly clean-up and liabilities under applicable laws and regulations governing the use, storage, handling and disposal of these materials and specified waste products. Although we believe that the safety procedures utilized by our third-party manufacturers and suppliers for handling and disposing of these materials generally comply with the standards prescribed by these laws and regulations, we cannot be absolutely certain that this is always the case and/or fully eliminate the risk of accidental contamination or injury from these materials. In such an event, we may be held liable for any resulting damages and such liability could exceed our resources and state or federal or other relevant authorities may curtail our use of certain materials and/or interrupt our business operations. Furthermore, environmental laws and regulations are complex, subject to frequent developments and are increasingly stringent over time. We cannot anticipate the impact of such changes and cannot be certain of our future compliance with such developments. We have not obtained any biological or hazardous waste insurance coverage as of the date of this Prospectus. Any contamination by biohazardous materials resulting from our operations could require us to suspend and/or cease our operations and therefore materially and adversely affect our business, financial condition, results of operations and growth prospects.

 

We are exposed to information technology and cyber security risks and disruption of service.

 

Our businesses and operations rely heavily on information technology as, amongst other things, we handle, store, manage and transmit data relating to our day-to-day activities not limited to manufacturing, product analysis and data, product candidates and trials. While we have taken steps internally to back up critical data on a service provided by a reputable third-party vendor, as well as storing local copies within the Company, a risk of failure beyond our control still exists. We are therefore exposed to risks of cyber security threats, data and data privacy breaches, as well as other network security and stability risks. The scale and sophistication of cyber security threats have increased especially in recent times. We are also reliant on a number of third-party vendors to provide adequate and timely software and hardware support, that could have a material adverse effect on our systems. Disruptions to our information technology systems, whether resulting from cyber-attacks, a failure by a key vendor or otherwise, that can cause interruptions to our network and services, may result in penalties. While we have established policies and frameworks, as described in the section titled “Intellectual Property – Trade Secrets” of this prospectus, we cannot assure you that such policies and frameworks are sufficient or that our business, financial condition, results of operations and prospects would not be adversely affected by such information technology and cyber security threats, data privacy breaches as well as other network security and stability risks.

 

RISKS RELATED TO MANUFACTURING OF CELL PRODUCTS

 

Our cGMP Facility may be affected by circumstances beyond our control, such as natural disasters, and we may be required to cease operations and manufacturing of our product candidates

 

We rely on the continued operations and maintenance of our cGMP Facility for the manufacture of our product candidates. The manufacturing of our product candidates in our cGMP Facility may be frustrated, disrupted, delayed or prevented by circumstances beyond our control, including without limitation earthquakes, fires, floods, explosion, accidents, disruptions to the electrical supply (including increased prices that may be prohibitive) leading to its shutdown, or other natural disasters. If any such event occurs, this could cause our equipment to malfunction and/or break down, and we may be forced to cease operations at our cGMP Facility notwithstanding that we have installed our own standby generator to try to mitigate such risks, until we manage to fully restore it in proper working order and condition. This will impede and delay our pre-clinical testing and progress of our proposed clinical trials and increase our costs and expenses, which will materially and adversely affect our business and operations.

 

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In addition, as our cGMP Facility is subject to rigorous testing and standards in Malaysia, we may be subject to unannounced audit checks (or routine testing) from time to time by the relevant authorities in Malaysia, including the NPRA and others. If we fail to comply with any of the standards required of us, or if we do not comply with any of the Malaysian authorities’ directions to us within a specified time period, we may be required to suspend or cease our operations at our cGMP Facility. If this happens, we may be subject to warnings or penalties imposed by the Malaysian authorities or we may lose our license to operate the cGMP Facility. This would similarly impede and delay our pre-clinical testing and progress of our proposed clinical trials and increase our costs and expenses, which would materially and adversely affect our business, operations and prospects. As of the date of this Prospectus, our Group has not been subject to any penalties issued by the Malaysian authorities for any non-compliance with the standards required for the operation and maintenance of a cGMP Facility in Malaysia.

 

Our current cGMP Facility may not be sufficient to handle the large-scale commercial manufacture and production of product candidates

 

As of the date of this Prospectus, we are a pre-clinical biopharmaceutical company with three product candidates: CTM-N2D, CTM-GDT and iPSC-gdNKT. Our cGMP Facility is equipped to undertake the manufacture and production of our product candidates for pre-clinical and clinical trial purposes. However, our current cGMP Facility may not have the capabilities and resources to undertake and facilitate large-scale commercial production of our product candidates. In the event that any of our product candidates reach the commercialization stage, we will need to incur additional expenses to build another facility which is equipped to handle large-scale manufacturing or outsource manufacturing and/or production.

 

Our manufacturing process is complex, and we may encounter challenges in production of our product candidates, which would delay or hinder our ability to provide a sufficient supply of our product candidates for clinical trials or our products for patients, if approved.

 

Our product candidates are human cells, and the process of manufacturing such product candidates, as well as engineered K562 cells, is complex, highly regulated and involves numerous risks. Manufacturing our product candidates involves harvesting blood cells from a donor, isolating the gamma delta T cells, activating and expanding the gamma delta T cells, introducing a mRNA to be expressed on the gamma delta T cells, fill and finish and eventually shipping and infusing the cell product into the patient’s body. As a result of these complexities, the cost of manufacturing our cellular product candidates is generally higher than traditional small-molecule chemical compounds or biologics, and such manufacturing process is less reliable and harder to reproduce.

 

Our manufacturing process is subject to product loss or failure, or product variation that may negatively impact patient outcomes, due to logistical issues associated with supply chain disruptions, the collection of starting material from the donor, shipping such material to the manufacturing site, shipping the final product back to the clinical trial recipient, preparing the product for administration, infusing the patient with the product, manufacturing issues or different product characteristics resulting from the differences in donor starting materials, variations between reagent lots, interruptions in the manufacturing process, contamination, equipment or reagent failure, improper installation or operation of equipment, vendor or operator error, inconsistency in cell growth and variability in product characteristics.

 

Apart from the transport of material from the donor, we may also face disruptions in the supply of other materials, especially those which have to be imported from other countries, which are essential parts of the manufacturing process. For example, we have to use a special cell culture vessel for storage of the CTM-N2D product candidate, for which we have currently only been able to identify one supplier who sends it from the United States. We also use a special cell culture medium in the manufacturing process of the CTM-N2D product candidate which has to be kept in a special freezer and therefore special arrangements have to be made for its courier. In this regard, medical courier is a lot more expensive than other third-party service providers. Therefore, in the event that there are any delays in these deliveries, or increased prices for the material and/or delivery, the manufacturing processes may be affected as the delay and/or increased costs may be prohibitive.

 

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Slight deviations from our normal manufacturing processes could result in a decrease in production yields, product defects and other supply disruptions. If, for any reason in our CTM-N2D, iPSC-gdNKT and CTM-GDT clinical studies, we damage and/or lose the starting material for a manufactured product for any of our patients at any point in the process, the manufacturing process for that patient would need to be repeated from the beginning and the resulting delay could require restarting the manufacturing process, or could result in such patient withdrawing from our clinical trial. If microbial, viral and/or other contaminations are discovered in any of our product candidates or in any of the manufacturing facilities in which our products or other materials are manufactured, such manufacturing facilities may need to be closed for an extended period of time to investigate and salvage the contamination. We may have to maintain a chain of identity in which materials are pegged to a specific donor as they move from the donor to the manufacturing facility, through the manufacturing process and back to the clinical trial recipient. Maintaining a chain of identity is challenging and complex and requires a high degree of accuracy and precision, and failure to do so could result in adverse patient outcomes, loss of product or regulatory action, including withdrawal of our products from the market, if licensed. Any failure in the foregoing processes could render a batch of product unusable, affect the regulatory approvals of such product candidate, cause us to incur fines or penalties or prejudice our reputation and that of our product candidates.

 

We may revise our manufacturing process for various reasons, such as to control costs, achieve scale, decrease processing time, and increase manufacturing success rate. As a result of changes made to our manufacturing process during the course of clinical development, we may need to demonstrate the comparability of the product used in earlier clinical phases or at earlier portions of a trial to the product used in later clinical phases or later portions of the trial. Changes to our manufacturing process made before or after commercialization could require us to show the comparability of the resulting product to the product candidate used in the clinical trials using earlier processes. We may need to collect additional non-clinical or clinical data from any modified process prior to obtaining marketing approval for the relevant product candidate produced with such modified process. If such data are not ultimately comparable to the data obtained in earlier trials or an earlier stage of the same trial in terms of safety and/or efficacy, we may be required to make further changes to our manufacturing process and/or undertake additional clinical testing, either of which could significantly delay the clinical development or commercialization of the associated product candidate, which would materially and adversely affect our business, financial condition, results of operations and growth prospects.

 

We are highly reliant on certain key suppliers for certain steps of our manufacturing processes.

 

Our manufacturing processes for CTM-N2D, iPSC-gdNKT and CTM-GDT depend on the use of cell culture vessel, and other reagents, some of which might only be available from certain key suppliers. In addition, some of these reagents, at the time of procurement, typically expire after approximately four to six months. Due to the short expiration period, we are unable to store the reagents in large quantities for future needs to mitigate against the risk of shortage due to disruption of the supply chain.

 

Further, although many of the reagents and consumables we require for our manufacturing process are available from more than one commercial supplier, we have not yet confirmed the suitability of the use of all such reagents and consumables in our manufacturing process. Even if we are able to replace any raw materials or consumables with alternatives, such alternatives may be more expensive, result in lower yields or not be as suitable for our purposes. In addition, some of the raw materials that we use are complex materials, which is likely to be harder to obtain substitutes for. Therefore, supply disruptions could result in significant delays and additional regulatory submissions and prevent us from being able to manufacture our product candidates due to the unsuitability of the substituted reagent or consumable that we are able to obtain.

 

In addition, some of the reagents that we use may be restricted by limited use label licenses and may be for research use and not for commercial application of any kind. We may need to replace certain reagents in order for us to commercialize our products in the future. While there are alternatives available, such alternatives may be more expensive, may result in lower yields or may not be as suitable for our purpose. These alternative reagents may also face regulatory challenges and review and potentially result in significant delays in our clinical trials and future developments.

 

Any disruption in supply of these reagents could result in significant delays in our clinical trials, which would materially and adversely affect our business, financial condition, results of operations and growth prospects.

 

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We rely on the storage of our cell bank for the engineered K562 cells and peripheral blood mononuclear cells, and any damage or loss to them would cause delays in our clinical trials and may materially and adversely affect our business.

 

The cell bank of the engineered K562 cells we license and our peripheral blood mononuclear cells are stored in liquid nitrogen tanks at our cGMP Facility. If these materials are damaged or lost at our cGMP Facility, including by the loss or malfunction of these liquid nitrogen tanks, or by damage from fire, power loss or other natural disasters, we would need to establish replacement master and working cell banks of the engineered K562 cells and peripheral blood mononuclear cells, which would impact clinical supply and delay our clinical trials or treatment of patients. If we are unable to find replacement storage facilities and/or re-manufacture the engineered K562 cells timeously, we may incur significant additional expenses and liability to patients whose treatment is delayed, which would materially and adversely affect our business. If we are unable to source for peripheral blood mononuclear cells which are suitable for manufacturing from healthy donors on a timely basis, we may incur significant additional expenses and liability to patients whose treatment is delayed, which would materially and adversely affect our business. Our K562 Cell License for NK cell expansion also requires us to broadly indemnify our licensor against any loss, damages, costs, expenses, or other claim for compensation in connection with the license or our licensed products under the license.

 

Delays in obtaining renewal of regulatory approvals for our cGMP Facility and licenses could delay our development plans and thereby limit our ability to generate revenues.

 

We believe that in-house cGMP manufacturing capability is important to facilitate clinical product supply, lower the risk of manufacturing disruptions and enable more cost-effective manufacturing. We have an existing cGMP Facility in Johor Bahru, Malaysia that will allow us to supply the product candidates needed for our clinical trials. In the event that our product candidates are approved for commercial use, we also plan to build an additional facility for the commercial-scale manufacture of our product candidates in the future. The design, construction, qualification and regulatory approvals for such facilities require substantial capital and technical expertise and any delay would limit our development activities and our opportunities for growth.

 

Furthermore, our cGMP Facility is subject to ongoing, periodic inspection by the NPRA to ensure compliance with cGMP and other relevant laws and regulations. Any failure to follow and document our adherence to these regulations or other regulatory requirements may lead to significant delays in the availability of products for clinical use or may result in the termination of or a hold on a clinical study. The Malaysian authorities may also make unannounced checks and audits of our cGMP Facility. Failure or omission to comply with relevant laws or regulations could also result in sanctions being imposed on us, including fines, injunctions, civil penalties, a requirement to suspend or put on hold one or more of our clinical trials, failure of regulatory authorities to grant marketing approval of our drug candidates, delays, suspension or withdrawal of approvals, license revocation, seizures or recalls of drug candidates, operating restrictions and criminal prosecutions, any of which could materially adversely affect our business, financial condition, results of operations and growth prospects.

 

We also may encounter problems with regard to the following:

 

  complying with legislation and regulations governing donor traceability, manufacturing, release of product candidates and other requirements from regulatory authorities outside Malaysia;
  achieving adequate or clinical-grade materials that fulfill regulatory agency standards and/or specifications with consistent and acceptable production yield and costs;
  bacterial, fungal or viral contamination in our cGMP Facility; and/or
  shortage in qualified personnel, raw materials and/or key contractors.

 

Our product candidates, if approved by the relevant regulatory authorities, may require significant commercial supply to meet market demand. In these cases, we may need to significantly increase or “scale up”, our production process. If we fail to develop sufficient manufacturing capacity and/or experience, whether internally or with a third party, in time or at all, or fail to manufacture our product candidates economically or at reasonable scale or volume or in accordance with cGMP, or if the cost of the increase or “scale-up” in our production process is not economically feasible, our development programs and commercialization of any approved products will be materially adversely affected and we may not be able to produce a sufficient quantity of our product candidates required to meet future demand and our business, financial condition, results of operations and growth prospects may be materially adversely affected.

 

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The optimal donor and manufacturing parameters for our product candidates may have not been definitively established, which may hinder our ability to optimize our product candidates or to address any safety or efficacy issues that may arise.

 

If any of our clinical trials reveal issues with the safety or efficacy of any of our product candidates, modification of the donor selection criteria or the manufacturing process may be necessary to address such issues. However, we have not fully characterized or identified how donor characteristics and manufacturing process parameters affect the optimal cancer cell killing ability for our CTM-N2D and CTM-GDT product candidates for in vitro and animal efficacy studies or how such potency differences may translate into efficacy to be seen in human clinical trials, including both the proportion of patients who achieve a meaningful clinical response, and the duration of any such clinical responses. As a result, our ability to improve our manufacturing process or product potency, safety, or efficacy according to such parameters is limited and may require significant trial and error, which may cause us to incur significant costs or could result in significant delays to the clinical development and eventual commercialization of our product candidates.

 

We have not yet developed a validated methodology of freezing and thawing large quantities of CTM-N2D, iPSC- gdNKT and CTM-GDT product candidates, which may be required for the storage and overseas distribution of our product candidates.

 

We have not yet developed a validated method of freezing and thawing CTM-N2D, iPSC-gdNKT and CTM-GDT, which can be frozen and thawed in smaller quantities, in large quantities without damage, in a cost-efficient manner and without degradation over time. We may encounter difficulties not only in developing freezing and thawing methodologies for large scale use, but also in obtaining the necessary regulatory approvals for using such methodologies in treatment. If we cannot adequately demonstrate that our frozen product candidates are similar to our product candidates in unfrozen form to the satisfaction of the HSA and/or other regulatory authorities, we could face substantial delays in obtaining regulatory approvals from the HSA and/or other regulatory authorities. If we are unable to develop a validated method of freezing CTM-N2D, iPSC-gdNKT and CTM-GDT for shipping purposes, our ability to promote adoption and standardization of our products candidates, as well as achieve economies of scale by centralizing our production facility, will be limited. Even if we are able to successfully freeze and thaw CTM-N2D, iPSC-gdNKT and CTM-GDT in large quantities, we will also need to develop a cost-effective and reliable distribution and logistics network, which we may be unable to accomplish.

 

Furthermore, we have not yet demonstrated long-term stability of cryopreserved CTM-N2D, iPSC-gdNKT and CTM-GDT and therefore are not certain if we will be able to store the cryopreserved cells for extended periods of time. If we are unable to demonstrate such long-term stability, we will need to reduce the manufacturing batch size to ensure that the material we produce will be used before it expires. In that case, the scaling of our production processes will not deliver the efficiencies we expect, and the cost per dose of our product candidates will be substantially higher.

 

Due to various reasons (including the foregoing), we have not yet established the long-term stability of our cryopreserved CTM-N2D, iPSC-gdNKT and CTM-GDT and we may not be able to commercialize CTM-N2D, iPSC-gdNKT and CTM-GDT on a large scale or in a cost-effective manner. If any of our product candidates is found to be unstable, we will have to conduct more frequent manufacturing runs, which could cause us to incur significant additional expenses. Currently, we have identified a potential collaboration partner to develop cryopreservation method for our product candidates.

 

We believe we may require an updated and validated protocol for commercial-scale expansion and manufacturing of gamma delta T cells for conducting pivotal trials and for commercialization of our product candidates, if approved.

 

Future clinical trials that we conduct, as well as any potential commercialization of our product candidates when approved, will depend on the reliability, safety and efficacy of our processes for expanding, modifying and manufacturing CTM-N2D, iPSC-gdNKT and CTM-GDT at scale. Our efforts to scale up production of our CTM-N2D, iPSC-gdNKT and CTM-GDT in anticipation of future clinical trials or commercialization may reveal, an inability to overcome biology or may otherwise encounter challenges, including scrutiny from regulatory authorities. To the extent we encounter any such difficulties, our ability to conduct additional clinical trials or to scale for commercialization will be hindered or prevented, which would have an adverse effect on our business. Currently, we are in the midst of identifying potential collaboration partners to develop methods for the scaling up manufacturing of our product candidates.

 

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RISKS RELATED TO OUR INTELLECTUAL PROPERTY 

 

It is difficult and costly to protect our proprietary rights, and we may not be able to ensure full protection of our proprietary rights. If our patent position does not adequately protect our product candidates, others could compete against us more directly, which would harm our business, possibly materially.

 

Our commercial success will depend in part on obtaining and maintaining proprietary rights including patent protection and trade secret protection of our current product candidates and future product candidates, the processes used to manufacture them and the methods for using them, as well as successfully asserting and defending these proprietary rights against third-party challenges. Our ability to stop third parties from making, using, selling, offering to sell or importing our product candidates is dependent upon the extent to which we have rights under valid and enforceable patents or trade secrets that cover these activities.

 

The patent positions of biotechnology and pharmaceutical companies can be highly uncertain and involve complex legal and factual questions for which important legal principles remain unresolved. No consistent policy regarding the breadth of claims allowed in pharmaceutical patents has emerged to date in the U.S. or in foreign jurisdictions outside of the U.S., including Singapore. Changes in either the patent laws or interpretations of patent laws in the U.S. and other countries may diminish the value of our intellectual property. Accordingly, we cannot predict the breadth of claims that may be enforced in the patents that may be issued from the applications we currently licensed or may in the future own or license from third parties. Further, if any patents we obtain or license are deemed invalid and unenforceable, our ability to commercialize or license our product candidates or technology could be adversely affected.

 

Others may file patent applications covering products and technologies that are similar, identical, or competitive to ours or important to our business. We cannot be certain that any patent application owned by a third party will not have priority over patent applications filed or in-licensed by us, or that we or our licensors will not be involved in patent office proceedings such as interference, derivation, opposition, reexamination, inter partes review, reissue, post grant review or invalidity proceedings before U.S. or non-U.S. patent offices. Such proceedings are also expensive and time consuming.

 

The degree of future protection for our proprietary rights is uncertain because legal means afford only limited protection and may not adequately protect our rights or permit us to gain or keep our competitive advantage. For example:

 

  others may be able to make products that are similar to our product candidates, but that are not covered by the claims of our patents or our licensed patents;
  any patents that we obtain from licensing or otherwise may not provide us with any competitive advantages;
  any granted patents that we rely upon may be held invalid or unenforceable as a result of legal challenges by third parties; and
  the patents of others may have an adverse effect on our business.

 

We are dependent on licensed intellectual property. If we were to lose our rights to licensed intellectual property, we may not be able to continue developing or commercializing our product candidates, if approved. If we breach any of the agreements under which we license the use, development and commercialization rights to our product candidates or technology from third parties or, in certain cases, we fail to meet certain development deadlines, we could lose license rights that are important to our business.

 

We do not currently own any patents, and we are heavily reliant upon a number of license agreements under which we are granted rights to intellectual property that are important to our business and we may need or choose to enter into additional license agreements in the future. Our existing license agreements impose, and we expect that future license agreements will impose on us, various development, regulatory and/or commercial diligence obligations, payment of milestones and/or royalties and other obligations. If we fail to comply with our obligations under these agreements, or we are subject to a bankruptcy, the licensor may have the right to terminate the licenses, in which event we would not be able to market products covered by the licenses. Our business could suffer, for example, if any current or future licenses terminate, if the licensors fail to abide by the terms of the licenses, if the licensed patents or other rights are found to be invalid or unenforceable, or if we are unable to enter into necessary licenses on acceptable terms.

 

Licensing of intellectual property is of critical importance to our business and involves complex legal, business and scientific issues. Disputes may arise between us and our licensors regarding intellectual property subject to a license agreement, including:

 

  the scope of rights granted under the license agreements and other interpretation-related issues;
  whether and the extent to which our technology and processes infringe on intellectual property of the licensor that is not subject to the licensing agreement;
  our right to sublicense patent and other rights to third parties;
  our diligence obligations with respect to the use of the licensed technology in relation to our development and commercialization of our product candidates, and what activities satisfy those diligence obligations;
  the ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensors and us and our partners;
  our right to transfer or assign the license; and
  the effects of termination.

 

If disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, we may be unable to successfully develop and commercialize the affected product candidates.

 

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We have entered into several licenses to support our various projects. Termination of any of these license agreements would have a material adverse impact on our ability to develop and commercialize derived products under each respective agreement.

 

We have entered into several licenses to support our various projects. We may enter into additional licenses to third-party intellectual property that are necessary or useful to our business. Our current licenses and any future licenses that we may enter into impose various royalty payment, milestone, and other obligations on us. Under some license agreements, we may not control prosecution of the licensed intellectual property, or may not have the first right to enforce the intellectual property. In those cases, we may not be able to adequately influence patent prosecution or enforcement, or prevent inadvertent lapses of coverage due to failure to pay maintenance fees. If we fail to comply with any of our obligations under a current or future license agreement, the licensor may allege that we have breached our license agreement, and may accordingly seek to terminate our license. Termination of any of our current or future licenses could result in our loss of the right to use the licensed intellectual property, which could materially adversely affect our ability to develop and commercialize a product candidate or product, if approved, as well as harm our competitive business position and our business prospects. Under some license agreements, termination may also result in the transfer of or granting in rights under certain of our intellectual property and information related to the product candidate being developed under the license, such as regulatory information.

 

The agreements under which we have licensed intellectual property or technology or may license intellectual property or technology in the future to or from third parties are complex, and certain provisions in such agreements may be susceptible to multiple interpretations. The resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology or increase what we believe to be our financial or other obligations under the relevant agreement, either of which could have a material adverse effect on our business, financial condition, results of operations and prospects. Moreover, if disputes over intellectual property that we have licensed or may license prevent or impair our ability to maintain our current licensing arrangements on commercially acceptable terms, we may be unable to successfully develop and commercialize the affected product candidates.

 

In addition, if our licensor fails to abide by the terms of any of the licenses, if the licensor fails to prevent infringement by third parties, if the licensed patents or other rights are found to be invalid or unenforceable, or if we are unable to enter into necessary licenses on acceptable terms, our business could suffer. Moreover, our licensor may own or control intellectual property that has not been licensed to us and, as a result, we may be subject to claims, regardless of their merit, that we are infringing, misappropriating or otherwise violating the licensor’s rights.

 

Similarly, if we are unable to successfully obtain rights to required third-party intellectual property rights or maintain the existing intellectual property rights we have, we may have to seek alternative options, such as developing new product candidates with design-around technologies, which may require more time and investment, or abandon development of the relevant research programs or product candidates and our business, financial condition, results of operations and prospects could suffer.

 

Some of the intellectual property covered by our licenses concern patent applications. We cannot assure investors that any of the currently pending or future patent applications will result in granted patents, nor can we predict how long it will take for such patents to be granted.

 

Some of the intellectual property covered by our current licenses from the licensor concern certain, specified patent rights (including patent applications and Patent Cooperation Treaty patent applications). While to some extent and for at least a certain period of time, the licensor has agreed to assume responsibility for the preparation, filing, prosecution and maintenance of patent applications covered by the licensed patent rights, we cannot be certain as to when or if final patents will be issued for those patent applications covered by the licensed patent rights. However, the licensor may not successfully prosecute certain patent applications, the prosecution of which the licensor controls, under which we are only a licensee and on which our business substantially depends. Even if patents issue from these applications, there is no assurance that the patents will be free from defects or survive validity or enforceability challenges, the licensors may fail to maintain these patents, may decide not to pursue litigation against third-party infringers, may fail to prove infringement or may fail to defend against counterclaims of patent invalidity or unenforceability.

 

Moreover, it is possible that the licensed pending patent applications will not result in granted patents, and even if such pending patent applications are granted as patents, they may not provide a basis for intellectual property protection of commercially viable products or may not provide us with any competitive advantages. Further, it is possible that, for any of the patents that may be granted in the future, others will design around the licensed patent rights or identify methods for preventing or treating diseases that do not concern the rights covered by our licenses. Further, we cannot assure investors that other parties will not challenge any patents granted to the licensor or that courts or regulatory agencies will hold licensor’s patents to be valid or enforceable. We cannot guarantee investors that, if required to defend the covered patents, we will have the funds to or be successful in defending challenges made against the licensed patents. Any successful third-party challenge to the licensed patents could result in the unenforceability or invalidity of such patents, or to such patents being interpreted narrowly or otherwise in a manner adverse to our interests. Our ability to establish or maintain a technological or competitive advantage over our competitors may be diminished because of these uncertainties. 

 

Even if patents are issued based on patent applications to which we have been granted a license, because the patent positions of pharmaceutical and biotechnology products are complex and uncertain, we cannot predict the scope and extent of patent protection for our product candidates.

 

Any patents that may be issued based on patent applications that we have been granted licenses to will not ensure sufficient protection with respect to our activities for a number of reasons, including without limitation the following:

 

  any issued patents may not be broad or strong enough to prevent competition from other identical or similar products;
  if patents are not issued or if issued patents expire, there would be no protections against competitors making generic equivalents;
  there may be prior art of which we are not aware that may affect the validity or enforceability of a patent claim;
  there may be other patents existing, now or in the future, in the patent landscape for our product candidates that we seek to commercialize or develop, if any, that will affect our freedom to operate;
  if patents that we have been granted licenses to are challenged, a court could determine that they are not valid or enforceable;
  a court could determine that a competitor’s technology or product does not infringe patents that we have been granted licenses to;
  patents to which we have been granted licenses could irretrievably lapse due to failure to pay fees or otherwise comply with regulations, or could be subject to compulsory licensing; and
  if we encounter delays in our development or clinical trials, the period of time during which we could market our products under patent protection would be reduced.

 

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Obtaining and maintaining patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and patent protection could be reduced or eliminated for noncompliance with these requirements.

 

Periodic maintenance fees on any issued patent are due to be paid to the United States Patent and Trademark Office (USPTO) and foreign Intellectual Property Offices in several stages over the term of the patent. Maintenance fees are also due for pending patent applications in some countries. The USPTO and various foreign intellectual property offices require compliance with a number of procedural, documentary, fee payment and other similar provisions during the patent application process. While an inadvertent lapse can in many cases be cured by payment of a late fee or by other means in accordance with the applicable rules, there are situations in which noncompliance can result in abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. Noncompliance events that could result in abandonment or lapse of a patent or patent application include, but are not limited to, failure to respond to office actions within prescribed time limits, non-payment of fees and failure to properly legalize and submit formal documents. In such an event, our competitors might be able to enter the market, which would have a material adverse effect on our business.

 

The life of patent protection is limited, and third parties could develop and commercialize products and technologies similar or identical to ours and compete directly with us after a patent licensed to us expires, which could materially and adversely affect our ability to commercialize our products and technologies.

 

The life of a patent and the protection it affords is limited. For example, in the United States, if all maintenance fees are timely paid, the natural expiration of a patent is generally 20 years from its earliest U.S. non-provisional filing date. In Europe, the expiration of an invention patent is 20 years from its filing date. Even if we successfully obtain patent protection for an approved product candidate, it may face competition from biosimilar medications. Manufacturers of other drugs may challenge the scope, validity or enforceability of the patents underlying our technology in court or before a patent office, and the patent holder may not be successful in enforcing or defending those intellectual property rights and, as a result, we may not be able to develop or market the relevant product candidate exclusively, which would materially adversely affect any potential sales of that product.

 

Given the amount of time required for the development, testing and regulatory review of new product candidates, patents protecting such product candidates might expire before or shortly after such product candidates are commercialized. As a result, the patent pending applications licensed to us may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours. Even if we believe that the patents involved are eligible for certain (and time-limited) patent term extensions, there can be no assurance that the applicable authorities, including the FDA and the USPTO, and any equivalent regulatory authority in other countries, will agree with our assessment of whether such extensions are available, and such authorities may refuse to grant extensions to such patents, or may grant more limited extensions than requested. For example, depending upon the timing, duration and specifics of any FDA marketing approval of any product candidates we may develop, one or more of the U.S. patents licensed to us may be eligible for limited patent term extension under the Drug Price Competition and Patent Term Restoration Action of 1984, or Hatch-Waxman Amendments. The Hatch-Waxman Amendments permit a patent extension term of up to five years as compensation for patent term lost during the FDA regulatory review process. A patent term extension cannot extend the remaining term of a patent beyond a total of 14 years from the date of product approval, only one patent may be extended and only those claims covering the approved drug, a method for using it, or a method for manufacturing it may be extended. However, we may not be granted an extension or may be granted a shorter extension because of, for example, failing to exercise due diligence during the testing phase or regulatory review process, failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patent, or otherwise failing to satisfy applicable requirements. Moreover, the applicable time period or the scope of patent protection afforded could be less than requested. If we are unable to obtain patent term extension or term of any such extension is less than requested, our competitors may obtain approval of competing products following our patent expiration, and our business could be harmed. Changes in either the patent laws or interpretation of the patent laws in the United States and other countries may diminish the value of our patents or narrow the scope of our patent protection.

 

The patent pending applications licensed to us for our product candidates are expected to expire on various dates. Upon the expiration, we or our licensor will not be able to assert such licensed patent rights against potential competitors, which would materially adversely affect our business, financial condition, results of operations and prospects.

 

We may need to license intellectual property from third parties, and such licenses may not be available on commercially reasonable terms or may not be available at all.

 

There may be intellectual property rights existing now, or in the future, relevant to our product candidates that we seek to commercialize or develop, if any, that may affect our ability to commercialize such product candidates. Although the Company is not aware of any such intellectual property rights, a third party may hold intellectual property rights, including patent rights, which are important or necessary to the development or manufacture of our product candidates. Even if all our main product candidates are covered by patents, it may be necessary for us to use the patented or proprietary technology of third parties to commercialize our product candidates, in which case we would be required to obtain licenses from these third parties. Such licenses may not be available on commercially reasonable terms, or at all, and we could be forced to accept unfavorable contractual terms. In that event, we may be required to expend significant time and resources to redesign our technology, product candidates, or the methods for manufacturing them or to develop or license replacement technology, all of which may not be feasible on a technical or commercial basis. If we are unable to do so, our business could be harmed.

 

The licensing or acquisition of third-party intellectual property rights is a competitive area, and several more established companies may pursue strategies to license or acquire third party intellectual property rights that we may consider attractive or necessary. These established companies may have a competitive advantage over us due to their size, capital resources and greater clinical development and commercialization capabilities. In addition, companies that perceive us to be a competitor may be unwilling to assign or license intellectual property rights to us. We also may be unable to license or acquire third party intellectual property rights on terms that would allow us to make an appropriate return on our investment or at all. If we are unable to successfully obtain rights to required third party intellectual property rights or maintain the existing intellectual property rights we have, we may have to abandon development of the relevant project or product candidate, which could have a material adverse effect on our business, financial condition, results of operations, and prospects.

 

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We may infringe the intellectual property rights of others, which may prevent or delay our product development efforts and stop us from commercializing or increase the costs of commercializing our product candidates.

 

Our success will depend in part on our ability to operate without infringing the proprietary rights of third parties. We are not aware of any third-party proprietary rights that our planned products will infringe or misappropriate, but we have not conducted any freedom to operate study as we are in the earliest stages of development. We thus cannot guarantee that our product candidates, or manufacture or use of our product candidates, will not infringe third-party patents. Furthermore, a third party may claim that we are using technologies covered by the third party’s patent rights and may go to court to stop us from engaging in our normal operations and activities, including making or selling our product candidates. These lawsuits are costly and could affect our results of operations and divert the attention of managerial and scientific personnel. Some of these third parties may be better capitalized and have more resources than us. There is a risk that a court would decide that we are infringing the third party’s patents and would order us to stop the activities covered by the patents. In that event, we may not have a viable way around the patent and may need to halt commercialization of our product candidates. In addition, there is a risk that a court will order us to pay the other party damages for having violated the other party’s patents. In addition, we may be obligated to indemnify our licensors and collaborators against certain intellectual property infringement claims brought by third parties, which could require us to expend additional resources. The pharmaceutical and biotechnology industries have produced a proliferation of patents, and it is not always clear to industry participants, including us, which patents cover various types of products or methods of use. The coverage of patents is subject to interpretation by the courts, and the interpretation is not always uniform.

 

If we are sued for patent infringement, we would need to demonstrate that our product candidates or methods either do not infringe the patent claims of the relevant patent or that the patent claims are invalid, and we may not be able to do this. Proving invalidity is difficult. For example, in the U.S., proving invalidity requires a showing of clear and convincing evidence to overcome the presumption of validity enjoyed by issued patents. Even if we are successful in these proceedings, we may incur substantial costs and diversion of management’s time and attention in pursuing these proceedings, which could have a material adverse effect on us. If we are unable to avoid infringing the patent rights of others, we may be required to seek a license, which may not be available, defend an infringement action or challenge the validity of the patents in court. Patent litigation is costly and time consuming. We may not have sufficient resources to bring these actions to a successful conclusion. In addition, if we do not obtain a license, develop or obtain non-infringing technology, fail to defend an infringement action successfully or have infringed patents declared invalid, we may incur substantial monetary damages, encounter significant delays in bringing our product candidates to market and be precluded from manufacturing or selling our product candidates.

 

Some of our competitors may be able to sustain the costs of complex patent litigation more effectively than us or the third parties from whom we license intellectual property because they have substantially greater resources. In addition, any uncertainties resulting from the initiation and continuation of any litigation could have a material adverse effect on our ability to raise the funds necessary to continue our operations.

 

We may become involved in lawsuits to protect or enforce our intellectual property, which could be expensive, time consuming and unsuccessful.

 

In addition to the possibility of litigation relating to infringement claims asserted against us, we may become a party to other patent litigation and other proceedings, including inter partes review proceedings, post grant review proceedings, derivation proceedings declared by the USPTO and similar proceedings in foreign countries, regarding intellectual property rights with respect to our current or future technologies or product candidates or products. The cost to us of any patent litigation or other proceeding, even if resolved in our favor, could be substantial. Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their substantially greater financial resources. Patent litigation and other proceedings may also absorb significant management time. Uncertainties resulting from the initiation and continuation of patent litigation or other proceedings could impair our ability to compete in the marketplace.

 

Competitors may infringe or otherwise violate our intellectual property, including patents that may issue to or be licensed by us. As a result, we may be required to file claims in an effort to stop third-party infringement or unauthorized use. Any such claims could provoke these parties to assert counterclaims against us, including claims alleging that we infringe their patents or other intellectual property rights, and/or that any of our intellectual property, including licensed intellectual property, is invalid and/or unenforceable. This can be prohibitively expensive, particularly for a company of our size, and time-consuming, and even if we are successful, any award of monetary damages or other remedy we may receive may not be commercially valuable. In addition, in an infringement proceeding, a court may decide that our asserted intellectual property is not valid or is unenforceable, or may refuse to stop the other party from using the technology at issue on the grounds that our intellectual property does not cover the third party’s technology. An adverse determination in any litigation or defense proceedings could put our intellectual property at risk of being invalidated or interpreted narrowly and could put our patent applications at risk of not issuing as patents.

 

If the breadth or strength of our patent or other intellectual property rights is compromised or threatened, it could allow third parties to exploit and, in particular, commercialize our technology or products or result in our inability to exploit and/or commercialize our technology and products without infringing third-party intellectual property rights. Further, third parties may be dissuaded from collaborating with us.

 

Interference or derivation proceedings brought by the USPTO or its foreign counterparts may be necessary to determine the priority or inventorship of inventions with respect to our licensed patents or patent applications, and we may also become involved in other proceedings, such as re-examination proceedings, before the USPTO or its foreign counterparts. Due to the substantial competition in the pharmaceutical space, the number of such proceedings may increase. This could delay the prosecution of our pending patent applications or impact the validity and enforceability of any future patents that we may obtain. In addition, any such litigation, submission or proceeding may be resolved adversely to us and, even if successful, may result in substantial costs and distraction to our management.

 

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If we are not able to adequately prevent disclosure of trade secrets and other proprietary information, the value of our technology and product could be significantly diminished.

 

We also rely on trade secrets to protect our proprietary technologies, especially where we do not believe patent protection is appropriate or obtainable. However, trade secrets are difficult to protect. We rely in part on confidentiality agreements with our employees, consultants, outside scientific collaborators, sponsored researchers and other advisors to protect our trade secrets and other proprietary information. These agreements may not effectively prevent disclosure of confidential information and may not provide an adequate remedy in the event of unauthorized disclosure of confidential information. In addition, others may independently discover our trade secrets and proprietary information. For example, the FDA, as part of its transparency initiative, is currently considering whether to make additional information publicly available on a routine basis, including information that we may consider to be trade secrets or other proprietary information, and it is not clear at the present time how the FDA’s disclosure policies may change in the future, if at all. Costly and time-consuming litigation could be necessary to enforce and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret protection could adversely affect our competitive business position.

 

We may be subject to claims that our employees or consultants have wrongfully used or disclosed alleged trade secrets.

 

As is common in the biotechnology and pharmaceutical industries, we employ individuals who were previously employed at other biotechnology or pharmaceutical companies, including our competitors or potential competitors. Although we try to ensure that our employees and consultants do not use the proprietary information or know-how of others in their work for us, we may be subject to claims that we or our employees or consultants have inadvertently or otherwise used or disclosed trade secrets or other proprietary information of their former employers. Litigation may be necessary to defend against these claims. If we fail in defending any such claims, in addition to paying monetary damages, we could lose valuable intellectual property rights or personnel, which could adversely impact our business. Even if we are successful in defending against these claims, litigation could result in substantial costs and be a distraction to management.

 

Our intellectual property may not be sufficient to protect our product candidates from competition, which may negatively affect our business as well as limit our partnership or acquisition appeal.

 

We may be subject to competition despite the existence of intellectual property we license or may in the future own. We can give no assurances that our intellectual property rights will be sufficient to prevent third parties from designing around patents we own or license and developing and commercializing competitive products. The existence of competitive products that avoid our intellectual property could materially adversely affect our operating results and financial condition. Furthermore, limitations, or perceived limitations, in our intellectual property may limit the interest of third parties to partner, collaborate or otherwise transact with us, if third parties perceive a higher than acceptable risk to commercialization of our product candidates or future product candidates.

 

We may elect to sue a third party, or otherwise make a claim, alleging infringement or other violation of patents, trademarks, trade dress, copyrights, trade secrets, domain names or other intellectual property rights that we either own or license from a third party. If we do not prevail in enforcing our intellectual property rights in this type of litigation, we may be subject to:

 

  paying monetary damages related to the legal expenses of the third party;
  facing additional competition that may have a significant adverse effect on our product pricing, market share, business operations, financial condition, and the commercial viability of our product; and
  restructuring our company or delaying or terminating select business opportunities, including, but not limited to, R&D, clinical trial, and commercialization activities, due to a potential deterioration of our financial condition or market competitiveness.

 

A third party may also challenge the validity, enforceability or scope of the intellectual property rights that we license or own and the result of these challenges may narrow the scope or claims of or invalidate patents that are integral to our product candidates in the future. There can be no assurance that we will be able to successfully defend patents we own or license in an action against third parties due to the unpredictability of litigation and the high costs associated with intellectual property litigation, amongst other factors.

 

Intellectual property rights may be less extensive and enforcement may be more difficult in jurisdictions outside of the U.S. Therefore, we may not be able to protect our intellectual property and third parties may be able to market competitive products that may use some or all of our intellectual property.

 

Changes to patent law, including the Leahy-Smith America Invests Act of 2011 and other future article of legislation, may substantially change the regulations and procedures surrounding patent applications, issuance of patents and prosecution of patents. We can give no assurances that the patents of ours or our licensor’s can be defended or will protect us against future intellectual property challenges, particularly as they pertain to changes in patent law and future patent law interpretations

 

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If any of our license agreements with ATPL is terminated, we could lose our rights to key components enabling our core proprietary CAR gamma delta T cell technology platform.

 

We are highly reliant on three licenses granted to us pursuant to the Patent License, K562 Cell License for NK cell expansion, and Know-How License by ATPL, a wholly-owned subsidiary of A*STAR and the leading R&D agency in Singapore. A*STAR is the leading body for biomedical research initiatives among the research community in Singapore. Please refer to the section entitled “Intellectual Property” for further information on these licenses. Our lead product candidates, CTM-N2D, iPSC-gdNKT and CTM-GDT, are derived from the technology we licensed from ATPL. If any of these three license agreements is terminated for any reason, we would lose the rights to use the licensed intellectual property rights that may be material or necessary to the development and/or production of our product candidates, which could impede or prevent our successful commercialization of such product candidates and materially adversely affect our business, financial condition, results of operations and growth prospects.

 

Furthermore, our Patent License is field-specific and has been granted to us in the field of immunotherapy, including stem cell therapy and treatment and immunotherapy drugs using any licensed patents that issue from and claim priority with and from the two Patent Cooperation Treaty applications in the Patent License.

 

If the licenses granted to us by ATPL are affected in any manner, it could delay our development and commercialization of our product candidates, which in turn could materially adversely affect our business, financial condition, results of operations and growth prospects.

 

Our development and commercialization rights to our current and future product candidates and technology are subject, in part, to the terms and conditions of patent licenses granted to us by others.

 

We do not have the right to control the preparation, filing, prosecution, maintenance, enforcement and defense of patents and patent applications in respect of the technology(ies) that we license from ATPL. ATPL is responsible for patent prosecution and maintenance costs in a limited number of countries and territories. Therefore, we cannot guarantee that these patent applications and patents issued therefrom will be prepared, filed, prosecuted, maintained, enforced and defended in a manner consistent with our best interests. If ATPL fails to prosecute, maintain, enforce and defend any of such patent applications or patents, or lose rights to any of those patents or patent applications, the patent rights we have licensed may be reduced or eliminated, and our right to develop and commercialize any of our products that are the subject of such licensed rights could be impaired. Additionally, we may be required to reimburse ATPL for their expenses related to the prosecution, maintenance, enforcement and defense of patents and patent applications that we license from them.

 

We may not be able to meet our commercialization milestones in our patent license agreements with ATPL, and if our license agreement is terminated as a result, our clinical trials and business will be significantly affected.

 

Any breach or non-compliance of any term in any of our patent license agreements with ATPL (such as our failure to meet any of the commercialization milestones relating to different phases of clinical trials or otherwise) may result in termination. Failure by us to renew or otherwise maintain the required patent licenses, or cancellation, suspension or revocation of any of our patent licenses pursuant to our patent license agreements with ATPL may result in the interruption of our clinical trials and operations if we are not able to use the patent licenses and this could potentially affect our working relationship with ATPL and/or A*STAR, which would have a materially adverse effect on our business, operations and future prospects. We may not be able to identify another licensor able and willing to license such technology(ies) to us, and we may be required to recreate our product candidates altogether which would significantly increase our costs and expenses required to operate. This would also severely delay any potential commercialization of our products and we may not be able to create a new product candidate suitable for pre-clinical or clinical trials or even commercialization.

 

We have entered into three addenda for our Patent License that extends the deadlines to meet the commercialization milestones. Failure to meet these extended milestone deadlines may result in termination of the license. Additionally, in the second addendum CytoMed agreed to take over responsibility for all patent prosecution maintenance costs beginning January 2022.

 

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Any patents that we have licensed from ATPL will expire, and when they expire, our business may be affected.

 

Our development of our product candidates is reliant on some of the technologies licensed to us pursuant to the patent licenses from ATPL as described in the section entitled “Intellectual Property”. When the patents licensed from ATPL, assuming they are issued from the pending patent applications reach the end of their lives, we may not be able to continue to preclude others from making, using or selling, any of our product candidates that are approved.

 

We may not be able to obtain and enforce our intellectual property rights throughout the world.

 

Filing, prosecuting, enforcing and defending the patents rights relating to our product candidates which have been licensed to us in every country in the world would likely be prohibitively expensive. ATPL is responsible for patent prosecution and maintenance costs in a limited number of countries and territories, and if we want to pursue protection in countries other than those for which ATPL is obligated, we will be responsible for the prosecution and maintenance costs. The extent of patent protection can vary in different countries. In addition, we have entered into three addenda for our Patent License that extends the deadlines to meet the commercialization milestones. Failure to meet these extended milestone deadlines may result in termination of the Patent License. Additionally, in the second addendum CytoMed agreed to take over responsibility for all patent prosecution and maintenance costs beginning January 2022.

 

The requirements for patentability may also differ in certain countries, particularly in developing countries; thus, even in countries where we do pursue patent protection, there can be no assurance that any patents will be issued by the relevant authorities in relation to our product candidates. Moreover, our ability to protect and enforce our intellectual property rights may be adversely affected by developments in international and foreign intellectual property legislation, regulations and policies.

 

Additionally, the laws of certain countries may not afford the same level of intellectual property protection as the laws of Singapore or other countries. Many companies have encountered significant problems in protecting and defending their intellectual property rights in certain foreign jurisdictions. It may be more difficult to enforce our patents license rights and other intellectual property rights in the legal systems of some countries, including India and China. This could make it difficult for us to obtain an injunction to stop third party infringement and/or misappropriation of our patents and/or our other intellectual property rights. For example, many foreign countries have compulsory licensing laws under which a patent owner must grant licenses to third parties. Consequently, we may not be able to prevent third parties from utilizing our technologies in certain countries outside Singapore or from selling or importing products made from our inventions in and into Singapore and/or other jurisdictions.

 

It is possible that competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop and market their own products and export such products to jurisdictions where we have patent protection, if our patent protection against infringement is not sufficiently robust. These products may compete with our product candidates, and our patents or other intellectual property rights may not be effective or sufficient to prevent them from competing with us. Further, our Patent License gives ATPL the right but not the obligation to prosecute and defend any and all infringements of any licensed patent that may issue. We are obligated to obtain ATPL’s consent to pursue enforcement of our licensed patents or defend any claims asserting the invalidity of these patents (or control of such enforcement or defense) of such patent rights in all relevant jurisdictions. Proceedings to enforce our patent rights, whether or not successful, could result in substantial costs and divert our efforts and resources from other aspects of our business.

 

Moreover, such proceedings could put any patents at issue in such proceedings at risk of being revoked, invalidated or interpreted narrowly and our licensed patent applications at risk of not being issued and could provoke third parties to assert claims against us. We may not be successful in any lawsuits or other patent office proceedings involving the licenses granted to us and the damages or other remedies awarded, if any, may not be sufficient to compensate us for our losses and expenses and/or otherwise be commercially meaningful. Furthermore, while we intend to seek to protect the patent rights under the license agreements granted to us and if necessary, enforce rights of any patents that issue, in major markets for our products, we cannot ensure that we will be able to initiate or maintain similar efforts in all jurisdictions in which we may wish to market our products, if approved. Accordingly, our efforts to protect our intellectual property rights in such countries may be inadequate.

 

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If our patent protection is not sufficiently robust, our competitors could develop and commercialize products and technology similar or identical to ours.

 

There is intense competition in the market for cell therapy, and the market is also subject to rapid technological change. Our business depends largely on our ability to maintain a competitive edge in the development and protection of technologies and products for use in these fields.

 

There have been several complex legal and factual questions relating to patents of biopharmaceutical companies which has, in recent years, been the subject of much litigation. As a result, there are considerable uncertainties relating to the issuance, scope, validity, enforceability and commercial value of our licensed patent rights. Our pending and future patent applications may not result in patents being issued that protect our technology or product candidates or effectively prevent others from commercializing similar or identical technologies and product candidates.

 

The process to seek and obtain patent protection is costly, time-consuming and complex, and we may not be able to file, prosecute, obtain, maintain, enforce or license all required or desirable patents or patent applications at a reasonable cost or in a timely manner. We may also fail to identify patentable aspects of our R&D output before it is too late to obtain patent protection.

 

There may be changes in the scope of patent claims before a patent is issued, and after issuance of the patent. Even if the patent applications we license issue as patents, the patents may not be in a form that will provide us with any meaningful protection, prevent competitors or other third parties from competing with us or otherwise provide us with any competitive advantage. Our competitors or other third parties may be able to circumvent our patents by developing similar or alternative products in a manner which does not infringe on our patents.

 

We may not identify relevant third-party patents or may incorrectly interpret the relevance, scope or expiration of third-party patents, which could materially and adversely affect our ability to develop, manufacture and market our product candidates.

 

There are many patents issued or applied for in the biopharmaceutical industry, and we may not be aware of patents or patent applications held by others which are relevant to our business and our product candidates.

 

Furthermore, after issuance of a patent, the scope of patent claims depends on an interpretation of the law, the written disclosure in a patent and the patent’s prosecution history. Our interpretation of the relevance or the scope of a patent or a pending application may be inaccurate, and we may incorrectly determine that our product candidates are not covered by a third-party patent or may incorrectly predict whether a third party’s pending application will issue with claims of relevant scope. Our determination of the expiration date of any patent in any relevant jurisdiction that we consider relevant may also be incorrect. If we fail to correctly identify or interpret the scope of third-party patents, we may be subject to infringement claims. We cannot guarantee that we will be able to successfully settle or otherwise resolve such infringement claims and/or lawsuits. If we fail in any such dispute, in addition to being forced to pay monetary damages, we may be temporarily or permanently prohibited from commercializing our product candidates. We may also be forced to attempt to redesign our product candidates in a manner that no longer infringes third-party intellectual property rights. Any of these events, even if we were ultimately to prevail, could require us to divert substantial financial and management resources that we would otherwise be able to devote to the development and commercialization of our product candidates.

 

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We may face claims for infringing, misappropriating or otherwise violating intellectual property rights of third parties or engaging in unfair competition, which would be expensive and time-consuming, and could hinder the successful development and/or commercialization our product candidates.

 

The success of our business is affected by our ability to develop, manufacture and market our technology and use our technology without infringing the proprietary rights of third parties. As the relevant pharmaceutical and biotechnology industries expand and more patents are issued, we face greater risks of patents being issued to third parties that relate to our product candidates and technology of which we are not aware or that we may need to circumvent or overcome to continue our business operations as currently contemplated. As a result, our technology and any future product candidates that we commercialize could be alleged to infringe patent rights and other proprietary rights of third parties, which may require costly litigation and, if we are not successful, could require us to pay substantial damages and/or limit our ability to commercialize our product candidates.

 

We may have to defend ourselves against litigation claims in which the scope, enforceability and validity of third-party proprietary rights are at issue, or to establish our proprietary rights. Regardless of whether any such claims that we are infringing patents or other intellectual property rights have merit, such claims can be time consuming, divert management attention and financial resources and are costly to evaluate and defend.

 

If a license is available from a third party who contends any product candidates for which we obtain approval infringe or misappropriate third party intellectual property rights, we may have to pay substantial license fees, annual minimum fees, royalties, upfront fees, or milestone fees, or grant cross-licenses to our intellectual property rights. We may also have to modify our product candidates so they do not infringe third-party intellectual property rights, which may not be possible or may require additional regulatory approvals, or substantial monetary expenditures and time, during which our product candidates may not be available for manufacture, use, or sale.

 

We may fail to identify unauthorized use of our intellectual property and enforce our intellectual property rights against infringement, and may incur substantial costs as a result of bringing litigation or other proceedings to protect our intellectual property rights.

 

Identifying unauthorized use of our intellectual property is challenging and expensive. From time to time, we will review products from our competitors to determine potential infringement of our rights if any. We may not be able to identify unauthorized use of, or take appropriate steps to enforce, our intellectual property rights. Any failure by us to identify any unauthorized use of our intellectual property rights by third parties could result in competitors offering products that incorporate our product features, which could in turn reduce demand for our products.

 

We may also, from time to time, seek to enforce our intellectual property rights against infringers when we determine that a successful outcome is probable and may result in an increase in the value of our intellectual property.

 

If we or our licensor choose to enforce our licensed patent rights against a party, we or our licensor may face a counterclaim that our patent is invalid and/or unenforceable. Our patents may be challenged in legal proceedings. Proceedings to challenge patents are also available internationally, including, for example, opposition proceedings and nullity actions. In general, grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness or non-enablement. Grounds for an unenforceability assertion may include an allegation that someone connected with the prosecution of the patent withheld relevant information, or made a misleading statement, during prosecution. Third parties may also raise similar claims, even outside the context of litigation. We are unable to predict the outcome of litigation suits. With respect to the validity question, for example, we cannot guarantee that there is no invalidating prior art, of which we and the patent examiner were unaware during prosecution. If a defendant were to prevail on a legal assertion of invalidity and/or unenforceability, we may lose at least part, and perhaps all, of the patent protection on our product candidates.

 

In addition, such lawsuits and proceedings are costly and would take up considerable time and resources and divert the attention of managerial and scientific personnel from our business operations even if we were successful in preventing the infringement of such patents. Litigation is inherently unpredictable, and there is a risk that the court will decide that such patents are not valid and that we do not have the right to stop the other party from using the technologies. Furthermore, some of our competitors have significantly greater resources and thus may be able to sustain the costs of complex patent litigation more effectively than us. There is also the risk that, even if the validity of such patents is upheld, the court will refuse to grant an injunction against the other party on the ground that there is no infringement of our intellectual property rights.

 

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There could also be public announcements of the results of hearings, motions or other interim proceedings or developments, and if securities analysts or investors perceive these results negatively on us, it could materially adversely affect the price of our ordinary shares. Additionally, any uncertainties resulting from the initiation and continuation of any litigation could materially and adversely affect our ability to raise the funds necessary to continue our operations.

 

Developments in U.S. patent law or the patent law of other jurisdictions present uncertainties in our ability to obtain patents and diminish the value of patents in general, thereby affecting our ability to protect our current and any future product candidates.

 

The U.S. Supreme Court and the Court of Appeals for the Federal Circuit have made, and will likely continue to make, changes in how the patent laws of the United States are interpreted. For example, in recent years, the U.S. Supreme Court has modified certain tests used by the USPTO in awarding patents, which may reduce our chances of obtaining the requisite patents and increase the likelihood of a challenge of any patents we obtain or license. Similarly, there have been international developments in how the patent laws in their respective jurisdictions are interpreted. Those changes, as well as any future changes, may materially and adversely affect our patent rights and our ability to obtain issued patents.

 

Developments in either the patent laws or interpretation of the patent laws in the United States could result in greater uncertainties and costs surrounding the prosecution of patent applications and the enforcement or defense of issued patents. Under the Leahy-Smith America Invents Act, or the America Invents Act, assuming that all other conditions for patentability are satisfied, the first inventor to file a patent application will be entitled to the patent on an invention regardless of whether a third party was the first to invent the claimed invention.

 

The America Invents Act also includes a number of significant changes that affect the prosecution of patent applications and patent litigation. These include allowing third-party submission of prior art to the USPTO during patent prosecution and additional procedures to attack the validity of a patent by USPTO-administered post-grant proceedings, including post-grant review, inter partes review and derivation proceedings. The implementation of the America Invents Act could result in greater uncertainties and expenses relating to the prosecution of our patent applications and the enforcement or defense of patents issued therefrom, all of which could materially and adversely affect our business, financial condition, results of operations and growth prospects.

 

Further, the U.S. Supreme Court has made judgments on several patent cases in recent years, with a trend towards either narrowing the scope of patent protection available in certain circumstances or weakening the rights of patent owners in certain situations. This results in greater uncertainty with respect to the value of patents, if and once obtained. Depending on actions by the U.S. Congress, the federal courts and the USPTO, the laws and regulations governing patents could change in unpredictable ways that could weaken our ability to obtain new patents or to enforce patents. Similarly, developments in patent law and regulations in other countries or jurisdictions, changes in the enforcement authorities or changes in how the relevant governmental authority enforces patent laws or regulations may weaken our ability to obtain new patents or to enforce patents, which in turn could materially adversely affect our business, financial condition, results of operations and growth prospects.

 

We may fail to obtain or enforce assignments of intellectual property rights from our employees and contractors.

 

Although we generally require our employees and contractors who may be involved in the conception or development of intellectual property to execute agreements assigning all such intellectual property to us, we may fail to obtain an enforceable agreement with each party who in fact conceives or develops intellectual property that we regard as our own. Furthermore, our assignment agreements may be breached, and we may be forced to bring or defend claims to determine the ownership of what we regard as our intellectual property, and we may not be successful in such claims. If we fail in any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights which could materially and adversely affect our business, financial condition, results of operations and growth prospects. Even if we are successful in defending against such claims, litigation could result in substantial costs and diversion of management’s and other employees’ attention from our business operations.

 

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If we fail to prevent disclosure of trade secrets and other proprietary information, the value of our technology and products could be materially diminished.

 

We may face difficulties in protecting our trade secrets from being disclosed or shared with third parties. We rely on trade secrets to protect our proprietary information and technologies, especially where we do not believe patent protection is appropriate or obtainable, or where the enforcement of such patents would be challenging. We rely in part on confidentiality agreements with our employees, consultants, contractors, outside scientific collaborators and other advisors to protect our trade secrets and other proprietary information. We cannot guarantee that we have entered into such agreements with each party that may have had access to our proprietary information or technologies, or that such agreements, even if in place, will not be circumvented. These agreements may not effectively prevent disclosure of proprietary information or technology and may not provide an adequate remedy in the event of unauthorized disclosure of such information or technology. In addition, others may independently discover our trade secrets and proprietary information, in which case we may have no right to prevent them from using such trade secrets or proprietary information to compete with us. We may need to engage in expensive and time-consuming litigation to enforce and determine the scope of our proprietary rights. Our failure to obtain or maintain trade secret protection could materially and adversely affect our business, financial condition, results of operations and growth prospects.

 

RISKS RELATED TO COMMERCIALIZATION

 

We have no experience as a company in obtaining regulatory approval for a drug.

 

As a company, we have not yet obtained regulatory approval for, or commercialized, any drug as of the date of this Prospectus. It is possible that the HSA and/or other relevant health and regulatory authorities may refuse to accept any or all of our planned NDAs for substantive review or may conclude after review of our data that our application is insufficient to obtain regulatory approval for any current or future product candidates. If the HSA and/or other relevant health and regulatory authorities does not approve any of our planned NDAs, we may need to conduct additional costly clinical, non-clinical or manufacturing validation studies before the HSA will reconsider our application(s). Depending on the extent of these or any other HSA and/or other relevant health and regulatory authorities-required studies, approval of any NDA or other application that we submit may be significantly delayed, possibly for several years, or may require us to expend more resources than we have available. Any failure or delay in obtaining regulatory approvals would prevent us from commercializing any of our product candidate, generating revenues and achieving and sustaining profitability. It is also possible that additional studies, if performed and completed, may not be considered sufficient by the HSA and/or other relevant health and regulatory authorities to approve any NDA or other application that we submit. If any of these outcomes occur, we may be forced to abandon the development of our product candidates, which would materially adversely affect our business and could potentially cause us to cease operations. We may face similar risks for our applications in foreign jurisdictions.

 

If any of our product candidates are approved for marketing and commercialization and we have not developed or secured third-party marketing, sales and distribution capabilities, we will be unable to successfully commercialize such products and may not be able to generate product revenue.

 

We currently do not have any sales, marketing or distribution organizational experience or capabilities. We will need to develop internal sales, marketing and distribution capabilities to commercialize any product candidate to obtain regulatory authority approval, which would be costly and time-consuming, or enter into partnerships with third parties to achieve the same. If we decide to directly market any approved products, we will have to invest substantial financial and managerial resources in a marketing and sales team with technical expertise and supporting distribution, administration and compliance capabilities. If we rely on third parties to market products or decide to co-promote products with partners, we will need to establish and maintain marketing and distribution arrangements with third parties, and there can be no assurance that we can enter into such arrangements on acceptable terms or at all. In entering into third-party marketing or distribution arrangements, any product revenue is contingent on the efforts of the third parties and we cannot guarantee that such third parties will establish adequate sales and distribution capabilities or be successful in gaining market acceptance for any approved product. If we fail to commercialize any product approved in the future, if any, either on our own or through third parties, our business, financial condition, results of operations and growth prospects could be materially adversely affected.

 

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If we fail to establish biopharmaceutical collaborations on commercially reasonable terms, or at all, we may have to change our development and commercialization plans.

 

The advancement of our product candidates and development programs and the potential commercialization of our current and future product candidates will require substantial additional financing. For some of our programs, we may partner with pharmaceutical and biotechnology companies to develop and commercialize such product candidates. Any such collaborations may incur non-recurring and other charges, increase our near and long-term expenditures, require us to issue securities that dilute our existing shareholders, or disrupt our management and business.

 

We face intense competition in seeking appropriate strategic partners and the negotiation process is time-consuming and complex. Any definitive agreement for other partnerships is contingent, among other things, on our assessment of the collaborator’s resources and expertise, the terms and conditions of the proposed collaboration and the proposed collaborator’s evaluation of a number of factors, including the design or results of clinical trials, the progress of our clinical trials, the likelihood of approval by the relevant regulatory authorities, the potential market for the subject product candidate, the costs and complexities of manufacturing and delivering such product candidate to patients, the potential of competing products, the existence of uncertainty with respect to our ownership of technology, which can exist if there is a challenge to such ownership without regard to the merits of the challenge and clinical trial industry and market conditions generally. The collaborator may also consider alternative product candidates or technologies for similar clinical trial indications that may be available to collaborate on and whether such a collaboration could be more attractive than the one with us for our product candidates. Further, we may fail to enter into a strategic partnership or other alternative arrangements for future product candidates because they may be deemed to be premature for collaborations and third parties may not be satisfied with the level of safety and efficacy of our product candidates. Any delays in entering into new collaborations or strategic partnership agreements related to any product candidate we develop could hinder the development and commercialization of our product candidates, which would materially and adversely affect our business prospects, financial condition, and results of operations.

 

We have entered enter into collaborations with third parties to develop or commercialize our product candidates, our prospects with respect to those product candidates will depend significantly on the success of those collaborations.

 

The risks of our present and future collaboration with third parties to develop and/or commercialize our product candidates include without limitation:

 

  collaborators have significant discretion in determining the efforts and resources that they will apply to these collaborations;
  collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our products or product candidates;
  our agreements with collaborators include agreements that may not provide us with sole ownership of all intellectual property rights resulting from the collaborations and do not address all issues that may arise from joint ownership;
  current and future collaboration agreements may not provide us with sufficient ownership or control of all intellectual property rights;
  collaborators may not properly enforce, maintain or defend our intellectual property rights or may use our proprietary information in a way that gives rise to actual or threatened litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation, or other intellectual property proceedings;
  disputes may arise between a collaborator and us that cause the delay or termination of the research, development or commercialization of the product candidates, or that result in costly litigation or arbitration that diverts management attention and resources;
  if a present or future collaborator of ours were to be involved in a business combination, the continued pursuit and emphasis on our product development or commercialization program under such collaboration could be delayed, diminished or terminated;
  collaboration agreements may restrict our right to pursue new product candidates; and
  we may become involved in disputes over the terms of our collaboration agreements and intellectual property rights generated from our collaborations.

 

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In the event of disagreements and/or conflicts between our collaborators and us, our collaborators may act in a hostile and/or vexatious manner which could hinder the implementation of our strategies. Future collaborators may develop, either alone or with others, products in related fields that are competitive with our products or potential products that are the subject of these collaborations. Competing products, either developed by the collaborators or to which the collaborators have rights, may result in the withdrawal of support for our product candidates. Non-competition clauses in our agreements with our collaborators may prevent us from entering into collaborations with their competitors and/or being able to obtain timely regulatory approvals. Our collaborators may also terminate their agreements with us prematurely and/or fail to devote sufficient resources to the development and commercialization of products. Any of these events could hinder and severely undermine our product development efforts.

 

As a result, if we enter into collaboration agreements and strategic partnerships or out-license our intellectual property, products or businesses, we may not be able to realize the benefit of such transactions if we are unable to successfully integrate them with our existing operations, which could delay our timelines or otherwise adversely affect our business. We also cannot be certain that, following a strategic transaction or license, we will be able to achieve a level of revenue or specific net income that justifies such transaction.

 

Our product candidates could be subject to regulatory limitations following approval, if such approval is granted.

 

Subsequent to obtaining approval of a product candidate, if any, we must adhere to all applicable government legislation and regulations regarding the manufacture, labeling, marketing, distribution and promotion of biologic products, which are subject to change from time to time. We must adhere to labeling protocols of HSA and/or other relevant regulatory authorities, which prohibit promoting “off-label uses”. We may not be able to obtain the labeling claims necessary or desirable to successfully commercialize our products, including CTM-N2D, iPSC-gdNKT, CTM-GDT or other product candidates in development from time to time.

 

The HSA and/or other relevant regulatory authorities could impose substantial restrictions on the use of an approved product including restricting its use to limited clinical centers as well as through the product label, as well as on advertising, promotional and distribution activities associated with such approved product. The HSA and/or other relevant regulatory authorities could also condition their approval on the performance of post-approval clinical trials, patient monitoring or testing, which could be time-consuming and expensive. If the results of such post-marketing trials are not satisfactory, the HSA and/or other relevant regulatory authorities could withdraw marketing authorization or may impose conditions on continued marketing and/or impose or require further commitments from us or our partners that may be expensive and/or time-consuming to fulfill.

 

In addition, if side effects are identified after any of our products are on the market, if manufacturing problems occur subsequent to regulatory approval, or if we, our manufacturers or our partners fail to comply with regulatory requirements, including those mentioned above, we or our partners could be subject to the following:

 

  restrictions on our ability to conduct clinical trials, including full or partial clinical holds on ongoing or planned clinical trials;
  restrictions on such products’ manufacturing processes;
  changes to the product label;
  restrictions on the marketing of a product;
  restrictions on product distribution;
  requirements to conduct post-marketing clinical trials;
  warnings from the regulatory authority;
  withdrawal of the product from the market;
  refusal to approve pending applications or supplements to approved applications that we submit;
  recall of products;
  fines, restitution or disgorgement of profits or revenue;
  suspension or withdrawal of regulatory approvals;
  refusal to permit the import or export of our products;
  product seizure;
     
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  injunctions; and/or
  imposition of civil or criminal penalties.

 

Any one or a combination of the above could obstruct market acceptance of the affected product, or could substantially increase the costs and expenses of commercializing such product, which in turn could delay or prevent us from generating any revenue or profit from the sale of such product and could materially and adversely affect our business, financial condition, results of operations and growth prospects.

 

A summary of the material regulations in Singapore and Malaysia applicable to our operations to our knowledge are set out in the section titled “Regulation”. However, as the biopharmaceutical industries in Singapore and Malaysia are only being regulated in recent times, there is a possibility that the biopharmaceutical industries may become more heavily regulated and we may be subject to further legislative, regulatory and compliance requirements.

 

Our product candidates could be subject to more stringent limitations and procedures imposed by third-party users, including hospitals, than those imposed by regulatory authorities.

 

Even if we manage to obtain the necessary licenses, permits and approvals for our products, we may also be required to comply with policies, limitations and other procedures imposed by third-party users, including hospitals, of our products. Such policies, limitations and other procedures may change from time to time, depending on factors including but not limited to perceived risks and benefits of our products, public sentiment towards the biopharmaceutical industries and relevant government legislation, regulations and policies. This may restrict the distribution of our products and/or increase our compliance costs, which may materially and adversely affect our financial performance and financial condition.

 

There may be limited market opportunities for our product candidates, if approved, and if such market opportunities are smaller than we anticipated, our revenues and business could be materially and adversely affected.

 

Cancer therapies are sometimes categorized as first-line, second-line, or third-line, and the regulatory authorities often approve new therapies initially only for third-line use. When cancer is detected early enough, first-line therapy, usually chemotherapy, hormone therapy, surgery, radiation therapy or a combination of these, may be sufficient as a cure for cancer. Second and third-line therapies are administered to patients when prior therapy is not effective. Our initial planned clinical trials are expected to enroll patients who have received these standard therapies in order to first evaluate whether the product is safe and whether there is any anti-cancer activity. We currently are unable to ascertain whether CTM-N2D, iPSC-gdNKT and CTM-GDT will be safe for use in humans and whether CTM-N2D, iPSC-gdNKT and CTM-GDT will demonstrate any anti-cancer activity. Subsequently, we plan to conduct additional clinical trials depending on the anti-cancer activity we note in the initial clinical trials. If the anti-cancer activity is sufficient, we may initially seek approval of any product candidates we develop as a therapy for patients who have received one or more prior standard therapies. Subsequently, for those products that prove to be sufficiently beneficial, if any, we would expect to seek approval potentially in earlier lines of therapy, but there is no guarantee that product candidates we develop, even if approved for later lines of therapy, would be approved for earlier lines of therapy, and, prior to any such approvals, we may have to conduct additional clinical trials.

 

There may not be as many patients who have the type of cancers we are targeting. Additionally, the potentially addressable patient population for our current or future product candidates may be limited. Potentially addressable patient populations for our product candidates are only estimates. These estimates could prove to be inaccurate as there may not be as many potential patients in Singapore and elsewhere as estimated. It may also be that such patients may not be otherwise amenable to treatment with our product candidates, or suitable patients could become increasingly difficult to identify and access, any of which could materially and adversely affect our business, financial condition, results of operations and growth prospects.

 

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The commercial success of any of our product candidates will depend upon such product candidate’s level of market acceptance by physicians, patients, third-party payors and others in the medical community.

 

Even if requisite approvals are obtained from HSA and/or other regulatory authorities, the commercial success of our product candidates will depend, in part, on the acceptance by physicians, patients and healthcare payors of cell therapy products in general, and our product candidates in particular, as medically necessary, cost-effective and safe. Physicians, patients, healthcare payors, professionals and others in the medical community may not approve of any product candidates that we commercialize. If these products do not achieve an adequate level of acceptance, we may not generate significant product revenue and may not become profitable. The degree of market acceptance of cell therapy products and, in particular, our product candidates, if approved for commercial sale, will depend on several factors, including without limitation:

 

  the efficacy and safety of such product candidates as demonstrated in clinical trials;
  the potential and perceived advantages of product candidates over alternative treatments;
  the cost of treatment relative to alternative treatments;
  the clinical trial indications for which the product candidate is approved by the HSA and/or other relevant regulatory authorities;
  the willingness of physicians to prescribe new therapies;
  the willingness of the target patient population to try new therapies;
  the prevalence and severity of any side effects;
  product labeling or product insert requirements imposed by HSA and/or other relevant regulatory authorities, including any limitations or warnings contained in a product’s approved labeling;
  relative convenience and ease of administration;
  the timing of market introduction of competitive products;
  adverse publicity concerning our product candidates or favorable publicity about competing products and treatments;
  sufficient third-party payor coverage, any limitations in terms of center or personnel training requirement imposed by third parties and adequate reimbursement;
  limitations or warnings contained in the regulatory authority-approved labeling for our product candidates;
  any regulatory authority requirement to undertake a risk evaluation and mitigation strategy;
  the effectiveness of our sales, marketing and distribution efforts; and
  potential product liability claims.

 

Even if a product candidate displays a favorable efficacy and safety profile in pre-clinical studies and clinical trials, market acceptance of the product will not be fully known until after such product is launched. Our product candidates may not achieve broad market acceptance.

 

Furthermore, the policies of HSA and/or other relevant regulatory authorities may change and additional government regulations may be enacted that could prevent, limit or delay marketing approval of a product. We cannot determine the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in Singapore or abroad. If we are late or fail to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we fail to maintain regulatory compliance, we may lose any marketing approval that we may have previously obtained and as a result, we may not be able to achieve or sustain profitability.

 

There are several uncertainties relating to the insurance coverage and reimbursement status of newly approved products on the market. Failure to obtain or maintain adequate coverage and reimbursement for our product candidates, if approved, could hinder our ability to market such products and to generate product revenue.

 

The expenses incurred as a result of the administration of any of our cell therapy product candidates is anticipated to be significant, when and if regulatory approval is obtained. We expect that coverage and reimbursement by government and private payors will be essential for most patients to be able to afford these treatments. Accordingly, sales of our products, if approved, will depend substantially, both domestically and internationally, on the extent to which the costs of our product candidates will be reimbursed by government authorities, private health coverage insurers and/or other third-party payors. Coverage and reimbursement by a third-party payor could depend upon several factors, including the third-party payor’s determination that use of our product is (i) a covered benefit under its health plan, (ii) safe, effective and medically necessary, (iii) appropriate for the specific patient, (iv) cost-effective and (v) neither experimental nor investigational.

 

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Obtaining coverage and reimbursement for a product from third-party payors is a time-consuming and expensive process that could require us to provide supporting scientific, clinical and cost-effectiveness data. We may not be able to provide adequate data to obtain acceptance with respect to coverage and reimbursement. If coverage and reimbursement are not available, or are available only at limited levels, we may fail to successfully commercialize our product candidates. Even if coverage is provided, the approved reimbursement amount may not be sufficient to generate a sufficient return on our investment.

 

There is significant uncertainty relating to third-party coverage and reimbursement of newly approved drug products and/or treatments.

 

Outside of Singapore, international operations may vary significantly by country and our products may be subject to extensive government price controls and other market regulations. Increasing focus on cost-containment initiatives in the European Union, Canada and other countries could result in pricing pressure. In many countries, the prices of medical products are governed by several price control mechanisms as part of national health systems. The post-approval process to secure pricing and reimbursement for a product may be time-consuming depending on the country. In general, the prices of medical and therapeutic products under such systems may be substantially lower than in Singapore. Other countries allow companies to fix their own prices for such products, but monitor and control company profits. Additional foreign price controls or other changes in pricing regulation could restrict the amount that we are able to charge for our product candidates. Accordingly, in markets outside Singapore, the reimbursement for our products may be lower than that of Singapore and may be insufficient to generate commercially viable and sustainable product revenues and profits.

 

Moreover, any efforts by government and third-party payors in Singapore and abroad to limit and/or reduce healthcare costs could limit coverage and the level of reimbursement for our product candidates.

 

There is no certainty that the medical costs of our treatment for suitable patients will be covered by insurance. As our product candidates are novel, the treatment and medical costs may not be covered by medical and/or hospitalization insurances obtained by these patients. If so, the costs of treatment with our product candidates may be prohibitively high, and deter suitable patients from seeking help resulting in a low take-up rate for our product candidates. This will materially and adversely affect our business, growth and future prospects of our Group.

 

Healthcare reform initiatives and other administrative and legislative proposals may affect our business.

 

We cannot anticipate the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action in Singapore, Malaysia and/or any other relevant jurisdiction. If we or any third parties we may engage are late or fail to adapt to developments in existing requirements or the adoption of new requirements or policies, or if we or such third parties are not able to maintain regulatory compliance, our product candidates may lose any regulatory approval that may have been previously obtained and we may not achieve or sustain profitability. Furthermore, future price controls or other changes in pricing regulation or negative publicity related to the pricing of cell therapy products could restrict the amount that we are able to charge for our cell therapy products, which could render our product candidates, if approved, commercially unviable and materially and adversely affect our ability to raise additional capital on acceptable terms.

 

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Obtaining and maintaining marketing approval or commercialization of our product candidates in one jurisdiction does not mean that we will be successful in obtaining marketing approval of our product candidates in other jurisdictions.

 

Approval procedures are different among different jurisdictions and can involve requirements and administrative review periods significantly different from, and more extensive than, those in Singapore, Malaysia and/or other relevant jurisdictions including additional pre-clinical studies or clinical trials as clinical trials conducted in one jurisdiction may not be accepted by regulatory authorities in other jurisdictions. In many jurisdictions outside Singapore, Malaysia and/or other relevant jurisdictions, a product candidate must be approved for reimbursement before it can be approved for sale in that jurisdiction. In some cases, we may have to obtain approval for the prices that we intend to charge for our products.

 

If we market products approved in jurisdictions outside Singapore, Malaysia and/or other relevant jurisdictions, we expect that we will be subject to additional risks in commercialization, including without limitation:

 

  variations in regulatory requirements for approval of therapies in different jurisdictions;
  decreased scope of protection of intellectual property rights;
  unanticipated changes in tariffs, trade barriers and other regulatory requirements;
  economic weakness, including inflation, or political instability in particular foreign economies and markets;
  compliance with tax, employment, immigration and labor laws for employees living or traveling abroad;
  foreign currency fluctuations, which could result in increased operating expenses and reduced revenues, and other obligations incident to doing business in another country;
  foreign reimbursement, pricing and insurance regimes;
  workforce uncertainty in countries where labor unrest is more common;
  production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; and
  business interruptions resulting from geopolitical actions, including war and terrorism, natural disasters including earthquakes, typhoons, floods and fires, and other public health crises, illnesses, epidemics or pandemics, such as the potential impact of the COVID-19 pandemic.

 

We do not have any prior experience in these areas. Any of the foregoing difficulties, if encountered, could materially and adversely affect our business, financial condition, results of operations and growth prospects.

 

RISKS RELATED TO OUR ORDINARY SHARES AND THIS OFFERING

 

There has been no public market for our ordinary shares prior to this offering, and you may not be able to resell our shares at or above the price you paid, or at all.

 

We have applied to list our ordinary shares on the Nasdaq, but we cannot guarantee an active trading market for our ordinary shares following this offering. If an active trading market for our ordinary shares does not develop after this offering, the market price and liquidity of our ordinary shares will be materially and adversely affected. You may not be able to sell your shares quickly or at the market price in this case. Negotiations between us and the underwriters will determine the offering price for our ordinary shares and the offering price may bear no relationship to the market price for our ordinary shares after this offering. In addition, the market price of our ordinary shares may decline below the offering price. Furthermore, an inactive market may also impair our ability to raise capital by selling shares of our ordinary shares and may impair our ability to enter into strategic partnerships or acquire companies or products by using our shares of ordinary shares as consideration.

 

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The market price for our ordinary shares may be volatile, which could contribute to the loss of all or part of your investment.

 

Prior to this offering, there has not been a public market for our ordinary shares. Accordingly, the initial public offering price for our ordinary shares may not be indicative of the price that will continue to prevail in the trading market, if any, following this offering. Assuming that there is an active market for our ordinary shares, the trading price of our ordinary shares following this offering is likely to be highly volatile and could be subject to wide fluctuations in response to various factors, some of which are beyond our control.

 

Factors affecting the trading price of our ordinary shares may include, but are not limited to:

 

  our decision on whether or not to initiate a clinical study or to terminate an existing clinical study;
  adverse regulatory decisions, including failure to receive regulatory approval for our products;
  success or failure of competitive products, immunotherapy or cellular therapies more generally;
  adverse developments concerning our manufacturers or our strategic partnerships;
  adverse safety or other clinical results, such as those that have occurred in the past or that may occur in the future, related to cellular therapies being developed by other companies that are or may be perceived to be similar to our cellular therapies;
  operating and share price performance of other companies that investors deem comparable to us;
  sales of substantial amounts of ordinary shares by our Directors, executive officers or significant shareholders or the perception that such sales could occur;
  general economic and political conditions such as recessions, interest rates, fuel prices, elections, drug pricing policies, international currency fluctuations, acts of war or terrorism, and other public health crises, illnesses, epidemics or pandemics, such as the potential impact of the COVID-19 pandemic; and
  other factors discussed in these risk factors.

 

Any of or a combination of the above factors could materially and adversely affect your investment in our ordinary shares, and our ordinary shares may trade at prices significantly below the initial public offering price, which could contribute to a loss of all or part of your investment. In such circumstances the trading price of our ordinary shares may not recover and may experience a further decline.

 

In addition, broad market and clinical trial industry factors could materially and adversely affect the market price of our ordinary shares, irrespective of our operating performance. The stock market in general, and Nasdaq and the market for biopharmaceutical companies in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the particular companies affected. We cannot predict the trading prices and valuations of these stocks, and of ours. For example, the trading prices for common stock of other biopharmaceutical and biotechnology companies have been highly volatile as a result of the COVID-19 pandemic. As the COVID-19 pandemic continues to rapidly evolve, the extent to which the outbreak may impact our business, pre-clinical studies and clinical trials is contingent on future developments, which are highly uncertain and cannot be accurately predicted. We may face a loss of investor confidence in the market for biopharmaceutical stocks or the stocks of other companies which investors perceive to be similar to us, the opportunities in the biopharmaceutical market or the stock market in general, which may decrease our share price regardless of our business, financial condition, results of operations or growth prospects.

 

We may face securities class action litigation.

 

In the past, securities class action litigation has often been brought against a company following a period of volatility or decline in the market price of its securities. We are likely to face this risk as pre-clinical biopharmaceutical companies have experienced significant share price volatility in recent years. If we face such litigation, we may have to pay substantial costs (including legal costs) and this would also require a diversion of management’s attention and resources, which could materially and adversely affect our business, financial condition, results of operation and growth prospects.

 

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If securities analysts do not publish research or reports about our business or if they publish negative reports or downgrade our shares, the price of our ordinary shares could decline.

 

The trading market for our ordinary shares will rely in part on the research and reports that financial analysts publish about us, our business, our markets and our competitors. We have no control over the research and reports that these financial analysts publish. If we and our ordinary shares are not discussed by securities analysts after the consummation of this offering, this may materially and adversely affect the market price of our ordinary shares. Furthermore, if any securities analyst chooses to downgrade our shares or issue unfavorable commentary on us or our business, our share price would likely decline. If one or more of these security analysts ceases coverage of us or fails to regularly publish reports on us, we could lose visibility in the market and interest in our ordinary shares could decrease, which in turn could cause our share price or trading volume to decline and may also impair our ability to expand our business with existing customers and attract new customers.

 

You will experience immediate and substantial dilution in the net tangible assets of the shares you purchase in this offering.

 

If you purchase our ordinary shares in this offering, you will experience immediate and substantial dilution, as the initial public offering price of our ordinary shares will be substantially greater than the net tangible assets per share of our ordinary shares.

 

Assuming (i) an initial public offering price of U.S.$ 4.50 per share, the midpoint of the price range set forth on the cover page of this Prospectus, (ii) that the number of shares offered by us, as set forth on the cover page of this Prospectus, remains the same and (iii) no exercise of the underwriters’ option to purchase additional shares, if you purchase our ordinary shares in this offering, you will suffer immediate and substantial dilution of approximately U.S.$3.39 per share. Further, giving effect to the same assumptions, investors purchasing ordinary shares in this offering will contribute approximately 58.60% of the total amount invested by shareholders since our incorporation, but will own only approximately 21.03% of the ordinary shares outstanding after giving effect to this offering. If the underwriters exercise their option to purchase additional shares, or if outstanding options to purchase our ordinary shares are exercised, you will experience additional dilution. For a further description of the dilution that you will experience immediately after this offering, please refer to the section entitled “Dilution”.

 

A significant portion of our total outstanding shares are eligible to be sold into the market in the near future, which could cause the market price of our ordinary shares to drop significantly.

 

Sales of a substantial number of shares of our ordinary shares in the public market, or the perception in the market that the holders of a large number of shareholders intend to sell ordinary shares, could reduce the market price of our ordinary shares. Following consummation of this offering, we will have 11,468,642 ordinary shares outstanding, based on the number of ordinary shares outstanding as of the date of this Prospectus and assuming conversion of all outstanding convertible loans into ordinary shares. This is inclusive of our shares offered in this offering, which may be resold in the market immediately without any restrictions, unless purchased by our affiliates. In addition, 1,337,631 ordinary shares may be sold without restriction under Rule 144 of the Securities Act and are not subject to any contractual restrictions. Substantially all of the remaining 7,718,642 ordinary shares will be restricted as a result of securities laws, market standoff provisions or lock-up agreements, but will become eligible to be sold after this offering as described in the section titled “Shares Eligible for Future Sale”.

 

We also intend to register all ordinary shares subject to equity awards issued or reserved for future issuance under our equity compensation plans on a registration statement on Form S-8. Once we register these shares, they can be freely sold in the public market upon issuance, subject to volume limitations applicable to affiliates under Rule 144 under the Securities Act and the market standoff provisions and lock-up agreements described above. Any sales of securities by these shareholders could have a negative impact on the trading price of our ordinary shares.

 

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Concentration of ownership of our ordinary shares among our existing Directors, executive officers, and principal shareholders may prevent new investors from influencing significant corporate decisions.

 

Following this offering, our Directors and executive officers, and entities affiliated with them, as well as holders of more than 5% of our outstanding ordinary shares, in the aggregate will beneficially own a percentage of our ordinary shares, after giving effect to the issuance of ordinary shares in this offering but without giving effect to any purchases by such persons or entities in the offering. These shareholders, acting together, will be able to control or significantly influence resolutions requiring shareholder approval, including the election and removal of our Directors and approval of any merger, consolidation or sale of all or substantially all of our assets. Some of these persons and entities may have an interest in purchasing additional ordinary shares in this offering, which would increase their ownership percentage.

 

Some of these persons or entities may have interests different from yours. For example, because many of these shareholders purchased their shares at prices substantially below the price at which shares are being sold in this offering and have held their shares for a longer period, they may be more interested in selling our company to an acquirer than other investors, or they may want us to pursue strategies that deviate from the interests of other shareholders.

 

We are an “emerging growth company” under the JOBS Act, and a “smaller reporting company” as of the date of this Prospectus and we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. As a result of the reduced disclosure and governance requirements applicable to emerging growth companies and smaller reporting companies, our ordinary shares may be less attractive to investors.

 

We intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding an advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

 

We intend to take advantage of these reporting exemptions until we are no longer an “emerging growth company”. We are expected to remain as an “emerging growth company” until the earlier of: (1) the last day of the financial year following the fifth anniversary of the consummation of this offering; (2) the last day of the financial year during which we have total annual gross revenue of at least U.S.$1.235 billion or (3) the date on which we are deemed to be a “large accelerated filer” under the rules of the SEC, which means the market value of our ordinary shares that is held by non-affiliates is of U.S.$700 million or more as of the prior June 30; and (4) the date on which we have issued more than U.S.$1 billion in non-convertible debt during the prior three-year period.

 

We have taken advantage of reduced reporting requirements in this Prospectus. In particular, in this Prospectus, we have not included all of the executive compensation related information that would be required if we were not an “emerging growth company”. In addition, Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. An “emerging growth company” can, therefore, delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have an irrevocable election to take advantage of the benefits of this extended transition period.

 

We are also a “smaller reporting company” as of the date of this Prospectus, meaning that the market value of our ordinary shares held by non-affiliates plus the proposed aggregate amount of gross proceeds to us as a result of this offering is less than U.S.$700 million and our annual revenue is less than U.S.$100 million during the most recently completed financial year. We may continue to be a “smaller reporting company” after consummation of this offering if either (i) the market value of our ordinary shares held by non-affiliates is less than U.S.$250 million or (ii) our annual revenue is less than U.S.$100 million during the most recently completed financial year and the market value of our ordinary shares held by non-affiliates is less than U.S.$700 million. Even after we no longer qualify as an emerging growth company, we may still qualify as a “smaller reporting company”, which would allow us to take advantage of many of the same exemptions from disclosure requirements, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and reduced disclosure obligations regarding executive compensation in this Prospectus and in our periodic reports and proxy statements. We cannot predict if investors will find our shares less attractive if we rely on such exemptions. If some investors find our shares less attractive as a result, there may be a less active trading market for our shares and our share price may be more volatile.

 

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We are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempted from certain provisions applicable to U.S. domestic public companies.

 

Because we qualify as a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the securities rules and regulations in the United States that are applicable to U.S. domestic issuers, including:

 

  the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q or current reports on Form 8-K;
  the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered under the Exchange Act;
  the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and
  the selective disclosure rules by issuers of material nonpublic information under Regulation FD.

 

We will be required to file an annual report on Form 20-F within four months of the end of each financial year. Press releases relating to financial results and material events will also be furnished to the SEC on Form 6-K. However, the information we are required to file with or furnish to the SEC will be less extensive and less timely compared to that required to be filed with the SEC by U.S. domestic issuers. As a result, you may not be afforded the same protections and/or information that would be made available to you if you were investing in a U.S. domestic issuer.

 

We will have significant operating expenditures as a public company, and our management will be required to devote substantial time and effort to planning and implementing new compliance initiatives.

 

As a public company, we expect to have significant legal, accounting and other expenditure (including related insurance) that we did not previously incur as a private company. In addition, the Sarbanes-Oxley Act and rules of the SEC and those of Nasdaq have imposed various requirements on public companies including that we establish and maintain effective disclosure and financial controls. Our management and other personnel will need to devote a substantial amount of time and effort to planning and implementing these compliance initiatives. Moreover, these rules and regulations have increased and will continue to increase our legal and financial compliance costs and will make some activities more laborious, time-consuming and expensive.

 

The Sarbanes-Oxley Act requires, among other things, that we maintain effective internal controls over financial reporting and disclosure controls and procedures. In particular, we are required to assess our systems and procedures, and test our internal control over financial reporting to allow management to report on the effectiveness of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act. In addition, we will be required to have an independent registered public accounting firm attest to the effectiveness of our internal control over financial reporting the later of our second annual report on Form 20-F or the first annual report on Form 20-F following the date on which we are no longer an emerging growth company unless we are a smaller reporting company. We are required to comply with Section 404 of the Sarbanes-Oxley Act, which will involve substantial accounting expense and expend significant management efforts. We currently do not have an internal audit group, and we will need to hire additional accounting and financial staff with appropriate public company experience and technical accounting knowledge. If we do not comply with the requirements of Section 404 in a timely manner, or if we or our clinical trial independent registered public accounting firm identify deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, there may be a decrease in the market price of our ordinary shares and we may be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities, which would require additional financial and management resources.

 

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We are required to prepare timely and accurate financial statements to implement our business plan and ensure compliance with Section 404. We expect that we will need to continue developing existing procedures and controls, and implement new operational and financial systems, to effectively conduct our business. Any delay in the implementation of, or disruption in the transition to, new or enhanced systems, procedures or controls, may cause our operations to suffer, and we may be unable to determine that our internal control over financial reporting is effective and to obtain an unqualified report on internal controls from our auditors as required under Section 404 of the Sarbanes-Oxley Act. This, in turn, could materially adversely affect the trading prices for our ordinary shares and our ability to access the capital markets.

 

We may lose our foreign private issuer status, which would then require us to comply with the Exchange Act’s domestic reporting regime and cause us to incur additional legal, accounting and other expenses.

 

In order to maintain our current status as a foreign private issuer, either (1) a majority of our ordinary shares must be either directly or indirectly owned of record by non-residents of the United States or (2) (a) a majority of our executive officers or directors must not be U.S. citizens or residents, (b) more than 50 percent of our assets cannot be located in the United States and (c) our business must be administered principally outside the United States. If we lost this status, we would be required to comply with the Exchange Act reporting and other requirements applicable to U.S. domestic issuers, which are more detailed and extensive than the requirements for foreign private issuers. We may also be required to make changes in our corporate governance practices in accordance with various SEC rules and Nasdaq listing standards. The regulatory and compliance costs to us under U.S. securities laws if we are required to comply with the reporting requirements applicable to a U.S. domestic issuer may be higher than the cost we would incur as a foreign private issuer. As a result, we expect that a loss of foreign private issuer status would increase our legal and financial compliance costs. We also expect that if we were required to comply with the rules and regulations applicable to U.S. domestic issuers, it would make it more difficult and expensive for us to obtain director and officer liability insurance. These rules and regulations could also make it more difficult for us to attract and retain qualified Board members.

 

If our system of internal control over financial reporting is not effective and robust, our financial results may not be accurately reported and we may not be able to prevent fraud. As a result, shareholders could deem our financial and other public reporting unreliable, which would materially and adversely affect our business and the trading price of our ordinary shares.

 

We need effective and robust internal controls over financial reporting in order to present reliable and accurate financial reports and prevent fraud. Any failure to implement required new or improved controls, or difficulties encountered in their implementation could result in us breaching our reporting obligations. When we lose our status both as an emerging growth company and a smaller reporting company, our independent registered public accounting firm will be required to attest to the effectiveness of our internal control over financial reporting. There are complex rules governing the standards that must be met for management to assess our internal control over financial reporting which require significant documentation, testing and possible remediation. Any testing by us conducted in connection with Section 404 of the Sarbanes-Oxley Act, or any subsequent testing by our independent registered public accounting firm, may reveal deficiencies in our internal controls over financial reporting that are deemed material weaknesses or that may require prospective or retroactive revisions to our financial statements or us to determine other areas for further attention or improvement. Inadequate internal controls could also cause investors to lose confidence in our reported financial information, which could materially and adversely affect the trading price of our ordinary shares.

 

Our disclosure controls and procedures are not risk-free and may not fully prevent and/or identify errors or acts of fraud.

 

Upon the consummation of this offering, we will have to satisfy periodic reporting requirements of the Exchange Act. We have planned our disclosure controls and procedures to reasonably ascertain that information required to be disclosed in reports we file or submit under the Exchange Act is accumulated and communicated to management, and recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC. Any disclosure controls and procedures or internal controls and procedures, no matter how well-conceived and operated, can provide only reasonable, not absolute, certainty that the objectives of the control system are met.

 

We are subject to inherent limitations including the possibility that judgments in decision-making can be faulty, and that breakdowns and/or non-compliance can occur due to simple error or oversight. For example, our Directors and/or executive officers could inadvertently fail to disclose a new relationship or arrangement causing us to fail to make any related party transaction disclosures. Additionally, our disclosure controls can possibly be circumvented by the individual acts of some persons, by collusion of two or more people or by an unauthorized override of the controls as misstatements due to error or fraud may occur and not be detected in time, if at all.

 

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Our results of operations may be affected by changes to, or interpretations of financial accounting standards may affect our results of operations, which may require us to change our business practices.

 

Our financial statements are prepared in accordance with IFRS. These accounting principles are subject to interpretation by the Financial Accounting Standards Board, the SEC and various bodies formed to interpret and create accounting rules and regulations. Changes in accounting rules can have a significant effect on our reported financial results and may affect our reporting of transactions which may be completed before the announcement of such a change. Changes to those rules or the questioning of current practices may materially adversely affect our financial results, including those contained in this filing, or the way we conduct our business.

 

Our ability to use our loss carryovers and certain other tax attributes may be limited.

 

As described above under the heading “We have incurred losses since our incorporation and we expect to incur significant losses for the foreseeable future”, we have incurred losses since our incorporation and anticipate that we will continue to incur significant losses for the foreseeable future. Under the Income Tax Act and subject to the agreement with the Comptroller, a corporation is generally allowed a deduction for trade losses, carried forward indefinitely from a prior taxable year. Under that provision, we can carry forward our trade losses to offset our future taxable income, if any, until such trade losses are fully utilized, subject to the fulfilment of certain conditions.

 

Furthermore, if a corporation undertakes substantial change in the shareholders (which is generally defined as changes of the owner of 50% or more of the company’s (or its ultimate parent company’s) total number of issued shares) as at the relevant dates (i.e. the last day of the year in which the loss was incurred and the first day of the year of assessment in which such loss is to be claimed), Section 37(12) of the Income Tax Act limits the corporation’s ability to use / carry forward the unutilized trade losses and donations to reduce its tax liability for periods after the substantial shareholder change. Our issuance of ordinary shares pursuant to this offering may result in a limitation under Section 37(12) of the Income Tax Act, either separately or in combination with certain prior or subsequent shifts in the ownership of our ordinary shares. As a result, our ability to carry forward of our trade losses to reduce our future income tax liability may be subject to limitations. This could result in increased income tax liability for us if we generate taxable income in a future period.

 

The use of our tax attributes will also be limited to the extent that we do not generate positive taxable income in future tax periods. To the extent our ability to utilize our trade losses and other tax assets going forward is limited, in part or altogether, our tax liability for future periods may be greater than expected, and our business, financial condition, results of operations and growth prospects may be materially adversely affected.

 

We have broad discretion in our use of net proceeds from this offering.

 

We currently intend to use the net proceeds from this offering for our working capital and general corporate purposes, which may include further funding for our operating costs as a public company. We may also use the proceeds to advance the clinical development of our product candidates. For a further description of our use of proceeds from this offering and the concurrent private placement, please refer to the section entitled “Use of Proceeds”. That said, we have broad discretion in our use of the net proceeds from this offering. As a result, investors will be relying only on limited information about our specific intentions for the use of the net proceeds of this offering. We may apply the net proceeds for purposes that do not yield a significant return or any return at all for our shareholders. In addition, we may use the net proceeds from this offering in a manner that does not produce income or results in a loss in value.

 

We do not intend to pay any cash dividends to our shareholders for the foreseeable future.

 

We intend to invest our future profits, if any, to fund our growth and development. In addition, we may enter into debt agreements, the terms of which may prevent us from issuing and paying dividends to our shareholders. As a result, capital appreciation, if any, of our ordinary shares will be your sole source of gain for the foreseeable future. We cannot guarantee that our ordinary shares will appreciate in value or even maintain the price at which our shareholders have purchased our ordinary shares. Investors seeking cash dividends should not purchase our ordinary shares.

 

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RISKS RELATED TO INVESTMENTS IN SINGAPORE COMPANIES

 

We are incorporated in Singapore, and our shareholders may have more difficulty in protecting their interests than they would as shareholders of a corporation incorporated in the United States.

 

Our corporate affairs are governed by, inter alia, our constitution and by the laws governing companies incorporated in Singapore. The rights of our shareholders and the responsibilities of the members of our Board under Singapore law may be different from those applicable to a corporation incorporated in the United States. Therefore, our public shareholders may have more difficulty protecting their interests in connection with actions taken by us, our management, members of our Board or our controlling shareholders than they would as shareholders of a corporation incorporated in the United States. For example, controlling shareholders in corporations incorporated in Delaware are subject to fiduciary duties while controlling shareholders in Singapore companies are not subject to such duties.

 

In addition, subject to the Singapore Companies Act and our constitution, only persons who are registered as shareholders in our register of members are recognized under Singapore law as our shareholders. Only registered shareholders have legal standing to institute shareholder actions against us or otherwise seek to enforce their rights as shareholders. Investors in our ordinary shares who are not specifically registered as shareholders in our register of members (for example, where such shareholders hold ordinary shares indirectly through the DTC) are required to be registered as shareholders in our register of members in order to institute or enforce any legal proceedings or claims against us, our Directors and/or our executive officers relating to shareholder rights. The administrative process of becoming a registered shareholder could result in delays prejudicial to any such legal proceeding or enforcement action. Please refer to the section entitled “Comparison of Shareholder Rights” for a discussion of certain differences between Singapore and Delaware corporation law.

 

Our shareholders may have more difficulty transferring their shares in the Company.

 

The transfer of our shares is subject to restrictions under our constitution and by the laws governing companies incorporated in Singapore. Under Singapore law, a public company shall not register a transfer of shares unless a proper instrument of transfer has been delivered to the company. In addition, our constitution provides that our Directors may decline to lodge a notice of transfer of shares with ACRA if (a) the shares are not fully paid shares, (b) the Directors do not approve of the transferee or (c) the Company has a lien on the shares. As such, it may be difficult for you to transfer your shares in the Company.

 

It may be difficult for you to enforce any judgment obtained in the United States against us, our Directors and officers and/or our affiliates.

 

A majority of our Directors and officers reside outside the United States. In addition, a majority of our assets and the assets of such persons are located outside the United States. As a result, it may be difficult to enforce in the United States any judgment obtained in the United States against us or any of such persons, including judgments based on the civil liability provisions of the U.S. securities laws. In addition, in original actions brought in courts in jurisdictions located outside the United States, it may be difficult for investors to enforce liabilities based upon U.S. securities laws.

 

As of the date of this Prospectus, there is no treaty between the United States and Singapore providing for the reciprocal recognition and enforcement of judgments in civil and commercial matters and a final judgment for the payment of money rendered by any federal or state court in the United States based on civil liability, whether or not predicated solely upon the federal securities laws, would, therefore, not be automatically enforceable in Singapore. It is not clear whether a Singapore court may impose civil liability on us, our Directors and/or officers who reside in Singapore in an action brought in the Singapore courts against us and/or such persons with respect to a violation solely of the federal securities laws of the United States.

 

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In addition, holders of book-entry interests in the ordinary shares (for example, where such shareholders hold ordinary shares indirectly through the DTC) will be required to be registered shareholders as reflected in our register of members in order to have standing to bring a shareholder action and, if successful, to enforce a foreign judgment against us, our Directors or our executive officers in the Singapore courts. Any such enforcement action would be subject to applicable Singapore laws. The administrative process of becoming a registered shareholder could result in delays that could be prejudicial to any legal proceeding or enforcement action. In making a determination as to enforceability of a judgment of a state court or a federal court of the United States, the Singapore courts would have regard to, among others, whether the judgment was final and conclusive, given by a court of law of competent jurisdiction, expressed to be for a fixed sum of money, whether it was procured by fraud, or in breach of principles of natural justice, or whether the enforcement thereof would be contrary to public policy.

 

Accordingly, there can be no assurance that the Singapore courts would enforce against us, our Directors and/or our officers, judgments obtained in the United States which based on the civil liability provisions of the federal securities laws of the United States.

 

Subject to the general authority to allot and issue new ordinary shares as may be approved by our shareholders pursuant to the Singapore Companies Act and our constitution, our Directors may allot and issue new ordinary shares from time to time on such terms and conditions and for such purposes as may be determined by our Board of Directors in its sole discretion. Any issuance of new shares would dilute the percentage ownership of existing shareholders and could adversely impact the market price of our ordinary shares.

 

Under Singapore law, we may only allot and issue new ordinary shares with prior approval of our shareholders in a general meeting. Subject to the general authority to allot and issue new ordinary shares provided by our shareholders, the provisions of the Singapore Companies Act, and our constitution, we may allot and issue new ordinary shares on such terms and conditions as our Directors may think fit to impose. Such terms and conditions may be adverse to the rights of holders of our ordinary shares. Any additional issuances of new ordinary shares could dilute the percentage ownership of our existing shareholders and may adversely impact the market price of our ordinary shares.

 

Because new issuances of ordinary shares are subject to restrictions in respect of the percentage thereof under the Singapore Companies Act and the requisite shareholders’ approval, if a sufficient number of shares have not been approved for issuance in respect of one or more transactions in any given year, we may be delayed in raising capital through equity offerings or delayed or prevented from consummating an acquisition using our ordinary shares. Assuming shareholders have approved the issuance of new shares, we may seek to raise capital in the future, including to fund acquisitions, future investments and other growth opportunities. We may, for these and other purposes, issue additional ordinary shares or securities convertible into ordinary shares. Any additional issuances of new ordinary shares could dilute the percentage ownership of our existing shareholders and may also adversely impact the market price of our ordinary shares.

 

We are subject to the laws of Singapore, which differ in certain material respects from the laws of the United States.

 

As a company incorporated in Singapore, we are required to comply with the laws of Singapore, some of which are capable of extra-territorial application, as well as our constitution. In particular, we are required to comply with certain provisions of the Securities and Futures Act 2001 of Singapore, which prohibit certain forms of market conduct and information disclosures, and impose criminal and civil penalties on corporations, directors and officers in respect of any breach of such provisions. In addition, the Singapore Take-over Code specifies, among other things, the circumstances wherein a general offer shall be taken upon a change in control of a Singapore-incorporated public company and the manner and price at which voluntary and mandatory general offers are to be made.

 

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The laws of Singapore and of the United States differ in certain significant respects. The rights of our shareholders and the obligations of our Directors and officers under Singapore law may be different from those applicable to U.S. corporations, including corporations incorporated in Delaware, in material respects, and our shareholders may have more difficulty and less clarity in protecting their interests in connection with actions taken by us, our management, members of our Board and/or our controlling shareholders than would otherwise apply to U.S. corporations, including those incorporated in Delaware. Please refer to the section titled “Comparison of Shareholder Rights” for a discussion of certain differences between Singapore and Delaware corporation law.

 

In addition, the application of Singapore law, in particular, the Singapore Companies Act may, in certain circumstances, impose more restrictions on us, our shareholders, Directors and officers than would otherwise be applicable to U.S. corporations, including those incorporated in Delaware. For example, the Singapore Companies Act requires a director to act with reasonable degree of diligence in the discharge of the duties of his office and, in certain circumstances, imposes criminal liability for specified contraventions of particular statutory requirements or prohibitions. In addition, pursuant to the provisions of the Singapore Companies Act, two or more shareholders holding 10% or more of the total number of issued shares as at the date of the deposit of the relevant requisition, carrying the right of voting at general meetings (disregarding paid-up shares held as treasury shares) may require our Directors to convene an extraordinary general meeting.

 

Singapore tax laws may differ from the tax laws of other jurisdictions.

 

Singapore tax laws may differ from the tax laws of other jurisdictions, including the United States. For example, Singapore does not impose tax on capital gains. However, there are no specific laws or regulations which deal with the characterization of whether a gain is income or capital in nature. Gains arising from the disposal of our ordinary shares may be construed to be of an income nature and subject to Singapore income tax, especially if they arise from or are otherwise connected with the activities which the IRAS regards as carrying on a trade or business in Singapore. In addition, holders of our ordinary shares may for the purposes of Singapore income tax be required to recognize gains or losses (not being gains or losses in the nature of capital) even though no sale or disposal of our ordinary shares is made. Prospective investors should consult their tax advisors concerning the overall tax consequences of purchasing, owning and disposing of our shares. Please also refer to the section entitled “Tax Considerations”.

 

Singapore take-over laws contain provisions that may vary from those in other jurisdictions.

 

The Singapore Take-over Code applies to, among others, corporations with a primary listing of their equity securities in Singapore. While the Singapore Take-over Code is drafted with, among others, listed public companies in mind, unlisted public companies with more than fifty (50) shareholders and net tangible assets of S$5.0 million or more, must also observe the letter and spirit of the general principles and rules of the Singapore Take-over Code, wherever this is possible and appropriate. Public companies with a primary listing overseas may apply to the SIC to waive the application of the Singapore Take-over Code. As of the date of this Prospectus, no application has been made to SIC to waive the application of the Singapore Take-over Code in relation to us.

 

In this regard, the Singapore Take-over Code contains certain provisions that may possibly delay, deter or prevent a future take-over or change in control of us. Under the Singapore Take-over Code, except with the consent of SIC, any person acquiring an interest, whether by a series of transactions over a period of time or not, either on his own or together with parties acting in concert with him, in 30% or more of our voting shares is required to extend a take-over offer for all remaining voting shares in accordance with the procedural and other requirements under the Singapore Take-over Code.

 

Except with the consent of SIC, such a take-over offer is also required to be made if a person holding between 30% and 50% (both inclusive) of our voting shares, either on his own or together with parties acting in concert with him, acquires additional voting shares representing more than 1% of our voting shares in any six (6) month period. While the Singapore Take-over Code seeks to ensure an equality of treatment among shareholders in take-over or merger situations, its provisions could substantially impede the ability of the shareholders to benefit from a change of control and, as a result, may adversely affect the market price of the ordinary shares and the ability to realize any benefit from a potential change of control.

 

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Our operations are affected by the changes in existing Malaysian laws and regulations, and the adoption of new Malaysian laws and regulations and/or the changes in interpretation of the Malaysian laws and regulations as well as possible inconsistencies between the various Malaysian laws and regulations and/or the corresponding interpretation

 

Our operations in Malaysia are regulated by the laws and regulations of Malaysia, including those relating to the corporate, investment, marketing, labor, environmental protection, occupational health and safety, and taxation matters. The legal and regulatory regimes in Malaysia may be uncertain and subject to unforeseen changes. At times, the interpretation or application of laws and regulations in Malaysia may be unclear. Government policies, regulations and guidelines issued and imposed by the relevant authorities may change from time to time. We may have to incur significant capital and maintenance expenditures to comply with laws and regulations. The failure to discharge our obligations could result in the imposition of fines and penalties, damage to our reputation, delays in production or the temporary or permanent closure of our operations. In addition, existing laws, regulations or policies may become stricter or more strictly enforced. Our operations and business may face investigation, scrutiny or evaluation. The adoption of new laws and regulations or any modification to the existing laws and regulations may result in additional expenses to comply with the new laws.

 

While we have compliance procedures in place to ensure compliance with new legislation and every effect is taken to ensure the requirements of any new legislation are met, there is no certainty on the approach which will be taken by the relevant regulators, and we may incur additional compliance costs with the introduction of new or amended regulations. We have no control over such conditions and developments and there can be no assurance that such conditions and developments will not have a material adverse effect on our business. As a result, we may face new liabilities, reduced operating hours, additional investment requirements, or delays in the opening or expansion of operations. We may also be compelled to conduct preventive or remedial actions. These may result in increased costs. Such costs, liabilities, or disruptions in operations may materially and adversely affect our business.

 

We are subject to the political, economic and social conditions in the jurisdiction of Malaysia

 

Our cGMP Facility is located in Malaysia and our operations are substantially based in Malaysia and is therefore sensitive to the social, economic, political and legal conditions in Malaysia. Developments in Malaysia such as changes in Malaysian government policies, currency and interest rates, inflation, capital restrictions, price and wage controls, unemployment rate, taxes and duties will materially and/or adversely affect our business. We have no control over such conditions and developments and there is no assurance that such conditions and developments will not occur. These changes, if they occur, will materially and/or adversely affect our Malaysian business and operations and thus our business in general.

 

We are subject to the foreign exchange legislation and regulations in the jurisdiction of Malaysia

 

Local and foreign investors are subject to the FX Notices in Malaysia. The FSA and the IFSA govern the foreign exchange control framework in Malaysia. Under the FSA and the IFSA, the BNM has issued FX Notices. These FX Notices embody the BNM’s general permissions and directions. They set out the circumstances in which residents and non-residents must seek the specific approval of BNM to remit funds to and from Malaysia.

 

The FX Notices are reviewed regularly according to changing circumstances. As of the date of this Prospectus, foreign investors are allowed to repatriate from Malaysia, funds including any income earned or proceeds from divestments of Ringgit Asset (including any property in Malaysia), provided that the repatriation is made in foreign currency and the conversion of Malaysian Ringgit into foreign currency is undertaken in accordance with the FX Notices. Should the repatriation of funds be restricted in the future, this will limit our ability to extract the profits from our Malaysian business operations. In addition, our Malaysian subsidiaries may be subject to restrictions on the borrowing of foreign currency or from non-residents, which may affect our ability to raise funds in the future should the need arise. “Ringgit Asset” is defined in the FX Notices as:

 

  Ringgit-denominated securities or Islamic securities issued in Malaysia by a resident;
  Ringgit-denominated securities or Islamic securities issued by a non-resident as approved in writing by the Bank;
  Ringgit-denominated Financial Instrument or Islamic Financial Instrument as approved in writing by the Bank;
  Ringgit deposit with a Financial Institution in Malaysia including deposit-like instrument with only Ringgit delivery at the inception and maturity; or
  any property in Malaysia.

 

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The relevant rules and regulations on foreign exchange control in Malaysia may also be subject to change from time to time. If there is any adverse change in the foreign exchange rules and regulations relating to the borrowing or repatriation of foreign currency, our business may be materially and adversely affected.

 

Regulatory risks in relation to environmental hazards, production safety and the occurrence of accidents in Malaysia

 

As CytoMed Malaysia’s operation in Malaysia involves handling and storing biohazardous materials or articles and sensitive equipment, CytoMed Malaysia is subject to the OSHA. The necessary facilities and measures to comply with OSHA would lead to additional costs of operation.

 

In the event of occurrence of accidents which causes personal injury of the staff, we may be subject to legal proceedings which may in turn result in civil or criminal liabilities if the legal proceeding taken against us turn out to be successful. Although employees who suffered injuries (including death) in the course of employment are able to claim for benefits under the SOSCO and the EIS, we as employers are not automatically immunized against any claims by virtue of contributions made towards SOSCO and EIS. In fact, courts in Malaysia have recently held that employees are allowed to claim for aggravated and exemplary damages for gross negligence on the part of employers despite having already received compensation from SOSCO.

 

In such circumstances, CytoMed Malaysia may also be subject to investigation by the relevant authority and if such occurrence of accidents is found to be a breach of any of the conditions of our licenses, permits and approvals, our licenses, permits and approvals for the operation of our business in Malaysia may be revoked. This could cause harm to our reputation and our financial condition may suffer. That said, claims for compensation may be mitigated by us procuring the relevant insurance or workmen’s compensation policies.

 

We may be subject to costs and risks associated with the monitoring, rehabilitation and compliance with environmental laws and regulations

 

We are subject to environmental laws and regulations, under which we are required to take steps and/or omit certain steps for the protection and preservation of the environment, including control of pollution and the conservation and management of land. Compliance with environmental laws and regulations will increase our costs and may also hinder, delay or prevent our activities, depending on what is permitted and how these requirements are interpreted and implemented by the relevant regulatory authorities. In addition, economic development and improvements in living standards may increase public awareness of environmental protection. Thus, environmental laws and regulations may become more stringent and/or more stringently enforced. If so, we may not be able to comply with these environmental laws and regulations, and thus may be subject to penalties and liabilities under environmental laws and regulations.

 

We are subject to regulations governing foreign workers in the event of employment of such foreign workers

 

In the event our operations in Malaysia require foreign workers, such foreign workers are regulated by the Malaysian government authorities which set a limit on the number of foreign workers which we may hire and also impose levies on each foreign worker hired by our Malaysian companies. Hence, any changes in governmental policies with respect to foreign workers in Malaysia, such as to decrease the number of foreign workers permissible to be employed by the Malaysian companies or to increase the levy payable by Malaysian companies for foreign works may materially and adversely affect our business. Any increase in demand and thus competition for foreign workers may also increase our labor costs.

 

Mechanism for enforcement of foreign judgments in Malaysia is limited to certain jurisdictions

 

In Malaysia, foreign judgments may be enforced without the need to commence a fresh action, provided that the foreign judgment in question is granted by a “reciprocating country”. The REJA provides for the mechanism to enforce foreign judgments, which is by way of ex-parte registration with the High Court of Malaya. To be eligible for registration, the foreign judgment must, amongst others, be final between parties, must provide for a sum of money to be payable (monetary judgment), the judgment must not be contrary to the public policy of Malaysia, the judgment was not obtained fraudulently or in a manner contrary to the rules of natural justice, and was pronounced by a specific court from one of the reciprocating countries set out in REJA. At the time of registration, the applicant must show that the foreign judgment was issued or pronounced within 6 years prior, has not been satisfied in full by the judgment debtor and is capable of being enforced or executed in the court of original jurisdiction. Upon registration, the judgment given by the High Court of Malaya will be treated as if it is a judgment given by the court of original jurisdiction.

 

The reciprocating countries under REJA are United Kingdom, Hong Kong, Singapore, New Zealand, Republic of Sri Lanka, India (excluding State of Jammu and Kashmir, State of Manipur, Tribal areas of State of Assam, Scheduled areas of the States of Madras and Andhra) and Brunei Darussalam. As mentioned, the foreign judgment eligible for registration under REJA must be one given by the specific court as prescribed. For example, in the case of Singapore, only the judgment made by the High Court of Singapore can be enforced in Malaysia through REJA.

 

As the mechanism provided under REJA is limited to monetary judgments in certain jurisdictions, enforcement of foreign judgments which do not fall within the ambit of REJA requires the initiation of a fresh suit and action in court.

 

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

 

This Prospectus contains “forward-looking statements”. Forward-looking statements are based on our beliefs and assumptions and on information currently available to us, and include, without limitation, statements regarding our business, financial condition, strategy, results of operations, certain of our plans, objectives, assumptions, expectations, prospects and beliefs and statements regarding other future events or prospects. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words “believe”, “expect”, “plan”, “intend”, “seek”, “anticipate”, “estimate”, “predict”, “potential”, “assume”, “continue”, “may”, “will”, “should”, “could”, “shall”, “risk” or the negative of these terms or similar expressions that are predictions of or indicate future events and future trends.

 

By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. We caution you that forward-looking statements are not guarantees of future performance and that our actual results of operations, financial condition and liquidity, the development of the industry in which we operate and the effect of acquisitions on us may differ materially from those made in or suggested by the forward-looking statements contained in this Prospectus. In addition, even if our results of operations, financial condition and liquidity, the development of the industry in which we operate and the effect of acquisitions on us are consistent with the forward-looking statements contained in this Prospectus, those results or developments may not be indicative of results or developments in subsequent periods.

 

Factors that may cause our actual results to differ materially from those expressed or implied by the forward-looking statements in this Prospectus include, but are not limited to, the risks described under “Risk Factors”. For example, factors that could cause actual results to vary from projected results include without limitation the following:

 

  our plans to develop and commercialize our product candidates;
  the initiation, timing, progress and results of our current and future pre-clinical studies and clinical trials and our R&D programs;
  our expectations regarding the impact of the ongoing COVID-19 pandemic on our business, our industry and the economy;
  our estimates regarding expenses, future revenue, capital requirements and needs for additional financing;
  our ability to successfully acquire or obtain licenses for additional product candidates on reasonable terms;
  our ability to establish and maintain collaborations and/or obtain additional funding;
  our ability to obtain regulatory approval for our current and future product candidates from the HSA and/or other relevant regulatory authorities;
  our expectations regarding the potential market size and the rate and degree of market acceptance of our current and future product candidates;
  our ability to fund our working capital requirements and expectations regarding the sufficiency of our capital resources;
  our intellectual property position;
  developments in and/or disputes concerning our intellectual property or other proprietary rights;