UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-K
(Mark
One)
For
the fiscal year ended December 31, 2025
OR
For
the transition period from ____________ to ____________
Commission
File Number 001-36288
Akari
Therapeutics, Plc
(Exact
name of registrant as specified in its charter)
(Address of principal executive offices) (Zip Code)
Registrant’s
telephone number, including area code: (929)274-7510
Securities
registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
* Trading, but only in connection with the American Depository Shares.
Securities
registered pursuant to Section 12(g) of the Act: None
Indicate
by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes
☐ No ☒
Indicate
by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes
☐ No ☒
Indicate
by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes ☒ No
☐
Indicate
by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant
was required to submit such files). Yes ☒ No
☐
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company,
or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller
reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☐ Accelerated filer ☐
Non-accelerated filer ☒ Smaller reporting company ☒
Emerging growth company ☐
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered
public accounting firm that prepared or issued its audit report. ☐
If
securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate
by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate
by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ☐ NO ☒
The
aggregate market value of the voting and non-voting common equity held by non-affiliates of the Registrant, based on the closing price
of the Registrant’s American Depository Shares, as reported on the Nasdaq Capital Market on June 30, 2025, was $15.0 million.
The
number of shares of Registrant’s Ordinary Shares outstanding as of March 1, 2026 was 91,567,009,533.
DOCUMENTS
INCORPORATED BY REFERENCE
None.
TABLE OF
CONTENTS
Page
PART I 3
Item 1. Business 3
Item 1A. Risk Factors 27
Item 1B. Unresolved Staff Comments 61
Item 1C. Cybersecurity 61
Item 2. Properties 61
Item 3. Legal Proceedings 61
Item 4. Mine Safety Disclosures 61
Item 6. [Reserved] 64
Item 7A. Quantitative and Qualitative Disclosures About Market Risk 80
Item 8. Financial Statements and Supplementary Data 80
Item 9A. Controls and Procedures 80
Item 9B. Other Information 82
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 82
PART III 82
Item 10. Directors, Executive Officers, and Corporate Governance 82
Item 11. Executive Compensation 86
Item 14. Principal Accounting Fees and Services 100
Item 15. Exhibits, Financial Statement Schedules 101
GENERAL
INFORMATION
Unless
otherwise stated or the context requires otherwise, references in this Annual Report on Form 10-K (“Form 10-K”) to “Akari,”
the “company,” the “Company,” “we,” “us,” “our” or similar designations refer
to Akari Therapeutics, Plc and its subsidiaries, taken together. All trademarks, service marks, trade names and registered marks used
in this report are trademarks, trade names or registered marks of their respective owners.
Website
addresses referenced in this Form 10-K are provided for convenience only, and the content on the referenced websites does not constitute
a part of, and are specifically not incorporated by reference into, this Form 10-K.
Statements
made in this Form 10-K concerning the contents of any agreement, contract or other document are summaries of such agreements, contracts
or documents and are not complete description of all of their terms. If we filed any of these agreements, contracts or documents as exhibits
to this Form 10-K or to any previous filing with the Securities and Exchange Commission (“SEC”), you may read the document
itself for a complete understanding of its terms.
NOTE
REGARDING FORWARD-LOOKING STATEMENTS
This
Form 10-K and the documents we incorporate by reference contain forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”). All statements, other than statements of historical fact, included or incorporated in this report regarding, among other
things, our cash resources and projected cash runway, financial position, our strategy, strategic alternatives, future operations, clinical
trials (including, without limitation, the anticipated timing enrollment, and results thereof), collaborations, intellectual property,
future revenues, projected costs, fundraising and/or financing plans, prospects, developments relating to our competitors and our industry,
the timing or likelihood of regulatory actions, filings and approvals for our current and future drug candidates, and the benefits related
to the Merger Agreement (as defined below) and the plans and objectives of management are forward-looking statements. The words “believes,”
“anticipates,” “estimates,” “plans,” “expects,” “intends,” “may,”
“could,” “should,” “potential,” “likely,” “projects,” “intend,”
“continue,” “will,” “schedule,” “would,” “aim,” “contemplate,”
“estimate,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking
statements contain these identifying words. We cannot guarantee that we will actually achieve the plans, intentions, or expectations
disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. These forward-looking
statements involve known and unknown risks, uncertainties, and other factors, which may be beyond our control, and which may cause our
actual results, performance, or achievements to be materially different from future results, performance, or achievements expressed or
implied by such forward-looking statements.
There
are a number of important factors that could cause our actual results to differ materially from those indicated or implied by forward-looking
statements. These important factors include those set forth below under Part I, Item 1A “Risk Factors” and in our other disclosures
and filings with the SEC. These factors and the other cautionary statements made in
this Form 10-K and the documents we incorporate by reference should be read as being applicable to all related forward-looking statements
whenever they appear in this Form 10-K and the documents we incorporate by reference.
In
addition, any forward-looking statements represent our estimates only as of the date that this Form 10-K is filed with the SEC and should
not be relied upon as representing our estimates as of any subsequent date. All forward-looking statements included in this Form 10-K
are made as of the date hereof and are expressly qualified in their entirety by this cautionary notice. We disclaim any intention or
obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except
as may be required by law.
SUMMARY
OF PRINCIPAL RISK FACTORS
Below
is a summary of material factors that make an investment in our American Depositary Shares (“ADSs”) speculative or risky.
Importantly, this summary does not address all the risks and uncertainties that we face. Additional discussion of the risks and uncertainties
summarized in this risk factor summary, as well as other risks and uncertainties that we face, can be found within Part I, Item 1A, “Risk
Factors” in this Form 10-K. The below summary is qualified in its entirety by those more complete discussions of such risks and
uncertainties. You should consider carefully the risks and uncertainties described under Part I, Item 1A, “Risk Factors”
in this Form 10-K as part of your evaluation of an investment in our ADSs.
PART
I
Item
1. Business.
Overview
We
are an oncology company developing next-generation antibody-drug conjugates (“ADCs”) built around novel, proprietary
payloads utilizing powerful biology to attack cancer. Our lead payload, PH1, targets RNA splicing by modulating the spliceosome, a
complex machinery in the cell that converts pre-RNA into spliced RNA for translation into vital proteins for cell survival and
growth. PH1’s disruption of normal RNA splicing has multiple modes of action on cancer cells: 1) cell killing and
cytotoxicity that causes cancer cell death and 2) generates neoantigen proteins that activates both the innate and adaptive immune
systems to drive robust and durable cancer killing activity in preclinical models. Additionally, AKTX-101 is active against
urothelial cancers with FGFR3- fusions, lung cancers with SMARCA4 deletions and BRAF G466V mutations, and K-Ras G12V driven
pancreatic cancers, whereas the PH1 payload has been demonstrated to be active against metastatic prostate cancer cells driven by
AR-v7 and AR-hormone dependent prostate cancer showing the power of the PH1 payload against oncogenes derived from spliced
isoforms/variants. Utilizing the novel PH1 payload as a platform, the Company has the ability to generate a pipeline of ADC
candidates each focused on a different cancer antigen target of interest (i.e. Trop-2, CEACAM5). Akari’s lead candidate,
AKTX-101, targets the Trop-2 receptor on cancer cells and is engineered with a proprietary linker to deliver its novel PH1 payload
directly into the tumor with minimal off-target effects. In preclinical studies, AKTX-101 has shown to have significant activity and
prolonged survival relative in animal models relative to an ADC with a traditional payload (topoisomerase1 inhibitor). Additionally,
because of the unique generation of neoantigens by PH1, AKTX-101 has the potential to be synergistic with checkpoint inhibitors and
has demonstrated prolonged survival as a combination regimen that is greater than the additive efficacy of either the ADC or
checkpoint inhibitor alone. The Company is advancing its lead asset AKTX-101 towards clinical trials and has initiated IND enabling
studies for AKTX-101 with a goal of starting its First-In-Human Phase 1 trial by late 2026/early 2027. The Company is also advancing
AKTX-102, an ADC against a novel antigen target CEACAM5, which is highly relevant in pancreatic, colon, stomach, esophageal, and
lung cancers.
Background
Cancers
are the second leading cause of mortality in the United States and the leading cause of death for those under 65 years of age. The American
Cancer Society estimates that approximately 626,000 people will die of cancer in the United States in 2026.
ADCs
are a class of cancer therapies that combine the precision targeting of antibodies with payload toxins or chemotherapy that attack cancer
cells. To date, innovation in the field of ADC therapies has focused primarily on the development of novel antibodies linked to existing
classes of payload toxins and chemotherapies. For example, there is a range of approved ADCs with antibodies that target the Her2, Trop-2,
CD19, CD22, CD30, Nectin-4, Tissue Factor, and FR alpha antibodies. But there is a surprising lack of diversity in the payload toxins
to which those antibodies are linked. All of the currently approved and marketed products, and more than 90% of ADCs in late-stage clinical
development of which we are aware, utilize payloads from just two standard classes: (1) microtubule inhibitors or (2) DNA-damaging agents
such as topoisomerase I inhibitors.
Despite
the initial success of ADCs as oncology therapies, each of these payload classes has limitations in terms of delivering significant and
enduring efficacy, and manageable toxicity and tolerability for cancer patients:
Our
ADC approach centers on creating novel payloads that work through different and powerful biological mechanisms as compared to these standard
payload classes. We believe that doing so may allow us to discover and develop ADCs that solve for the known limitations outlined of
current therapies that utilize existing payload classes. However, our strategy is new and unproven, and we cannot guarantee that we will
be successful in our efforts.
Our
differentiated ADC discovery and development platform (our “ADC Platform”) enables us to generate a range of ADC product
candidates that pair our novel payloads with biologically validated antibody targets prevalent in cancer tumors. We believe that our
focus on the development of ADCs that utilize our novel payloads may allow us to develop ADCs with benefits that include:
● more effective cancer-killing properties, or cytotoxicity;
● reduced tumor resistance; and
● improved safety and tolerability relative to the current ADCs available.
Our
lead payload, PH1, derives its 1) cytotoxic and 2) immune activating properties from its ability to disrupt the function of spliceosomes,
which play a critical role in protein synthesis. In addition to the cytotoxic or cell killing properties of the PH1 payload, we have
observed in preclinical studies that PH1 triggers an immune response that leads to additional cancer cell killing via the activation
B-cells and T-cells through neoantigen formation on the cancer cell. We believe this dual 1-2 mode of action of tumor killing by PH1
is differentiated from current standard ADC payloads used today and suggests that PH1 presents a unique approach to immuno-oncology ADC
therapies moving forward.
Our
lead product candidate is AKTX-101, a preclinical Trop-2–targeting ADC that combines PH1 with a proprietary non-cleavable
linker and antibody construct. We are developing AKTX-101 as a potential best-in-class Trop-2 ADC based on preclinical
differentiation described in this Annual Report on Form 10-K and our public scientific updates. Trop-2 is an antigen target
expressed in several solid tumor cancers with significant unmet need, including lung, breast, bladder, gastric, head and neck,
pancreatic, and others. Given the wide expression of Trop-2, AKTX-101 as the potential to address a wide range of cancers affecting
hundreds of thousands of patients globally.
In
addition, we have expanded our PH1-based pipeline with AKTX-102, a CEACAM5-directed ADC program that combines a novel CEACAM5-targeting
antibody construct with PH1, reflecting the scope of our research capabilities, and the potential of our PH1 payload to be designed into
novel ADC candidates. and ADC design capabilities while we prioritize resources on the lead program.
Our
Strategy
We
aim to create more effective ADC cancer therapies for patients that aim to arrest and destroy cancer by leveraging our payload
biology and chemistry expertise to harness the power of the immune system to create potentially superior ADC therapies for cancer
patients. We intend to leverage the core capabilities of our experienced team in cancer biology and chemistry, as well as
experienced senior leadership in the oncology field to advance our novel ADC payload and resulting ADC candidates.
Our
approach is focused on three key areas:
Our
Novel Payload
PH1:
Our Lead Payload That Targets RNA Splicing
PH1,
or Thailanstatin ThA13, is an analog of a toxin produced by the bacterium Burkholderia thailandensis MSMB43, with cytotoxic properties
that stem from its ability to inhibit the ability of spliceosomes in eukaryotic cells to properly generate mature messenger mRNA (“mRNA”)
from pre-messenger RNA (“pre-mRNA”) during the step of protein synthesis called splicing.
We
believe spliceosomes are attractive targets for ADCs because the inhibition or significant modulation of spliceosome function prevents
cells from receiving critical information necessary for their continued survival. During splicing, pre-RNA is converted to mRNA via the
removal of “junk” sequences of pre-mRNA called introns, and the stitching together of the meaningful parts of pre-mRNA called
exons. After the introns have been removed and the exons stitched together, the resulting mRNA is then translated into proteins. The
spliceosome is the machinery responsible for the correct splicing of pre-mRNA and resultant formation of mRNA.
Faulty
spliceosome function, results in improper construction of exons, leading to faulty mRNA and resultant aberrant proteins.
Accumulation of thousands of aberrant mis-spliced RNA sequences result in numerous misfolded and unnatural proteins within the cell.
This causes the cell to die by endoplasmic reticulum stress, unfolded protein response, and other various mechanisms. The
accumulation of these mis-spliced RNA cells also produces unnatural proteins called neoepitopes and act as neoantigens, which
generate an immune activation response that leads to further elimination of cancer cells by the immune system that express similar
neoepitopes. We believe the secondary cytotoxic effect of spliceosome malfunction that results from neoepitope formation makes the
use of spliceosome modulators/inhibitors attractive in the development of potential ADC therapies due to their potential to exhibit
a 1-2 Mechanism of Actin punch, through which the payload targets and kills cancer cells, and the resultant formation of
neoepitopes/neoantigens triggers the body’s immune system to also attack the cancer with powerful response.
Preclinical
data that we have generated indicates that PH1 possesses the ability to induce neoepitope formation. In an in vitro study, we
performed an unbiased comparison of our PH1 – a microtubule inhibitor payload, ravtansine (“DM4”), and dimethyl sulfoxide
(“DMSO”) vehicle control – to treat human gastric cancer cells. After treatment by each test agent. We performed RNA
sequencing of all genes and looked for sequences that would give rise to neoepitopes. After identifying the normal and novel RNA species,
we highlighted the neoepitope-containing species that respectively increased in response to treatment with DM4 and PH1, as compared to
the control treatment (DMSO). We observed that PH1-treated cells contained 765 neoepitope-containing RNA species, representing approximately
9 times the number of neoepitope-containing species created by DM4, which suggests that PH1 may be highly proficient at recruiting immune
cells to the tumor and stimulating immune-cell mediated cancer cell death. When we looked for genes that were negatively impacted and
reduced in quantity, we found 660 unique RNA species were depleted in PH1-treated cells, which was over three times greater than the number
found in DM4-treated cells.
Summary
of Preclinical Studies of PH1
We
have further examined the cytotoxic and immunostimulatory effects of PH1 as part of multiple ADC molecules against multiple antigen
targets (HER2, Trop-2, CEACAM5, etc.) and across several solid tumor types. To further establish the immuno-oncology effects of
PH1, we have explored the efficacy of these ADC-PH1 molecules as both a single agent compared to checkpoint inhibitors and in
combination with checkpoint inhibitors to evaluate its synergistic effects and ability to drive profound efficacy benefits. In in
vitro gastric and breast cancer models, we compared the cytotoxicity of an ADC comprised of PH1 conjugated to a Her2 antibody
(“Her2-PH1 ADC”) with that of Kadcyla®, a Her2-targeting ADC commercially approved for use in the treatment of
Her2-positive breast cancer. In both studies, the Her2-PH1 ADC demonstrated superior cytotoxic activity. We also studied
PH1 conjugated to a novel target (undisclosed) in an in vitro preclinical model of non-small cell lung cancer (NSCLC) and
found that the PH1 ADC showed increased anti-tumor activity in comparison to a vehicle comprised of the naked antibody
alone.
We
have also studied PH1’s potential synergies with checkpoint inhibitors in a mouse colon cancer model in which we examined tumor
regression and overall survival rates in 76 mice that were injected subcutaneously with colon cancer cells expressing Her2. We compared
a Trastuzumab-PH1 ADC against Kadcyla®, (Kadcyla® is not approved for colon cancer) both as a single agent treatment and in combination
with checkpoint inhibitor therapy (“I/O”). When administered as a combination with I/O therapy, the Her2-PH1 ADC demonstrated
significant greater survival rates vs Kadcyla plus I/O therapy. The Trastuzumab-PH1 ADC induced 14 complete tumor regressions (“CRs”)
whereas 5 tumors rebounded after initial shrinkage (n=19 mice per arm). As a result, 73% of Her2-PH1 + I/O treated mice showed complete
regressions and were still on study at 5 months, and median survival was not reached. In the Kadcyla® combination arm with I/O, there
were 8 CRs and 11 tumor rebounds, and 42% of Kadcyla® + I /O treated mice were tumor-free at 5 months. The median survival of Kadcyla®
+ I/O treated mice was 149 days.
A
second in vivo preclinical mouse study was performed to demonstrate the immunological memory to attack cancer that is created
uniquely by the PH1 payload. Using an identical mouse colon cancer model with the cancer cells expressing Her2 as described previously,
the mice developed measurable tumors and were then treated with two doses of a Trastuzumab-PH1 ADC, both as monotherapy and in combination
with I/O. Of the eight mice treated with the Trastuzumab-PH1 ADC in combination with I/O, seven (87.5%) had achieved CR and survived
at 150 days. These seven mice that had complete tumor/cancer remissions were subsequently rechallenged with colon cancer cells expressing
Her2, similar to the cells administered at the onset of the study. No tumor growth was observed in any of the seven mice after they were
rechallenged with colon cancer cells. These zero occurrences of colon cancer were found despite these mice not receiving any additional
treatment with the Trastuzumab-PH1 ADC after being rechallenged, indicating that these mice retained immune memory developed during the
initial treatment of Trastuzumab-PH1 against the colon cancer cells expressing Her2. Based on the results of these two in vivo studies,
we believe that PH1 has the potential to generate a powerful immunostimulatory effect and may possess synergies with checkpoint inhibitors,
which could improve the longer-term control of cancer that could result in enduring remissions.
To
further understand PH1’s unique ability to drive a powerful immune response observed in these studies, immune cell repertoire analysis
of the blood and tissue were performed from the mice treated in the first Her2 colon cancer in vivo experiment described previously.
In
this analysis, it was found that the Trastuzumab-PH1 ADC was uniquely able to drive a multi-modal immune response of both the innate
and adaptive immune system not seen with the Kadcyla ADC or with an anti-PD1 inhibitor. These changes included a polarization of macrophages
to the pro-inflammatory phenotype, an increase in neutrophils, and an increase in diverse B cells that generate a wide range of IgM antibodies:
In
addition to the unique immune activation seen with Trastuzumab-PH1 as a single agent, when this ADC-payload was combined with an anti-PD1
inhibitor, a unique expansion of Gamma Delta T Cells was observed and not seen with any other comparator arms including Kadcyla®
+ I /O or anti-PD1. The expansion of this T cell is profound given this subpopulation of T-cells is known to attack cancer through a
rapid response and has high cytotoxic activity, likely explaining some of differentiated complete remission rates seen in the in vivo
mouse experiment. This data demonstrates the unique design, action, and results seen with the PH1 payload that is highly differentiated
from current payloads used with traditional ADC molecules and enables the opportunity to potentially drive even better clinical outcomes
for patients.
PH1
payload designed to evade traditional ADC payload resistance mechanism by cancer cells:
We
have also observed that PH1 may be less susceptible to multidrug resistance (“MDR”), which can occur when cancer cells develop
resistance to chemotherapeutic agents. One mechanism by which MDR occurs is through the overexpression of what are referred to as MDR
transporters, which have the ability to pump standard ADC payloads (topoisomerase 1 and microtubule inhibitors) out of the cell before
the payload can kill the cell.
We
evaluated PH1 and Monomethyl auristatin E’s (MMAE, microtubule inhibitor) ability to kill mouse embryonic stem
(“MES”) cells with normal and high levels of MDR. We found that MMAE, but not PH1, was recognized by these pumps, and
the presence of high levels of these pumps reduced the in vitro cytotoxicity (IC50) of MMAE by ~ 200x. However, for the PH1 payload,
the presence of high levels of these pumps had no significant effect on its cytotoxic potency, as PH1 was not recognized by MDRs and
thus not pumped out of the cell. To confirm that the MDR resistance mechanism was at play for MMA3, the MDR-specific inhibitor
Elacridar when applied to the cell prevented MDR pumps in MDR-high MES cells from pumping MMAE payload out of the cell, allowing
accumulation of MMAE, and returning MMAE’s cell killing potency back to baseline. This finding confirmed that the loss of
MMAE’s potency was specific to the increase in the number of MDR pumps and did not occur when we blocked MDR’s ability
to pump out the payload using Elacridar. We believe this is important because MDR transporters are known to be implicated in the
emergence of resistance against many chemotherapies, including some ADC payloads. Furthermore, if MDRs recognized PH1, it would have
reduced its potency and restricted its cytotoxicity to only targets that were highly expressed in cancer cells.
AKTX-101:
Our Lead ADC Product Candidate
We
aim to establish a best-in-class Trop-2-targeting ADC with our lead product candidate AKTX-101. AKTX-101 is designed to treat solid tumors
by delivering PH1 into cells expressing Trop-2. Trop-2 is a cell surface antigen which is upregulated in a variety of malignant tumors,
including lung, breast, urothelial, gastric, pancreatic, and other solid tumors, but has limited expression in normal human tissues,
making it an ideal target in cancer.
We
have studied AKTX-101 in a number of preclinical models, both in vitro and in vivo, as well as in a non-human primate (“NHP”)
toxicity study. Based on our preclinical experiments, we believe AKTX-101 may have the potential to offer advantages over existing therapies
in terms of increased cytotoxicity, reduced resistance, better tolerance, and most importantly, activating the innate and adaptive immune
system to drive enduring efficacy. In in vitro preclinical studies, we compared AKTX-101 (drug antibody ratio (“DAR”)
4) to a currently approved Trop-2-targeting ADC Trodelvy® (with DAR 8). We found that AKTX-101 showed greater cytotoxicity at lower
drug doses in gastric, pancreatic and bladder cancer models. To further corroborate our in vitro observations, we evaluated AKTX-101
and the same currently approved ADC in an in vivo model against the same Trop-2 gastric carcinoma cell-line derived xenograft
grown as tumors in mice. Two doses of each agent were given with the currently approved ADC administered at 10 mg/kg while AKTX-101 (DAR
4) was administered at 3 mg/kg. Both treatments induced tumor regression at 3-6 weeks. Throughout the study at different timepoints (day
21, day 42, and day 150), the AKTX-101 arm delivered significantly superior efficacy compared to Trodelvy® validated PH1’s
greater cytotoxic ability to kill cancer cells even at significantly lower active drug doses.
First-line checkpoint inhibitor therapy is standard-of-care (“SOC”) for platinum-ineligible patients that have recurrent, resistant, or
metastatic urothelial cancer. Also, the Trop2 ADC Trodelvy® had accelerated approval for the treatment of metastatic urothelial cancer
but was later withdrawn in November 2024. Therefore, we generated a syngenetic mouse urothelial model expressing human Trop2 that failed
to respond to checkpoint blockade as a single agent after tumors exceeded a certain size threshold.
In
these studies, SOC anti-PD-1 therapy showed no significant TGI relative to control tumors (p>0.99). We then evaluated whether
AKTX-101 single agent therapy was active in this SOC unresponsive syngeneic mouse model.
AKTX-101
prevented growth of pre-established urothelial tumors up until the last dose on Day 14 in this immune competent model. AKTX-101-treated
tumors exhibited significantly delayed tumor growth relative to vehicle-treated controls (p=0.04) and relative to SOC (p=0.002).
A P-value is a statistical measurement that measures
the strength of evidenced against a null hypothesis, ranging from 0 to 1. A P-value measures the probability of obtaining results as extreme
or more extreme than observed, assuming the null hypothesis is true. A lower P-value, indicates stronger evidence to reject the null hypothesis.
The
use of our proprietary L22 linker in AKTX-101 may contribute to a safety profile that has the potential to be superior to currently
approved Trop-2-targeting ADCs. As a non-cleavable linker, L22 causes the PH1 payload to bind irreversibly to the spliceosome
machinery, thereby eliminating the potential for PH1 to be released by the cancer cell and thus enter and kill normal, non-cancerous
cells. In pre-clinical in vitro models, AKTX-101 demonstrated minimal killing of normal human fibroblasts not expressing
Trop-2 in comparison to an approved Trop-2-targeting ADC, which, due to its known bystander effect, is toxic to normal human
fibroblasts. We believe this preclinical data suggests that a higher therapeutic index may be possible using AKTX-101 over current
Trop-2 ADCs available today. We also studied the toxicity and tolerability of AKTX-101 in a NHP model. We evaluated AKTX-101 in this
study and performed a repeat-dose study wherein three ADC doses were intravenously administered every three weeks, followed by a
three-week recovery period. To gain an understanding of the maximal cumulative effects of AKTX-101, animals were evaluated two days
after receiving the last of all three doses being administered. Reversibility was addressed in another set of animals that received
all three doses but were allowed a three-week recovery period. Histopathology was performed unilaterally for all tissues in both
sets of animals. We found that AKTX-101 was well-tolerated with observed side effects that were transient (skin rash, mild
thrombocytopenia and mild elevation of liver enzymes) and resolved within weeks after administration. Based on these results
seen across the doses and frequency tested, and when analyzed with the dosing regimens driving efficacy in preclinical models, we
believe there is a suitable Therapeutic Index to support moving AKTX-101 into Phase 1 trials.
In
addition to these findings, importantly, there was no evidence of neutropenia, leukopenia, interstitial lung disease or mucosal inflammation,
which have been associated with other Trop-2-targeting ADCs that use standard payloads comprising of topoisomerase I inhibitors. We believe
the absence of observed lung complications, colitis and hypothyroidism in this study may further support AKTX-101’s potential suitability
and feasibility for use in combination with checkpoint inhibitors, given these side effects are often common with checkpoint inhibitors.
Our
Legacy Programs
As
highlighted above, the following assets are not part of our active portfolio and we are working on seeking external partners for out-licensing:
Competition
The
biotechnology and pharmaceutical industries, and the oncology subsector, are characterized by rapid technological evolution, fierce competition
and strong defense of intellectual property. While we believe that our technology, the expertise of our team, and our development experience
and scientific knowledge provide us with competitive advantages, we face competition from biotechnology and pharmaceutical companies,
including companies that are larger and better funded than we are, academic institutions, governmental agencies and public and private
research institutions, among others. Moreover, we may also compete with smaller or earlier-stage companies, universities and other research
institutions that have developed, are or may be developing or may in the future develop current and future cancer therapeutics. Product
candidates that we successfully develop and commercialize may compete with existing therapies and new therapies that may become available
in the future.
We
also face competition more broadly across the oncology market for cost-effective and reimbursable cancer treatments. The most common
methods of treating patients with cancer are surgery, radiation and drug therapy, including chemotherapy, hormone therapy, biologic therapy
such as monoclonal and bispecific antibodies, immunotherapy, cell-based therapy and targeted therapy, or a combination of any such methods.
There is a variety of available drug therapies marketed for cancer. In many cases, these drugs are administered in combination to enhance
efficacy. While our product candidates, if any are approved, may compete with these existing drugs and other therapies, to the extent
they are ultimately used in combination with or as an adjunct to these therapies, our product candidates may not be competitive with
them. Insurers and reimbursement authorities may also encourage the use of generic products or specific branded products. As a result,
obtaining market acceptance of, and gaining significant share of the market for, any product candidates that we successfully introduce
to the market may pose challenges. In addition, many companies are developing new oncology therapeutics, and we cannot predict what the
standard of care will be as our current and future product candidates progress through development.
AKTX-101
will compete with approved Trop-2-targeting ADCs such as Trodelvy® and Datroway® as well as other programs
in clinical trials that also target Trop-2. If we are unable to effectively differentiate AKTX-101 from other products and product candidates
or other common methods of treating cancer patients our ability to compete would be negatively impacted.
Sales
and Marketing
Because
we have been focused on discovery and development of drugs, we currently have limited sales, marketing and distribution capabilities
in order to commercialize any other product candidates that may be approved in the future. If our lead product candidate is approved,
we intend either to establish a sales and marketing organization with technical expertise and supporting distribution capabilities, or
to outsource some or all of these functions to third parties. We may take different approaches to commercialization in different geographies.
We will adopt a similar strategy for the other compounds in our pipeline.
Manufacturing
We
rely on third party contract manufacturers (CDMOs) for the development, scaleup, and GMP production of materials used in our research
and development activities. In December 2025, we initiated GMP manufacturing activities for AKTX-101 and selected WuXi Biologics/XDC
as our partner for these key parts of IND enabling work and product supply for future clinical trials. This milestone supports our planning
for a Phase 1 first-in-human study timeline described in our public communications and prior disclosures. The partnership with WuXi for
these activities enables us to maintain an efficient, high quality, and reliable model to develop and supply our clinical material for
future studies.
Intellectual
Property
We
will be able to protect our technology and products from unauthorized use by third parties only to the extent it is covered by valid
and enforceable patents or is effectively maintained as trade secrets. Patents and other proprietary rights are thus an essential element
of our business.
Our
success will depend in part on our ability to obtain and maintain proprietary protection for our product candidates, technology, and
know-how, to operate without infringing on the proprietary rights of others, and to prevent others from infringing our proprietary rights.
Our policy is to seek to protect our proprietary position by, among other methods, filing U.S. and foreign patent applications related
to our proprietary technology, inventions, and improvements that are important to the development of our business and defending our patent
applications and patents if they are subjected to challenge by a third party. We also rely on trade secrets, know-how, continuing technological
innovation, and in-licensing opportunities to develop and maintain our proprietary position.
As
of January 1, 2026, our payload platform and ADC pipeline consist of two Patent co-operation treaty (PCT) families and three provisional
patents filed at the European Patent Office (“EPO”) or the United States Patent and Trademark Office (“USPTO”).
The
PH-1 payload program was developed in-house. This patent family has been granted in the United States, China, Israel, India, Mexico,
and Brazil, with actions pending in Europe, Japan, New Zealand, Canada and Australia. The composition of matter
claims describing novel Thailanstatin payloads and linkers have IP coverage through September 2038.
The
PCT patent application filed in 2024 has claims describing next-generation Thailanstatin diastereomer payloads, novel Trop-2 antibodies
and Trop-2 ADCs protecting different aspects of pipeline candidate, AKTX-101, while also covering aspects of use or application of AKTX-101
to different cancer settings. This patent also describes a large-scale chemosynthetic process for payload synthesis amenable to manufacturing.
This patent family is pending in 12 jurisdictions, and the anticipated expiry of this patent family is April 2043.
In
2025, we filed 3 additional provisional patent applications at USPTO covering a wide scope of anti-cancer biological mechanisms unique
to targeting RNA splicing in cancer cells that are not specific to the composition of matter of the PH1 payload:
These
2025 provisional patent filings are anticipated to expire between September and October 2045 and if granted, will provide the Company
with broad protection over ADC molecules that use splicing modulation actions to attack cancers.
We
are planning to file composition of matter patents as we continue to research and induct new ADCs into our pipeline. We will continue
to create novel composition of matter patents to cover new ADCs not limited to new usage of linkers, formulations, and/or standard-of-care
combination patents to secure additional protection after the PH-1 and AKTX-101 patent families expire.
If
we are unable to obtain, maintain, defend and enforce patent and other intellectual property rights for our technologies and product
candidate, or if the scope of the patent and other intellectual property rights obtained is not sufficiently broad, our competitors and
other third parties could develop and commercialize technology, biologics and/or biosimilars similar or identical to ours, and erode
or negate any competitive advantage that we may have, which could harm our business and ability to achieve profitability.
We
can provide no assurance that our patent applications or those of our licensors will result in additional patents being issued or that
issued patents will afford sufficient protection against competitors with similar technologies, nor can there be any assurance that the
patents issued will not be infringed, designed around, or invalidated by third parties. Even issued patents may later be found unenforceable
or may be modified or revoked in proceedings instituted by third parties before various patent offices or in courts. The degree of future
protection for our proprietary rights is uncertain. Only limited protection may be available and may not adequately protect our rights
or permit us to gain or keep competitive advantage. Composition-of-matter patents on the biological or chemical active pharmaceutical
ingredients are generally considered to offer the strongest protection of intellectual property and provide the broadest scope of patent
protection for pharmaceutical products, as such patents provide protection without regard to any method of use or any method of manufacturing.
While we have issued composition-of-matter patents in the United States and other countries, we cannot be certain that the claims in
our issued composition-of-matter patents will not be found invalid or unenforceable if challenged. We cannot be certain that the claims
in any patent applications covering composition-of-matter or formulations of our product candidates that are pending, or that we may
file, will be considered patentable by the USPTO, and courts in the United States or by the patent offices and courts in foreign countries,
nor can we be certain that the claims in our issued composition-of-matter patents will not be found invalid or unenforceable if challenged.
Even if any patent applications that we may file relating to specific formulations of our product candidates issue as patents, formulation
patents protect a specific formulation of a product and may not be enforced against competitors making and marketing a product that has
the same active pharmaceutical ingredient in a different formulation. Method-of-use patents protect the use of a product for the specified
method or for treatment of a particular indication. This type of patent may not be enforced against competitors making and marketing
a product that has the same active pharmaceutical ingredient for use in a method not claimed by the patent. Moreover, even if competitors
do not actively promote their product for our targeted indications, physicians may prescribe these products “off-label.”
Although off-label prescriptions may infringe or contribute to the infringement of method-of-use patents, the practice is common and
such infringement may be difficult to prevent or prosecute. Also, as is the case for composition-of-matter patents, we cannot be certain
that the claims in our issued method-of-use patents will not be found invalid or unenforceable if challenged. We cannot be certain that
the claims in any patent applications covering methods of using our product candidates that are pending, or that we may file, will be
considered patentable by the USPTO and courts in the United States or by the patent offices and courts in foreign countries, nor can
we be certain that the claims in our issued method-of-use patents will not be found invalid or unenforceable if challenged.
Government
Regulation
Government
Regulation and Product Approval
Government
authorities in the U.S., at the federal, state and local level, and in other countries extensively regulate, among other things, the
research, development, testing, manufacture, quality control, approval, labeling, packaging, storage, record-keeping, promotion, advertising,
distribution, marketing and export and import of products such as those that we are developing. A new drug must be approved by the FDA,
generally through the new drug application (“NDA”) process and a new biologic must be approved by the FDA through the biologics
license application (“BLA”) process before it may be legally marketed in the U.S. The animal and other non-clinical data
and the results of human clinical trials performed under an Investigational New Drug application (“IND”) and under similar
foreign applications will become part of the NDA or BLA.
U.S.
Drug Development Process
In
the U.S., the FDA regulates drugs under the Federal Food, Drug, and Cosmetic Act (“FDCA”) and in the case of biologics, also
under the Public Health Service Act (“PHSA”) and the implementing regulations for both statutes. The process of obtaining
marketing authorizations and the subsequent compliance with applicable federal, state, local, and foreign statutes and regulations require
the expenditure of substantial time and financial resources. Failure to comply with the applicable U.S. requirements at any time during
the product development process, approval process or after approval, may subject an applicant to administrative or judicial sanctions.
These sanctions could include the FDA’s refusal to approve pending applications, withdrawal of an approval, a clinical hold, warning
letters, requesting product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines,
refusals of government contracts, restitution, disgorgement, or civil or criminal penalties. Any agency or judicial enforcement action
could have a material adverse effect on us. The process required by the FDA before a drug or biologic may be marketed in the U.S. generally
involves the following:
● submission to the FDA of an NDA or BLA;
● FDA review and approval of the NDA or BLA.
Once
a product candidate is identified for development, it enters the preclinical testing stage. Preclinical tests include laboratory evaluations
of product chemistry, toxicity and formulation, as well as animal studies. An IND sponsor must submit the results of the preclinical
tests, together with manufacturing information and analytical data, to the FDA as part of the IND. The sponsor will also include a protocol
detailing, among other things, the objectives of the first phase of the clinical trials, the parameters to be used in monitoring safety,
and the effectiveness criteria to be evaluated, if the first phase lends itself to an efficacy evaluation. Some preclinical testing may
continue even after the IND is submitted. The IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA, within
the 30-day time period, places the clinical trial on a clinical hold. In such a case, the IND sponsor and the FDA must resolve any outstanding
concerns before the clinical trial can begin. Clinical holds also may be imposed by the FDA at any time before or during studies due
to safety concerns or non-compliance.
All
clinical trials must be conducted under the supervision of one or more qualified investigators in accordance with GCP. They must be conducted
under protocols detailing the objectives of the trial, dosing procedures, subject selection and exclusion criteria and the safety and
effectiveness criteria to be evaluated. Each protocol must be submitted to the FDA as part of the IND, and progress reports detailing
the results of the clinical trials must be submitted at least annually. In addition, timely safety reports must be submitted to the FDA
and the investigators for serious and unexpected adverse events. An institutional review board (“IRB”) responsible for the
research conducted at each institution participating in the clinical trial must review and approve each protocol before a clinical trial
commences at that institution and must also approve the information regarding the trial and the consent form that must be provided to
each trial subject or his or her legal representative, monitor the study until completed and otherwise comply with IRB regulations.
Human
clinical trials are typically conducted in three sequential phases that may overlap or be combined:
The
FDA or the sponsor may suspend a clinical trial at any time on various grounds, including a finding that the research subjects or patients
are being exposed to an unacceptable health risk. Similarly, an IRB can suspend or terminate approval of a clinical trial at its institution
if the clinical trial is not being conducted in accordance with the IRB’s requirements or if the drug has been associated with
unexpected serious harm to patients. Phase 1, Phase 2, and Phase 3 testing may not be completed successfully within any specified period,
if at all.
During
the development of a new drug, sponsors are given opportunities to meet with the FDA at certain points. These points may include prior
to submission of an IND, at the end of Phase 2, and before an NDA or BLA is submitted. Meetings at other times may be requested. These
meetings can provide an opportunity for the sponsor to share information about the data gathered to date, for the FDA to provide advice,
and for the sponsor and FDA to reach agreement on the next phase of development. Sponsors typically use the end of Phase 2 meeting to
discuss their Phase 2 clinical results and seek feedback on their plans for the pivotal Phase 3 clinical trial that they believe will
support approval of the new drug.
Progress
reports detailing the results of the clinical trials must be submitted at least annually to the FDA. Safety reports must be submitted
to the FDA and the clinical investigators 15 calendar days after the trial sponsor determines that the adverse event information qualifies
for reporting. The sponsor also must notify FDA of any unexpected fatal or life-threatening suspected adverse reaction as soon as possible
but in no case later than 7 calendar days after the sponsor’s initial receipt of the information. Sponsors of clinical trials of
drugs and biologics are required to register and disclose certain clinical trial information on a registry maintained by the National
Institutes of Health, at www.clinicaltrials.gov.
Concurrent
with clinical trials, sponsors usually complete additional animal studies and must also develop additional information about the chemistry
and physical characteristics of the drug and finalize a process for manufacturing the product in commercial quantities in accordance
with cGMP requirements. The manufacturing process must be capable of consistently producing quality batches of the product candidate
and, among other things, the manufacturer must develop methods for testing the identity, strength, quality and purity of the final drug.
Additionally, appropriate packaging must be selected and tested, and stability studies must be conducted to demonstrate that the product
candidate does not undergo unacceptable deterioration over its shelf life.
U.S.
Review and Approval Processes
The
results of product development, preclinical studies and clinical trials, along with descriptions of the manufacturing process, analytical
tests conducted on the chemistry of the drug, proposed labeling, and other relevant information are submitted to the FDA as part of an
NDA or BLA requesting approval to market the product. The submission of an NDA or BLA is subject to the payment of substantial user fees;
a waiver of such fees may be obtained under certain limited circumstances. Within sixty days of receipt, the FDA initially reviews all
NDAs and BLAs submitted to ensure that they are sufficiently complete for substantive review before it accepts them for filing. The FDA
may request additional information rather than accept a NDA or BLA for filing. In this event, the NDA or BLA must be resubmitted with
the additional information. The resubmitted application also is subject to review before the FDA accepts it for filing. Once the submission
is accepted for filing, the FDA begins an in-depth substantive review. FDA may refer an NDA or BLA that is novel or that presents difficult
questions of safety or efficacy to an advisory committee for review, evaluation and recommendation on questions presented by the FDA,
which may include questions related to whether the application should be approved and under what conditions. The FDA is not bound by
the recommendation of an advisory committee, but it generally follows such recommendations. Before approving an NDA or BLA, the FDA will
typically inspect one or more clinical sites to assure compliance with GCP. Additionally, the FDA will inspect the facility or the facilities
at which the product is manufactured to assess compliance with cGMP.
The
FDA may also place other conditions on approval, including the requirement for a Risk Evaluation and Mitigation Strategy (“REMS”)
to assure the safe use of the product. If the FDA concludes a REMS is needed, the sponsor of the NDA or BLA must submit a proposed REMS,
and the FDA will not approve the application without an approved REMS. A REMS could include medication guides, physician communication
plans or elements to assure safe use, such as restricted distribution methods, patient registries and other risk minimization tools.
Any of these limitations on approval or marketing could restrict the commercial promotion, distribution, prescription or dispensing of
a product.