UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-K
☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACTOF 1934
For
the fiscal year ended December 31, 2024
OR
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For
the transition period from to
Commission
File Number: 001-38022
MATINAS
BIOPHARMA HOLDINGS, INC.
(Exact
name of registrant as specified in its charter)
1545
Route 206 South, Suite 302
Bedminster,
New Jersey07921
(Address
of principal executive offices) (Zip Code)
908-484-8805
(Registrant’s
telephone number, including area code)
Securities
registered pursuant to Section 12(b) of the Act:
Title of Each Class Trading Symbol Name of Each Exchange on Which Registered
Common Stock, par value $0.0001 MTNB NYSE American
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 Section 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, a smaller reporting
company, or 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 Act). Yes ☐ No ☒
The
aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which
the common equity was sold on June 30, 2024 was approximately $38.7 million.
As
of April 15, 2025, there were 5,086,985 shares of the registrant’s common stock, $0.0001 par value, outstanding.
DOCUMENTS
INCORPORATED BY REFERENCE
None.
MATINAS
BIOPHARMA HOLDINGS, INC.
Annual
Report on Form 10-K
Fiscal
Year Ended December 31, 2024
Table
of Contents
Page
PART I 1
Item 1. Business 1
Item 1A. Risk Factors 24
Item 1B. Unresolved Staff Comments 54
Item 1C. Cybersecurity 54
Item 2. Properties 55
Item 3. Legal Proceedings 55
Item 4. Mine Safety Disclosures 55
Item 6. [Reserved] 55
Item 7A. Quantitative and Qualitative Disclosures About Market Risk 62
Item 8. Financial Statements and Supplementary Data 62
Item 9A. Controls and Procedures 62
Item 9B. Other Information 63
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 63
PART III 63
Item 10. Directors, Executive Officers and Corporate Governance 63
Item 11. Executive Compensation 67
Item 14. Principal Accounting Fees and Services 72
Item 15. Exhibits and Financial Statement Schedules 73
Financial Statements F-1
i
PART
I
CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
report on Form 10-K contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995 under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations,
assumptions, estimates, intentions and future performance, and 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. All statements other than statements of
historical fact are statements that could be forward-looking statements. You can identify these forward-looking statements through our
use of words such as “may,” “can,” “anticipate,” “assume,” “should,” “indicate,”
“would,” “believe,” “contemplate,” “expect,” “seek,” “estimate,”
“continue,” “plan,” “point to,” “project,” “predict,” “could,”
“intend,” “target,” “potential” and other similar words and expressions of the future.
There
are a number of important factors that could cause the actual results to differ materially from those expressed in any forward-looking
statement made by us. These factors include, but are not limited to:
● our ability to raise capital when needed;
These
forward-looking statements reflect our management’s beliefs and views with respect to future events and are based on estimates
and assumptions as of the date of this Annual Report on Form 10-K and are subject to risks and uncertainties. We discuss many of these
risks in greater detail under “Risk Factors.” Moreover, we operate in a very competitive and rapidly changing environment.
New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors
on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those
contained in any forward-looking statements we may make. Given these uncertainties, you should not place undue reliance on these forward-looking
statements.
You
should read this Annual Report on Form 10-K and the documents that we reference and have filed as exhibits to the Annual Report on Form
10-K completely and with the understanding that our actual future results may be materially different from what we expect. We qualify
all of the forward-looking statements in this Annual Report on Form 10-K by these cautionary statements. Except as required by law, we
undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.
Item 1. Business
Background
Matinas
BioPharma Holdings, Inc. (“Matinas” or the “Company”) is a clinical-stage biopharmaceutical company focused on
delivering groundbreaking therapies using our lipid nanocrystal (“LNC”) platform delivery technology (LNC Platform).
Our
lead product candidate is MAT2203 (oral amphotericin B), a highly potent antifungal drug which, by virtue of LNC delivery, has been made
oral, safe, and well-tolerated for prolonged administration in patients with life-threatening invasive fungal infections. Following the
successful EnACT Phase 2 trial in the treatment of cryptococcal meningitis, MAT2203 is now positioned for a single, Phase 3 registration
trial (the “ORALTO trial”) in support of a New Drug Application (“NDA”) for the treatment of invasive aspergillosis
in patients with limited treatment options.
We
had also been seeking to develop an internal pipeline of products utilizing the LNC Platform to successfully encapsulate small molecules
and small oligonucleotides and facilitate targeted and extrahepatic delivery to desired cells and tissues without toxicity, with a focus
on small molecule oncology applications as well as the formulation and delivery of small oligonucleotides with a primary therapeutic
focus on inflammation.
Following
an 80% reduction in workforce implemented in late October 2024, the Company implemented a cost-cutting strategy and paused further
clinical development of MAT2203 while continuing to engage in dialogue with prospective partners for the product with the goal of
consummating a licensing, sale or other similar transaction as soon as possible to advance the development of MAT2203 into Phase 3.
In addition, the Company continues to engage with the FDA to keep the MAT2203 Investigational New Drug Application
(“IND”) active and is actively maintaining and prosecuting intellectual property relating to MAT2203 and to the LNC
Platform generally as well as maintaining all of its obligations under our license agreement with Rutgers University. We also
continue to support the patients in our Expanded/Compassionate Use Access Program with the assistance of outside medical clinician
consultants. As a result of the reduction in force, the Company has paused the internal development of a pipeline of products
utilizing the LNC Platform as it evaluates strategic alternatives for those early-stage programs in oncology and inflammatory
diseases.
We remain engaged in an ongoing partnership process
for MAT2203, seeking one or more development and/or commercialization partners. We will require either (i) the consummation of a partnership
transaction, or (ii) raising additional capital, prior to commencing the ORALTO trial. In the event a partnership is consummated, the
partner may seek to revise the ORALTO trial or could determine a completely new development program and pathway for MAT2203. There can
be no assurance that the Company will be successful in consummating a transaction involving MAT2203.
Corporate
Events
The
funds will be used for general corporate purposes, with a focus on reducing operating expenses and exploring strategic alternatives for
MAT2203, the Company’s Phase 3-ready antifungal drug candidate for the treatment of invasive fungal infections, as well as other
strategic alternatives for the Company. In connection with the February 2025 Agreement, Dr. Robin L. Smith, MD, MBA has been appointed
to the Board of Directors.
MAT2203
Our
lead drug candidate based on the LNC Platform is MAT2203, an oral formulation of amphotericin B, a well-known and highly effective antifungal
drug. Amphotericin B is currently only available in IV formulations which are associated with significant renal toxicity and have labeled
restrictions on their use for up to 2 weeks in the United States and only 1 week in most parts of the world due to toxicities, the most
prevalent of which is severe nephrotoxicity. Despite these limitations, amphotericin B is currently used and approved to treat a variety
of invasive, and potentially deadly, fungal infections due to its potency. MAT2203, which is formulated using our LNC Platform, has the
potential to preserve or even increase the efficacy of amphotericin B, while eliminating the risk of nephrotoxicity and providing more
convenient and cost-effective oral administration. MAT2203’s product profile has allowed physicians and patients to use MAT2203
for longer periods of time and more broadly than amphotericin B has ever have been used previously and in an outpatient setting.
MAT2203
has been developed to date with the assistance and financial support of the National Institutes of Allergy and Infectious Disease (NIAID)
of the National Institutes of Health (NIH). MAT2203 has been designated as a Qualified Infectious Disease Product (QIDP) with Fast Track
Status for the treatment of invasive candidiasis, the treatment of aspergillosis, the prevention of IFIs in patients who are on immunosuppressive
therapy, and, most recently with an Orphan Designation for the treatment of cryptococcosis. We believe that it is possible to pursue
additional orphan designations for the treatment of aspergillosis, the treatment of invasive candidiasis and the treatment of certain
endemic mycoses. Upon approval, MAT2203 could be eligible for up to 12 years of regulatory or marketing exclusivity in the United States.
The
initial planned indication for MAT2203 is early step-down therapy from IV amphotericin B for the treatment of invasive aspergillosis
in patient with limited treatment options. Invasive aspergillosis is a serious and life-threatening invasive fungal infection that occurs
primarily in severely immunocompromised patients with hematological malignancies and in transplant recipients. This initial step-down
indication is a gateway indication, as we believe that a partner could expand the utilization of MAT2203 into the treatment of other
invasive fungal infections (IFIs) and potentially even for prophylaxis against IFIs in immunocompromised patients, such as transplant
patients.
The
EnACT (Encochleated Oral Amphotericin for Cryptococcal Meningitis Trial) Phase 2 study was a Phase 2 prospective, randomized,
open-label, sequential cohort study, financially supported by the NIH NINDS, evaluating the safety, tolerability, and efficacy of MAT2203
in 100 HIV-positive persons with cryptococcal meningitis. The EnACT trial included a total of four cohorts of patients, with the first
two cohorts testing MAT2203 as early step-down therapy following initial treatment with IV amphotericin B during the 14-day induction
period, and the second two cohorts testing MAT2203 as potentially all oral therapy. The induction period for all patients in each cohort
(active or control) is 14 days, followed by an additional four weeks of treatment (active or control) during a consolidation/maintenance
period. Cohorts 1 and 3 were safety lead-ins to Cohorts 2 and 4, respectively, which were the key efficacy cohorts for EnACT.
The
primary endpoint in EnACT was Early Fungicidal Activity (EFA), a measurement of cerebrospinal fluid fungal clearance. EFA is a well-validated
quantitative measure of the efficacy of antifungal agents and is a key surrogate marker for survival. EFAs of less than 0.20 log10
Cryptococcus colony forming units (CFUs) per mL CSF per day are associated with significantly higher mortality and worse clinical
outcomes1. EFA measured above this threshold is clinically meaningful and represents robust fungal clearance. In the second
cohort of EnACT, the mean EFA achieved with patients treated with MAT2203 was 0.38 log10 CFU/mL/day, with 95% confidence intervals
(0.30 to 0.46) significantly higher than the prespecified primary endpoint threshold of >0.20. All patients treated with MAT2203 who
completed the induction phase achieved sterile CSF cultures during treatment (either during induction or early consolidation phases).
There was no evidence of breakthrough or relapsed cryptococcal infections observed in any of the patients during treatment with MAT2203
through 10 weeks. In Cohort 2, overall survival was 90% after 18 weeks in 40 patients randomized to receive MAT2203.
Interim
data from Cohort 4 of the Phase 2 EnACT study of MAT2203 (oral amphotericin B) for the treatment of cryptococcal meningitis (CM) were
presented at IDWeek in October 2022. As part of IDWeek, the EnACT abstract was the recipient of the Outstanding Abstract and IDSA Awardee
by the Infectious Diseases Society of America. In the EnACT trial, MAT2203 exceeded the primary endpoint threshold for early fungicidal
activity (EFA) of 0.20 log10 CFU/mL/day, with a mean EFA achieved of 0.30 log10 CFU/mL/day with 95% confidence
intervals from 0.22 – 0.38.
Cohort
4 also yielded key secondary endpoints, including overall survival and safety. For 40 patients receiving MAT2203 treatment, overall survival
remained at 90% through 18 weeks, while the survival rate at Week 2 was 95%. Importantly, the incidence of adverse events relating to kidney function and anemia were significantly
lower for MAT2203 compared to the conventional IV amphotericin B standard of care treatment across the entirety of the EnACT trial, with
no evidence of kidney toxicity even with up to 6 weeks of oral MAT2203 treatment.
In
February 2024, we announced agreement with the United States Food and Drug Administration (FDA) on the design of a single Phase 3 registration
trial of MAT2203 in patients with invasive aspergillosis who have limited treatment options, including consensus on all critical elements
of the ORALTO trial. In its correspondence, FDA agreed that the ORALTO trial would potentially be sufficient to support
the registration of MAT2203 for an initial indication for the treatment of invasive aspergillosis in patients with limited treatment options,
when and if conducted. Approval would be subject to normal FDA review of all aspects of this clinical trial.
ORALTO
is planned to be a Phase 3, randomized, multicenter, open-label, adjudicator-blinded study to evaluate the efficacy and safety of MAT2203
as an oral step-down treatment following treatment with AmBisome® (liposomal IV-amphotericin B) compared with the standard of care
in patients with invasive aspergillosis who have limited treatment options. The primary efficacy endpoint would be all-cause mortality
at study day 42.
Key
secondary objectives would include:
1*Clin
Infect Dis. 2020;71(5):e45-49
Enrollment
has been planned to include approximately 216 adults with recently diagnosed probable or proven invasive aspergillosis who are being
treated with AmBisome due to their inability to receive an IV mold-active azole and with limited alternative treatment options. Following
up to two days of initial treatment with AmBisome, eligible study participants would be entered into the study and randomized in a 2:1
ratio to receive either oral MAT2203 or continued AmBisome treatment followed by standard of care.
All
study participants would receive up to 12 weeks of treatment starting from the first day of treatment with AmBisome. It is anticipated
that all study participants would be hospitalized during the initial AmBisome treatment period. After step-down to oral MAT2203, study
participants may be discharged from the hospital to continue treatment on an outpatient basis, as clinically appropriate.
An
independent Data Review Committee, who will be blinded to treatment, would adjudicate primary and secondary endpoints, including clinical,
radiological, and mycological responses. Once approximately 75% of participants are enrolled, an independent Data Safety Monitoring Board
would review the overall pooled all-cause mortality rate in a blinded fashion to ensure that the sample size assumptions are reasonable
and that the study is adequately powered. Should the pooled event differ substantially from expected levels, a sample size adjustment
can be made to the trial.
ORALTO
was planned to be conducted at approximately 65 investigator sites in the U.S., Europe, South America, Middle East, and Asia Pacific.
Enrollment is expected to require approximately 24 months, if commenced.
We
remain engaged in an ongoing partnership process for MAT2203, seeking one or more development and/or commercialization partners. We will
require either (i) the consummation of a partnership transaction, or (ii) raising additional capital, prior to commencing the ORALTO
trial. In the event a partnership is consummated, the partner may seek to revise the ORALTO trial or could determine a completely new
development program and pathway for MAT2203. There can be no assurance that the Company will be successful in consummating a transaction
involving MAT2203.
In
addition to conducting the EnACT trial, a MAT2203 Compassionate/Expanded Use Access Program was established to provide MAT2203 on a compassionate
use basis. Enrollment into the Program requires that patient applicants meet certain criteria for eligibility, including:
● the patient has no other treatment options.
● the invasive fungal infection is serious and/or life-threatening.
A
total of 37 patients to date have been enrolled in the Program at multiple healthcare institutions, including the University of Michigan,
Johns Hopkins, Nationwide Children’s Hospital, City of Hope, Vanderbilt University Medical Center, the National Institutes of Health,
Children’s Hospital of Philadelphia, Memorial Sloan Kettering Cancer Center, and the University of California, San Diego School
of Medicine. The majority of enrolled patients are post-transplant or are undergoing treatment for underlying malignancies. 7 of the
patients have been treated for invasive asperillosis, each with positive results. The infections being treated with MAT2203 include a
variety of micro-organisms (including Aspergillus, Mucorales species, Candidiasis, Fusarium and suspected
Coccidioides) occurring at multiple sites of infection, including brain, bladder/colon, bone, lung, sinus, and skin. Most patients
were receiving AmBisome® prior to enrollment but developed treatment-limiting nephrotoxicity and most also required treatment for
either azole-resistant organisms or had clinically failed azole therapy and had no other treatment options.
Of
the 15 patients enrolled in the Program who completed treatment with MAT2203 (median treatment of 16 weeks with a range of 2 to 49 weeks),
8 had a complete response and 7 were improved. Response to treatment was assessed by the treating physician. Nine additional patients
continued to receive longer-term treatment with positive ongoing effects and 5 initiated treatment in the third and fourth quarter of
2024. To date, only 2 patients have discontinued MAT2203, both occurring during the first week of treatment, with one due to an intolerance
and the other due to a terminal condition not otherwise related to the underlying fungal infection.
Importantly,
all patients who experienced renal toxicity following treatment with AmBisome saw their renal function return to baseline after transitioning
to MAT2203 therapy and suffered no further renal side effects over the course of extended treatment with MAT2203.
Strategy
We
have been focused on redefining the intracellular delivery of nucleic acids and small molecules through our LNC Platform and its application
to overcome current challenges in safely and effectively delivering small molecules, nucleic acids, gene therapies, proteins/peptides,
and vaccines.
Key
elements of our strategy now include:
MAT2203
Regulatory Designations
The
FDA has granted MAT2203 designations for Qualified Infectious Disease Product, or QIDP, and Fast Track for the treatment of invasive
candidiasis and aspergillosis, for the prevention of IFIs in patients on immunosuppressive therapy, and the treatment of cryptococcosis.
We recently also received Orphan Drug Designation for MAT2203 for the treatment of cryptococcosis and associated CM from the U.S. FDA
and EMA. The FDA may designate a product candidate as an orphan drug if it is intended to treat a rare disease or condition, which is
generally defined as having a patient population of fewer than 200,000 individuals in the United States, or a patient population greater
than 200,000 in the United States where there is no reasonable expectation that the cost of developing the drug will be recovered from
sales in the United States. The orphan drug designation provides eligibility for orphan drug exclusivity in the United States upon FDA
approval if a product that has orphan drug designation subsequently receives the first FDA approval for a particular active ingredient
for the disease for which it has such designation. For a product that obtains orphan drug designation based on a plausible hypothesis
that it is clinically superior to the same drug that is already approved for the same indication, to obtain orphan drug exclusivity upon
approval, clinical superiority of such product to this same drug that is already approved for the same orphan indication must be demonstrated.
Orphan drug exclusivity means that the FDA may not approve any other applications, including a NDA, to market the same drug for the same
indication for seven years, except in limited circumstances such as if the FDA finds that the holder of the orphan drug exclusivity has
not shown that it can assure the availability of sufficient quantities of the orphan drug to meet the needs of patients with the disease
or condition for which the drug was designated. Similarly, the FDA can subsequently approve a drug with the same active moiety for the
same condition during the exclusivity period if the FDA concludes that the later drug is clinically superior, meaning the later drug
is safer, more effective or makes a major contribution to patient care. Orphan drug designation also entitles a party to financial incentives
such as opportunities for grant funding towards clinical trial costs, a waiver from payment of user fees, an exemption from performing
clinical studies in pediatric patients unless the FDA requires otherwise by regulation, and tax credits for the cost of the clinical
research.
The
QIDP designation, provided under the Generating Antibiotic Incentives Now Act, or the GAIN Act, offers certain incentives for the development
of new antibacterial or antifungal drugs, including eligibility for Fast Track designation, priority review and, if approved by the FDA,
eligibility for an additional five years of marketing exclusivity. Fast Track designation enables more frequent interactions with FDA
to expedite drug development and review. Fast Track designation does not change the standards for approval, and we can provide no assurances
that we can maintain Fast Track designation for MAT2203 or that such designation will result in faster regulatory review. The seven-year
period of marketing exclusivity provided through orphan designation, if granted, combined with an additional five years of marketing
exclusivity provided by the QIDP designation positions MAT2203 with a potential for a total of 12 years of marketing exclusivity in the
United States to be granted at the time of FDA approval.
Antifungal
Market Opportunity
The
overall global antifungal market was valued at approximately $15.8 billion in 2023 and is expected to reach approximately $20.5 billion
by 2030. In 2021, the global invasive fungal infection market was valued at more than $7.2 billion and is expected to reach $10.4
billion in 2030. This includes therapies used as active treatment or prophylaxis (preventative) in the inpatient and outpatient setting,
therapies used for the treatment of hospitalized patients and therapies used for the treatment of patients who are being discharged from
the hospital. Importantly, private insurance costs per visit range from approximately $40k to $150K per patient (2019 Benedict) mostly
due to extended length of stay. We estimate that, each year, there are over 1.5 million cases of IFIs caused by various species of Candida,
Aspergillus and Cryptococcus, the three most common invasive fungal pathogens, globally. The estimated incidence in the U.S.
for these conditions is approximately 46,000 for invasive candidiasis, 15,000 for invasive aspergillosis, and 4,900 for CM. For example,
aspergillosis-associated hospitalizations in the U.S. alone came at an estimated treatment cost of more than $1.3 billion, with indirect
costs amounting to an additional $485 million. The rapid progression of disease and high mortality rates (20% - 50%) associated with
documented IFIs often result in antifungal therapy being administered in suspected (unconfirmed) cases or as a preventative measure in
patients at high risk. Also, the increasingly widespread use of immune suppressive drugs as cancer chemotherapy or for organ transplantation
or treatment of autoimmune disease has resulted in an increasing population of patients at risk for IFIs. Furthermore, the limited number
of systemic antifungal drug classes, consisting of azoles, echinocandins and polyenes, and their extensive use, has led to increased
numbers of infections with drug-resistant strains. The Centers for Disease Control and Prevention (“CDC”) has listed fluconazole-resistant
Candida as a serious threat requiring prompt and sustained action and has also identified a rise in echinocandin resistance, especially
among Candida glabrata. In 2022, the World Health Organization issued a fungal priority pathogens list including cryptococcal
neoformans, aspergillus fumigatus and c. auris and c. albicans as critical priority for antifungal development due to the high unmet
need. We believe this underscores the urgent need for new agents with demonstrated activity against resistant strains and that can be
administered with significantly less toxicity and the potential to discharge patients earlier to reduce hospital stays and associated
costs.
Exclusive
License Agreement with Rutgers University
Through
our acquisition of Aquarius Biotechnologies Inc., we acquired a license from Rutgers for certain patents related to the LNC Platform.
We subsequently changed the name of Aquarius Biotechnologies Inc. to Matinas BioPharma Nanotechnologies, Inc. and in February of 2022,
the parties agreed to a Second Amended and Restated Exclusive License Agreement. The agreement provides for (1) royalties on a tiered
basis between low single digits and the mid-single digits of net sales of products using such licensed technology, (2) a one-time sales
milestone fee of $100,000 when and if sales of products using the licensed technology reach the specified sales threshold and (3) an
annual license fee of $50,000 over the term of the license agreement. There was also a reduction in the consideration paid to Rutgers
in the event of a sublicense to a third party of the exclusive patent rights granted pursuant to the Agreement. In consideration of the
concessions made by Rutgers in the amended license agreement, the Company issued Rutgers 400,000 shares of common stock in February 2022.
We also agreed to continue to assume the responsibility to pay required patent prosecution and maintenance fees covering the technology.
Unless
otherwise terminated by either party, the term of the license, on a country-by-country basis, shall be the longer of 8-1/2 years
from the date of first commercial sale of a product in a country using the licensed technology or until the expiration of the
last-to-expire patent rights licensed under the agreement, whichever is longer. Rutgers has the right to terminate the license
agreement if we have not commenced commercial sales of at least one product using the licensed technology within eight years of the
effective date of the Second Amended and Restated License Agreement. We have discussed the elimination of this termination right
with Rutgers through an amendment to the license agreement while we seek a partner for MAT2203.
Intellectual
Property
The
proprietary nature of, and protection for, our product candidates and our discovery programs, processes and know-how are important to
our business. We will seek to protect our products and associated technologies for their manufacturing and development through a combination
of patents, trade secrets, proprietary know-how, FDA exclusivity and contractual restrictions on disclosure. Our policy is to pursue,
maintain and defend patent rights and to protect the technology, inventions and improvements that are commercially important to the development
of our business. Our success will significantly depend on our ability to obtain and maintain patent and other proprietary protection
for commercially important technology and inventions and know-how related to our business, defend and enforce our patents, preserve the
confidentiality of our trade secrets and operate without infringing the valid and enforceable patents and proprietary rights of third
parties. We also rely heavily on know-how and continuing technological innovation to develop and maintain our proprietary position.
Exclusively
Licensed and Matinas-Owned Intellectual Property Relating to Our Proprietary LNC Platform and MAT2203
The
patents and patent applications that we exclusively license from Rutgers provide some patent protection for the proprietary chemistry
technology used in certain of our processes to make our lipid nanocrystal and geodate cochleates and formulate the active pharmaceutical
ingredients delivered inside this delivery technology, as in MAT2203, our lead product utilizing the LNC Platform. Pursuant to our license
agreement, we acquired rights to a portfolio that as of March 31, 2025 included 1 pending U.S. non-provisional patent application, 6
U.S. patents, and 49 granted foreign patents, which extends patent protection until at least 2033, excluding patent term adjustments
or extensions. The in-licensed patents have been granted in countries including Europe, China, India, Brazil, Russia, Canada, Japan,
Korea, Australia and Mexico.
The
Matinas-owned patent portfolio covers our LNC Platform and users. As of March 31, 2025, this patent portfolio includes 5 pending U.S.
provisional applications, 2 pending U.S. non-provisional applications, 2 pending PCT applications, 13 pending foreign applications, and
20 granted foreign patents. The foreign pending applications and granted patents are in countries including Europe, China, Brazil, Canada,
Japan, Korea, Australia and Mexico
As
of March 31, 2025, we owned one issued U.S. patent, 7 issued foreign patents in Australia, Canada, Europe, and Japan, and one pending
foreign patent application in Korea, directed to compositions and methods for enhancing tissue penetration of an active agent in an LNC.
The patents are expected to expire in 2036, and patents issuing from or claiming priority to the pending application are also expected
to expire in 2036, excluding patent term adjustments or extensions.
As
of March 31, 2025, we owned 9 foreign patents in Australia, Europe, and Japan, directed to LNC compositions and methods for treating
mycobacteria infection. The patents are expected to expire in 2036, excluding patent term adjustments or extensions.
As
of March 31, 2025, we owned one U.S. issued patent, one pending non-provisional U.S. patent application, 2 issued foreign patents in
Japan and Australia, and 4 pending applications in China, Korea, Canada, and Europe, directed to LNC compositions and methods for treating
cryptococcus infections. The patents are expected to expire in 2037, and patents issuing from or claiming priority to the pending application
are also expected to expire in 2037, excluding patent term adjustments or extensions.
As
of March 31, 2025, we owned one pending non-provisional U.S. patent application, and 4 pending applications in Australia, Brazil, Canada,
China, Europe, Hong Kong, Japan, and Mexico, directed to LNC compositions and methods for treating cryptococcus infections. Patents issuing
from or claiming priority to the pending applications are also expected to expire in 2040, excluding patent term adjustments or extensions.
As
of March 31, 2025, we owned one PCT application directed to methods for controlling LNC particle size. Patents issuing from or claiming
priority to the pending applications are also expected to expire in 2043, excluding patent term adjustments or extensions.
As
of March 31, 2025, we owned one PCT application directed to LNC compositions and methods for treating mucormycosis. Patents issuing
from or claiming priority to the pending applications are also expected to expire in 2043, excluding patent term adjustments or extensions.
We
cannot be sure that patents will be granted with respect to any of our pending patent applications or with respect to any patent applications
we may own or license in the future, nor can we be sure that any of our existing patents or any patents we may own or license in the
future will be useful in protecting our technology. For this and more comprehensive risks related to our intellectual property, please
see “Risk Factors—Risks Relating to Our Intellectual Property and Regulatory Exclusivity.”
In
addition to patents, we rely on trade secrets and know-how to develop and maintain our competitive position. For example, significant
aspects of our proprietary LNC Platform are based on unpatented trade secrets and know-how. Trade secrets and know-how can be difficult
to protect. We seek to protect our proprietary technology and processes, in part, by confidentiality agreements and invention assignment
agreements with our employees, consultants, scientific advisors, contractors and commercial partners. These agreements are designed to
protect our proprietary information and, in the case of the invention assignment agreements, to grant us ownership of technologies that
are developed through a relationship with a third party. We also seek to preserve the integrity and confidentiality of our data and trade
secrets by maintaining physical security of our premises and physical and electronic security of our information technology systems.
While we have confidence in these individuals, organizations and systems, agreements or security measures may be breached, and we may
not have adequate remedies for any breach. In addition, our trade secrets may otherwise become known or be independently discovered by
competitors. To the extent that our contractors use intellectual property owned by others in their work for us, disputes may arise as
to the rights in related or resulting know-how and inventions.
We
also plan to seek trademark protection in the United States and outside of the United States where available and when appropriate. We
intend to use these registered marks in connection with our pharmaceutical research and development as well as our product candidates.
Competition
The
biotechnology and pharmaceutical industries are characterized by rapidly advancing technologies, intense competition, and a strong emphasis
on proprietary products. We face competition from many different sources, including commercial pharmaceutical and biotechnology enterprises,
academic institutions, government agencies and private and public research institutions. Many of these companies have far greater human
and financial resources and may have product candidates in more advanced stages of development and many will reach the market before
our product candidates. Competitors may also develop products that are more effective, safer or less expensive or that have better tolerability
or convenience.
Although
we believe that our proprietary LNC Platform, experience, and knowledge in our areas of focus provide us with competitive advantages,
potential competitors could reduce our commercial opportunities. For many of our product candidates, we anticipate facing competition
from other products that are available on a generic basis and offered at low prices. Many of these generic products have been marketed
by third parties for many years and are well accepted by physicians, patients, and payers.
We
believe that MAT2203 provides us with competitive advantages over our peers. However, we face potential competition from various sources,
including larger and better-funded pharmaceutical, specialty pharmaceutical, and biotechnology companies, as well as from generic drug
manufacturers, academic institutions, governmental agencies, and public and private research institutions.
MAT2203,
if approved by FDA, will primarily compete with antifungal classes approved for the treatment of fungal and mold infections, which
include polyenes, azoles and echinocandins. The approved branded therapies for these indications include Cancidas (caspofungin, marketed
by Merck & Co.), Eraxis (anidulafungin, marketed by Pfizer, Inc.), Mycamine (micafungin, marketed by Astellas Pharma US, Inc.), Diflucan
(fluconazole, marketed by Pfizer, Inc.), Noxafil (posaconazole, marketed by Merck & Co.), Vfend (voriconazole, marketed by Pfizer,
Inc.), Sporanox (itraconazole, marketed by Jansen Pharmaceuticals, Inc.), Cresemba (isavuconazole, marketed by Astellas Pharma US, Inc.),
Ambisome (liposomal amphotericin B, marketed by Astellas Pharma US, Inc.), Abelcet (lipid complex amphotericin B, marketed by Sigma Tau
Pharmaceuticals Inc.), Rezzayo (rezafungin, marketed by Melinta Therapeutics), Brexafemme (Ibrexafungerp marketed by GlaxoSmithKline)
and amphotericin B deoxycholate (marketed by X-Gen Pharmaceuticals, Inc.). There currently are and may be more generic versions of these
products available at the time of MAT2203 market approval, which will create added competition. In addition to approved therapies, we
expect that MAT2203 may compete with product candidates that we are aware of in clinical development by third parties, such olorofim
(being developed by F2G, Ltd), fosmanogepix (being developed by Basilea), and AM2-19, a derivative of amphotericin B being developed
by Elion Therapeutics.
Manufacturing
We
currently lease in-house manufacturing capabilities for our lead LNC Platform product candidate, MAT2203. While sufficient to produce
the clinical supplies of product necessary to conduct our previous clinical trials with MAT2203, we continue to explore relationships
with well-respected third-party contract manufacturers for the formulation and manufacture of MAT2203, which would be necessary should
we be successful in finding a partner to continue the development of MAT2203. We would be required to transfer our technology and any
associated information to our partner or to a third-party manufacturer in order to manufacture the drug necessary for additional clinical
work and any supplies required for the commercialization of MAT2203, if approved.
There
are several potential third-party suppliers for amphotericin B, the generic active pharmaceutical ingredient in our lead clinical stage
product candidate – MAT2203. Although to date we have not entered into formal supply agreements to secure sufficient supply of
amphotericin B to support our clinical programs for MAT2203, we believe we will be able to secure supply of amphotericin B to support
our clinical programs for MAT2203 from one or more third-party suppliers.
Sales
and Marketing
We
currently do not have any sales and marketing infrastructure and do not plan to develop this infrastructure in the future.
Review
and Approval of Drugs in the United States
In
the United States, FDA regulates drugs under the Federal Food, Drug, and Cosmetic Act, or FDCA, and implementing regulations. The process
of obtaining regulatory approvals and the subsequent compliance with appropriate federal, state, local and foreign statutes and regulations
requires 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 and/or sponsor to a variety
of administrative or judicial sanctions, including refusal by FDA to approve pending applications, withdrawal of an approval, imposition
of a clinical hold, issuance of warning letters and other types of letters, product recalls, product seizures, total or partial suspension
of production or distribution, injunctions, fines, refusals of government contracts, restitution, disgorgement of profits, or civil or
criminal investigations and penalties brought by FDA and the Department of Justice (DOJ) or other governmental entities.
Our
product candidates must be approved by FDA through the NDA or biologics license application (BLA), in the case of biologic product candidates,
process before they may be legally marketed in the United States. An applicant seeking approval to market and distribute a new drug product
in the United States must typically undertake the following:
● preparation and submission to FDA of an NDA or BLA;
● payment of user fees and securing FDA approval of the NDA or BLA; and
Nonclinical
Studies
Nonclinical
studies include laboratory evaluation of the purity and stability of the manufactured drug substance or active pharmaceutical ingredient
and the formulated drug or drug product, as well as in vitro and animal studies to assess the safety and activity of the drug
for initial testing in humans and to establish a rationale for therapeutic use. The conduct of nonclinical studies is subject to federal
regulations and requirements, including cGLP regulations. The results of the nonclinical tests, together with manufacturing information,
analytical data, any available clinical data or literature and plans for clinical trials, among other things, are submitted to FDA as
part of an IND.
Companies
usually must complete some long-term nonclinical testing, such as animal tests of reproductive AEs and carcinogenicity, and must also
develop additional information about the chemistry and physical characteristics of the drug and finalize a process for manufacturing
the drug in commercial quantities in accordance with cGMP requirements. The manufacturing process must be capable of consistently producing
quality batches of the drug candidate and, among other things, the manufacturer must develop methods for testing the identity, strength,
quality and purity of the final drug product. Additionally, appropriate packaging must be selected and tested, and stability studies
must be conducted to demonstrate that the drug candidate does not undergo unacceptable deterioration over its shelf life.
Human
Clinical Trials in Support of a Regulatory Approval
Clinical
trials involve the administration of the investigational product to human subjects under the supervision of qualified investigators in
accordance with GCP requirements, which include, among other things, the requirement that all research subjects provide their informed
consent in writing before their participation in any clinical trial. Clinical trials are conducted under written study protocols detailing,
among other things, the objectives of the study, the parameters to be used in monitoring safety and the effectiveness criteria to be
evaluated. A protocol for each clinical trial and any subsequent protocol amendments must be submitted to FDA as part of the IND. An
IND automatically becomes effective 30 days after receipt by FDA, unless before that time FDA raises concerns or questions related to
a proposed clinical trial and places the trial on clinical hold. In such a case, the IND sponsor and FDA must resolve any outstanding
concerns before the clinical trial can begin. Accordingly, submission of an IND may or may not result in FDA allowing clinical trials
to commence.
In
addition, an IRB representing each institution participating in the clinical trial must review and approve the plan for any clinical
trial before it commences at that institution, and the IRB must conduct continuing review and reapprove the study at least annually.
The IRB must review and approve, among other things, the study protocol and informed consent information to be provided to study subjects.
An IRB must operate in compliance with FDA regulations. Information about certain clinical trials must be submitted within specific timeframes
to the National Institutes of Health for public dissemination on their ClinicalTrials.gov website.
A
sponsor who wishes to conduct a clinical trial outside the United States may, but need not, obtain FDA authorization to conduct the clinical
trial under an IND. When a foreign clinical study is conducted under an IND, all FDA IND requirements must be met unless waived. If a
foreign clinical trial is not conducted under an IND, the sponsor may submit data from the clinical trial to FDA in support of an NDA
or IND so long as the clinical trial is conducted in accordance with GCP and if FDA is able to validate the data from the clinical trial
through an on-site inspection if FDA deems it necessary.
Human
clinical trials are typically conducted in three sequential phases, which may overlap or be combined:
Phase
1: The drug is initially introduced into a small number of healthy human subjects or patients with the target disease (e.g. cancer)
or condition and tested for safety, dosage tolerance, absorption, metabolism, distribution, excretion and, if possible, to gain an early
indication of its effectiveness and to determine optimal dosage.
Phase
2: The drug is administered to a larger number of trial participants, up to several hundred, who usually have the disease or condition
that the experimental drug is intended to treat, to identify possible adverse effects and safety risks, to preliminarily evaluate the
efficacy of the product for specific targeted diseases and to determine dosage tolerance and optimal dosage.
Phase
3: These clinical trials are commonly referred to as “pivotal” studies, which typically denotes a study which presents
the data that FDA or another relevant regulatory agency will use to determine whether or not to approve a drug. In Phase 3 clinical trials,
the drug is administered to an expanded patient population, generally at geographically dispersed clinical trial sites, in well-controlled
clinical trials to generate enough data to statistically evaluate the efficacy and safety of the product for approval, to establish the
overall risk-benefit profile of the product, and to provide adequate information for the labeling of the product.
Progress
reports detailing the results of the clinical trials must be submitted at least annually to FDA and more frequently if serious AEs occur.
Phase 1, Phase 2 and Phase 3 clinical trials may not be completed successfully within any specified period, or at all. Furthermore, FDA
or the sponsor may suspend or terminate a clinical trial at any time on various grounds, including a finding that the research subjects
are being exposed to an unacceptable health risk. Similarly, an IRB can suspend or terminate approval of a clinical trial at its institution,
or an institution it represents, 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. FDA will typically inspect one or more clinical sites to assure compliance
with GCP and the integrity of the clinical data submitted.
Submission
of an NDA to FDA
Regulatory
approval for most new drug or biologic products is based on two adequate and well-controlled Phase 3 clinical trials that provide evidence
of the safety and efficacy of the proposed new product. Assuming successful completion of required clinical testing and other requirements,
the results of the nonclinical and clinical trials, together with detailed information relating to the product’s chemistry, manufacture,
controls, and proposed labeling, among other things, are submitted to FDA as part of an NDA requesting approval to market the drug product
for one or more indications. Under federal law, the submission of most NDAs is additionally subject to an application user fee and the
sponsor of an approved NDA is also subject to annual prescription drug program fees and establishment user fees. These fees are typically
increased annually.
FDA
conducts a preliminary review of an NDA within 60 days of its receipt and informs the sponsor by the 74th day after FDA’s receipt
of the submission whether the application is sufficiently complete to permit substantive review. FDA may request additional information
rather than accept an NDA for filing. In this event, the application must be resubmitted with the additional information. The resubmitted
application is also subject to review before FDA accepts it for filing. Once the submission is accepted for filing, FDA begins an in-depth
substantive review. FDA has agreed to specified performance goals in the review process of NDAs. Most such applications are meant to