PHARMACYTE BIOTECH, INC. Form 10-K
Table of Contents
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 ACT OF 1934
For the fiscal year ended April 30, 2026
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 001-40699
PHARMACYTE BIOTECH, INC.
(Exact name of registrant as specified in its charter)
Securities registered pursuant to Section 12(b)
of the Act:
Title of each class Trading symbol(s) Name of each exchange on which registered
Common Stock, Par Value $0.0001 Per Share PMCB The Nasdaq Stock Market LLC
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 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 ☒
State 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 last sold, or the average
bid and asked price of such common equity, as of October 31, 2025: $6,278,282.
As of July 24, 2026, the registrant had 10,735,649
outstanding shares of common stock.
DOCUMENTS INCORPORATED BY REFERENCE
None.
TABLE OF CONTENTS
PART I
ITEM 1. BUSINESS 1
ITEM 1A. RISK FACTORS 30
ITEM 1B. UNRESOLVED STAFF COMMENTS 78
ITEM 1C. CYBERSECURITY 79
ITEM 2. PROPERTIES 81
ITEM 3. LEGAL PROCEEDINGS 81
ITEM 4. MINE SAFETY DISCLOSURES 81
PART II
ITEM 6. [RESERVED] 82
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 92
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 92
ITEM 9A. CONTROLS AND PROCEDURES 92
ITEM 9B. OTHER INFORMATION 94
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 94
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 95
ITEM 11. EXECUTIVE COMPENSATION 101
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES 108
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 110
i
Cautionary Note Regarding Forward-Looking Statements
This Annual Report on Form 10-K (“Report”)
includes “forward-looking statements” within the meaning of the federal securities laws. Forward-looking statements are inherently
subject to risks, uncertainties and assumptions. Generally, statements other than statements of historical fact are “forward-looking
statements” for purposes of this Report, including any projections of earnings, revenue or other financial items, any statements
regarding the plans and objectives of management for future operations, any statements concerning proposed new products or services, any
statements regarding future economic conditions or performance, any statements regarding expected benefits from any transactions and any
statements of assumptions underlying any of the foregoing. In some cases, forward-looking statements can be identified by use of terminology
such as “may,” “will,” “should,” “believes,” “intends,” “expects,”
“plans,” “anticipates,” “estimates,” “goal,” “aim,” “potential”
or “continue,” or the negative thereof or other comparable terminology. Although we believe that the expectations reflected
in the forward-looking statements contained in this Report are reasonable, there can be no assurance that such expectations or any of
the forward-looking statements will prove to be correct, and actual results could differ materially from those projected or assumed in
the forward-looking statements. Thus, investors should refer to and carefully review information in future documents we file with the
U.S. Securities and Exchange Commission (“Commission”). Our future financial condition and results of operations, as well
as any forward-looking statements, are subject to inherent risk and uncertainties, including, but not limited to, the risk factors set
forth in “Part I, Item 1A – Risk Factors” set forth in this Report and for the reasons described elsewhere in this Report.
Among others, these include:
· the success and timing of our preclinical studies and clinical trials;
All forward-looking statements and reasons why results
may differ included in this Report are made as of the date hereof, and we do not intend to update any forward-looking statements except
as required by law or applicable regulations. New risk factors emerge from time to time, and it is not possible to predict all such risk
factors, nor can we assess the impact of all such risk 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. Forward-looking statements are not
guarantees of performance. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in
their entirety by the foregoing cautionary statements.
Except where the context otherwise requires, in this
Report, the “Company,” “we,” “us” and “our” refer to PharmaCyte Biotech, Inc., a Nevada
corporation, and, where appropriate, its subsidiaries.
ii
PART I
ITEM 1. BUSINESS
We are a biotechnology company focused on developing
cellular therapies for cancer based upon a proprietary cellulose-based live cell encapsulation technology known as “Cell-in-a-Box®.”
The Cell-in-a-Box® technology is intended to be used as a platform upon which therapies for several types of cancer, including LAPC,
will be developed. The current generation of our product candidate is referred to as “CypCapsTM.”
On November 17, 2023, the Board formed the Strategic
Scientific Committee (the “Scientific Committee”), chaired by Dr. Michael Abecassis. The Scientific Committee and our independent
consultants are reviewing many of the risks relative to our business. In addition, the Board is reviewing risks associated with our development
programs and our relationship with SG Austria Pte. Ltd. (“SG Austria”), including that all licensed patents have expired and
that know-how relating to our Cell-in-a-Box® technology solely resides with SG Austria. The Board has reduced spending on our programs,
including pre-clinical and clinical activities, until the review by the Scientific Committee and the Board is complete and the Board has
determined the actions and plans to be implemented. The Scientific Committee’s recommendations will include potentially seeking
a new framework for our relationship with SG Austria and its subsidiaries. We are reevaluating those programs which are dependent on SG
Austria and the U.S. Food and Drug Administration’s (the “FDA”) acceptance of its technologies, including our development
programs for locally advanced, inoperable, non-metastatic pancreatic cancer (“LAPC”). Our reevaluation for addressing the
FDA concerns has resulted in delays stemming from the review of the nonclinical package provided by SG Austria and changes to the FDA
review process.
The Cell-in-a-Box® encapsulation technology is
designed to present genetically engineered live human cells to targeted tissues. The technology is intended to result in the formation
of pinhead-sized cellulose-based porous capsules in which genetically modified live human cells can be encapsulated, grown to confluence
and maintained in a cryopreserved (frozen) state until shortly before they are injected into an appropriate patient. In a laboratory setting,
this proprietary live cell encapsulation technology has been shown to create a micro-environment in which encapsulated cells survive and
flourish. Encapsulated cells are protected from environmental challenges, such as the shear forces associated with bioreactors and passage
through catheters and needles, which we believe enables greater cell growth and production of the active molecules. The capsules are largely
composed of cellulose (cotton) and are bioinert. During the past year, SG Austria has generated data and reports to support submission
to the FDA concerning the safety of the microcapsules.
We have been developing therapies for pancreatic tumors
by using genetically engineered live human cells that we believe may be capable of converting a cancer prodrug into its cancer-killing
form. We encapsulate those cells using the Cell-in-a-Box® technology and place those capsules in the body as close as possible to
the tumor. In this way, we believe that when a cancer prodrug is administered to a patient with a particular type of cancer that may be
affected by the resulting active drug, the killing or shrinking the patient’s cancerous tumor may be optimized both by enhanced
potency and limited exposure away from the target tumor. We believe that the prodrug/activator technology is well suited to address the
shift from cure/enhanced survival to creating a zone of clearance around blood vessels adjacent to tumor. This zone of clearance improves
the probability of successful surgical resection of LAPC, which has been shown to improve survival.
In addition to reengaging SG Austria, we are also
identifying alternative approaches to expand the prodrug/activator technology for cancer treatment. These discussions may expand our prodrug/activation
options to use highly toxic cancer-killing drugs in tightly controlled perivascular spaces.
Until the Scientific Committee
completes its evaluation of our programs and we enter into a new framework for our relationship with SG Austria, spending on our
development programs has been curtailed.
Investigational New Drug Application and Clinical
Hold
On September 1, 2020, we submitted an IND to the FDA
for a planned clinical trial in LAPC. On October 1, 2020, we received notice from the FDA that it had placed our IND on clinical hold.
On October 30, 2020, the FDA sent us a letter setting forth the reasons for the clinical hold and providing specific guidance on what
we must do to have the clinical hold lifted.
In order to address the clinical hold, the FDA has
requested that we:
· Provide additional sequencing data and genetic stability studies;
· Provide additional product release specifications for our encapsulated cells;
· Conduct a biocompatibility assessment using the capsules material;
The FDA also requested that we address the following
issues as an amendment to our IND:
We assembled a scientific and regulatory team to address
the FDA requests. That team has been working diligently to complete the items requested by the FDA.
The following provides a detailed summary of our activities
to have the clinical hold lifted:
We assembled a scientific and regulatory team of experts
to address the FDA requests. During the year ended April 30, 2026, our scientific consultants have been in active dialog with the FDA.
The technology upon which the LAPC treatment will be based, intra-arterial chemotherapy The treatment may not be a treatment of pancreatic
cancer, but a method of improving and possibly enabling complete surgical resection of the tumor. We are waiting for the FDA’s responses
and hope the FDA will accept that the LAPC treatment now meets manufacturing standard requirements, which have significantly improved
since the clinical hold was first placed. The FDA may require additional preclinical studies when the meeting takes place. We are in ongoing
dialogue with SG Austria to prepare for the next steps including encapsulation of the cells, testing the glide force and pressure testing
of pushing the cells through syringes and catheters.
History of the Business
In 2013, we restructured our operations to focus on
biotechnology. On January 6, 2015, we changed our name from “Nuvilex, Inc.” to “PharmaCyte Biotech, Inc.” to reflect
the nature of our business.
We are a biotechnology company focused on developing
and preparing to commercialize cellular therapies for cancer using our live cell encapsulation technology. This resulted from entering
into the following agreements.
Commencing in May 2011, we entered into a series of
agreements and amendments with SG Austria Pte. Ltd. (“SG Austria”) to acquire certain assets from SG Austria as well as an
exclusive, worldwide license to use, with a right to sublicense, the Cell-in-a-Box® technology and trademark for the development
of therapies for cancer (“SG Austria APA”).
In June 2013, we and SG Austria entered a Third Addendum
to the SG Austria APA (“Third Addendum”). The Third Addendum materially changed the transaction contemplated by the SG Austria
APA. Under the Third Addendum, we acquired 100% of the equity interests in Bio Blue Bird and received a 14.5% equity interest in SG Austria.
We paid: (i) $500,000 to retire all outstanding debt of Bio Blue Bird; and (ii) $1.0 million to SG Austria. We also paid SG Austria $1,572,193
in exchange for a 14.5% equity interest of SG Austria. The transaction required SG Austria to return to us the 66,667 shares of our common
stock held by SG Austria and for us to return to SG Austria the 67 shares of common stock of Austrianova we held.
Effective as of the same date we entered the Third
Addendum, we and SG Austria also entered a Clarification Agreement to the Third Addendum (“Clarification Agreement”) to clarify
and include certain language that was inadvertently left out of the Third Addendum. Among other things, the Clarification Agreement confirmed
that the Third Addendum granted us an exclusive, worldwide license to use, with a right to sublicense, the Cell-in-a-Box® technology
and trademark for the development of therapies for cancer.
With respect to Bio Blue Bird, Bavarian Nordic A/S
(“Bavarian Nordic”) and GSF-Forschungszentrum für Umwelt u. Gesundheit GmbH (collectively, “Bavarian Nordic/GSF”)
and Bio Blue Bird entered into a non-exclusive License Agreement (“Bavarian Nordic/GSF License Agreement”) in July 2005, whereby
Bio Blue Bird was granted a non-exclusive license to further develop, make, have made (including services under contract for Bio Blue
Bird or a sub-licensee, by Contract Manufacturing Organizations, Contract Research Organizations, Consultants, Logistics Companies or
others), obtain marketing approval, sell and offer for sale the clinical data generated from the pancreatic cancer clinical trials that
used the cells and capsules developed by Bavarian Nordic/GSF (then known as “CapCellsTM”) or otherwise use the licensed
patent rights related thereto in the countries in which patents had been granted. Bio Blue Bird was required to pay Bavarian Nordic a
royalty of 3% of the net sales value of each licensed product sold by Bio Blue Bird and/or its Affiliates and/or its sub-licensees to
a buyer. The term of the Bavarian Nordic/GSF License Agreement continued on a country-by-country basis until the expiration of the last
valid claim of the licensed patent rights.
Bavarian Nordic/GSF and Bio Blue Bird amended the
Bavarian Nordic/GSF License Agreement in December 2006 (“First Amendment to Bavarian Nordic/GSF License Agreement”) to reflect
that: (i) the license granted was exclusive; (ii) a royalty rate increased from 3% to 4.5%; (iii) Bio Blue Bird assumed the patent prosecution
expenses for the existing patents; and (iv) to make clear that the license will survive as a license granted by one of the licensors if
the other licensor rejects performance under the Bavarian Nordic/GSF License Agreement due to any actions or declarations of insolvency.
In October 2016, Bavarian Nordic/GSF and Bio Blue
Bird further amended the Bavarian Nordic/GSF License Agreement (“Second Amendment to Bavarian Nordic/GSF License Agreement”)
in order to: (i) include the right to import in the scope of the license; (ii) reflect ownership and notification of improvements; (iii)
clarify which provisions survive expiration or termination of the Bavarian Nordic/GSF License Agreement; (iv) provide rights to Bio Blue
Bird to the clinical data after the expiration of the licensed patent rights; and (v) change the notice address and recipients of Bio
Blue Bird.
Market Opportunity and Competitive Landscape
We are developing live cell encapsulation-based therapies
for cancer.
The Cell-in-a-Box® capsules are
comprised of cotton’s natural component – cellulose. Other materials used by competitors include alginate, collagen, chitosan,
gelatin and agarose. Alginate appears to be the most widely used of these. We believe the inherent strength and durability of our cellulose-based
capsules provides us with advantages over the competition. They do so with no evidence of rupture, damage, degradation, fibrous overgrowth
or immune system response. The cells within the capsules also remained alive and functioning during these studies. Other encapsulating
materials degrade in the human body over time, leaving the encapsulated cells open to immune system attack. Damage to surrounding tissues
has also been reported to occur over time when other types of encapsulation materials begin to degrade.
The cells encapsulated using the Cell-in-a-Box® technology
can be frozen for extended periods of time. When thawed, the cells are recovered with approximately 85% viability. The implications of
this property of the Cell-in-a-Box® technology are obvious – long-term storage of encapsulated cells and shipment
of encapsulated cells over long distances.
We believe our live cell encapsulation technology
may have new opportunities for us in numerous and developing ways. For example:
Pancreatic cancer is increasing in most industrialized
countries. The American Cancer Society estimated that in 2025 there were 67,000 people in the U.S. diagnosed with pancreatic cancer. It
also estimated 52,000 patients with pancreatic cancer died in 2025. Pancreatic cancer accounts for about 3% of all cancers in the U.S.
and about 7% of all cancer deaths.
Our goal is to meet the medical need for patients
with LAPC whose tumors no longer respond after 4-6 months of treatment with the chemotherapy combination of Abraxane® plus
gemcitabine or the four-drug combination known as FOLFIRINOX. For these patients, there are currently only limited therapy options. We
believe there will be no therapy comparable to our Cell-in-a-Box® plus low dose of ifosfamide combination therapy
when it is used in these patients.
We face intense competition in the field of treating
pancreatic cancer. There are dozens of startups, smaller biotech companies, big pharma, and several academic institutions and cancer centers
all trying to improve the outcome for pancreatic cancer patients. There are several drugs already available and in the pipelines of pharmaceutical
companies worldwide, not the least of which is the combination of the drugs of Abraxane® and gemcitabine. This is
the primary FDA-approved combination of drugs for treating advanced pancreatic cancer. In Europe and in the U.S., the 4-drug combination
FOLFIRINOX has also found use as a first-line treatment for advanced pancreatic cancer. Some of our competitive strengths include the
Orphan Drug Designation we have been granted by the FDA and the European Medicines Agency for our pancreatic cancer therapy. Yet many
of our competitors have substantially greater financial and marketing resources than we do. They also have stronger name recognition,
better brand loyalty and long-standing relationships with customers and suppliers. Our future success will be dependent upon our ability
to compete.
Material Agreements
Fourth Addendum to the SG Austria APA
In May 2018, we and SG Austria entered the Fourth
Addendum to the Asset Purchase Agreement. The Fourth Addendum required us to make the following payment. The payment was timely made in
full under the payment deadlines set forth in the Fourth Addendum:
The Fourth Addendum also requires us to make future
royalty payments as follows:
· Four percent royalty on all gross sales received by us or our affiliates;
· The removal of all milestone payments.
Sources and Availability of Raw Materials
The entire encapsulation process relating to the encapsulation
of the cells for the oncology is to be carried out by Austrianova. Austrianova is the sole source of our product candidates. Austrianova
is responsible for acquiring all of the necessary raw materials used in this process, including the cellulose sulfate necessary for encapsulating
the live cells, a process proprietary to Austrianova. Austrianova from time to time has experienced significant supply chain delays, and
we believe Austrianova may also be experiencing liquidity issues as well. If Austrianova is unwilling or unable to perform such manufacturing
for us, we may not be able to locate a replacement manufacturer for our product candidates.
Intellectual Property and Trade Secrets
Intellectual property and patent protection are of
paramount importance to our business, as are the trade secrets and other strategies we have employed with Austrianova to protect the proprietary
Cell-in-a-Box® technology. Although we believe we take reasonable measures to protect our intellectual property and trade secrets
and those of Austrianova, we cannot guarantee we will be able to protect and enforce our IP or obtain patent protection for our product
candidates as needed. We license technology and trademarks relating to two areas: (i) live cell encapsulation with cells that express
cytochrome P450 where the capsule is permeable to prodrug molecules and the cells are retained within the capsules and (ii) treatment
of solid cancerous tumors.
Litigation may be required to protect our product
candidates, intellectual property rights or to determine the validity and scope of the proprietary rights of others. Establishment, maintenance
and enforcement of our intellectual property utilizes financial and operational resources. In addition, the possibility exists that our
intellectual property could be discovered to be owned by others, be invalid or be unenforceable – potentially bringing unforeseen
challenges to us.
Human Capital
As of April 30, 2026, we had two full-time employees
and several consultants who devote substantial time to us. The consultants are physicians, scientists, regulatory experts, clinical operation
experts and cGMP experts. All of our research and development (“R&D”) work is handled by our consultants.
Our Corporate Information
We are a Nevada corporation incorporated in 1996.
In 2013, we restructured our operations to focus on biotechnology. The restructuring resulted in us focusing our efforts to develop a
novel, effective and safe way to treat cancer. In January 2015, we changed our name from Nuvilex, Inc. to PharmaCyte Biotech, Inc. to
reflect the nature of our current business.
Our corporate headquarters are located at 3960 Howard
Hughes Parkway, Suite 500, Las Vegas, Nevada 89169. Our telephone number is (917) 595-2850. We maintain a website at www.pharmacyte.com
to which we post copies of our press releases as well as additional information about us. Our filings with the Commission are available
free of charge through our website as soon as reasonably practicable after being electronically filed with or furnished to the Commission.
Information contained in our website is not a part of, nor incorporated by reference into, this Report or our other filings with the Commission,
and should not be relied upon.
Government Regulation and Product Approval
As a development-stage biotechnology company that
operates in the U.S., we are subject to extensive regulation by the FDA and other federal, state, and local regulatory agencies. The federal
Food, Drug, and Cosmetic Act (“FDCA”) and its implementing regulations set forth, among other things, requirements for the
research, testing, development, manufacture, quality control, safety, effectiveness, approval, labeling, storage, record keeping, reporting,
distribution, import, export, advertising, promotion, marketing and sale of our product candidates. Although the discussion below focuses
on regulation in the U.S., we anticipate seeking approval for, and marketing of, our product candidates in other countries. Our activities
in other countries will also be the subject of extensive regulation, although there can be important differences with the U.S. The process
of obtaining regulatory marketing approvals and the subsequent compliance with applicable federal, state, local and foreign statutes and
regulations will require the expenditure of substantial time and financial resources and may not be successful.
Regulatory approval, when obtained, may be limited
in scope which may significantly limit the uses for which a product may be placed in the market. Further, approved drugs or biologic products,
as well as their manufacturers, are subject to ongoing post-marketing review, inspection and discovery of previously unknown issues regarding
the safety and efficacy of such products or the manufacturing or quality control procedures used in their production. These may result
in restrictions on their manufacture, sale or use or in their withdrawal from the market. Any failure or delay by us, our suppliers of
manufactured drug product, collaborators or licensees in obtaining regulatory approvals could adversely affect the marketing of our product
candidates and our ability to receive product revenue, license revenue or profit-sharing payments. For more information, see Item 1A.
“Risk Factors.”
U.S. Government Regulation
The FDA is the main regulatory body that controls
pharmaceuticals and biologics in the U.S. Its regulatory authority is based in the FDCA and the Public Health Service Act (the “PHSA”).
Pharmaceutical products and biologics are also subject to other federal, state and local statutes and regulations. A failure to comply
with any applicable requirements during the product development, approval, or post-approval periods, may lead to administrative or judicial
sanctions. These sanctions could include, among other things, the imposition by the FDA or by an Institutional Review Board (“IRB”)
of a hold on clinical trials, FDA refusal to approve pending marketing applications or supplements, withdrawal of previously granted approval,
warning letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, civil
penalties or criminal prosecution.
The steps required before a new drug or biologic may
be marketed in the U.S. generally include:
· submission to the FDA of an IND to support human clinical testing in the U.S.;
· FDA review and approval of the NDA or BLA.
Clinical Development
Before a drug or biological product candidate may
be tested in human subjects, it must undergo preclinical testing. Preclinical tests generally include laboratory evaluations of a product
candidate’s chemical and biological activities, formulation and stability, as well as studies to evaluate toxicity in animals and
potential for other adverse events, which support subsequent clinical testing and rationale for subsequent therapeutic use.
The Consolidated Appropriations Act for 2023, signed
into law on December 29, 2022, (P.L. 117-328) amended both the FDCA and PHSA to specify that nonclinical testing for drugs and biologics,
respectively, may, but is not required to, include in vivo animal testing. According to the amended language, a sponsor may fulfill
nonclinical testing requirements by completing various in vitro assays (e.g., cell-based assays, organ chips, or microphysiological
systems), in silico studies (i.e., computer modeling), other human or non-human biology-based tests (e.g., bioprinting), or in
vivo animal tests. The results of these studies must be submitted, together with manufacturing information, analytical data, any available
clinical data or literature and a proposed clinical protocol, to the FDA as part of an IND which must be reviewed by the FDA for safety
and other considerations and become effective before testing can begin in humans. Some long-term nonclinical testing, such as animal tests
of reproductive adverse events and carcinogenicity, may continue after an IND for an investigational drug or biologic candidate is submitted
to the FDA and human clinical trials have been initiated.
An IND is a request for authorization from the FDA
to administer an investigational product candidate to humans. This authorization is required before interstate shipping and administration
can commence for any drug or biologic product candidate destined for use in humans in the U.S. A 30-day waiting period after the submission
of each IND is required before commencement of clinical testing in humans. An IND automatically becomes effective 30 days after receipt
by the FDA, unless before that time the FDA raises concerns or questions related to one or more proposed clinical trials and 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. As a result, submission of an IND may not result in the FDA allowing clinical trials to commence. Clinical holds may
also be imposed by the FDA at any time before or during studies due to safety concerns or non-compliance.
A clinical trial involves the administration of the
investigational product candidate to patients under the supervision of qualified investigators following GCP standards, which include
the requirement that all research subjects provide their informed consent in writing for their participation in any clinical trial (unless
the consent requirement has been waived by an IRB) along with the requirement to ensure that the data and results reported from the clinical
trials are credible and accurate. GCP requirements are meant to protect the rights and health of patients and to define the roles of clinical
trial sponsors, administrators and monitors. A clinical trial is conducted under a protocol that details, among other things, the objectives
of the trial, the criteria for determining subject eligibility, the dosing plan, the parameters to be used in monitoring safety, the procedure
for timely reporting of adverse events, and the efficacy criteria to be evaluated. Each protocol involving testing on U.S. patients and
subsequent protocol amendments must be submitted to the FDA as part of the IND.
In addition, an IRB representing each institution
that is 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 thereafter conduct a continuing review and re-approve the trial at least annually. The IRB must review and approve, among
other things, the trial protocol and informed consent information to be provided to clinical trial subjects. An IRB must operate in compliance
with FDA regulations.
Information about certain clinical trials, including
details of the protocol and eventually study results, also must be submitted within specific time frames to the National Institutes of
Health, or NIH, for public dissemination on the ClinicalTrials.gov data registry. Information related to the product, patient population,
phase of investigation, study sites and investigators and other aspects of the clinical trial is made public as part of the registration
of the clinical trial. Sponsors are also obligated to disclose the results of their clinical trials after completion. Disclosure of the
results of these trials can be delayed in some cases for up to two years after the date of completion of the trial. Failure to timely
register a covered clinical study or to submit study results as provided for in the law can give rise to civil monetary penalties and
also prevent the non-compliant party from receiving future grant funds from the federal government. The U.S. Department of Health and
Human Services’ Final Rule and NIH’s complementary policy on ClinicalTrials.gov registration and reporting requirements became effective
in 2017, and the government has begun enforcing those requirements against non-compliant clinical trial sponsors.
Human clinical trials are typically conducted in three
sequential phases that may overlap or be combined:
Phase 1 Clinical Trial: The product candidate
is initially introduced into healthy human subjects and tested for safety, and such trials typically include a preliminary determination
of a product candidate’s safe dosage range. A Phase 1 clinical trial also determines how a drug is absorbed, distributed, metabolized
and excreted by the body and, therefore, the potential duration of its action. In the case of some products for severe or life-threatening
diseases, such as cancer, especially when the product may be too inherently toxic to ethically administer to healthy volunteers, the initial
human testing is often conducted in patients.
Phase 2 Clinical Trial: A Phase 2 clinical
trial is conducted on a limited number of patients; these patients can have a specific targeted disease. The product candidate is administered
to such patients to identify possible adverse effects and safety risks, to preliminarily evaluate the efficacy of the product for specific
indications and to determine dosage tolerance and optimal dosage. Phase 2 clinical trials are typically well-controlled and closely monitored.
Phase 3 Clinical Trial: Such trials are undertaken
with an expanded patient population to further evaluate dosage, clinical efficacy and safety in an expanded patient population, often
at geographically dispersed clinical study sites. These studies are intended to establish the overall risk-benefit ratio of the product
candidate and provide, if appropriate, an adequate basis for product labeling. These trials may include comparisons with placebo and/or
other comparator treatments. The duration of treatment is often extended to mimic the actual use of a product during marketing.
Post-approval trials, sometimes referred to as Phase
4 clinical trials, may be conducted after initial marketing approval. These trials are used to gain additional experience from the treatment
of patients in the intended therapeutic indication. In certain instances, the FDA may mandate the performance of Phase 4 clinical trials
as a condition of approval of an NDA or BLA.
Congress also amended the FDCA, as part of the Consolidated
Appropriations Act for 2023, in order to require sponsors of a Phase 3 clinical trial, or other “pivotal study” of a new drug
or biologic to support marketing authorization, to design and submit a diversity action plan for such clinical trial. The action plan
must include the sponsor’s diversity goals for enrollment, as well as a rationale for the goals and a description of how the sponsor
will meet them. Sponsors must submit a diversity action plan to the FDA by the time the sponsor submits the relevant clinical trial protocol
to the agency for review. The FDA may grant a waiver for some or all of the requirements for a diversity action plan. It is unknown at
this time how the diversity action plan may affect Phase 3 trial planning and timing or what specific information FDA will expect in such
plans, but if the FDA objects to a sponsor’s diversity action plan, it may delay trial initiation.
Progress reports detailing the results of the clinical
trials must be submitted at least annually to the FDA and more frequently if serious adverse events occur. The decision to terminate development
of an investigational product candidate may be made by either a health authority body, such as the FDA, by IRB/ethics committees, or by
the sponsor for various reasons. The FDA may order the temporary or permanent discontinuation of a clinical trial at any time, or impose
other sanctions, if it believes that the clinical trial either is not being conducted in accordance with FDA requirements or presents
an unacceptable risk to the patients enrolled in the trial. 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 clinical protocol, GCP, or other IRB requirements
or if the product candidate has been associated with unexpected serious harm to patients. In some cases, a clinical trial is overseen
by an independent group of qualified experts organized by the trial sponsor, known as a data safety monitoring board (or DSMB). This group
provides authorization for whether a trial may move forward at designated checkpoints based on access that only the group maintains to
available data from the study.
A sponsor may be able to request a special protocol
assessment (“SPA”), the purpose of which is to reach agreement with the FDA on the Phase 3 trial protocol design, clinical
endpoints and statistical analysis that will form the primary basis of an efficacy claim. A sponsor meeting the regulatory criteria may
make a specific request for a SPA and provide information regarding the design and size of the proposed clinical trial. A SPA request
must be made before the proposed trial begins. All open issues must be resolved before the trial begins. If a written agreement is reached,
it will be documented and made part of the administrative record. The agreement will be binding on the FDA and may not be changed by the
sponsor or the FDA after the trial begins, except with the written agreement of the sponsor and the FDA or if the FDA determines that
a substantial scientific issue essential to determining the safety or efficacy of the product candidate was identified after the testing
began. A SPA is not binding if new circumstances arise, such as if the FDA identifies, after the clinical trial begins, new information
that may cause the scientific community and the agency to question or reject the assumptions supporting the SPA, or if the sponsor fails
to follow the protocol that was agreed upon with the FDA, and there is no guarantee that a study trial will ultimately be adequate to
support an approval even if the study is subject to a SPA. Having a SPA does not guarantee that a product candidate will receive FDA approval.
Concurrent with clinical trials, companies usually
complete additional nonclinical studies and must also develop additional information about the physical characteristics of the drug or
biological product 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, potency and purity of the final drug or biological
product. For biological products in particular, the PHSA emphasizes the importance of manufacturing control for products whose attributes
cannot be precisely defined in order to help reduce the risk of the introduction of adventitious agents. 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. Assuming successful completion of all required testing in accordance with all applicable regulatory
requirements, detailed investigational product candidate information is submitted to the FDA in the form of an NDA or BLA to request regulatory
approval for the product in the specified indication.
New Drug Applications and Biologic Licensing Applications
To obtain approval to market a drug or biologic in
the U.S., a marketing application must be submitted to the FDA that provides data establishing the safety and effectiveness of the product
candidate for the proposed indication. The application includes all relevant data available from pertinent preclinical studies and clinical
trials, including negative or ambiguous results as well as positive findings, together with detailed information relating to the product’s
chemistry, manufacturing and controls, as well as proposed labeling, among other things. Data can come from company-sponsored clinical
trials intended to test the safety and effectiveness of a product, or from several alternative sources, including studies initiated by
investigators. To support marketing approval, the data submitted must be sufficient in quality and quantity to establish the safety and
effectiveness of the investigational product candidate to the satisfaction of the FDA.
In most cases, the NDA, in the case of a drug, or
BLA, in the case of a biologic, must be accompanied by a substantial user fee. These fees are typically adjusted annually, but exemptions
and waivers may be available under certain, narrow circumstances. The FDA will initially review the NDA or BLA for completeness before
it accepts the application for filing. The FDA has 60 days from its receipt of an NDA or BLA to determine whether the application will
be accepted for filing based on the agency’s threshold determination that it is sufficiently complete to permit substantive review.
The FDA may request additional information rather than accept an NDA or BLA for filing, in which case, the application must be resubmitted
with the requested information. The resubmitted application is also subject to review before the FDA accepts it for filing.
After the NDA or BLA submission is accepted for filing,
the FDA begins an in-depth review. The FDA has agreed to certain performance goals in the review of NDAs and BLAs. Under the goals and
policies agreed to by the FDA under the Prescription Drug User Fee Act (“PDUFA”), for original NDAs and BLAs, the FDA has
ten months from the filing date in which to complete its initial review of a standard application and respond to the applicant, and six
months from the filing date for an application with “priority review.” For all BLAs and new molecular entity (“NME”)
NDAs, the ten and six-month time periods run from the filing date; for all other original applications, the ten and six-month time periods
run from the submission date. However, the FDA can extend such review periods by three months to consider new information or in the case
of a clarification provided by the applicant to address an outstanding deficiency identified by the FDA following the original submission.
The FDA reviews the NDA or BLA to determine, among
other things, whether the proposed product is safe and effective for its intended use, and whether the product is being manufactured in
accordance with cGMP standards. The FDA may refer applications for novel product candidates which present difficult questions of safety
or efficacy to an advisory committee. This is typically a panel of independent experts, including clinicians and other scientific experts,
that reviews, evaluates and provides a recommendation as to whether the application should be approved and under what conditions. The
FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions.
Before approving an NDA or a BLA, the FDA will typically
inspect the facilities at which the product is manufactured. The FDA will not approve the product candidate unless it determines that
the manufacturing processes and facilities substantially comply with cGMP requirements and are adequate to assure consistent production
of the product within required specifications. Manufacturers of human cellular or tissue-based biologics also must comply with the FDA’s
Good Tissue Practices (“GTP”), as applicable, and with the general biological product standards. The FDA also may inspect
the sponsor and one or more clinical trial sites to assure compliance with GCP requirements and the integrity of the clinical data submitted
to the FDA.
FDA also may require the development of a risk evaluation
and mitigation strategy (“REMS”) if it determines that a REMS is necessary to ensure that the benefits of the drug outweigh
its risks and to assure the safe use of the drug or biological product. The REMS could include medication guides, physician communication
plans, assessment plans and/or elements to assure safe use, such as restricted distribution methods, patient registries, or other risk
minimization tools. The FDA determines the requirement for a REMS, as well as the specific REMS provisions, on a case-by-case basis. If
the FDA concludes a REMS is needed, the sponsor of the NDA or BLA must submit a proposed REMS. The FDA will not approve a BLA without
a REMS, if required.
Under the Pediatric Research Equity Act as amended
(“PREA”), a NDA, BLA, or supplement to an NDA or BLA must contain data that are adequate to assess the safety and efficacy
of the product candidate for the claimed indications in all relevant pediatric populations and to support dosing and administration for
each pediatric population for which the product is safe and effective. The FDA may grant deferrals for submission of pediatric data or
full or partial waivers from such requirements. Under the law, a sponsor who is planning to submit a marketing application for a product
that includes a new active ingredient, new indication, new dosage form, new dosing regimen or new route of administration must submit
an initial Pediatric Study Plan (“PSP”) within sixty days of an end-of-Phase 2 meeting or, if there is no such meeting, as
early as practicable before the initiation of the Phase 3 or Phase 2/3 clinical trial. The initial PSP must include an outline of the
pediatric study or studies that the sponsor plans to conduct, including trial objectives and design, age groups, relevant endpoints and
statistical approach, or a justification for not including such detailed information, and any request for a deferral of pediatric assessments
or a full or partial waiver of the requirement to provide data from pediatric studies along with supporting information. The FDA and the
sponsor must reach an agreement on the PSP. A sponsor can submit amendments to an agreed upon initial PSP at any time if changes to the
pediatric plan need to be considered based on data collected from pre-clinical studies, early phase clinical trials or other clinical
development programs.
After the FDA evaluates the NDA or BLA and the product
manufacturing facilities, it issues either an approval letter or a complete response letter. An approval letter authorizes commercial
marketing of the product with specific prescribing information for specific indications. A complete response letter indicates that the
review cycle of the application is complete and the application will not be approved in its present form. A complete response letter generally
outlines the deficiencies in the submission and may require substantial additional testing or information, which may include data from
further preclinical studies or clinical trials, for the FDA to reconsider the application. If and when those deficiencies have been addressed
to the FDA’s satisfaction in a resubmission of the NDA or BLA, the FDA will issue an approval letter. Notwithstanding the submission
of any requested additional information, the FDA ultimately may decide that the application does not satisfy the regulatory criteria for
approval.
If a product receives regulatory approval from the
FDA, the approval is limited to the conditions of use (e.g., patient population, indication) described in the application. Further, depending
on the specific risks to be addressed, the FDA may require that contraindications, warnings or precautions be included in the product
labeling, require that post-approval trials, including Phase 4 clinical trials, be conducted to further assess a product’s safety
after approval, require testing and surveillance programs to monitor the product after commercialization, or impose other conditions,
including distribution and use restrictions or other risk management mechanisms under a REMS, which can materially affect the potential
market and profitability of the product. The FDA may prevent or limit further marketing of a product based on the results of post-marketing
trials or surveillance programs. After approval, some types of changes to the approved product, such as adding new indications, manufacturing
changes and additional labeling claims, are subject to further testing requirements and FDA review and approval.
FDA Review and Approval Process for Combination
Products
A combination product is a product composed of a combination
of two or more FDA-regulated product constituent parts or products, e.g., drug-device or biologic-device. Such products often raise regulatory,
policy and review management challenges because they integrate constituent parts that are regulated under different types of regulatory
requirements and by different FDA Centers, namely, the Center for Drug Evaluation and Research, or CDER, the Center for Devices and Radiological
Health, or CDRH, or the Center for Biologics Evaluation and Research, or CBER. Differences in regulatory pathways for each constituent
part can impact the regulatory processes for all aspects of product development and management, including preclinical testing, clinical
investigation, marketing applications, manufacturing and quality control, adverse event reporting, promotion and advertising, and post-approval
modifications. Specifically, under regulations issued by the FDA, a combination product may be:
The FDA’s Office of Combination Products, or
OCP, was established to provide prompt determination of the FDA Center with primary jurisdiction over the review and regulation of a combination
product; ensure timely and effective premarket review by overseeing the timeliness of and coordinating reviews involving more than one
center; ensure consistent and appropriate post-market regulation; resolve disputes regarding review timeliness; and review/revise agreements,
guidance and practices specific to the assignment of combination products.
OCP determines which Center will have primary jurisdiction
for the combination product, referred to as the Lead Center, based on the combination product’s “primary mode of action,”
or PMOA. A mode of action is the means by which a product achieves an intended therapeutic effect or action. The PMOA is the mode of action
that provides the most important therapeutic action of the combination product, or the mode of action expected to make the greatest contribution
to the overall intended therapeutic effects of the combination product. The Lead Center has primary responsibility for the review and
regulation of a combination product; however a second Center is often involved in the review process, especially to provide input regarding
the “secondary” component(s). In most instances, the Lead Center applies its usual regulatory pathway. For example, a drug-biologic
combination product assigned to CDER will typically be reviewed under an NDA, while a drug-biologic combination product assigned to CBER
is typically reviewed under through a BLA.
Often it is difficult for OCP to determine with reasonable
certainty the most important therapeutic action of the combination product. In those difficult cases, OCP will consider consistency with
other combination products raising similar types of safety and effectiveness questions, or which Center has the most expertise to evaluate
the most significant safety and effectiveness questions raised by the combination product. A sponsor may use a voluntary formal process,
known as a Request for Designation, when the product classification is unclear or in dispute, to obtain a binding decision as to which
Center will regulate the combination product. If the sponsor objects to that decision, the sponsor may request that OCP reconsider its
decision.
Combination products are subject to FDA user fees
based on the type of application submitted for the product’s premarket approval or clearance. For example, a combination product
for which an NDA is submitted is subject to the NDA fee under PDUFA.
Since a combination product incorporates two or more
constituent parts that have different regulatory requirements, a combination product manufacturer must comply with all cGMP requirements
that apply to each constituent part. The FDA has issued a combination product cGMP regulation, along with final guidance, describing two
approaches a combination product manufacturer may follow to demonstrate compliance. Under these two options, the manufacturer demonstrates
compliance with: (1) All cGMP regulations applicable to each separate regulated constituent part included in the combination product;
or (2) either the drug cGMP or the QSR (if there is a device constituent part), as well as with specified provisions from the other of
these two sets of requirements (also called the “streamlined approach”).
Post Approval Regulations
After regulatory approval of a drug or biologic is
obtained, a company is required to comply with pervasive and continuing FDA requirements. For example, as a condition of approval of an
NDA or BLA, the FDA may require post-marketing testing, including a Phase 4 clinical trial and surveillance to further assess and monitor
the product’s safety and effectiveness after commercialization has begun. In addition, NDA and BLA holders are subject to regulations
governing, among other things, monitoring and recordkeeping activities, reporting of adverse experiences with the product, product sampling
and distribution restrictions, complying with promotion and advertising requirements, which include restrictions on promoting drugs for
unapproved uses or patient populations (i.e., “off-label use”) and limitations on industry-sponsored scientific and educational
activities. If there are any modifications to the product, including changes in indications, labeling or manufacturing processes or facilities,
the applicant may be required to submit and obtain FDA approval of a new NDA/BLA or an NDA/BLA supplement, which may require the applicant
to develop additional data or conduct additional nonclinical studies and clinical trials. The FDA may also place other conditions on approvals
including the requirement for a REMS to assure the safe use of the product. 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 products.
Product approvals may be withdrawn for non-compliance with regulatory standards or if problems occur following initial marketing.
FDA regulations also require drug and biologic manufacturers
to implement and maintain quality control and manufacturing procedures that conform to cGMP standards to assure and preserve the long-term
stability of the approved product. The cGMP regulations include requirements relating to organization of
personnel, buildings and facilities, equipment, control of components and drug product containers and closures, production and process
controls, packaging and labeling controls, holding and distribution, laboratory controls, records and reports and returned or salvaged
products. Manufacturers and other entities involved in the production and distribution of approved drugs or biologics are required to
register their establishments with the FDA and certain state agencies, and such facilities are subject to periodic unannounced or scheduled
inspections by the FDA and certain state agencies to assess compliance with cGMP standards. In addition, FDA regulations require investigation
and correction of any deviations from cGMP standards and impose reporting and documentation requirements upon a company and any third-party
manufacturers that a company may decide to use. Accordingly, manufacturers must continue to expend time, money and effort in production
and quality control to maintain compliance with cGMP standards and other aspects of regulatory compliance. Future inspections by the FDA
and other regulatory agencies may identify compliance issues at the facilities of our CMOs that may disrupt production or distribution
or require substantial resources to correct. In addition, the discovery of conditions that violate these rules, including failure to conform
to cGMPs, could result in enforcement actions, and the discovery of problems with a product after approval may result in restrictions
on a product, manufacturer or holder of an approved NDA or BLA, including voluntary recall and regulatory sanctions as described below.
Once an approval of a drug or biologic is granted,
the FDA may withdraw the approval if compliance with regulatory requirements and standards is not maintained or if problems occur after
the product reaches the market. Later discovery of previously unknown problems with a product, including adverse events of unanticipated
severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in mandatory revisions
to the approved labeling to add new safety information, imposition of post-market surveillance studies or clinical trials to assess new
safety risks, or imposition of distribution or other restrictions under a REMS program. Other potential consequences include, among other
things: