Item 1A. Risk Factors 34
Item 1B. Unresolved Staff Comments 72
Item 2. Properties 72
Item 3. Legal Proceedings 72
Item 4. Mine Safety Disclosures 72
Item 6. (Reserved) 73
Item 7A. Quantitative and Qualitative Disclosures About Market Risk 80
Item 8. Financial Statements and Supplementary Data 80
Item 9A. Controls and Procedures 81
Item 9B. Other Information 81
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspection 81
PART III 82
Item 10. Directors, Executive Officers and Corporate Governance 82
Item 11. Executive Compensation 88
Item 14. Principal Accounting Fees and Services 97
Item 15. Exhibits and Financial Statement Schedules 98
References
in this Annual Report on Form 10-K (this “Annual Report”) to the “Company,” “Beyond Air,” “we,”
“our,” or “us” mean Beyond Air, Inc. and its subsidiaries except where the context otherwise requires.
FORWARD-LOOKING
STATEMENTS AND MARKET DATA
This
Annual Report contains forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions
for forward-looking statements contained in Section 27A of the Securities Act of 1933 (the “Securities Act”) and Section
21E of the Securities Exchange Act of 1934 (the “Exchange Act”). All statements other than statements of historical facts
contained in this Annual Report, including statements regarding our future results of operations and financial position, business strategy,
approved product and product candidates, certifications or approvals, timing of our clinical development activities, research and development
costs, our commercialization plans and the expected timing thereof, timing and likelihood of success, and the plans and objectives of
management for future operations and future results of anticipated products are forward-looking statements. These statements involve
known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to
be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
In
some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,”
“expect,” “plan,” “anticipate,” “expect,” “could,” “intend,”
“target,” “project,” “contemplate,” “believe,” “estimate,” “predict,”
“potential,” or “continue” or the negative of these terms or other similar conditional expressions. The forward-looking
statements in this Annual Report are only predictions. We have based these forward-looking statements largely on our current expectations
and projections about future events and financial trends that we believe may affect our business, financial condition and results of
operations. These forward-looking statements speak only as of the date of this Annual Report and are subject to a number of important
factors that could cause actual results to differ materially from those in the forward-looking statements, including the factors described
under the sections in this Annual Report titled “Risk Factors” and “Management’s Discussion and Analysis
of Financial Condition and Results of Operations” as well as the following:
-
our ability to successfully commercialize our LungFit® PH system in the U.S.;
-
our ability to obtain a CE Certificate of Conformity to CE mark LungFit® in the European Union (the “EU”);
-
our expectation to incur losses for the next few years;
-
our ability to predict accurately the demand for our products, and products under development and to develop strategies to address markets
successfully;
-
the possibility that products may contain undetected errors or defects or otherwise not perform as anticipated;
-
the anticipated development of markets we sell our products into and the success of our products in these markets;
-
our future capital needs and our need to raise additional funds;
-
our ability to build a pipeline of product candidates and develop and commercialize our approved products;
-
our ability to enroll patients in clinical trials, timely and successfully complete those trials and receive necessary certifications
or regulatory approvals;
-
our ability to maintain our existing or future collaborations or licenses;
-
our ability to protect and enforce our intellectual property rights;
-
federal, state, and foreign regulatory requirements, including the U.S. Food and Drug Administration (“FDA”) regulation of
our approved product and product candidates;
-
our ability to obtain and retain key executives and attract and retain qualified personnel; and
-
our ability to successfully manage our growth, including as a commercial-stage company.
Moreover,
we operate in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for management
to predict all risk factors and uncertainties.
You
should read this Annual Report and the documents that we reference in this Annual Report completely and with the understanding that our
actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary
statements. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained
herein, whether as a result of any new information, future events, changed circumstances or otherwise.
Beyond
Air, Inc., the Beyond Air logo, and other trademarks or service marks of Beyond Air, Inc. appearing in this Annual Report are the property
of Beyond Air, Inc. This Annual Report also includes trademarks, tradenames and service marks that are the property of other organizations.
Solely for convenience, trademarks and tradenames referred to in this Annual Report may appear without the ® and TM
symbols, but those references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable
law, our rights, or that the applicable owner will not assert its rights, to these trademarks and tradenames.
MARKET,
INDUSTRY AND OTHER DATA
This
Annual Report contains estimates, projections, market research and other information concerning our industry, our business, markets for
LungFit® PH and our product candidates and the size of those markets, the prevalence of certain medical conditions, LungFit®
PH market access, prescription data and other physician, patient and payor data. Unless otherwise expressly stated, we obtain this
information from reports, research surveys, studies and similar data prepared by market research firms and other third parties, industry,
medical and general publications, government data and similar sources as well as from our own internal estimates and research and from
publications, research, surveys and studies conducted by third parties on our behalf. Information that is based on estimates, projections,
market research or similar methodologies is inherently subject to uncertainties and actual events or circumstances may differ materially
from events and circumstances that are reflected in this information. As a result, you are cautioned not to give undue weight to such
information.
SUMMARY
OF PRINCIPAL RISK FACTORS
This
summary briefly lists the principal risks and uncertainties facing our business, which are only a select portion of those risks. A more
complete discussion of those risks and uncertainties is set forth in Part I, Item 1A of this Annual Report, entitled Risk Factors. Additional
risks not presently known to us or that we currently deem immaterial may also affect us. If any of these risks occur, our business, financial
condition or results of operations could be materially and adversely affected.
Our
business is subject to the following principal risks and uncertainties:
Risks
Related to our Financial Position and Capital Requirements
Risks
Related to Commercialization of our Approved Product or Product Candidates
Risks
Related to the Discovery and Development of Our Product Candidates
Risks
Related to our Reliance on Third Parties
Risks
Related to our Intellectual Property
Risks
Related to our Business Operations
Risks
Related to the Ownership of our Common Stock
Risks
Related to Employee Matters
● Our employees may engage in misconduct or other non-compliant activities.
General
Risk Factors
PART
I
ITEM
1. BUSINESS
Business
Overview
We
are a commercial-stage medical device and biopharmaceutical company developing a platform of nitric oxide (“NO”)
generators and delivery systems (the “LungFit® platform”) capable of generating NO from ambient air. Our
first device, LungFit® PH received premarket approval (“PMA”) approval from the FDA in June 2022. The NO generated by the
LungFit® PH system is indicated to improve oxygenation and reduce the need for extracorporeal membrane oxygenation in
term and near-term (>34 weeks gestation) neonates with hypoxic respiratory failure associated with clinical or echocardiographic
evidence of pulmonary hypertension in conjunction with ventilatory support and other appropriate agents. This condition is commonly
referred to as persistent pulmonary hypertension of the newborn or “PPHN”. The LungFit® platform can
generate NO up to 400 parts per million (“ppm”) for delivery to a patient’s lungs directly or via a ventilator.
LungFit® can deliver NO either continuously or for a fixed amount of time at various flow rates and has the ability
to either titrate dose on demand or maintain a constant dose. In July 2022, the Company commenced marketing LungFit® PH in the United States for PPHN as a medical
device.
LungFit®
can be used to treat patients on ventilators that require NO, as well as patients with chronic or acute severe lung infections
via delivery through a breathing mask or similar apparatus. Furthermore, we believe that there is a high unmet medical need for patients
suffering from certain severe lung infections that the LungFit® platform can potentially address. Our current areas of
focus with LungFit® are PPHN, viral community-acquired pneumonia (“VCAP”) including COVID-19, bronchiolitis
(“BRO”), nontuberculous mycobacteria (“NTM”) lung infection and those with various severe lung infections with
underlying chronic obstructive pulmonary disease (“COPD”). The Company’s current product candidates will be
subject to premarket reviews and approvals by the FDA, certification through the conduct of a conformity assessment by a notified body
in the EU for the product to be CE marked, as well as comparable foreign regulatory authorities.
With Beyond Air’s focus on NO and its effect on the human condition,
there are two additional programs that do not utilize our LungFit® system. Through our majority-owned affiliate Beyond
Cancer, Ltd. (“Beyond Cancer”), NO is used to target solid tumors. The LungFit® platform is not utilized for
the solid tumor indication due to need for ultra-high concentrations of gaseous nitric oxide (“UNO”). A proprietary delivery
system has been developed that can safely deliver UNO in excess of 10,000 ppm directly to a solid tumor. This program has advanced to
a phase 1 human study.
The second program which does not utilize the LungFit® platform,
partially inhibits neuronal nitric oxide synthase (“nNOS”) in the brain to treat neurological conditions. The first target
indication is autism spectrum disorder (“ASD”). ASD is a serious neurodevelopmental and behavioral disorder, and one of the
most disabling conditions and chronic illnesses in children. ASD includes a wide range of developmental disorders that share a core of
neurobehavioral deficits manifested by abnormalities in social interactions, deficits in communication, restricted interests, and repetitive
behaviors. In 2023, the CDC reported that approximately 1 in 36 children in the U.S. is diagnosed with an ASD. The cost of caring
for Americans with autism had reached $268 billion in 2015 and would rise to $461 billion by 2025 in the absence of more-effective interventions
and support across the life span. We expect this program to progress from pre-clinical to a phase 1 first-in-human study by early
2025.
Our
approved product and active pipeline of product candidates is shown in the table below:
Our
programs represent large market opportunities:
All
figures are Company estimates for peak year sales: Global sales potential includes U.S. sales potential.
LungFit®
PH is the first FDA approved system using our patented ionizer technology to generate on-demand NO from ambient air and,
regardless of dose or flow, deliver it to a ventilator circuit. The device uses a medical air compressor to drive room air through a
plasma chamber in the center of the unit where pulses of electrical discharge are created between two electrodes. The system uses the
power equivalent to a 60-watt lightbulb to ionize the nitrogen and oxygen molecules, which then combine as NO with low levels of nitrogen
dioxide (“NO2”) created as a byproduct. The products are then passed through a Smart Filter, which removes the
toxic NO2 from the internal circuit. With respect to PPHN, the novel LungFit® PH is designed to deliver a dosage
of NO to the lungs that is consistent with current guidelines for delivery of 20 ppm NO with a range of 0.5 ppm – 80 ppm (low concentration
NO) for ventilated patients.
We
believe the ability of LungFit® PH to generate NO from ambient air provides us with many competitive advantages over the
current standard of NO delivery systems in the U.S., the EU, Japan and other markets. For example, LungFit® PH does
not require the use of a high-pressure cylinder, does not require cumbersome purging procedures and places less burden on hospital staff
in carrying out safety procedures.
Our
novel LungFit® platform can also deliver a high concentration (>150 ppm) of NO directly to the lungs, which
we believe has the potential to eliminate microbial infections including bacteria, fungi and viruses, among others. We believe that current
FDA-approved NO vasodilation treatments would have limited success in treating microbial infections given the low concentrations of NO
being delivered (<100 ppm). Given that NO is produced naturally by the body as an innate immunity mechanism, at a concentration of
200 ppm, supplemental high dose NO should aid in the body’s fight against infection. Based on our preclinical and clinical studies,
we believe that 150 ppm is the minimum therapeutic dose to achieve the desired pulmonary antimicrobial effect of NO. To date, neither
the FDA nor comparable foreign regulatory agencies in other countries or regions have approved any NO formulation and/or delivery system
for >80 ppm NO.
LungFit®
PH for the treatment of Persistent Pulmonary Hypertension of the Newborn (PPHN)
In
June 2022, the FDA approved LungFit® PH to improve oxygenation and reduce the need for extracorporeal membrane oxygenation
in term and near-term (>34 weeks gestation) neonates with hypoxic respiratory failure associated with clinical or echocardiographic
evidence of pulmonary hypertension in conjunction with ventilatory support and other appropriate agents. LungFit® PH is
the inaugural device from the LungFit® platform of NO generators that use patented ionizer technology and is the first
FDA-approved product for Beyond Air.
We
also expect to be CE Mark certified under the EU Medical Device Regulation
(“EU MDR”) in the EU in the second half of calendar year 2023. According to the most recent year-end report from Mallinckrodt
Pharmaceuticals (“Mallinckrodt”), sales of NO were $339.7 million in 2022 (down from $448.5 million in 2021) for the United
States, Canada, Japan, Mexico and Australia, with ~90% in the United States. Outside of the U.S. there are multiple market participants
which translates to considerably lower sales than in the U.S. We believe the U.S. sales potential of LungFit® PH in PPHN
to be approximately $400 million and worldwide sales potential to be greater than $700 million. We initiated the first phase of our commercial
launch in June 2022, and entered into phase 2 with an expanded commercial presence during the spring of 2023 in the U.S. and will continue
to work toward a potential launch in the EU and globally in 2023 and beyond.
LungFit®
PRO for the treatment of viral lung infections in hospitalized patients
Viral Community-Acquired Pneumonia (including COVID-19)
Viral
pneumonia in adults is most commonly caused by rhinovirus, respiratory syncytial virus (“RSV”) and influenza virus. However,
newly emerging viruses (including SARS-CoV-1, SARS-CoV-2, avian influenza A, and H1N1 viruses) have been identified as pathogens contributing
to the overall burden of adult viral pneumonia. COVID-19 is an infectious disease caused by SARS-CoV-2, that resulted in a global
pandemic, causing millions of hospitalizations and over 6.6 million deaths worldwide as of January 2023 according to the World Health
Organization. Excluding the pandemic, there are approximately 350,000 annual viral pneumonia hospitalizations in the U.S., and up to 16
million annual viral pneumonia hospitalizations globally. For the broader annual viral pneumonia hospitalizations, we believe U.S. market
potential to be greater than $1.5 billion and worldwide market potential to be greater than $3 billion.
We
initiated a pilot study in late 2020 using our novel LungFit® PRO system at 150 ppm to treat patients with VCAP. The trial was a
multi-center, open-label, randomized clinical trial in Israel, including patients infected with COVID-19. Patients were randomized in
a 1:1 ratio to receive either inhalations of 150 ppm NO given intermittently for 40 minutes four times per day for up to seven days in
addition to standard supportive treatment (“NO+SST”) or standard supportive treatment alone (“SST”). Endpoints
related to safety (primary endpoint), oxygen saturation and ICU admission, among others, were assessed.
We
presented results from the pilot study at the 32nd European Congress of Clinical Microbiology & Infectious Diseases (ECCMID
2022), which took place from April 23, 2022 through April 26, 2022 as a hybrid event both onsite in Lisbon, Portugal and online. At the
time of the data cut off, the trial enrolled a total of 40 subjects hospitalized for VCAP (SARS-CoV-2, n=39; other viruses n=1). The
ITT population included 35 subjects with 16 subjects in the inhaled NO group and 19 subjects in the control group. The primary COVID-19
treatments used during the study were Remdesivir (>30%) and Dexamethasone (>65%). Safety data from the study show that inhaled
NO treatment was well tolerated overall with no treatment related adverse events as assessed by the investigators. There were two SAEs reported in the group receiving inhaled NO along with SST, which were determined to be related to underlying conditions
and unrelated to study drug/device. From an efficacy perspective, results show a trend of shortening length of stay (“LOS”)
by a factor 1.8 in favor of inhaled NO treatment. Duration of oxygen support, measured in-hospital and at home, was significantly shorter
(p=0.0339) for inhaled NO treated subjects. Subjects with unstable oxygen saturation during hospitalization, 66.7% of the inhaled NO
treatment group, reached stable saturation of ≥93% during hospital stay as compared to 26.7% in the SST group.
Following
completion of the study and the 180-day follow-up period, incremental data
were provided in a poster presentation at IDWeek 2022 held from October 19, 2022, through October 23, 2022 in Washington, D.C. In addition
to the positive clinical results provided at ECCMID 2022, the poster showed a larger decline in c-reactive protein (“CRP”)
from baseline for subjects treated with NO + SST compared to the control group. Analysis of the data provides compelling evidence that
high concentration NO delivery with the LungFit® PRO generator and delivery system can be a powerful tool against any type of pneumonia,
especially COVID-19. The Company anticipates commencing a study in calendar year 2023 following discussions with the FDA.
Bronchiolitis
(BRO)
Bronchiolitis
is the leading cause of hospital admission in children less than 1 year of age. The incidence is estimated to be 150 million new cases
a year worldwide, with 2-3% (over 3 million) of them severe enough to require hospitalization. Worldwide, 95% of all cases
occur in developing countries. In the U.S., there are approximately 120,000 annual bronchiolitis hospitalizations and approximately 3.2
million annual child hospitalizations globally. Currently, there is no approved treatment for bronchiolitis. The treatment for acute
viral lung infections that cause bronchiolitis in infants is largely supportive care and is based primarily on prolonged hospitalization
during which the infant receives a constant flow of oxygen to treat hypoxemia, a reduced concentration of oxygen in the blood. In addition,
systemic steroids and inhalation with bronchodilators are sometimes utilized until recovery, but we believe that these treatments do
not successfully reduce hospital length of stay. We believe the U.S. market potential for bronchiolitis to be greater than $500 million
and worldwide market potential to be greater than $1.2 billion.
The pivotal study for bronchiolitis was originally set
to be performed in the winter of 2020/21 but was delayed due to the pandemic. We have completed three successful pilot studies for bronchiolitis.
A further analysis of the three previously reported pilot studies was presented at the ATS International Conference 2021, which was held
virtually from May 14, 2021 through May 19, 2021. Analysis across the studies (n=198 infants, mean age 3.9 months) showed that 150 ppm
– 160 ppm NO administered intermittently was generally safe and well tolerated with adverse event rates similar among treatment
groups with no reported treatment-related serious adverse events. The short course of treatments with intermittent high concentration
inhaled NO was effective in shortening hospital length of stay and accelerating time to fit for discharge – a composite endpoint
of clinical signs and symptoms to indicate readiness to be evaluated for hospital discharge. This treatment was also effective in accelerating
time to stable oxygen saturation – measured as SpO2 ≥ 92% in room air. Additionally, NO at a dose of 85 ppm NO showed no difference
compared to control for all efficacy endpoints, while 150 ppm NO showed statistical significance when compared to control.
Additionally,
long-term safety data for high concentration inhaled NO in bronchiolitis was presented at the Pediatric Academic Societies Meeting
2022 (PAS 22), which was held in Denver, Colorado from April 21, 2022 through April 25, 2022. A total of 101 infants from the three
prior pilot studies for bronchiolitis (n=198) participated in the long-term follow-up study. Study endpoints for the long-term
safety study included percentage of subjects re-hospitalized for bronchiolitis related reasons, such reasons included wheezing
episodes, pneumonia, and asthma and the percentage of subjects re-hospitalized for any reason. Data from the study showed the
re-hospitalization rate per 100 Patient Exposure Years (PEY) due to bronchiolitis related reasons trended favorably for the inhaled
NO group. In addition, the long-term subject re-hospitalization rate for any reason was similar between inhaled NO and control
groups. As such, the study concluded that the treatment of hospitalized infants with acute bronchiolitis by intermittent high dose
inhaled NO show a favorable long-term safety profile.
We
believe that the entirety of data at 150 ppm - 160 ppm NO in both adult and infant patient populations supports further development of
LungFit® PRO in a pivotal study for patients hospitalized with VCAP or bronchiolitis.
LungFit®
GO for the treatment of Nontuberculous mycobacteria (NTM)
NTM
lung infection is a rare and serious pulmonary disease associated with increased morbidity and mortality. Patients with NTM lung disease
may experience a multitude of symptoms such as fever, weight loss, cough, lack of appetite, night sweats, blood in the sputum and fatigue.
Patients with NTM lung disease, specifically Mycobacterium abscessus (M. abscessus) representing 20% - 25% of all NTM and
other forms of NTM that are refractory to antibiotic therapy, frequently require lengthy and repeated hospital stays to manage
their condition. There are no treatments specifically indicated for the treatment of M. abscessus lung disease in North America,
Europe or Japan.
There
are approximately 50,000 to 90,000 people with NTM infections in the U.S. In Asia, the number of patients suffering from NTM surpasses
what is seen in the U.S. There is one inhaled antibiotic approved for the treatment of refractory Mycobacterium avium complex
(“MAC”). Current guideline-based approaches to treat NTM lung disease involve multi-drug regimens of antibiotics that may
cause severe, long lasting side effects, and treatment can be longer than 18 months. Median survival for NTM MAC patients is approximately
13 years while median survival for patients with other variations of NTM is typically 4.6 years. The prevalence of human disease attributable
to NTM has increased over the past two decades. In a study conducted between 2007 and 2016, researchers found that the prevalence of NTM
in the U.S. is increasing at approximately 7.5% per year. M. abscessus treatment costs are estimated to be more than double that
of MAC. A 2015 publication by co-authors from several U.S. government departments stated that cases in 2014 alone cost the U.S. healthcare
system approximately $1.7 billion. For this indication, we believe U.S. sales potential to be greater than $1 billion and worldwide sales
potential to be greater than $2.5 billion.
In
December 2020 we began a 12-week, multi-center, open-label clinical trial in Australia intended to enroll approximately 20 adult patients
with chronic refractory NTM lung disease. We received a grant of up to $2.17 million from the Cystic Fibrosis Foundation (“CFF”)
to fund this study and advance the clinical development of inhaled NO to treat NTM pulmonary disease. The trial enrolled both cystic
fibrosis (“CF”) and non-CF patients infected with MAC, M. abscessus or any strain of NTM. The study consisted of a
run-in period followed by two treatment phases. The run-in period provided a baseline for the efficacy endpoints. The first treatment
phase took place over a two-week period and began in the hospital setting where patients were titrated from 150 ppm NO up to 250 ppm
NO over several days. During this phase patients received NO for 40 minutes, four times per day while Methemoglobin (“MetHb”) levels were monitored. Patients
were also trained to use LungFit® GO and subsequently discharged to complete the remaining portion of the two-week treatment
period at their home at the highest tolerated NO concentration. For the second treatment phase, a 10-week maintenance phase, the administration
was twice daily. The study evaluated safety, quality of life, physical function, and bacterial load among other parameters.
At
the American Thoracic Society International Conference 2022 (ATS 2022), which was held in San Francisco from May 13, 2022 through May
18, 2022, we presented positive interim data from the ongoing study. At the time of data cutoff on April 4, 2022, a total of 15 subjects
were enrolled in the pilot study. The mean age of subjects was 62.1 years (range: 22 – 82 years) with the majority female (80%),
a distribution consistent with real-world NTM disease. All 15 subjects were successfully titrated to 250 ppm NO in the hospital setting,
and no patients required dose reductions during the subsequent at-home portion of the study. Patients were followed up for 12 weeks after
the 12-week treatment period was completed.
After
completion of the study, we presented positive results at the American
College of Chest Physicians (“CHEST”) annual meeting, held from October 16, 2022 through October 19, 2022, further supporting
development of intermittent high dose NO for the treatment of NTM. The study demonstrated that high dose NO treatment was well-tolerated
in both the home and hospital settings. During the 10-week at-home treatment period of the study, a total of 2,492 inhalations were self-administered
with overall high treatment compliance (>90%). There were no SAEs related to treatment discontinuations reported over the 12-week treatment
or 12-week follow up periods. Key efficacy endpoints showed strong results with improvement seen in the majority of quality-of-life domains.
Respiratory function and physical function were maintained during treatment and follow-up. Trends in the reduction of microbial load were
observed and one subject achieved culture conversion with three consecutive negative sputum samples. We anticipate commencing a pivotal
study in the first half of calendar year 2025 following discussions with the FDA.
Our
program in COPD is in the preclinical stage and, subject to obtaining additional financing, is expected to enter clinical trials in calendar
year 2024.
Ultra-High
Concentration NO (UNO) in solid tumors through majority-owned affiliate Beyond Cancer, Ltd.
In
the fourth calendar quarter of 2021, Beyond Cancer, our majority-owned affiliate, raised $30 million in a private placement
of common shares. The investors purchased a 20% equity ownership in Beyond Cancer, while Beyond Air maintained 80%. The funding is being used to accelerate ongoing preclinical work, including the completion of IND-enabling studies, completion of a Phase 1 study, expansion
of preclinical programs for combination studies, hiring of additional Beyond Cancer team members, and optimization of the delivery system,
as well as for general corporate purposes.
Beyond
Cancer will benefit from Beyond Air’s NO expertise, IP portfolio, preclinical oncology team, and regulatory progress, and will
pay Beyond Air a single-digit royalty on all future revenues. Beyond Cancer is being led by a seasoned leadership team with experience
in emerging healthcare companies and clinical oncology.
Selena
Chaisson, MD, currently serves as Beyond Cancer’s Chief Executive
Officer. Previously, Dr. Chaisson was the Director of Healthcare Investments at Bailard, where she spent 16 years focusing on highly specialized,
emerging healthcare opportunities with more than one-third of her portfolio dedicated to investing in oncology companies. Prior to Bailard,
Dr. Chaisson held senior executive roles at RCM Capital Management and Tiger Management. RCM Capital Management was acquired by Dresdner
Bank in 1996 and then subsequently acquired by Allianz Global Investors U.S. in 2001. Dr. Chaisson received a BS in microbiology in 1987
from Louisiana State University in Baton Rouge, LA, where she graduated summa cum laude. She earned her MBA and MD from Stanford University
in 1992 and 1993, respectively.
The
Beyond Cancer Board of Directors consists of six members:
● Selena Chaisson, MD, Director, and Chief Executive Officer of Beyond Cancer
● Robert Carey, Director, and Board Member of Beyond Air
● David Dvorak, Director
● Gregory Berk, MD, Director
UNO has shown anticancer properties in preclinical trials by eliciting an immune
response from the host. We have released preclinical data at several medical/scientific conferences showing the promise of delivering
NO directly to tumors at concentrations of 20,000 ppm – 200,000 ppm. Results showed that local tumor ablation with NO conveyed anti-tumor
immunity to the host. In April 2022, we presented in vivo and in vitro preclinical data at the American Association for
Cancer Research (“AACR”) 2022 annual meeting. The in vivo study assessed the mode of action following a single 5-minute
gaseous NO (“gNO”) treatment which provided data showing an effect on the primary tumor 14 days post-treatment. These data
showed that intratumoral injections of concentrations of gNO at 20,000 and 50,000 ppm led to increased recruitment of T cells, B cells,
macrophages, and dendrocytes to the primary tumor. An elevated number of T cells and B cells were also detected in the spleen and blood
21 days following gNO treatment. In addition, at the same time point, a marked reduction in the number of myeloid-derived suppressor cells
was observed in the spleen. Results from the in vitro study showed that exposure of six different cancer cell lines – including
human ovarian and pancreatic and mouse lung, melanoma, colon, and breast – to UNO ranging from 10,000 ppm to 100,000 ppm for up
to 10 minutes resulted in a dose-dependent cytotoxic response. The higher concentration doses of gNO led to near-instant cell death, while
the lower concentration doses required a longer exposure period to elicit cell death. Cell viability was assessed using two assays: XTT
and clonogenic assay. After one minute of exposure to 25,000 ppm gNO, less than 10% viability was observed in all cell lines.
In March 2022 we received approval from the IMOH (Israeli Ministry of Health)
to do a Phase 1 study.
The second half of calendar year 2022 was a time of significant progress for
Beyond Cancer. On August 23, 2022, we announced that the first patient was treated in a first-in-human Phase 1 study to assess the safety
and immune biomarkers of UNO therapy. In November, at the annual meeting of the Society for Immunotherapy of Cancer (“SITC”),
we presented new in vivo combination data that support the potential of the Company’s novel UNO therapy to treat various types of
solid tumors in combination with immune checkpoint inhibitor (“ICI”) therapies, including anti-PD-1. The data presented at
SITC appears to indicate that UNO in combination with anti-PD-1 treatment may lead to higher tumor regression rates and prolonged survival.
Also in 2022, on December 13, we announced the publication of preclinical data in the peer-reviewed journal Cancer Cell International
(CCI), which showed that our proprietary tumor ablation technology utilizing UNO induced a potent innate and adaptive immune response
that prevented metastases and resulted in a statistically significant survival benefit.
Calendar
year 2023 began with the announcement of Beyond Cancer’s entry into a sponsored research agreement with Stanford School of Medicine
and the appointment of Frederick M. Dirbas, MD, Associate Professor of Surgery, Division of Surgical Oncology, Stanford School of Medicine,
and Mark D. Pegram, MD, the Suzy Yuan-Huey Hung Endowed Professor of Medical Oncology at the Stanford School of Medicine, to the Beyond
Cancer Scientific Advisory Board (“SAB”). In addition to the research agreement, Dr. Dirbas was named as Chair of the SAB, which provides
guidance for ongoing preclinical studies as well as ongoing and planned future clinical trials in the use of UNO to treat solid tumors.
The newly appointed members of the SAB will work to provide input on the clinical development of Beyond Cancer’s UNO technology,
particularly as it relates to the U.S. regulatory submission.
In April 2023, Beyond Cancer presented additional preclinical data for UNO
therapy in solid tumors during the AACR 2023 annual meeting. Data showed a statistically significant survival benefit for repeat dosing
of UNO compared to anti-mCTLA-4 as monotherapy and repeat doses of UNO prolonged survival in combination with anti-PD-1 compared to gNO
alone. With regard to tumor volume, statistically significant reductions were observed with repeat dosing of UNO versus anti-mPD-1 as
a monotherapy and in combination with anti-CTLA-4 versus anti-CTLA-4 alone. Additionally, the data shows that short exposures between
10 seconds to one minute of tumor cells to UNO at increasing concentrations of 25,000 ppm to 100,000 ppm NO significantly upregulate mPD-L1
expression in a dose and time-dependent manner. Also, in vivo experiments exhibited a statistically significant day 1 increase
in M1 macrophages, decrease in Tregs, and reduction in tumor cell viability was directionally maintained through day 5. We believe that
together with the known ability of NO to activate and recruit the immune system, the data presented at this year’s AACR annual meeting
appears to indicate that repeat dosing of UNO is feasible and may be effective even in difficult-to-treat, non-immunogenic tumor types.
The
Company expects to present top-line data from the first-in-human Phase 1 trial before the end of calendar year 2023.
Selective neuronal nitric oxide synthase (nNOS) inhibitor for the treatment
of neurological conditions in collaboration with Hebrew University of Jerusalem
On
June 15, 2023, the Company announced that it had entered into an agreement
with Yissum Research Development Company of the Hebrew University of Jerusalem, LTD. to acquire the commercial rights for neuronal nitric
oxide synthase (nNOS) inhibitors being developed for the treatment of autism spectrum disorder (“ASD”) and other neurological
conditions. Currently, there are no FDA approved therapies utilizing nNOS inhibitors specifically for the treatment of ASD. Under the
terms of the agreement, Beyond Air will make payments to the University over the next two years for preclinical work. Also, the Company
will pay a low single digit royalty on net sales and certain one-time payments based on clinical, regulatory and sales milestones.
Work
is currently being done by the University in a preclinical setting. We
expect the program to progress into a phase 1 first-in-human study early in 2025.
Background
and NO Mechanism of Action
NO
is recognized as a vital molecule involved in many physiological and pathological processes. NO is naturally produced by the body’s
immune system to provide a first line of defense against invading pathogens. It is a powerful molecule with a short half-life of a few
seconds in the blood, enabling it to be cleared rapidly from the body. NO has been shown to play a critical role in the function of several
body systems. For example, as vasodilator of smooth muscles, NO enhances blood flow and circulation. In addition, NO is involved in regulation
of wound healing and immune responses to infection. The pharmacology, toxicity and other data for NO in humans is generally well known,
and its use has been approved by the FDA as a vasodilator. The precise effect of inhaled NO is dependent on concentration, oxidation
state and type of pathogen.
NO
has multiple immunoregulatory and antimicrobial functions that are likely to be of relevance to inhaled NO therapy. In vitro studies
suggest that NO possesses anti-microbial activity against common bacteria, gram positive and gram negative, as well as mycobacteria,
fungi, yeast, parasites and helminths. It has the potential to eliminate multi-drug resistant strains of the above. Anti-viral activity
covers respiratory viruses such as influenza, corona viruses, RSV and others. In healthy humans, NO has been shown to stimulate mucociliary
clearance, and low levels of nasal NO correlate with impaired mucociliary function in the human upper airway. Unlike other inhaled drugs,
NO is also a smooth muscle relaxant and avoids the concomitant bronchial constriction often associated with inhaled antibiotics and mucolytics.
A potential benefit of these multiple mechanisms may be that in addition to treating lung infections in CF patients, this suggests that
NO may be useful in directly treating the mucus caused by CF, which is the principal manifestation of the disease.
Nitric
Oxide and Infection
NO
possesses broad-spectrum anti-microbial activity acting against bacteria, fungi and viruses. NO is produced at high output as part
of the innate immune response. NO and its by-products (for example, reactive nitrogen species (“RNS”)) are responsible
for the process of killing microorganisms within white blood cells called macrophages and in organs such as the lungs and other
mucolytic tissues.
More
than a decade ago, several research groups showed that NO and RNS possess
anti-viral activity and affect several viruses including coxsackievirus, RSV, influenza, severe acute respiratory syndrome (SARS), coronavirus,
rhinovirus, herpes simplex virus, Epstein-Barr virus (EBV), and others. NO has also been shown to be useful in preventing bacterial growth
on surfaces.
Continuous
exposure to 150 ppm NO and above, especially in the lungs, may have side effects and cause damage to host cells. Intermittent exposure
to NO in cycles retains NO anti-microbial activity both in vitro and in animal model of infection. Exposure of bacteria to concomitant
30-minute treatments with 160 ppm NO resulted in a significant reduction in bacterial load. A similar dose has been shown to reduce viruses
(common influenza) by 30-100% in a canine kidney infection model. In vivo, in a pneumonia model in rats, inhaled 160 ppm NO, for 30 minutes,
every 4 hours, resulted in significant reduction in bacteria counts in the lungs, without affecting the body’s defense mechanisms,
and without any other adverse effect. In addition, we believe a daily dose of 160 ppm of NO can treat bovine respiratory disease (BRD)
in cattle.
Importantly,
several studies report synergy between NO and antibiotic drugs. Adjunctive treatment combining NO together with inhaled tobramycin antibiotics
or other anti-microbial agents has been shown to greatly enhance the efficacy of the antibiotics in dispersing P. aeruginosa biofilms
and to increase their ability to elicit anti-microbial activity. These studies suggest that adjuvant treatment combining NO with antibiotics
might have a beneficial role by reducing bacterial infectivity, and therefore reduce the dependency on antibiotics.
Beyond
Air Technology
We
have developed the Beyond Air NO generator and delivery system which we call LungFit®, a novel and precise delivery
system that uses NO generated from ambient air with a novel NO generator, the ionizer. Our system provides continuous monitoring and
control of the gaseous content administered during intermittent and continuous NO inhalation treatments, as well as a precise and reliable
monitoring system that is able to monitor patient status and alert medical staff to any adverse effects.
The
LungFit® system is innovatively designed to provide patients with a gaseous dose of NO (ranging from 0.5 ppm up to 400
ppm) combined with ambient air. The gaseous blend is supplied to the patient via a ventilator, face mask, or similar apparatus. LungFit®
is designed to minimize the time that NO is mixed with oxygen and air. The system is also designed to continuously monitor inhaled
NO concentration, NO2 concentration and oxygen. A dedicated screen allows for monitoring of the gas mixture. Further, our
approved product and product candidates resemble other inhalation systems, making them user friendly, with operation and maintenance
that we believe will be immediately familiar to medical staff. Our LungFit® system has been manufactured at commercial
scale with a contract manufacturer.
When
programmed for lung infections, the LungFit®, is designed to specifically deliver a NO dosage of 150 ppm and higher. We
believe that the LungFit® has a number of advantages over other NO formulation delivery systems. For example, it is:
● designed to be used by the patient, thus convenient and portable; and
We
believe that our solution has the potential for a number of additional benefits and opportunities, as follows:
NitricGen
License
On
January 31, 2018, we entered into a definitive agreement to acquire a global, exclusive, perpetual, transferable license to the eNOGenerator
and associated critical assets including intellectual property, know-how, trade secrets and confidential information (the “License”)
from NitricGen Inc. (“NitricGen”). The eNOGenerator is a novel and precise delivery system that uses NO generated from ambient
air with a novel NO generator.
The
Beyond Air LungFit® system, which incorporates the eNOGenerator, has been designated as a medical device by the FDA. The
eNOGenerator can generate NO on demand for delivery to the lungs at concentrations ranging from 0.5 to 400 ppm. With the License, we
expect that we will be able to target all conditions requiring NO at any concentration, regardless of the need for intermittent or continuous
dosing.
Under
the terms of the License, we agreed to pay NitricGen an aggregate of $2 million in up-front, clinical, and regulatory milestone payments,
with the majority pertaining to regulatory milestones, as well as royalties on net sales of the delivery system containing the eNOGenerator
at a percentage in the low-single digits. As partial consideration for the License, we issued to NitricGen warrants to purchase 100,000
shares of our common stock at an exercise price of $6.90 per share. To date, $1.5 million has been paid for milestones that were earned.
Cystic
Fibrosis Foundation Agreement
On
February 10, 2021, we received a grant for up to $2.17 million from the CFF to advance the clinical development of high concentration
NO for the treatment of nontuberculous mycobacteria pulmonary disease, which disproportionally affects CF patients. Under the terms of
the agreement, the funding will be allocated to the ongoing LungFit® GO NTM pilot study. The Company met the third milestone
and received a reimbursement of $0.4 million in the fiscal year ended March 31, 2023. The Company has received a total of $1.3 million from the CFF since February 2021.
Strategies
Our
objective is to build a leading medical device and biopharmaceutical company
that develops and commercializes patented and proprietary products for the treatment of respiratory infections and diseases, with an initial
focus on the treatment of PPHN, AVP, BRO, NTM and severe infections in COPD patients, among others. We are exploring and testing the effects
of NO on solid tumors through our subsidiary, Beyond Cancer. Additionally, we are exploring the development of nNOS inhibitors for the
treatment of ASD and other neurological conditions. If our clinical trials for our product candidates are successful, we expect to seek
certification or marketing approval from the FDA and other worldwide authorities and notified regulatory bodies.
Our
Clinical Results to Date
We
have conducted several clinical trials to assess our 150-250 ppm NO inhalation-treatment in various indications. These trials
include:
Date Study Indication Primary Results
2011 Pilot Safety (n=10) All comers Safety No SAEs
Cystic
Fibrosis and NTM Clinical Development
In
2011, a prospective, open label, controlled, single-center pilot safety study was conducted on ten healthy adults between 20 and 62 years
of age. The data were published in the Journal of Cystic Fibrosis in 2012. Subjects received 160 ppm NO for 30 minutes, five times a
day, for five consecutive days via direct inhalation to the lungs using a prototype delivery system. The primary objective of the study
was to determine the effect of inhaled 160 ppm NO on pulmonary function tests and characterize the relationship between high-concentration
NO administration and MetHb – a form of hemoglobin that is a biproduct of NO and hemoglobin that cannot bind oxygen – and
establish a MetHb safety threshold level to assess adverse events associated with the treatment. Secondary objectives of the study were
to assess the changes in cytokine levels. Multiple safety markers were continuously monitored including: NO levels, NO2 (a
biproduct of NO and O2 that can be toxic at high concentrations), FiO2, as well as MetHb and oxygen saturation
(“SaO2”). Vital signs, lung function, blood chemistry (including nitrite/nitrates), hematology, prothrombin
time, inflammatory cytokine/chemokines levels and endothelial activation (angiopoietin ratio) were also closely monitored. All individuals
tolerated the NO formulation treatment courses well. No SAEs occurred. The maximum amount of air one can forcefully
exhale in one second, known as forced expiratory volume in one second (“FEV1”) and other lung function parameters, serum
nitrites/nitrates, prothrombin, pro-inflammatory cytokine and chemokine levels did not differ between baseline and day 5, while MetHb
increased during the study period by an average of 0.9%, as expected. These data suggest that inhalation of 160 ppm NO for 30 minutes,
five times a day, for five consecutive days is well tolerated in healthy individuals.
In
2014, we completed a pilot open label, multi-center study in nine CF patients
(≥10 years old). Patients received intermittent (30 minutes, three times a day) inhalation of 160 ppm NO formulation, five days a week,
over a two-week period. The study was performed in two centers, Soroka Medical Center and Schneider Children’s Medical Center of
Israel. The primary endpoints of the study were to determine the MetHb percentage, adverse events associated with inhaled NO and the percentage
of subjects who prematurely discontinued the study due to adverse events (“AEs”) and/or SAEs, or for any other reason. AEs
were reported by five (55.5%) subjects. There were no SAEs related to NO therapy, no treatment-related withdrawals due to AEs, and no
deaths. AEs considered by the investigator as possibly or probably related to treatment were reported for two (22.2%) subjects. There
were no AEs of MetHb elevation >5% or NO 2 elevation >5 ppm (study safety threshold of MetHb and NO2, respectively).
In total, seven cases of hemoptysis were reported in two subjects and all events were mild in severity. There was no cumulative effect
of MetHb exposure during the study. The maximum MetHb level reported was 4.6%. Several secondary efficacy analyses were conducted in this
study, and though the study was not powered for efficacy, results show various positive effects of the treatment regime. Bacterial and
fungal sputum load analysis results were highly variable, though marked reductions of Methicillin-sensitive Staphylococcus aureus (“MSSA”),
Achromabacter, P. aeruginosa, and Aspergillus were seen in several subjects. These results suggest non-specific targeting of bacteria
and fungi that commonly manifest in CF patients. In subjects with systemic inflammation (CRP >5 mg/mL) at baseline, CRP levels decreased
over the treatment period, showing the effect of NO in the reduction of systemic inflammation. There were no statistically significant
or clinically relevant changes in FEV1 over time, and lung function indices also remained relatively constant throughout the study duration.
In
2016, Rambam healthcare campus in Israel conducted a compassionate use treatment for two patients with CF who suffer from M, abscessus
lung infections. The data were published in the Pediatric Infectious Disease Journal in 2017. The NO treatment regime, as well as
the device for this treatment, was supplied by BA Ltd., our wholly owned subsidiary. Patients received intermittent 30-minute treatments
of 160 ppm NO, with two different regimes including hospitalization (5 times a day) and ambulatory treatment (2-3 inhalations a day).
Treatment was well tolerated with no evidence of any serious side effects. We observed significant improvement in sputum production (up
to 5-10 times more sputum), and subjective improvement in the well-being of both patients. Significant reduction in systemic inflammation
was observed in the first patient, as observed by reduction of CRP (C-reactive protein, a systemic inflammation marker that rises in
response to inflammation) levels during treatment. In addition, the first patient had a 2 log (100-fold) reduction in M. abscessus
during treatment (an effect that was lost after the treatment regime changed to ambulatory). The second patient showed a significant
increase in the 6-minute walk (“6MW”) test and the sputum culture became negative, which is consistent with eradication
of M. abscessus. Further information is needed, but we believe these results suggest that the treatment of M. abscessus with
high-concentration inhaled NO is effective.
In
2017, we treated one patient with CF who suffered from NTM infections (specifically, M. abscessus) under compassionate use in
the United Sates at the National Heart, Lung and Blood Institute with our generator based NO delivery system. The patient saw improvements
in 6MW, FEV1, most Quality-of-Life measures and had no SAEs. The bacteria was not eradicated. The patient requested to be treated again
and this treatment commenced in February 2018. A total of 38 treatments were administered over 8 days, 29 of them at a concentration
of 240 ppm, with no SAEs believed to be related to NO reported.
Additionally
in 2017, we completed a single-arm, open-label Pilot trial in nine patients
with M. abcessus lung disease, who were refractory to standard-of-care (“SOC”). The patients were treated with inhaled
NO at a concentration of 160 ppm for 30 minutes, in addition to treatment with SOC. Our inhaled NO treatment was administered intermittently
five times per day over a 14-day period, followed by a seven-day period with three treatments per day. The primary endpoint of safety,
as measured by NO-related SAEs, over the 21-day treatment period was met with no SAEs reported. Secondary endpoints of a 6MW test FEV1,
Quality of Life and M. abscessus load in sputum all trended positively. 6MW showed an increase of >40 meters at the end of treatment
at day 21 versus baseline and an increase of >25 meters on day 81 (60 days after the cessation of therapy). The mean percentage change
in FEV1 at day 21 and day 51 (30 days after the cessation of treatment) was > 3.5% with FEV1 returning to baseline at day 81 (60 days
after the cessation of therapy). At day 81 (60 days after the cessation of therapy) bacterial load was 65% lower than baseline. 1 of 9
patients saw culture conversion. This study was published in the Journal of Cystic Fibrosis in 2019.
In
2018, an additional CF patient infected with M. abscessus was treated over a 4-week period with 76 of 84 treatments at 250 ppm
NO in Israel at Soroka Medical Center. The patient saw improvements in 6MW, FEV1 and most Quality-of-Life measures. The bacteria were
not eradicated. Importantly, there were no SAE’s reported and all treatments were completed without incident.
In
December 2020 we began a 12-week, multi-center, open-label clinical trial
in Australia intended to enroll approximately 20 adult patients with chronic refractory NTM lung disease. We received a grant of up to
$2.17 million from the CFF to fund this study and advance the clinical development of inhaled NO to treat NTM pulmonary disease. The trial
enrolled both CF and non-CF patients infected with MAC, M. abscessus or any strain of NTM. The study consisted of a run-in period
followed by two treatment phases. The run-in period provided a baseline for the efficacy endpoints. The first treatment phase took place
over a two-week period and begun in the hospital setting where patients were titrated from 150 ppm NO up to 250 ppm NO over several days.
During this phase patients received NO for 40 minutes, four times per day while MetHb levels were monitored. Patients were also trained
to use LungFit® GO and subsequently discharged to complete the remaining portion of the two-week treatment period at their