Wugen, Inc.

This release has made a correction to a release issued under the same headline on August 14, 2024, by HCW Biologics, Inc. (NASDAQ: HCWB), to show the amount included in the condensed interim balance sheet for Cash and cash equivalents as of December 31, 2023 as $3,595,101, not $95,101 as previously stated. The full text of the corrected release is as follows: MIRAMAR, Fla., Aug. 23, 2024 (GLOBE NEWSWIRE) -- HCW Biologics Inc. (the “Company” or “HCW Biologics”) (NASDAQ: HCWB), a clinical-stage biopharmaceutical company focused on discovering and developing novel immunotherapies to lengthen healthspan by disrupting the link between inflammation and age-related diseases, today reported financial results and recent business highlights for its second quarter ended June 30, 2024. Dr. Hing C. Wong, Founder and CEO of HCW Biologics, stated, “We reached a critical milestone recently that has profound implications for the future of our Company -- we successfully reached a settlement agreement for an arbitration that created an overhang that hampered our progress for nearly two years. We wasted no time in launching our multi-faceted financing plan, including a significant equity offering and a reinvigorated out-licensing program. We have a bright future ahead, as we have emerged with the TOBI™ platform and a strong portfolio of TOBI™-based molecules, as well as several development-stage ideas that we consider “next generation” immunotherapeutics which leverage what we learned from the human data readouts from the initial phases of our clinical trials. We remain committed to developing immunotherapeutic drugs that target the reduction of senescent cells and the proinflammatory factors they secrete. Our focus continues to be on senescence-associated disorders, most typical in age-related diseases, including cancer. We are also excited to bring HCW9302 to the clinic in the very near future to evaluate this drug in the treatment of autoimmune diseases by expanding regulatory T cells.” Business Highlights On July 13, 2024, the Company entered into a confidential Settlement Agreement and Release (“Settlement Agreement”) to resolve arbitration brought against the Company and Dr. Hing C. Wong, the Company’s Founder and Chief Executive Officer. The Settlement Agreement includes mutual general releases by and among all the parties. There were no monetary payments or damages paid by any party under the Settlement Agreement. See “Financial Guidance.”Going forward, the Company retains ownership and control of the TOBI™ platform and TOBI™-based molecules, with no restrictions under the Settlement Agreement on its ability to use the TOBI™ platform for protein-fusion molecules for non-oncology indications. The Company may pursue the clinical development of treatments for cancer indications based on HCW9302, HCW9206 and HCW9201. Further, HCW Biologics retains ownership of the Wugen license and shares of Wugen common stock transferred to the Company as the upfront licensing fee from Wugen for granting the Wugen license.A new financing plan was launched including an equity offering, which the Company intends to close before the end of 2024. Financing plans also include out-licensing non-core assets, and there are several discussions underway with potential licensing partners. Second Quarter 2024 Financial Results Revenues: Revenues for the quarter ended June 30, 2023 and 2024 were $622,807 and $618,854, respectively. Revenues for the six months ended June 30, 2023 and 2024 were $664,690 and $1.7 million, respectively. Revenues in both periods were derived exclusively from the sale of licensed molecules to the Company’s licensee, Wugen. The licensed molecules are one of the inputs for manufacturing Wugen’s products.Research and development (R&D) expenses: R&D expenses for the quarter ended June 30, 2023 and 2024 were $1.6 million and $2.0 million, respectively, an increase of $412,520, or 26%. R&D expenses for the six months ended June 30, 2023 and 2024 were $3.9 million and $4.2 million, respectively, an increase of $279,991, or 7%. Manufacturing costs increased in three- and six-month periods ended June 30, 2024 because the Company was replenishing its supply of a high-expressing cell line of HCW9101. Preclinical expenses declined in the three- and six-month periods ended June 30, 2024 due to a change in the types of activities being performed in connection with IND-enabling activities to prepare an IND application to obtain permission from the FDA to evaluate HCW9302 in an autoimmune indication. In the three- and six-month periods ended June 30, 2023, preclinical costs were incurred for setup costs for toxicology studies and other IND-enabling studies. In the three- and six-month periods ended June 30, 2024, costs were incurred for supplemental research studies. Clinical trial expenses were incurred in the three- and six-month period ended June 30, 2023 related to two clinical studies to evaluate HCW9218 in chemo-refractory / chemo-resistant solid tumors. Clinical trial expenses declined in the three- and six-month periods ended June 30, 2024 because these trials were fully enrolled in the first quarter of 2024.General and administrative (G&A) expenses: G&A expenses for the quarter ended June 30, 2023 and 2024 were $1.6 million and $1.6 million, respectively, an increase of $6,332, or 0%. The increase was primarily attributable to an increase in fees for auditing and tax advisory services, offset by a reduction in salaries and benefits arising from the Company’s cost-cutting measures. G&A expenses for the six months ended June 30, 2023 and 2024 were $3.6 million and $3.2 million, a decrease of $436,454, or 12%. The decrease was a result of cost-cutting measures and a decrease in legal fees incurred in procuring patents and insurance-related costs, partially offset by an increase in financing costs.Legal Expenses: Legal expenses for the quarter ended June 30, 2023 and 2024 were $1.4 million and $10.4 million, respectively, an increase of $9.0 million, or 629%. Legal expenses for the six months ended June 30, 2023 and 2024 were $2.5 million and $14.8 million, an increase of $12.3 million, or 484%. The increase in legal expenses is related to the Altor/NantCell matter. See further discussion of the Altor/NantCell arbitration in “Financial Guidance.”Net loss: Net loss for the quarter ended June 30, 2023 and 2024 was $4.3 million and $15.3 million, respectively, an increase of $11.0 million, or 255%. Net loss for the six months ended June 30, 2023 and 2024 was $9.4 million and $22.7 million, respectively, an increase of $13.4 million, or 143%. Financial Guidance The Company has raised $8.0 million to date in 2024, through a $2.5 million private placement of common stock to officers and directors and $5.5 million issuance of Secured Notes secured by the Company’s Wugen shares. The Company is authorized to raise up to $10.0 million in Secured Notes and intends to have the Secured Notes offering fully subscribed. As of June 30, 2024, the Company believes that substantial doubt exists regarding its ability to continue as a going concern for at least 12 months from the issuance date of the condensed interim financial statements, without additional funding or financial support. After considering the elements of the Company’s financing plan that were probable to occur within a year of the date of issuance, the Company concluded that substantial doubt was not alleviated in its going concern analysis. As reported in the Company’s Form 8-K filed on July 18, 2024, as of July 13, 2024, the Company and Dr. Hing C. Wong, the Company’s Founder and Chief Executive Officer, entered into the Settlement Agreement, with Altor BioScience, LLC (“Altor”), NantCell, Inc. (“NantCell”), and ImmunityBio, Inc. (the parent of Altor and NantCell, together with Altor and NantCell, “ImmunityBio”), to resolve the previously disclosed arbitration before JAMS brought by Altor and NantCell (the “Arbitration”) as well as a complaint Altor filed against the Company in the Chancery Court of the State of Delaware for the contribution of legal fees and expenses advanced to Dr. Wong (“Complaint”). The parties entered into the Settlement Agreement to avoid the costs, disruption and distraction of further litigation. Under the terms of the Settlement Agreement, no party will make monetary payments to any other party or person and each party will bear its own expenses. The Company is completing procedures required to be in compliance with the terms of the Settlement Agreement. The Settlement Agreement provides that, upon completion of these procedures, the parties will stipulate that the Arbitration and Complaint should be dismissed. The Company retains rights to develop immunotherapeutic treatments based on TOBI™-based molecules as well as the TOBI™ platform, in addition to the Wugen license and Wugen equity interest. The Company reported a balance of $10.0 million for legal fees incurred but not yet paid that were included within Accounts payable and an accrual of $4.8 million for accrued legal fees within Accrued liabilities and other current liabilities in the accompany condensed balance sheet as of June 30, 2024. In order not to overwhelm the Company’s resources, a reasonable payment plan will be required. The Company is engaged in discussions with the law firms involved with this matter. As reported on the Company’s Form 8-K filed on August 12, 2024, the Company received written notices from the Listing Qualifications Staff (“Staff”) of the Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that it is not in compliance with Nasdaq Listing Rules. The notifications from Nasdaq do not impact the listing of the Company’s common stock at this time. The Company received a notice that it was not in compliance with Nasdaq Listing Rules for the $50.0 million market value listed securities requirement as of June 17, 2024; the minimum bid price as of August 6, 2024; and the $15.0 million market value of publicly held shares requirement as of August 8, 2024. The Company has 180 days from the respective date of notice to address each deficiency. While the Company is exercising diligent efforts to maintain the listing of its common stock on Nasdaq, there can be no assurance that the Company will be able to regain or maintain compliance with the applicable continued listing standards set forth in the Nasdaq Listing Rules. About HCW Biologics: HCW Biologics is a clinical-stage biopharmaceutical company focused on discovering and developing novel immunotherapies to lengthen healthspan by disrupting the link between chronic, low-grade inflammation, and age-related diseases, such as cancer, cardiovascular diseases, diabetes, neurodegenerative diseases, autoimmune diseases, as well as other conditions such as long-haul COVID-19. The Company has combined a deep understanding of disease-related immunology with its expertise in advanced protein engineering to develop the TOBI™ (Tissue factOr-Based fusIon) discovery platform. The Company uses its TOBI™ discovery platform to generate designer, novel multi-functional fusion molecules with immunotherapeutic properties. The invention of HCW Biologics’ lead molecules, HCW9218, HCW9302, HCW9206 and HCW9201, was made via the proprietary TOBI™ discovery platform. The University of Pittsburgh Medical Center has agreed to include HCW9218 in an Investigator-sponsored Phase 2 clinical trial to evaluate HCW9218 in patients with metastatic, advanced stage ovarian cancer in combination with neoadjuvant chemotherapy (NCT05145569). Forward Looking Statements: Statements in this press release contain “forward-looking statements” that are subject to substantial risks and uncertainties. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements contained in this press release may be identified by the use of words such as “anticipate,” “expect,” “believe,” “will,” “may,” “should,” “estimate,” “project,” “outlook,” “forecast” or other similar words and include, the Company’s ability to develop new immunotherapeutic treatments for non-oncology or oncology indications; timing of initiation of studies for age-related diseases; the Company’s ability to continue as a going concern; the Company’s cash runway; the Company’s expectations regarding future purchases of licensed molecules by Wugen; the Company’s future capital-raising plans and ability to continue with clinical development efforts until they are achieved, if at all; and Company’s ability to pay legal fees incurred in connection with the Altor/NantCell arbitration. Forward-looking statements are based on the Company’s current expectations and are subject to inherent uncertainties, risks and assumptions that are difficult to predict. Further, certain forward-looking statements are based on assumptions as to future events that may not prove to be accurate. Factors that could cause actual results to differ include, but are not limited to, the risks and uncertainties that are described in the section titled “Risk Factors” in the annual report on Form 10-K/A filed with the United States Securities and Exchange Commission (the “SEC”) on May 15, 2024, and in other filings filed from time to time with the SEC. Forward-looking statements contained in this press release are made as of this date, and the Company undertakes no duty to update such information except as required under applicable law. Company Contact:Rebecca ByamCFOHCW Biologics Inc.rebeccabyam@hcwbiologics.com HCW Biologics Inc.Unaudited Statements of Operations(Unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2024 2023 2024 Revenues: Revenues$622,807 $618,854 $664,690 $1,745,566 Cost of revenues (502,402) (438,443) (531,752) (950,408)Total revenues 120,405 180,411 132,938 795,158 Operating expenses: Research and development 1,616,666 2,029,186 3,872,479 4,152,470 General and administrative 1,587,861 1,594,193 3,596,739 3,160,285 Legal expenses 1,426,399 10,393,042 2,534,811 14,812,076 Nonoperating loss — 1,300,000 — 1,300,000 Total operating expenses 4,630,926 15,316,421 10,004,029 23,424,831 Loss from operations (4,510,521) (15,136,010) (9,871,091) (22,629,673)Interest expense (95,514) (159,666) (188,951) (159,666)Other (expense) income, net 301,615 15,485 684,936 41,086 Net loss$(4,304,420) $(15,280,191) $(9,375,106) $(22,748,253) HCW Biologics Inc. Condensed Balance Sheets December 31, June 30, 2023 2024 UnauditedASSETS Current assets: Cash and cash equivalents$3,595,101 $1,161,314 Accounts receivable, net 1,535,757 654,973 Prepaid expenses 1,042,413 404,918 Other current assets 230,916 164,607 Total current assets 6,404,187 2,385,812 Investments 1,599,751 1,599,751 Property, plant and equipment, net 20,453,184 22,806,052 Other assets 56,538 28,476 Total assets$28,513,660 $26,820,091 LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) Liabilities Current liabilities: Accounts payable$6,167,223 $16,877,463 Accrued liabilities and other current liabilities 2,580,402 6,341,676 Total current liabilities 8,747,625 23,219,139 Debt, net 6,304,318 9,900,721 Total liabilities 15,051,943 33,119,860 Commitments and contingencies (Note 8) Stockholders’ equity (deficit): Common stock: Common, $0.0001 par value; 250,000,000 shares authorized and 36,025,104 shares issued at December 31, 2023; 250,000,000 shares authorized and 37,823,394 shares issued at June 30, 2024 3,603 3,782 Additional paid-in capital 83,990,437 86,977,024 Accumulated deficit (70,532,323) (93,280,575)Total stockholders’ equity (deficit) 13,461,717 (6,299,769)Total liabilities and stockholders’ equity (deficit)$28,513,660 $26,820,091

MIRAMAR, Fla., Aug. 14, 2024 (GLOBE NEWSWIRE) -- HCW Biologics Inc. (the “Company” or “HCW Biologics”) (NASDAQ: HCWB), a clinical-stage biopharmaceutical company focused on discovering and developing novel immunotherapies to lengthen healthspan by disrupting the link between inflammation and age-related diseases, today reported financial results and recent business highlights for its second quarter ended June 30, 2024. Dr. Hing C. Wong, Founder and CEO of HCW Biologics, stated, “We reached a critical milestone recently that has profound implications for the future of our Company -- we successfully reached a settlement agreement for an arbitration that created an overhang that hampered our progress for nearly two years. We wasted no time in launching our multi-faceted financing plan, including a significant equity offering and a reinvigorated out-licensing program. We have a bright future ahead, as we have emerged with the TOBI™ platform and a strong portfolio of TOBI™-based molecules, as well as several development-stage ideas that we consider “next generation” immunotherapeutics which leverage what we learned from the human data readouts from the initial phases of our clinical trials. We remain committed to developing immunotherapeutic drugs that target the reduction of senescent cells and the proinflammatory factors they secrete. Our focus continues to be on senescence-associated disorders, most typical in age-related diseases, including cancer. We are also excited to bring HCW9302 to the clinic in the very near future to evaluate this drug in the treatment of autoimmune diseases by expanding regulatory T cells.” Business Highlights On July 13, 2024, the Company entered into a confidential Settlement Agreement and Release (“Settlement Agreement”) to resolve arbitration brought against the Company and Dr. Hing C. Wong, the Company’s Founder and Chief Executive Officer. The Settlement Agreement includes mutual general releases by and among all the parties. There were no monetary payments or damages paid by any party under the Settlement Agreement. See “Financial Guidance.”Going forward, the Company retains ownership and control of the TOBI™ platform and TOBI™-based molecules, with no restrictions under the Settlement Agreement on its ability to use the TOBI™ platform for protein-fusion molecules for non-oncology indications. The Company may pursue the clinical development of treatments for cancer indications based on HCW9302, HCW9206 and HCW9201. Further, HCW Biologics retains ownership of the Wugen license and shares of Wugen common stock transferred to the Company as the upfront licensing fee from Wugen for granting the Wugen license.A new financing plan was launched including an equity offering, which the Company intends to close before the end of 2024. Financing plans also include out-licensing non-core assets, and there are several discussions underway with potential licensing partners. Second Quarter 2024 Financial Results Revenues: Revenues for the quarter ended June 30, 2023 and 2024 were $622,807 and $618,854, respectively. Revenues for the six months ended June 30, 2023 and 2024 were $664,690 and $1.7 million, respectively. Revenues in both periods were derived exclusively from the sale of licensed molecules to the Company’s licensee, Wugen. The licensed molecules are one of the inputs for manufacturing Wugen’s products.Research and development (R&D) expenses: R&D expenses for the quarter ended June 30, 2023 and 2024 were $1.6 million and $2.0 million, respectively, an increase of $412,520, or 26%. R&D expenses for the six months ended June 30, 2023 and 2024 were $3.9 million and $4.2 million, respectively, an increase of $279,991, or 7%. Manufacturing costs increased in three- and six-month periods ended June 30, 2024 because the Company was replenishing its supply of a high-expressing cell line of HCW9101. Preclinical expenses declined in the three- and six-month periods ended June 30, 2024 due to a change in the types of activities being performed in connection with IND-enabling activities to prepare an IND application to obtain permission from the FDA to evaluate HCW9302 in an autoimmune indication. In the three- and six-month periods ended June 30, 2023, preclinical costs were incurred for setup costs for toxicology studies and other IND-enabling studies. In the three- and six-month periods ended June 30, 2024, costs were incurred for supplemental research studies. Clinical trial expenses were incurred in the three- and six-month period ended June 30, 2023 related to two clinical studies to evaluate HCW9218 in chemo-refractory / chemo-resistant solid tumors. Clinical trial expenses declined in the three- and six-month periods ended June 30, 2024 because these trials were fully enrolled in the first quarter of 2024.General and administrative (G&A) expenses: G&A expenses for the quarter ended June 30, 2023 and 2024 were $1.6 million and $1.6 million, respectively, an increase of $6,332, or 0%. The increase was primarily attributable to an increase in fees for auditing and tax advisory services, offset by a reduction in salaries and benefits arising from the Company’s cost-cutting measures. G&A expenses for the six months ended June 30, 2023 and 2024 were $3.6 million and $3.2 million, a decrease of $436,454, or 12%. The decrease was a result of cost-cutting measures and a decrease in legal fees incurred in procuring patents and insurance-related costs, partially offset by an increase in financing costs.Legal Expenses: Legal expenses for the quarter ended June 30, 2023 and 2024 were $1.4 million and $10.4 million, respectively, an increase of $9.0 million, or 629%. Legal expenses for the six months ended June 30, 2023 and 2024 were $2.5 million and $14.8 million, an increase of $12.3 million, or 484%. The increase in legal expenses is related to the Altor/NantCell matter. See further discussion of the Altor/NantCell arbitration in “Financial Guidance.”Net loss: Net loss for the quarter ended June 30, 2023 and 2024 was $4.3 million and $15.3 million, respectively, an increase of $11.0 million, or 255%. Net loss for the six months ended June 30, 2023 and 2024 was $9.4 million and $22.7 million, respectively, an increase of $13.4 million, or 143%. Financial Guidance The Company has raised $8.0 million to date in 2024, through a $2.5 million private placement of common stock to officers and directors and $5.5 million issuance of Secured Notes secured by the Company’s Wugen shares. The Company is authorized to raise up to $10.0 million in Secured Notes and intends to have the Secured Notes offering fully subscribed. As of June 30, 2024, the Company believes that substantial doubt exists regarding its ability to continue as a going concern for at least 12 months from the issuance date of the condensed interim financial statements, without additional funding or financial support. After considering the elements of the Company’s financing plan that were probable to occur within a year of the date of issuance, the Company concluded that substantial doubt was not alleviated in its going concern analysis. As reported in the Company’s Form 8-K filed on July 18, 2024, as of July 13, 2024, the Company and Dr. Hing C. Wong, the Company’s Founder and Chief Executive Officer, entered into the Settlement Agreement, with Altor BioScience, LLC (“Altor”), NantCell, Inc. (“NantCell”), and ImmunityBio, Inc. (the parent of Altor and NantCell, together with Altor and NantCell, “ImmunityBio”), to resolve the previously disclosed arbitration before JAMS brought by Altor and NantCell (the “Arbitration”) as well as a complaint Altor filed against the Company in the Chancery Court of the State of Delaware for the contribution of legal fees and expenses advanced to Dr. Wong (“Complaint”). The parties entered into the Settlement Agreement to avoid the costs, disruption and distraction of further litigation. Under the terms of the Settlement Agreement, no party will make monetary payments to any other party or person and each party will bear its own expenses. The Company is completing procedures required to be in compliance with the terms of the Settlement Agreement. The Settlement Agreement provides that, upon completion of these procedures, the parties will stipulate that the Arbitration and Complaint should be dismissed. The Company retains rights to develop immunotherapeutic treatments based on TOBI™-based molecules as well as the TOBI™ platform, in addition to the Wugen license and Wugen equity interest. The Company reported a balance of $10.0 million for legal fees incurred but not yet paid that were included within Accounts payable and an accrual of $4.8 million for accrued legal fees within Accrued liabilities and other current liabilities in the accompany condensed balance sheet as of June 30, 2024. In order not to overwhelm the Company’s resources, a reasonable payment plan will be required. The Company is engaged in discussions with the law firms involved with this matter. As reported on the Company’s Form 8-K filed on August 12, 2024, the Company received written notices from the Listing Qualifications Staff (“Staff”) of the Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that it is not in compliance with Nasdaq Listing Rules. The notifications from Nasdaq do not impact the listing of the Company’s common stock at this time. The Company received a notice that it was not in compliance with Nasdaq Listing Rules for the $50.0 million market value listed securities requirement as of June 17, 2024; the minimum bid price as of August 6, 2024; and the $15.0 million market value of publicly held shares requirement as of August 8, 2024. The Company has 180 days from the respective date of notice to address each deficiency. While the Company is exercising diligent efforts to maintain the listing of its common stock on Nasdaq, there can be no assurance that the Company will be able to regain or maintain compliance with the applicable continued listing standards set forth in the Nasdaq Listing Rules. About HCW Biologics: HCW Biologics is a clinical-stage biopharmaceutical company focused on discovering and developing novel immunotherapies to lengthen healthspan by disrupting the link between chronic, low-grade inflammation, and age-related diseases, such as cancer, cardiovascular diseases, diabetes, neurodegenerative diseases, autoimmune diseases, as well as other conditions such as long-haul COVID-19. The Company has combined a deep understanding of disease-related immunology with its expertise in advanced protein engineering to develop the TOBI™ (Tissue factOr-Based fusIon) discovery platform. The Company uses its TOBI™ discovery platform to generate designer, novel multi-functional fusion molecules with immunotherapeutic properties. The invention of HCW Biologics’ lead molecules, HCW9218, HCW9302, HCW9206 and HCW9201, was made via the proprietary TOBI™ discovery platform. The University of Pittsburgh Medical Center has agreed to include HCW9218 in an Investigator-sponsored Phase 2 clinical trial to evaluate HCW9218 in patients with metastatic, advanced stage ovarian cancer in combination with neoadjuvant chemotherapy (NCT05145569). Forward Looking Statements: Statements in this press release contain “forward-looking statements” that are subject to substantial risks and uncertainties. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements contained in this press release may be identified by the use of words such as “anticipate,” “expect,” “believe,” “will,” “may,” “should,” “estimate,” “project,” “outlook,” “forecast” or other similar words and include, the Company’s ability to develop new immunotherapeutic treatments for non-oncology or oncology indications; timing of initiation of studies for age-related diseases; the Company’s ability to continue as a going concern; the Company’s cash runway; the Company’s expectations regarding future purchases of licensed molecules by Wugen; the Company’s future capital-raising plans and ability to continue with clinical development efforts until they are achieved, if at all; and Company’s ability to pay legal fees incurred in connection with the Altor/NantCell arbitration. Forward-looking statements are based on the Company’s current expectations and are subject to inherent uncertainties, risks and assumptions that are difficult to predict. Further, certain forward-looking statements are based on assumptions as to future events that may not prove to be accurate. Factors that could cause actual results to differ include, but are not limited to, the risks and uncertainties that are described in the section titled “Risk Factors” in the annual report on Form 10-K/A filed with the United States Securities and Exchange Commission (the “SEC”) on May 15, 2024, and in other filings filed from time to time with the SEC. Forward-looking statements contained in this press release are made as of this date, and the Company undertakes no duty to update such information except as required under applicable law. Company Contact:Rebecca ByamCFOHCW Biologics Inc.rebeccabyam@hcwbiologics.com HCW Biologics Inc.Unaudited Statements of Operations(Unaudited) Three Months Ended June 30, Six Months Ended June 30, 2023 2024 2023 2024 Revenues: Revenues$622,807 $618,854 $664,690 $1,745,566 Cost of revenues (502,402) (438,443) (531,752) (950,408)Total revenues 120,405 180,411 132,938 795,158 Operating expenses: Research and development 1,616,666 2,029,186 3,872,479 4,152,470 General and administrative 1,587,861 1,594,193 3,596,739 3,160,285 Legal expenses 1,426,399 10,393,042 2,534,811 14,812,076 Nonoperating loss — 1,300,000 — 1,300,000 Total operating expenses 4,630,926 15,316,421 10,004,029 23,424,831 Loss from operations (4,510,521) (15,136,010) (9,871,091) (22,629,673)Interest expense (95,514) (159,666) (188,951) (159,666)Other (expense) income, net 301,615 15,485 684,936 41,086 Net loss$(4,304,420) $(15,280,191) $(9,375,106) $(22,748,253) HCW Biologics Inc. Condensed Balance Sheets December 31, June 30, 2023 2024 UnauditedASSETS Current assets: Cash and cash equivalents$95,101 $1,161,314 Accounts receivable, net 1,535,757 654,973 Prepaid expenses 1,042,413 404,918 Other current assets 230,916 164,607 Total current assets 6,404,187 2,385,812 Investments 1,599,751 1,599,751 Property, plant and equipment, net 20,453,184 22,806,052 Other assets 56,538 28,476 Total assets$28,513,660 $26,820,091 LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) Liabilities Current liabilities: Accounts payable$6,167,223 $16,877,463 Accrued liabilities and other current liabilities 2,580,402 6,341,676 Total current liabilities 8,747,625 23,219,139 Debt, net 6,304,318 9,900,721 Total liabilities 15,051,943 33,119,860 Commitments and contingencies (Note 8) Stockholders’ equity (deficit): Common stock: Common, $0.0001 par value; 250,000,000 shares authorized and 36,025,104 shares issued at December 31, 2023; 250,000,000 shares authorized and 37,823,394 shares issued at June 30, 2024 3,603 3,782 Additional paid-in capital 83,990,437 86,977,024 Accumulated deficit (70,532,323) (93,280,575)Total stockholders’ equity (deficit) 13,461,717 (6,299,769)Total liabilities and stockholders’ equity (deficit)$28,513,660 $26,820,091

ROCKVILLE, Md., Aug. 06, 2024 (GLOBE NEWSWIRE) -- MaxCyte, Inc., (NASDAQ: MXCT; LSE: MXCT), a leading, cell-engineering focused company providing enabling platform technologies to advance the discovery, development, and commercialization of next-generation cell therapeutics and innovative bioprocessing applications, today announced its financial results for the second quarter ended June 30, 2024, and updates its 2024 guidance. Second Quarter and Recent Highlights Total revenue of $10.4 million in the second quarter of 2024, an increase of 15% over the second quarter of 2023.Core business revenue of $7.6 million in the second quarter of 2024, a decline of 9% over the second quarter of 2023.Strategic Platform License (SPL) Program-related revenue was $2.9 million for the second quarter of 2024, an increase of 279% over the second quarter of 2023.Five new SPL clients signed year-to-date. Legend Biotech signed in May, Be Biopharma signed in March, and Wugen, Imugene, and Lion TCR signed in January. The total number of SPL partners now stands at 28.Total cash, cash equivalents and investments were $199.8 million as of June 30, 2024. “We are pleased by our second quarter results and our business performance in the first half of 2024 and remain confident we will deliver our full year guidance. We continue to drive commercial execution in cell therapy and believe that we remain the premier cell engineering platform in the industry,” said Maher Masoud, President and CEO at MaxCyte. “Since the beginning of the year, MaxCyte has signed five new SPLs, which includes recently signed Legend Biotech, along with Be Biopharma, in March 2024. Our total number of SPLs now stands at 28, highlighting the demand for our platform and our continued expansion into a range of different indications. As our clients continue to progress through the clinic, we believe we continue to provide the best electroporation platform with the best support for their programs. We remain excited by continued demand for our platform and our role in enabling a growing set of next-generation cell therapies.” The following table provides details regarding the sources of our revenue for the periods presented. Three Months Ended Six Months Ended June 30, June 30, 2024 2023 % 2024 2023 %(in thousands, except percentages) Cell therapy$6,218 $6,637 (6%) $12,633 $12,611 0% Drug discovery 1,357 1,652 (18%) 3,129 3,450 (9%) Program-related 2,854 754 279% 6,008 1,558 286% Total revenue$10,429 $9,043 15% $21,770 $17,619 24% Three Months Ended Six Months Ended June 30, June 30, 2024 2023 % 2024 2023 %(in thousands, except percentages) Instrument$1,762 $2,126 (17%) $3,690 $4,315 (14%) PAs 2,974 3,293 (10%) 6,406 5,893 9% Lease 2,610 2,667 (2%) 5,214 5,476 (5%) Other 229 203 13% 452 377 20% Total Core Revenue$7,575 $8,289 (9%) $15,762 $16,061 (2%) In addition to revenue, management regularly reviews key business metrics to evaluate our business, measure performance, identify trends affecting our business, formulate financial projections and make strategic decisions. As of the dates presented, these key metrics were as follows: As of June 30, 2024 2023 Installed base of instruments (sold or leased) 723 654 Three Months Ended June 30, 2024 2023 Core Revenue Generated by SPL Clients as % of Core Revenue 51% 49% Second Quarter 2024 Financial Results Total revenue for the second quarter of 2024 was $10.4 million, compared to $9.0 million in the second quarter of 2023, representing growth of 15%. Core business revenue (sales and leases of instrument and disposables to cell therapy and drug discovery customers, excluding SPL Program-related revenue) for the second quarter of 2024 was $7.6 million, compared to $8.3 million in the second quarter of 2023, representing a decline of 9%. Cell therapy revenue for the second quarter of 2024 was $6.2 million, compared to $6.6 million in the second quarter of 2023, representing a decline of 6%. Drug discovery revenue for the second quarter of 2024 was $1.4 million, compared to $1.7 million in the second quarter of 2023, representing a decline of 18%. SPL Program-related revenue was $2.9 million in the second quarter of 2024, as compared to $0.8 million in the second quarter of 2023, representing an increase of 279% over the second quarter of 2023. Gross profit for the second quarter of 2024 was $8.9 million (86% gross margin), compared to $7.7 million (85% gross margin) in the second quarter of 2023. Operating expenses for the second quarter of 2024 were $20.9 million, compared to operating expenses of $20.7 million in the second quarter of 2023. Second quarter 2024 net loss was $9.4 million compared to net loss of $10.5 million for the same period in 2023. EBITDA, a non-GAAP measure, was a loss of $10.9 million for the second quarter of 2024, compared to a loss of $12.0 million for the second quarter of 2023; stock-based compensation expense was $3.6 million in the second quarter of 2024 compared to $3.5 million in the second quarter of 2023. First Half 2024 Financial Results Total revenue for the first half of 2024 was $21.8 million, compared to $17.6 million in the first half of 2023, representing growth of 24%. Core business revenue (sales and leases of instrument and disposables to cell therapy and drug discovery customers but excluding SPL Program-related revenue) for the first half of 2024 was $15.8 million, compared to $16.1 million in the first half of 2023, representing a decline of 2%. Cell therapy revenue for the first half of 2024 was $12.6 million, compared to $12.6 million in the first half of 2023, representing flat growth. Drug discovery revenue for the first half was $3.1 million, compared to $3.5 million in the first half of 2023, representing a decline of 9%. SPL Program-related revenue was $6.0 million in the first half of 2024, as compared to $1.6 million in program-related revenue in the first half of 2023. Gross profit for the first half of 2024 was $18.9 million (87% gross margin), compared to $15.2 million (87% gross margin) in the same period of the prior year. Operating expenses for the first half of 2024 were $43.1 million, compared to operating expenses of $41.5 million in the first half of 2023. First half 2024 net loss was $18.9 million compared to net loss of $21.4 million for the same period in 2023. EBITDA, a non-GAAP measure, was a loss of $22.1 million for the first half of 2024, compared to a loss of $24.3 million for the first half of 2023; stock-based compensation expense was $6.6 million for the first half of 2024 compared to $6.8 million for the first half of 2023. 2024 Revenue Guidance MaxCyte affirms 2024 revenue guidance for core business revenue and increases SPL Program-related revenue guidance. MaxCyte continues to expect full year 2024 core business revenue to be flat to 5% growth compared to 2023. SPL Program-related revenue is now expected to be approximately $6 million. The outlook for the full year does not include SPL Program-related revenue from Vertex/CRISPR’s CASGEVYTM. MaxCyte now expects to end 2024 with at least $180 million in total cash, cash equivalents and investments, up from an expected $175 million. Webcast and Conference Call Details MaxCyte will host a conference call today, August 6, 2024, at 4:30 p.m. Eastern Time. Investors interested in listening to the conference call are required to register online. A live and archived webcast of the event will be available on the “Events” section of the MaxCyte website at https://investors.maxcyte.com/. About MaxCyte At MaxCyte, we pursue cell engineering excellence to maximize the potential of cells to improve patients’ lives. We have spent more than 20 years honing our expertise by building best-in-class platforms, perfecting the art of the transfection workflow, and venturing beyond today’s processes to innovate tomorrow’s solutions. Our ExPERT™ platform, which is based on our Flow Electroporation® technology, has been designed to support the rapidly expanding cell therapy market and can be utilized across the continuum of the high-growth cell therapy sector, from discovery and development through commercialization of next-generation, cell-based medicines. The ExPERT family of products includes: four instruments, the ATx™, STx™, GTx™ and VLx™; a portfolio of proprietary related processing assemblies or disposables; and software protocols, all supported by a robust worldwide intellectual property portfolio. By providing our partners with the right technology, as well as scientific, technical and regulatory support, we aim to guide them on their journey to transform human health. Learn more at maxcyte.com and follow us on Twitter and LinkedIn. Non-GAAP Financial Measures This press release contains EBITDA, which is a non-GAAP measure defined as earnings before interest income and expense, taxes, depreciation and amortization. MaxCyte believes that EBITDA provides useful information to management and investors relating to its results of operations. The company’s management uses this non-GAAP measure to compare the company’s performance to that of prior periods for trend analyses, and for budgeting and planning purposes. The company believes that the use of EBITDA provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the company’s financial measures with other companies, many of which present similar non-GAAP financial measures to investors, and that it allows for greater transparency with respect to key metrics used by management in its financial and operational decision-making. Management does not consider EBITDA in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of EBITDA is that it excludes significant expenses that are required by GAAP to be recorded in the company’s financial statements. In order to compensate for these limitations, management presents EBITDA together with GAAP results. Non-GAAP measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. A reconciliation table of net loss, the most comparable GAAP financial measure, to EBITDA is included at the end of this release. MaxCyte urges investors to review the reconciliation and not to rely on any single financial measure to evaluate the company’s business. Forward-Looking Statements This press release contains "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements about us and our industry involve substantial known and unknown risks, uncertainties, and assumptions 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. All statements other than statements of historical facts contained in this press release, including statements regarding our future results of operations or financial condition, business strategy and plans and objectives of management for future operations, are forward-looking statements. Forward-looking statements include, but are not limited to, statements about the Company’s projected full-year total revenue, core revenue, and SPL program revenue and statements about possible or future results of operations or financial position. In some cases, you can identify forward-looking statements because they contain words such as "may," “might,” "will," "could," "would," "should," "expect," "plan," "anticipate," "intend," "believe," “expect,” "estimate," “seek,” "predict," “future,” "project," "potential," "continue," “contemplate,” "target,” the negative of these words and similar words or expressions. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements. The forward-looking statements contained in this press release, include, without limitation, statements concerning the following: our expected future growth and success of our business model; the size and growth potential of the markets for our products, and our ability to serve those markets, increase our market share, and achieve and maintain industry leadership; our ability to expand our customer base and enter into additional SPL partnerships; our expectation that our partners will have access to capital markets to develop and commercialize their cell therapy programs; our financial performance and capital requirements; and the amount and adequacy of our cash resources. These and other risks and uncertainties are described in greater detail in Item 1A , entitled "Risk Factors,” in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission on or about March 12, 2024, as well as in discussions of potential risks, uncertainties, and other important factors in the other filings that we make with the Securities and Exchange Commission from time to time. These documents are available through the Investor Menu, Financials section, under “SEC Filings” on the Investors page of our website at http://investors.maxcyte.com. Any forward-looking statements in this press release are based on our current beliefs and opinions on the relevant subject based on information available to us as of the date of such press release, and you should not rely on forward-looking statements as predictions of future events. We undertake no obligation to update any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law. MaxCyte Contacts: US IR Adviser Gilmartin Group David Deuchler, CFA +1 415-937-5400 ir@maxcyte.com US Media Relations Spectrum Seismic Collaborative Valerie Enes +1 408-497-8568 venes@spectrumscience.com Nominated Adviser and Joint Corporate Broker Panmure LiberumEmma Earl / Freddy Crossley Corporate Broking Rupert Dearden +44 (0)20 7886 2500 UK IR Adviser ICR ConsiliumMary-Jane Elliott Chris Welsh +44 (0)203 709 5700maxcyte@consilium-comms.com MaxCyte, Inc.Unaudited Consolidated Balance Sheets(in thousands, except share and per share amounts) June 30, December 31, 2024 2023 Assets Current assets: Cash and cash equivalents$37,513 $46,506 Short-term investments, at amortized cost 119,817 121,782 Accounts receivable, net 4,581 5,778 Inventory 11,159 12,229 Prepaid expenses and other current assets 2,577 3,899 Total current assets 175,647 190,194 Investments, non-current, at amortized cost 42,481 42,938 Property and equipment, net 21,720 23,513 Right-of-use asset - operating leases 11,008 11,241 Other assets 640 388 Total assets$251,496 $268,274 Liabilities and stockholders’ equity Current liabilities: Accounts payable$953 $743 Accrued expenses and other 7,076 11,269 Operating lease liability, current 878 774 Deferred revenue, current portion 3,368 5,069 Total current liabilities 12,275 17,855 Operating lease liability, net of current portion 17,650 17,969 Other liabilities 310 283 Total liabilities 30,235 36,107 Commitments and contingencies Stockholders’ equity Preferred stock, $0.01 par value; 5,000,000 shares authorized and no shares issued and outstanding at June 30, 2024 and December 31, 2023 — — Common stock, $0.01 par value; 400,000,000 shares authorized, 104,824,124 and 103,961,670 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively 1,048 1,040 Additional paid-in capital 414,912 406,925 Accumulated deficit (194,699) (175,798)Total stockholders’ equity 221,261 232,167 Total liabilities and stockholders’ equity$251,496 $268,274 MaxCyte, Inc.Unaudited Consolidated Statements of Operations(in thousands, except share and per share amounts) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Revenue$10,429 $9,043 $21,770 $17,619 Cost of goods sold 1,488 1,376 2,891 2,376 Gross profit 8,941 7,667 18,879 15,243 Operating expenses: Research and development 5,619 5,664 12,297 11,711 Sales and marketing 6,617 6,436 13,981 12,732 General and administrative 7,639 7,663 14,742 15,161 Depreciation and amortization 1,034 977 2,102 1,890 Total operating expenses 20,909 20,740 43,122 41,494 Operating loss (11,968) (13,073) (24,243) (26,251) Other income: Interest income 2,593 2,561 5,342 4,857 Total other income 2,593 2,561 5,342 4,857 Net loss$(9,375) $(10,512) $(18,901) $(21,394)Basic and diluted net loss per share$(0.09) $(0.10) $(0.18) $(0.21)Weighted average shares outstanding,basic and diluted 104,639,239 103,063,606 104,364,498 102,955,422 MaxCyte, Inc.Unaudited Consolidated Statements of Cash Flows(in thousands) Six Months ended June 30, 2024 2023 Cash flows from operating activities: Net loss$(18,901) $(21,394) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 2,192 1,988 Non-cash lease expense 233 190 Net book value of consigned equipment sold 21 66 Loss on disposal of fixed assets 361 - Stock-based compensation 6,579 6,796 Credit loss (recovery) expense (130) 230 Change in excess/obsolete inventory reserve 137 - Amortization of discounts on investments (3,665) (3,641) Changes in operating assets and liabilities: Accounts receivable 1,327 3,990 Accounts receivable - TIA - 1,912 Inventory 833 (2,542)Prepaid expense and other current assets 1,322 724 Other assets (321) 212 Accounts payable, accrued expenses and other (3,497) (1,039)Operating lease liability (215) 112 Deferred revenue (1,701) (2,020)Other liabilities 27 (13)Net cash used in operating activities (15,398) (14,429) Cash flows from investing activities: Purchases of investments (79,353) (104,955)Maturities of investments 85,440 163,320 Purchases of property and equipment (1,098) (2,065)Proceeds from sale of equipment — 9 Net cash provided by investing activities 4,989 56,309 Cash flows from financing activities: Proceeds from exercise of stock options 1,151 1,613 Proceeds from issuance of common stock under employee stock purchase plan 265 - Net cash provided by financing activities 1,416 1,613 Net (decrease) increase in cash and cash equivalents (8,993) 43,493 Cash and cash equivalents, beginning of period 46,506 11,064 Cash and cash equivalents, end of period$37,513 $54,557 Unaudited Reconciliation of Net Loss to EBITDA(in thousands) Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 (in thousands) Net loss$(9,375) $(10,512) $(18,901) $(21,394)Depreciation and amortization expense 1,081 1,026 2,192 1,988 Interest income (2,593) (2,561) (5,342) (4,857)Income taxes — — — — EBITDA$(10,887) $(12,047) $(22,051) $(24,263) %