Annual Report for Fiscal Year Ending December 31, 2024 (Form 20-F)
OPERATING AND FINANCIAL REVIEW AND PROSPECTS
| A. | Operating Results |
The following discussion of the results of our operations and our financial condition should be read in conjunction with the consolidated financial statements and the related notes to those statements included in this annual report. The following discussion includes forward-looking statements. These forward-looking statements are subject to risks, uncertainties and other factors that could cause our actual results to differ materially from those expressed or implied by the forward-looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed elsewhere in this annual report. Please refer to the sections titled "Cautionary Statement Regarding Forward-Looking Statements" and "Item 3. Key Information-D. Risk Factors" for further details.
All translations from
Overview
We are a clinical stage biopharmaceutical company focused on the R&D of allogeneic, "off-the-shelf" cell-based immunotherapies for treatment of human cancers. The development of our novel technologies has been inspired by the clinical success of existing CAR-T cells in treating hematological malignancies as well as the current clinical limitations and commercial challenges in extrapolating the CAR-T principle into treatment of solid tumors. All of our product candidates are designed to be allogeneic, meaning they are produced using cells from a different person than the patient treated, as well as on an "off-the-shelf" basis, unlike existing autologous cell therapies. Built on our proprietary platform technologies, we are developing four product candidates: CTM-N2D, iPSC-gdNKT, CTM-GDT and CTM-MSC.
To date, we have conducted the first in human Phase I clinical trial, ANGELICA Trial, using our first product candidate, CTM-N2D. Two patients have been successfully dosed with four weekly CTM-N2D at dose level 1. We foresee to recruit more patients in 2025.
Our second product candidate, iPSC-gdNKT, has been undergoing pre-clinical process development since the fourth quarter of 2022 and is targeting to commence pre-clinical studies after the fourth quarter of 2025.
Through a US agent, we have submitted a drug master file to the
As of the date of this annual report, we are finalizing the dossier for a Phase I clinical trial using our fourth product candidate, CTM-MSC to treat osteoarthritis and target for submission in second half of 2025.
On
By last quarter of 2024, we completed the acquisition of certain assets of
Key Factor Affecting Our Results of Operations
Our financial condition and results of operation have been and will continue to be affected by a number of factors, many of which may be beyond our control, including those factors set out in the section headed ''Risk Factors'' in this annual report and those set out below:
No product candidates approved for commercial sale
We are a clinical stage biopharmaceutical company and we do not have any products approved for commercial sale as of the date of this annual report. We are focused on developing human cells as therapeutics and our technologies are new and unproven. Since our incorporation in 2018, we have devoted most of our resources to support our product candidate development efforts, building our intellectual property portfolio, developing our supply chain, conducting business planning, constructing our centralized cGMP Facility, hiring and training staff, raising capital and providing general and administrative support for these operations. We have not generated any revenue. Given that we will continue to invest most of our resources in developing our product candidates, we expect to continue to incur increasing losses for the foreseeable future.
Key Components of Our Results of Operations
Revenue
Since our incorporation, we have not generated any revenue and do not expect to generate any revenue from the commercial sale of products in the foreseeable future. As of the date of this annual report, we have no therapeutic products approved for sale commercially. If our development efforts for one or more of our product candidates are successful and result in regulatory approval, or if we enter into collaboration with third parties, we may generate revenue from a combination of product sales or payments from collaboration in the future.
For the financial year ended
Other Operating Income
Other operating income amounted to
| Year ended |
||||||||||||
| 2022 | 2023 | 2024 | ||||||||||
| S$ | S$ | S$ | ||||||||||
| Government grants: | ||||||||||||
| Wage Subsidy Program | 3,099 | - | - | |||||||||
| Enterprise Development Grant | 8,640 | - | - | |||||||||
| Jobs Growth Incentive | 5,550 | - | - | |||||||||
| Hiring Incentive and Training Programme | 9,077 | 3,459 | - | |||||||||
| Startup SG Tech - Proof-of-concept grant | 84,091 | - | - | |||||||||
| Market Readiness Assistance Grant | - | - | 15,447 | |||||||||
| Others | 2,880 | 4,112 | 11,715 | |||||||||
| Research income | 363,912 | 507,736 | 433,871 | |||||||||
| Interest income | 2,097 | 285,719 | 317,670 | |||||||||
| Others | 6,028 | 2,878 | 5,358 | |||||||||
| Total | 485,374 | 803,904 | 784,061 | |||||||||
The Hiring Incentive and Training Programme ("Hiring Incentive") was an economic recovery incentive introduced in
The Startup SG Tech - Proof-of-concept ("SSG Tech POC") grant is a scheme to drive the growth of startups based on proprietary technology and to foster the spirit of deep-tech innovation among startups. Under the scheme, qualifying companies may receive early-stage funding for developing and commercializing the innovations. For the financial year ended
The Market Readiness Assistance ("MRA") grant helps companies expand into new markets overseas by defraying the costs of overseas market promotion, business development and set-up. For the financial year ended
Research income was derived from the manufacturing of limited quantities of cells for researchers and institutions on a non-profit, cost recovery basis for the purpose of research. Research income was
Interest income was
Other (losses)/gains including fair value changes on financial instruments - net
Other (losses)/gains including fair value changes on financial instruments - net, mainly consist of the net currency exchange changes and the fair value changes on convertible loans and warrants. We recorded a net other loss of
Research Expenses
Our research expenses consist primarily of costs incurred for our research, pre-clinical and clinical activities. We expense research costs as incurred. Non-refundable advance payments for goods or services to be received in the future for use in R&D activities are recorded as prepaid expenses. The prepaid amounts are expensed as the related goods are delivered or the services are performed. The following table sets forth the breakdown of our research expenses for these periods:
| Year ended |
||||||||||||
| 2022 | 2023 | 2024 | ||||||||||
| S$ | S$ | S$ | ||||||||||
| Employee benefits expenses | 500,038 | 642,533 | 737,524 | |||||||||
| Depreciation of property, plant and equipment | 270,421 | 272,886 | 212,322 | |||||||||
| Amortization of intangible assets | 10,700 | 4,209 | 642 | |||||||||
| Clinical trial expenses | - | 33,845 | 382,014 | |||||||||
| Consumables expenses | 310,938 | 455,267 | 345,706 | |||||||||
| Royalty expenses | 9,592 | 30,382 | 11,365 | |||||||||
| Professional fees | 317,613 | 20,779 | 35,040 | |||||||||
| Electricity expenses | 64,968 | 62,515 | 69,323 | |||||||||
| Others | 38,495 | 67,277 | 115,583 | |||||||||
| Total | 1,522,765 | 1,589,693 | 1,909,519 | |||||||||
Research expenses were
Our R&D activities are central to our business. We expect that our research expenses will continue to increase in absolute amounts in the foreseeable future as we continue pre-clinical and clinical development for our product candidates and continue our advances in scientific research and product development.
Employee benefits expenses
Employee benefits expenses were
Finance Expenses
Finance expenses consisted interest expenses on bank borrowing, convertible loans, third party loans and lease liabilities.
Finance expenses were
Other Expenses
Other expenses consist mainly of Offering expenses and costs associated with being a public listed company, including annual listing fee, directors' and officers' insurance and investor relationship expenses. Other expenses also include, inter alia, professional fees for legal, auditing, tax and consulting services, and other expenses that are not attributable to R&D activities. The following table sets forth the breakdown of our other expenses for these periods:
| For the year ended |
||||||||||||
| 2022 | 2023 | 2024 | ||||||||||
| S$ | S$ | S$ | ||||||||||
| Advertising | - | 33,307 | 23,782 | |||||||||
| Annual listing fee | - | 64,370 | 87,279 | |||||||||
| Company insurance | - | 282,797 | 94,367 | |||||||||
| Entertainment | 3,260 | 30,977 | 7,941 | |||||||||
| Investor relationship expenses | - | 204,808 | 76,176 | |||||||||
| Legal fees | - | 115,272 | 119,580 | |||||||||
| Low-value assets rental | 2,201 | 1,703 | 3,215 | |||||||||
| Offering expenses | 199,625 | 758,563 | - | |||||||||
| Professional fees | 184,253 | 396,915 | 405,420 | |||||||||
| Property tax | 7,045 | 6,661 | 8,412 | |||||||||
| Printing and stationery | 6,176 | 11,941 | 18,718 | |||||||||
| IT expenses | 13,051 | 18,255 | 20,122 | |||||||||
| Repair and maintenance | 8,720 | 3,728 | 13,926 | |||||||||
| Reversal of grant | - | 84,091 | - | |||||||||
| Service fees | 11,268 | 13,209 | 8,665 | |||||||||
| Subscription fee | 2,165 | 1,083 | 873 | |||||||||
| Transportation and travelling expenses | 3,364 | 144,998 | 62,758 | |||||||||
| Tools and supplies | 3,516 | 2,333 | 7,195 | |||||||||
| Utilities | 21,201 | 23,941 | 17,662 | |||||||||
| Others | 28,830 | 14,190 | 21,963 | |||||||||
| Total | 494,675 | 2,213,142 | 998,054 | |||||||||
Other expenses were
Share of results of associate
Share of results of associate consisted of the share of post-acquisition results of an associate incorporated in
Share of loss of associate recognized by
Loss for the year
As a result of the foregoing, we had loss of
Quantitative and Qualitative Disclosures about Market Risks
We are exposed to market risks in the ordinary course of our business. These risks primarily include currency risk and interest rate risk.
Currency risk
We operate in
Interest rate risk
As at
| B. | Liquidity and Capital Resources |
Overview
Since our incorporation, we have not generated any revenue from commercial sales of product and have incurred losses and negative cash flows from our operations and expect these conditions to continue for the foreseeable future. We have not yet commercialized any of our product candidates, which are in various phases of pre-clinical development, and we do not expect to generate revenue from commercial sales of any products for the foreseeable future.
As at
As at
Cash Flows
The following table summarizes our cash flows for the years presented:
| For the year ended |
||||||||||||||||
| 2022 | 2023 | 2024 | ||||||||||||||
| S$ | S$ | S$ | U.S.$ | |||||||||||||
| Net cash used in operating activities | (1,398,409 | ) | (3,531,196 | ) | (2,709,929 | ) | (1,983,552 | ) | ||||||||
| Net cash (used in)/generated from investing activities | (473,305 | ) | (2,730,809 | ) | 1,126,541 | 824,580 | ||||||||||
| Net cash generated from/(used in) financing activities | 968,716 | 10,919,885 | (64,892 | ) | (47,498 | ) | ||||||||||
| Net changes in cash and cash equivalents | (902,998 | ) | 4,657,880 | (1,648,280 | ) | (1,206,470 | ) | |||||||||
| Cash and cash equivalents at beginning of year | 2,512,768 | 1,579,718 | 6,224,187 | 4,555,839 | ||||||||||||
| Effect of foreign currency translation on cash and cash equivalents | (30,052 | ) | (13,411 | ) | 121,140 | 88,669 | ||||||||||
| Cash and cash equivalents at end of year | 1,579,718 | 6,224,187 | 4,697,047 | 3,438,038 | ||||||||||||
Operating Activities
During the financial year ended
During the financial year ended
During the financial year ended
Investing Activities
Net cash used in investing activities during the financial year ended
Net cash used in investing activities during the financial year ended
Net cash generated from investing activities during the financial year ended
Financing Activities
During the financial year ended
During the financial year ended
During the financial year ended
Funding Requirements
Our plan of operation is to continue implementing our business strategy, continue R&D of CTM-N2D and our other product candidates and continue to expand our research pipeline and our internal R&D capabilities. We expect our expenses to increase substantially in connection with our ongoing activities, particularly as we conduct the ANGELICA Trial with National University Hospital Singapore, research collaboration with
| ● | the scope, timing, progress, costs, and results of discovery, pre-clinical development, and clinical trials for our current and future product candidates; |
| ● | the number of clinical trials required for regulatory approval of our current and future product candidates; |
| ● | the costs, timing, and outcome of regulatory review of any of our current and future product candidates; |
| ● | the cost of manufacturing clinical and commercial supplies of our current and future product candidates; |
| ● | the costs and timing of future commercialization activities, including manufacturing, marketing, sales, and distribution, for any of our product candidates for which we receive marketing approval; |
| ● | the costs and timing of preparing, filing, and prosecuting patent applications, maintaining and enforcing our intellectual property rights, and defending any intellectual property-related claims, including any claims by third parties that we are infringing on their intellectual property rights; |
| ● | the cost of maintaining our own R&D and centralized cGMP Facility and future facility expansion plans; |
| ● | our ability to maintain existing, and establish new, strategic collaborations, licensing, or other arrangements and the financial terms of any such agreements, including the timing and amount of any future milestone, royalty, or other payments due under any such agreement; |
| ● | the revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval; |
| ● | the expenses to attract, hire and retain, skilled personnel; |
| ● | the costs of operating as a public company; |
| ● | our ability to establish a commercially viable pricing structure and obtain approval for coverage and adequate reimbursement from third-party and government payors; |
| ● | the effect of competing technological and market developments; and |
| ● | the extent to which we acquire or invest in businesses, products and technologies. |
A change in the outcome of any of these variables with respect to the development of a product candidate could mean a significant change in the costs and timing associated with the development of that product candidate.
Until such time as we can generate significant revenue from sales of our product candidates, if ever, we expect to finance our operations from the sale of additional equity or debt financings, or other capital which comes in the form of strategic collaborations, licensing, or other arrangements. In the event that additional financing is required, we may not be able to raise it on terms favorable to us, or at all. If we raise additional funds through the issuance of equity or convertible debt securities, it may result in dilution to our existing shareholders. Debt financing or preferred equity financing, if available, may result in increased fixed payment obligations, and the existence of securities with rights that may be senior to those of our ordinary shares. If we incur indebtedness, we could become subject to covenants that would restrict our operations.
If we raise funds through strategic collaboration, licensing or other arrangements, we may relinquish significant rights or grant licenses on terms that are not favorable to us. Our ability to raise additional funds may be adversely impacted by potential worsening global economic conditions and the recent disruptions to, and volatility in, the credit and financial markets in
Contractual Obligations and Commitments
The following table summarizes our contractual obligations and commitments as of
| Payment Due by Period | ||||||||||||||||||||
| Total | Less than 1 year |
Between 1 and 2 years |
Between 2 and 5 years |
Over 5 years |
||||||||||||||||
| S$ | S$ | S$ | S$ | S$ | ||||||||||||||||
| Contractual Obligations: | ||||||||||||||||||||
| Bank borrowings (1)(2) | 531,400 | 56,432 | 56,432 | 169,295 | 249,241 | |||||||||||||||
|
Lease liabilities (2) |
34,020 | 9,494 | 9,494 | 15,032 | - | |||||||||||||||
| Commitment: | ||||||||||||||||||||
| Minimum royalty commitments | 143,133 | 12,333 | 10,900 | 32,700 | 87,200 | |||||||||||||||
| Loan commitments (3) | 500,000 | 500,000 | - | - | - | |||||||||||||||
| (1) | Includes scheduled outstanding principal payments as of |
| (2) | Includes interest payments. |
| (3) | Loan to a third party at 5.0% interest per annum to set up our presence in |
Other than as shown above, we did not have any significant capital and other commitments, long term obligations or guarantees as of
| C. | R&D Expenses |
We record as expenses all costs incurred in conducting research and pre-clinical activities in the periods in which such costs are incurred. R&D expenses include employees' benefits, laboratory supplies, fees paid to entities that conduct certain quality testing activities as well as facility-related expenses.
As part of the process of preparing our financial statements, we are required to estimate our accrued R&D expenses. We make estimates of our accrued expenses as of each balance sheet date in the financial statements based on facts and circumstances known to us at that time. There may be instances in which payments made to our vendors will exceed the level of services provided and result in a prepayment of the expense. In accruing service fees, we estimate the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, we adjust the accrual or the amount of prepaid expenses accordingly. Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and may result in reporting amounts that are too high or too low in any particular period. To date, there have not been any material adjustments to our prior estimates of accrued R&D expenses.
| D. | Trend Information |
See "Item 5A. Operating Results" within this annual report.
| E. | Critical Accounting Estimates |
Our management's discussion and analysis of financial condition and results of operations is based on our financial statements, which have been prepared in accordance with IFRS. The preparation of our financial statements and related disclosures requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, costs and expenses and the disclosure of contingent assets and liabilities in our financial statements. We base our estimates on historical experience, known trends and events and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions.
While our significant accounting policies are described in greater detail in Note 2 to our financial statements in this annual report, we believe that the following accounting policies are those most critical to the judgments and estimates used in the preparation of our financial statements.
Recently Issued Accounting Pronouncements
A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2 to our financial statements in this annual report.
Emerging Growth Company Status
We are an "emerging growth company" under the JOBS Act. The JOBS Act, permits that an "emerging growth company" may take advantage of the extended transition period for complying with new or revised accounting standards applicable to public companies until those standards would otherwise apply to private companies. We have elected to avail ourselves of delayed adoption of certain accounting standards. Accordingly, our financial statements may not be comparable to the financial statements of public companies that comply with such new or revised accounting standards. We intend to rely on other exemptions provided by the JOBS Act, including without limitation, not being required to comply with the auditor attestation requirements of Section 404(b) of Sarbanes-Oxley Act.
We will remain an emerging growth company until the earliest of (i) the last day of the financial year in which we have more than U.S.
Recent Developments
The Company has assessed all events occurred from
On
On
Attachments
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