Table of Contents
Filed pursuant to Rule 424(b)(3)
Registration No. 333-233584
PROSPECTUS
Up to 8,125,946 Shares of Common Stock
This prospectus covers the offer and sale
of up to 8,125,946 shares of our common stock, $0.0001 par value, by Lincoln Park Capital Fund, LLC (“Lincoln Park”
or the “Selling Stockholder”).
The shares of common stock being offered
to the Selling Stockholder have been or may be issued pursuant to the purchase agreement dated August 7, 2019 that we entered
into with Lincoln Park (as amended on August 20, 2019, the “Purchase Agreement”). See “The Lincoln
Park Transaction” for a description of the Purchase Agreement and “Selling Stockholder” for additional information
regarding Lincoln Park. The prices at which Lincoln Park may sell the Shares will be determined by the prevailing market price
for the Shares or in negotiated transactions.
We are not selling any securities under
this prospectus and will not receive any of the proceeds from the sale of the Shares by the Selling Stockholder.
The Selling Stockholder may sell the shares
of common stock described in this prospectus in a number of different ways and at varying prices. See “Plan of Distribution”
for more information about how the Selling Stockholder may sell the shares of common stock being registered pursuant to this prospectus.
The Selling Stockholder is an “underwriter” within the meaning of Section 2(a)(11) of the Securities Act of 1933, as
amended (the “Securities Act”).
We will pay the expenses relating to the
registration under the Securities Act of the offer and sale by Lincoln Park of the shares covered by this prospectus, including
legal and accounting fees.
Our common stock is currently quoted
on the Nasdaq Capital Market under the symbol “PHIO”. The closing price of our common stock on October 1, 2019, as
reported by Nasdaq, was $0.29 per share.
Investing in our securities involves
a high degree of risk. In reviewing this prospectus, you should consider carefully the risks and uncertainties in the section
entitled “Risk Factors” beginning on page 4 of this prospectus.
Neither the Securities and Exchange
Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus
is truthful or complete. Any representation to the contrary is a criminal offense. The securities are not being offered in any
jurisdiction where the offer is not permitted.
The date of this prospectus is
October 1, 2019
TABLE OF CONTENTS
We have not authorized
anyone to provide you with information other than that contained or incorporated by reference in this prospectus or in any free
writing prospectus prepared by or on behalf of us or to which we have referred you. We take no responsibility for and can provide
no assurance as to the reliability of, any other information that others may give to you. We are not offering to sell, and the
Selling Stockholder is not offering to sell, securities in any jurisdictions where offers and sales are not permitted. The information
contained or incorporated by reference in this prospectus or any free writing prospectus is accurate only as of its date, regardless
of its time of delivery or any sale of our securities. Our business, financial condition, results of operations, and prospects
may have changed since that date.
We urge you to
carefully read this prospectus and any prospectus supplement, together with the information incorporated herein by reference
as described under the heading “Where You Can Find More Information” and “Incorporation of
Certain Information by Reference.”
No action is being
taken in any jurisdiction outside the United States to permit an offering of our securities or possession or distribution of this
prospectus in that jurisdiction. Persons who come into possession of this prospectus in jurisdictions outside the United States
are required to inform themselves about and to observe any restrictions as to this offering and the distribution of this prospectus
applicable to that jurisdiction.
CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified
by words such as “intends,” “believes,” “anticipates,” “indicates,” “plans,”
“expects,” “suggests,” “may,” “should,” “potential,” “designed
to,” “will” and similar references, although not all forward-looking statements contain these words. Forward-looking
statements are neither historical facts nor assurances of future performance. These statements are based only on our current beliefs,
expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events
and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject
to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our
control. Risks that could cause actual results to vary from expected results expressed in our forward-looking statements include,
but are not limited to:
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our ability to obtain sufficient financing to develop our product candidates;
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expected ongoing significant research and development expenses without a current source of revenue, which may lead to uncertainty as to our ability to continue as a going concern;
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dilution that could be caused by future financing transactions or future issuances of capital stock in strategic transactions;
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our strategic focus on immuno-oncology;
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the novel and unproven approach associated with our RNAi technology;
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our limited experience as a company in immuno-oncology;
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identifying and developing product candidates, including whether we are able to commence clinical trials in humans or obtain approval for our product candidates;
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our dependence on the success of our product candidates, which may not receive regulatory approval or be successfully commercialized;
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factors could prevent us from obtaining regulatory approval or commercializing our product candidates on a timely basis, or at all;
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FDA regulation of our therapeutics;
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our reliance on in-licensed technologies and the potential need for additional intellectual property rights in the future;
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our ability to protect our intellectual property rights and the adequacy of our intellectual
property rights;
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competitive risks, including the risks associated with competing against companies in the immuno-oncology space with significantly greater resources;
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our reliance on third parties for the manufacture of our clinical product candidates;
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potential product liability claims;
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pricing regulations, third-party reimbursement practices or healthcare reform initiatives;
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our ability to attract, hire and retain qualified personnel;
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effectiveness of our internal control over financial reporting; and
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volatility of our common stock.
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Our actual results and financial condition
may differ materially from those indicated in the forward-looking statements as a result of the foregoing factors, as well as those
identified in this prospectus under the heading “Risk Factors” and in other filings the Company periodically makes
with the Securities and Exchange Commission. Therefore, you should not rely unduly on any of these forward-looking statements.
Forward-looking statements contained in this prospectus speak as of the date hereof and the Company does not undertake to update
any of these forward-looking statements to reflect a change in its views or events or circumstances that occur after the date of
this report.
Prospectus
Summary
The following
summary highlights certain information contained elsewhere in this prospectus and the documents incorporated by reference
herein. This summary provides an overview of selected information and does not contain all of the information you should
consider in making your investment decision. Therefore, you should read the entire prospectus and the documents incorporated
by reference herein carefully before investing in our securities. Investors should carefully consider the information set
forth under “Risk Factors” beginning on page 4 of this prospectus and the financial statements and other
information incorporated by reference in this prospectus. In this prospectus, unless otherwise noted, (1) the term
“Phio” refers to Phio Pharmaceuticals Corp. and our subsidiary, MirImmune, LLC and (2) the terms
“Company,” “we,” “us,” and “our” refer to the ongoing business operations of
Phio and MirImmune, LLC, whether conducted through Phio or MirImmune, LLC.
Overview
Phio Pharmaceuticals
Corp. is a biotechnology company developing the next generation of immuno-oncology therapeutics based on our self-delivering RNAi
(“sd-rxRNA®”) therapeutic platform. The Company's efforts are focused on silencing tumor-induced
suppression of the immune system through our proprietary sd-rxRNA platform with utility in immune cells and/or the tumor micro-environment.
Our goal is to maximize the power of our sd-rxRNA therapeutic compounds by weaponizing immune effector cells to overcome tumor
immune escape providing patients a powerful new treatment option that goes beyond current treatment modalities.
Our development efforts are based on our
broadly patented sd-rxRNA technology platform. Our sd-rxRNA compounds do not require a delivery vehicle to penetrate into tissues
and cells and are designed to “silence” or down-regulate, the expression of a specific gene which is over-expressed
in cancer. We believe that our sd-rxRNA platform uniquely positions the Company in the field of immuno-oncology because of this
and the following reasons:
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Efficient uptake of sd-rxRNA to immune cells obviating the need for facilitated delivery (mechanical or formulation);
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Can target multiple genes (i.e. multiple immunosuppression pathways) in a single therapeutic entity;
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Gene silencing by sd-rxRNA has been shown to have a sustained, or long-term, effect in vivo;
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Favorable clinical safety profile of sd-rxRNA with local administration; and
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Can be readily manufactured under current good manufacturing practices.
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The self-delivering
nature of our compounds makes sd-rxRNA ideally suited for use with adoptive cell transfer (“ACT”) treatments
and direct therapeutic use. ACT consists of the infusion of immune cells with antitumor properties. These cells can be derived
from unmodified (i.e. naturally occurring) immune cells, immune cells isolated from resected tumors, or genetically engineered
immune cells recognizing tumor neoantigens/neoepitopes cells.
Currently, ACT
therapies for the treatment of solid tumors face several hurdles. Multiple inhibitory mechanisms restrain immune cells used in
ACT from effectively eradicating tumors, including immune checkpoints, reduced cell fitness and cell persistence. Furthermore,
the immunosuppressive tumor micro-environment (the “TME”) can pose a formidable barrier to immune cell infiltration
and function.
Phio has developed
a platform based on our sd-rxRNA technology that allows easy, precise, rapid, and selective non-genetically modified programming
of ACT cells (ex-vivo, during manufacturing) and of the TME (in vivo, by local application), resulting in improved
cell-based immunotherapy.
For additional information
about the Company, please refer to other documents we have filed with the Securities and Exchange Commission and that are incorporated
by reference into this prospectus, as listed under the heading “Incorporation of Certain Information by Reference.”
Corporate Information
We were incorporated
in the state of Delaware in 2011 as RXi Pharmaceuticals Corporation. On November 19, 2018, the Company changed its name to Phio
Pharmaceuticals Corp., to reflect its transition from a platform company to one that is fully committed to developing groundbreaking
immuno-oncology therapeutics. Our executive offices are located at 257 Simarano Drive, Suite 101, Marlborough, MA 01752, and our
telephone number is (508) 767-3861. The Company’s website is www.phiopharma.com. Our website and the information
contained on that site, or connected to that site, is not part of or incorporated by reference into this prospectus.
Our certificate
of incorporation provides that the Court of Chancery of the State of Delaware is the exclusive forum for the following types of
actions or proceedings: any derivative action or proceeding brought on behalf of the Company, any action asserting a claim of
breach of a fiduciary duty owed by any director, officer or other employee of the Company to the Company or the Company’s
stockholders, any action asserting a claim against the Company arising pursuant to any provision of the Delaware General Corporation
Law or the Company’s certificate of incorporation or bylaws, or any action asserting a claim against the Company governed
by the internal affairs doctrine. Despite the fact that our certificate of incorporation provides for this exclusive forum provision
to be applicable to the fullest extent permitted by applicable law, Section 27 of the Securities and Exchange Act of 1934, as
amended (the “Exchange Act”), creates exclusive federal jurisdiction over all suits brought to enforce any
duty or liability created by the Exchange Act or the rules and regulations thereunder and Section 22 of the Securities Act of
1933, as amended (the “Securities Act”), creates concurrent jurisdiction for federal and state courts over
all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. As a
result, this provision of our certificate of incorporation would not apply to claims brought to enforce a duty or liability created
by the Securities Act, Exchange Act, or any other claim for which the federal courts have exclusive jurisdiction.
THE OFFERING
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Common stock to be offered
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8,125,946 shares consisting of:
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by the Selling Stockholder
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· 500,000
Commitment Shares issued to Lincoln Park upon the execution of the Purchase Agreement; and
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7,625,946 shares we may sell to Lincoln Park under the Purchase Agreement from time to time after the date of this
prospectus, subject to the Exchange Cap and Beneficial Ownership Cap, as defined below under “Lincoln Park
Transaction”
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Common stock outstanding prior to this offering
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25,091,197 shares, as of August 6, 2019
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Common stock to be outstanding after this offering
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33,217,143 shares, which gives effect to the issuance of a total of 8,125,946 shares under
the Purchase Agreement.
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Use of Proceeds
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We will receive no proceeds from the sale of shares of common stock by Lincoln Park in this
offering. We may receive up to $10,000,000 in aggregate gross proceeds under the Purchase Agreement from any sales we make to
Lincoln Park pursuant to the Purchase Agreement after the date of this prospectus. Any proceeds that we receive from sales to
Lincoln Park under the Purchase Agreement will be used for working capital and general corporate purposes. See “Use of
Proceeds.”
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Risk factors
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This investment involves a high degree of risk. See “Risk
Factors” for a discussion of factors you should consider carefully before making an investment decision.
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Trading Market
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Our common stock is listed on The Nasdaq Capital Market under the symbol “PHIO.”
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RISK FACTORS
Investing in our securities involves a high degree of risk.
Before investing in our securities, you should carefully consider the risks, uncertainties and assumptions described below and
discussed under the heading “Risk Factors” included in our most recent Annual Report on Form 10-K for the year ended
December 31, 2018, as revised or supplemented by subsequent filings, which are on file with the Securities and Exchange Commission
and are incorporated herein by reference, and which may be amended, supplemented or superseded from time to time by other reports
we file with the Securities and Exchange Commission in the future.
Our business, financial condition, results of operations
and future growth prospects could be materially and adversely affected by any of these risks. In these circumstances, the market
price of our common stock could decline, and you may lose all or part of your investment. The risks and uncertainties incorporated
by reference into this prospectus are not the only ones we face. Additional risks and uncertainties not presently known or which
we consider immaterial as of the date hereof may also have an adverse effect on our business.
Risks Related to This Offering
The sale or issuance of our common stock to Lincoln Park
may cause dilution and the sale of the shares of common stock acquired by Lincoln Park, or the perception that such sales may occur,
could cause the price of our common stock to fall.
On August 7, 2019, we entered into
the Purchase Agreement with Lincoln Park, pursuant to which Lincoln Park has committed to purchase up to $10,000,000 of
our common stock. Upon the execution of the Purchase Agreement, we issued 500,000 Commitment Shares to Lincoln Park as a fee
for its commitment to purchase shares of our common stock under the Purchase Agreement. The remaining shares of our common
stock that may be issued under the Purchase Agreement may be sold by us to Lincoln Park at our discretion from time to time
over a 30-month period commencing after the satisfaction of certain conditions set forth in the Purchase Agreement, including
that the SEC has declared effective the registration statement that includes this prospectus, and subject to applicable
Nasdaq limits on the number of shares that we can sell to Lincoln Park, absent stockholder approval. The purchase price for the
shares that we may sell to Lincoln Park under the Purchase Agreement will fluctuate based on the price of our common stock.
Depending on market liquidity at the time, sales of such shares may cause the trading price of our common stock to fall.
We generally have the right to control the
timing and amount of any future sales of our shares to Lincoln Park. Additional sales of our common stock, if any, to Lincoln Park
will depend upon market conditions and other factors to be determined by us. We may ultimately decide to sell to Lincoln Park all,
some, or none of the additional shares of our common stock that may be available for us to sell pursuant to the Purchase Agreement.
If and when we do sell shares to Lincoln Park, after Lincoln Park has acquired the shares, Lincoln Park may resell all, some or
none of those shares at any time or from time to time in its discretion. Therefore, sales to Lincoln Park by us could result in
substantial dilution to the interests of other holders of our common stock. Additionally, the sale of a substantial number of shares
of our common stock to Lincoln Park, or the anticipation of such sales, could make it more difficult for us to sell equity or equity-related
securities in the future at a time and at a price that we might otherwise wish to effect sales.
We may require additional financing to sustain our operations
and without it we may not be able to continue operations.
The Company believes that its existing
cash, and the potential proceeds available under the Purchase Agreement with Lincoln Park (assuming the Company is able to
access the full amount), should be sufficient to fund the Company’s operations for at least the next twelve months. We have
generated significant losses to date and expect to continue to incur significant operating losses as we advance our product
candidates through drug development and the regulatory process. In the future, we will be dependent on obtaining funding from
third parties, such as proceeds from the issuance of debt, sale of equity, funded research and development programs and
payments under partnership and collaborative agreements, in order to maintain our operations and meet our obligations to
licensors. There is no guarantee that debt, additional equity or other funding will be available to us on acceptable terms,
or at all.
The extent we rely on Lincoln Park as a
source of funding will depend on a number of factors including, the prevailing market price of our common stock and the extent
to which we are able to secure working capital from other sources. If obtaining sufficient funding from Lincoln Park were to prove
unavailable or prohibitively dilutive, we will need to secure another source of funding in order to satisfy our working capital
needs. Even if we sell all $10,000,000 under the Purchase Agreement to Lincoln Park, we may still need additional capital to fully
implement our business, operating and development plans. Should the financing we require to sustain our working capital needs be
unavailable or prohibitively expensive when we require it, the consequences could be a material adverse effect on our business,
operating results, financial condition and prospects.
USE OF PROCEEDS
This prospectus relates to shares of our
common stock that may be offered and sold from time to time by Lincoln Park. We will receive no proceeds from the sale of shares
of common stock by Lincoln Park in this offering. We may receive up to $10,000,000 in aggregate gross proceeds from any sales of
our common stock to Lincoln Park under the Purchase Agreement after the date of this prospectus. We will pay the expenses relating
to the registration under the Securities Act of the offer and sale by Lincoln Park of the shares covered by this prospectus, including
legal and accounting fees.
DIVIDEND
POLICY
We have never paid any cash dividends and
do not anticipate paying any cash dividends on our common stock in the foreseeable future. We expect to retain future earnings,
if any, for use in our development activities and the operation of our business. The payment of any future dividends will be subject
to the discretion of our Board of Directors and will depend, among other things, upon our results of operations, financial condition,
cash requirements, prospects and other factors that our Board of Directors may deem relevant.
lincoln
park Transaction
General
On August 7, 2019, we entered into a
purchase agreement with Lincoln Park, which, as amended on August 20, 2019, we refer to in this prospectus as the
“Purchase Agreement,” pursuant to which Lincoln Park has agreed to purchase from us up to an aggregate of
$10,000,000 of our common stock (subject to certain limitations) from time to time over the term of the Purchase Agreement.
Also on August 7, 2019, we entered into a registration rights agreement with Lincoln Park, which we refer to in this
prospectus as the “Registration Rights Agreement,” pursuant to which we have filed with the SEC the registration
statement that includes this prospectus to register for resale under the Securities Act of 1933, as amended, or the
“Securities Act,” the shares of common stock that have been or may be issued to Lincoln Park under the Purchase
Agreement.
Following the execution of the Purchase
Agreement, we issued 500,000 shares of common stock to Lincoln Park as consideration for its commitment to purchase shares of our
common stock under the Purchase Agreement, which we refer to in this prospectus as the “Commitment Shares.” We do not
have the right to commence any sales of our common stock to Lincoln Park under the Purchase Agreement until certain conditions
set forth in the Purchase Agreement, all of which are outside of Lincoln Park’s control, have been satisfied, including that
the registration statement of which this prospectus is a part is declared effective by the Securities and Exchange Commission.
Thereafter, under
the terms and subject to the conditions of the Purchase Agreement, we have the right to sell to Lincoln Park, and Lincoln Park
is obligated to purchase, up to $10,000,000 of shares of our common stock, subject to certain limitations set forth in the Purchase
Agreement, from time to time, over a 30-month period.
Under the Purchase Agreement, on any business
day selected by the Company, the Company may direct Lincoln Park to purchase shares of our common stock in amounts up to 200,000
shares (or up to $50,000 in shares of common stock, whichever is greater) in a “regular purchase,” which amounts may
be increased to up to 500,000 shares provided the market price of our common stock at the time of sale exceeds is not below certain
threshold prices, as set forth in the Purchase Agreement, subject in each case to $1,000,000 in total purchase proceeds per purchase
date. In addition to regular purchases, the Company may also direct Lincoln Park to purchase additional amounts as accelerated
purchases or as additional purchases if the Company has utilized the Regular Purchase Amount in full and if the closing sale price
of the Common Stock exceeds certain threshold prices, as set forth in the Purchase Agreement. The purchase price of the shares
that may be sold to Lincoln Park under the Purchase Agreement will be based on the market price of our common stock preceding the
time of sale as computed under the Purchase Agreement.
In accordance with applicable rules of The
Nasdaq Capital Market, the Purchase Agreement also limits the Company’s issuance of shares of Common Stock to Lincoln Park
thereunder to 5,015,730 shares of Common Stock, representing 19.99% of the shares of Common Stock outstanding on the date of the
Purchase Agreement (the “Exchange Cap”) unless (a) stockholder approval is obtained to issue more than such amount
or (b) the average price of all applicable sales of our common stock to Lincoln Park under the Purchase Agreement equals or exceeds
the lower of (i) the closing price of our common stock on the Nasdaq Capital Market immediately preceding August 7, 2019 plus an
incremental amount or (ii) the average of the closing price of our common stock on the Nasdaq Capital Market for the five Business
Days immediately preceding August 7, 2019 plus an incremental amount, such that issuances and sales of our common stock to Lincoln
Park under the Purchase Agreement would be exempt from the Exchange Cap limitation under applicable Nasdaq rules.
The Purchase Agreement also prohibits us
from directing Lincoln Park to purchase any shares of common stock if those shares, when aggregated with all other shares of our
common stock then beneficially owned by Lincoln Park and its affiliates, would result in Lincoln Park and its affiliates having
beneficial ownership, at any single point in time, of more than 9.99% of the then total outstanding shares of our common stock,
as calculated pursuant to Section 13(d) of the Securities Exchange Act of 1934, as amended, or the “Exchange Act,”
and Rule 13d-3 thereunder, which limitation we refer to as the “Beneficial Ownership Cap”.
There are no trading volume requirements
or restrictions under the Purchase Agreement, and we will control the timing and amount of any sales of our common stock to Lincoln
Park. We may at any time in our sole discretion terminate the Purchase Agreement without fee, penalty or cost upon one business
days’ notice. There are no restrictions on future financings, rights of first refusal, participation rights, penalties or
liquidated damages in the Purchase Agreement or Registration Rights Agreement, other than a prohibition on entering into any “Variable
Rate Transaction,” as defined in the Purchase Agreement. Lincoln Park may not assign or transfer its rights and obligations
under the Purchase Agreement.
A total of 8,125,946 shares of our common
stock are being offered under this prospectus, which may be less than the amount of shares issuable under the Purchase Agreement.
As of August 23, 2019, there were 25,591,197 shares of our common stock outstanding, of which 25,124,081 shares were held by non-affiliates.
If all of the 8,125,946 shares offered by Lincoln Park under this prospectus were issued and outstanding as of August 23, 2019,
such shares would represent 24% of the total number of shares of our common stock outstanding and 25% of the total number of outstanding
shares held by non-affiliates, in each case as of the date hereof; however, these percentages do not give effect to the prohibition
contained in the Purchase Agreement that prevents us from selling and issuing to Lincoln Park shares of our common stock that would
cause us to exceed the Exchange Cap or that would cause Lincoln Park and its affiliates to exceed the Beneficial Ownership Cap.
If we elect to issue and sell more than
the 8,125,946 shares offered under this prospectus to Lincoln Park, which we have the right, but not the obligation, to do, we
must first register for resale under the Securities Act any such additional shares, which could cause additional substantial dilution
to our stockholders. The number of shares ultimately offered for resale by Lincoln Park is dependent upon the number of shares
we sell to Lincoln Park under the Purchase Agreement.
Issuances of our common
stock in this offering will not affect the rights or privileges of our existing stockholders, except that the economic and voting
interests of each of our existing stockholders will be diluted as a result of any such issuance. Although the number of shares
of common stock that our existing stockholders own will not decrease, the shares owned by our existing stockholders will represent
a smaller percentage of our total outstanding shares after any such issuance to Lincoln Park.
Purchase of Shares Under the Purchase Agreement
Under the Purchase Agreement, on any business
day selected by us, we may direct Lincoln Park to purchase up to 200,000 shares of our common stock on any such business day, which
we refer to as a “Regular Purchase,” provided, however, that (i) the Regular Purchase may be increased to up to 300,000
shares, provided that the closing sale price is not below $0.60 on the purchase date, (ii) the Regular Purchase may be increased
to up to 400,000 shares, provided that the closing sale price is not below $0.80 on the purchase date, and (iii) the Regular Purchase
may be increased to up to 500,000 shares, provided that the closing sale price is not below $1.00 on the purchase date. In each
case, the maximum amount of any single Regular Purchase may not exceed $1,000,000 per purchase. The purchase price per share for
each such Regular Purchase will be equal to the lower of:
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the lowest sale price for our common stock on the purchase date of such shares; or
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the arithmetic average of the three lowest closing sale prices for our common stock during the 10 consecutive
business days ending on the business day immediately preceding the purchase date of such shares.
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In addition to Regular Purchases described
above, we may also direct Lincoln Park, on any business day on which we have properly submitted a Regular Purchase for the full
amount of our common stock permitted on such business day, to purchase an additional amount of our common stock, which we refer
to as an “Accelerated Purchase,” not to exceed the lesser of:
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30% of the aggregate shares of our common stock traded during normal trading hours on the purchase date;
and
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3 times the number of purchase shares purchased pursuant to the corresponding Regular Purchase.
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The purchase price per share for each such
Accelerated Purchase will be equal to the lower of:
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95% of the volume weighted average price during (i) the entire trading day on the purchase date, if the
volume of shares of our common stock traded on the purchase date has not exceeded a volume maximum calculated in accordance with
the Purchase Agreement, (ii) the portion of the trading day of the purchase date (calculated starting at the beginning of normal
trading hours) until such time at which the volume of shares of our common stock traded has exceeded such volume maximum, or (iii)
the portion of the trading day on the purchase date (calculated starting at the beginning of normal trading hours) until such time
at which the sales price of our common stock has fallen below the minimum price threshold set forth in the notice for the Accelerated
Purchase; or
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the closing sale price of our common stock on the accelerated purchase date.
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We may also direct Lincoln Park,
not later than 1:00 p.m., Eastern time, on a business day on which an Accelerated Purchase has been completed and all of the shares
to be purchased thereunder have been delivered to Lincoln Park in accordance with the Purchase Agreement prior to such time on
such business day to purchase an additional amount of our common stock, which we refer to as an Additional Accelerated Purchase,
of up to the lesser of:
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30% of the aggregate shares of our common stock traded during normal trading hours on the purchase date;
and
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3 times the number of purchase shares purchased pursuant to the corresponding Regular Purchase.
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The purchase price per share for each such
Additional Accelerated Purchase will be equal to the lower of:
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95% of the volume weighted average price during (i) the entire trading day on the additional accelerated
purchase date, if the volume of shares of our common stock traded on the purchase date has not exceeded a volume maximum calculated
in accordance with the Purchase Agreement, (ii) the portion of the trading day of the purchase date (calculated starting at the
beginning of normal trading hours) until such time at which the volume of shares of our common stock traded has exceeded such volume
maximum, or (iii) the portion of the trading day on the purchase date (calculated starting at the beginning of normal trading hours)
until such time at which the sales price of our common stock has fallen below the minimum price threshold set forth in the notice
for the Additional Accelerated Purchase; or
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the closing sale price of our common stock on the additional accelerated purchase date.
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The Company has the right, in its sole
discretion, to set a minimum price threshold for each Accelerated Purchase and Additional Accelerated Purchase in the notice provided
with respect to such Accelerated Purchase and Additional Accelerated Purchase, and the Company may direct multiple Regular, Accelerated
and Additional Accelerated Purchases in a day provided that delivery of shares has been completed with respect to any prior Regular,
Accelerated and Additional Accelerated Purchases that Lincoln Park has purchased.
In the case of the Regular Purchases, Accelerated
Purchases and Additional Accelerated Purchases, the purchase price per share will be equitably adjusted for any reorganization,
recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction occurring during the business
days used to compute the purchase price.
Other than as described above, there are
no trading volume requirements or restrictions under the Purchase Agreement, and we will control the timing and amount of any sales
of our common stock to Lincoln Park.
Events of Default
Events of default under the Purchase Agreement
include the following:
|
·
|
the effectiveness of the registration statement of which this prospectus forms a part lapses for any
reason (including, without limitation, the issuance of a stop order), or any required prospectus supplement and accompanying prospectus
are unavailable for the resale by Lincoln Park of our common stock offered hereby, and such lapse or unavailability continues for
a period of 10 consecutive business days or for more than an aggregate of 30 business days in any 365-day period;
|
|
|
|
|
·
|
suspension by our principal market of our common stock from trading for a period of one business day;
|
|
|
|
|
·
|
the de-listing of our common stock from The NASDAQ Capital Market, our principal market, provided our
common stock is not immediately thereafter trading on the New York Stock Exchange, the NASDAQ Global Market, the NASDAQ Global
Select Market, the NYSE Market, the OTC Bulletin Board or OTC Markets (or nationally recognized successor thereto);
|
|
|
|
|
·
|
the failure of our transfer agent to issue to Lincoln Park shares of our common stock within three business
days after the applicable date on which Lincoln Park is entitled to receive such shares;
|
|
|
|
|
·
|
any breach of the representations or warranties or covenants contained in the Purchase Agreement or Registration
Rights Agreement that has or could have a material adverse effect on us and, in the case of a breach of a covenant that is reasonably
curable, that is not cured within five business days;
|
|
|
|
|
·
|
if at any time the Exchange Cap is reached, to the extent applicable;
|
|
|
|
|
·
|
any voluntary or involuntary participation or threatened participation in insolvency or bankruptcy proceedings
by or against us; or
|
|
|
|
|
·
|
if at any time we are not eligible to transfer our common stock electronically.
|
Lincoln Park does not have the right to
terminate the Purchase Agreement upon any of the events of default set forth above. During an event of default, all of which are
outside of Lincoln Park’s control, we may not direct Lincoln Park to purchase any shares of our common stock under the Purchase
Agreement.
Our Termination Rights
We have the unconditional right, at any
time, for any reason and without any payment or liability to us, to give notice to Lincoln Park to terminate the Purchase Agreement.
In the event of bankruptcy proceedings by or against us, the Purchase Agreement will automatically terminate without action of
any party.
No Short-Selling or Hedging by Lincoln Park
Lincoln Park has agreed that neither it
nor any of its affiliates shall engage in any direct or indirect short-selling or hedging of our common stock during any time prior
to the termination of the Purchase Agreement.
Prohibitions on Variable Rate Transactions
There are no restrictions on future financings,
rights of first refusal, participation rights, penalties or liquidated damages in the Purchase Agreement or Registration Rights
Agreement other than a prohibition on entering into a “Variable Rate Transaction,” as defined in the Purchase Agreement.
Effect of Performance of the Purchase Agreement on Our Stockholders
All 8,125,946 shares registered in this
offering which have been or may be issued or sold by us to Lincoln Park under the Purchase Agreement are expected to be freely
tradable. It is anticipated that shares registered in this offering will be sold over a period of up to 30 months commencing on
the date that the registration statement including this prospectus becomes effective. The sale by Lincoln Park of a significant
amount of shares registered in this offering at any given time could cause the market price of our common stock to decline and
to be highly volatile. Sales of our common stock to Lincoln Park, if any, will depend upon market conditions and other factors
to be determined by us. We may ultimately decide to sell to Lincoln Park all, some or none of the additional shares of our common
stock that may be available for us to sell pursuant to the Purchase Agreement. If and when we do sell shares to Lincoln Park, after
Lincoln Park has acquired the shares, Lincoln Park may resell all, some or none of those shares at any time or from time to time
in its discretion. Therefore, sales to Lincoln Park by us under the Purchase Agreement may result in substantial dilution to the
interests of other holders of our common stock. In addition, if we sell a substantial number of shares to Lincoln Park under the
Purchase Agreement, or if investors expect that we will do so, the actual sales of shares or the mere existence of our arrangement
with Lincoln Park may make it more difficult for us to sell equity or equity-related securities in the future at a time and at
a price that we might otherwise wish to effect such sales. However, we have the right to control the timing and amount of any additional
sales of our shares to Lincoln Park and the Purchase Agreement may be terminated by us at any time at our discretion without any
cost to us.
Pursuant to the terms of the Purchase Agreement,
we have the right, but not the obligation, to direct Lincoln Park to purchase up to $10,000,000 of our common stock, exclusive
of the 500,000 shares issued to Lincoln Park on such date as a commitment fee. Depending on the price per share at which we sell
our common stock to Lincoln Park pursuant to the Purchase Agreement, we may need to sell to Lincoln Park under the Purchase Agreement
more shares of our common stock than are offered under this prospectus in order to receive aggregate gross proceeds equal to the
$10,000,000 total commitment available to us under the Purchase Agreement. If we choose to do so, we must first register for resale
under the Securities Act such additional shares of our common stock, which could cause additional substantial dilution to our stockholders.
The number of shares ultimately offered for resale by Lincoln Park under this prospectus is dependent upon the number of shares
we direct Lincoln Park to purchase under the Purchase Agreement.
The Purchase Agreement prohibits us from
issuing or selling to Lincoln Park under the Purchase Agreement (i) any shares of our common stock if those shares, when aggregated
with all other shares of our common stock then beneficially owned by Lincoln Park and its affiliates, would exceed the Beneficial
Ownership Cap and (ii) shares of our common stock in excess of the Exchange Cap, unless we obtain stockholder approval to
issue shares in excess of the Exchange Cap or the average price of all applicable sales of our common stock to Lincoln Park under
the Purchase Agreement equals or exceeds the lower of (a) the closing price of our common stock on the Nasdaq Capital Market immediately
preceding August 7, 2019 plus an incremental amount or (b) the average of the closing price of our common stock on the Nasdaq Capital
Market for the five Business Days immediately preceding August 7, 2019 plus an incremental amount, such that the transactions contemplated
by the Purchase Agreement are exempt from the Exchange Cap limitation under applicable NASDAQ rules.
The following table sets forth the amount
of gross proceeds we would receive from Lincoln Park from our sale of shares to Lincoln Park under the Purchase Agreement at varying
purchase prices:
|
Assumed Average Purchase Price Per Share
|
|
|
Number of Registered Shares to be Issued if Full Purchase (1)
|
|
|
Percentage of Outstanding Shares After Giving Effect to the Issuance to Lincoln Park (2)
|
|
|
Proceeds from the Sale of Shares to Lincoln Park Under the $10M Purchase Agreement
|
|
|
$
|
0.29 (3)
|
|
|
|
5,015,730
|
|
|
|
16%
|
|
|
$
|
1,454,561
|
|
|
$
|
0.60
|
|
|
|
7,625,946
|
|
|
|
23%
|
|
|
$
|
4,575,568
|
|
|
$
|
0.80
|
|
|
|
7,625,946
|
|
|
|
23%
|
|
|
$
|
6,100,757
|
|
|
$
|
1.00
|
|
|
|
7,625,946
|
|
|
|
23%
|
|
|
$
|
7,625,946
|
|
____________________
|
|
(1)
|
Although the Purchase Agreement provides that we may sell up to $10,000,000 of our common stock to Lincoln Park, we are only
registering 8,125,946 shares under this prospectus which represents: (i) 500,000 shares that we already issued to Lincoln Park
as a commitment fee for making the commitment under the Purchase Agreement, and (ii) an additional 7,625,946 shares which may be
issued to Lincoln Park in the future under the Purchase Agreement, if and when we sell shares to Lincoln Park under the Purchase
Agreement, and which may or may not cover all the shares we ultimately sell to Lincoln Park under the Purchase Agreement, depending
on the purchase price per share. As a result, we have included in this column only those shares that we are registering in this
offering. If we seek to issue shares of our common stock, including shares from other transactions that may be aggregated with
the transactions contemplated by the Purchase Agreement under the applicable rules of The NASDAQ Capital Market, in excess of 5,015,730
shares, or 19.99% of the total common stock outstanding immediately prior to the execution of the Purchase Agreement, we may be
required to seek stockholder approval in order to be in compliance with the rules of The NASDAQ Capital Market.
|
|
|
(2)
|
The denominator is based on 25,591,197 shares outstanding as of August 23, 2019, which includes (i) 500,000 commitment
shares issued to Lincoln Park upon the execution of the Purchase
Agreement, and (ii) the number of shares set forth in the adjacent
column which we would have sold to Lincoln Park, assuming the purchase price in the adjacent column. The numerator is based
on the number of shares issuable under the Purchase Agreement at the corresponding assumed purchase price set forth in the
adjacent column.
|
|
|
(3)
|
The closing sale price of our common stock on October 1,
2019.
|
DETERMINATION OF OFFERING PRICE
The prices at which the Shares covered by
this prospectus may actually be sold will be determined by the prevailing public market price for shares of our common stock, by
negotiations between the Selling Stockholder and buyers of our Common Stock in private transactions or as otherwise described in
“Plan of Distribution.”
SELLING STOCKHOLDER
This prospectus relates to the possible
resale by the Selling Stockholder, Lincoln Park, of shares of our common stock that have been or may be issued to Lincoln Park
pursuant to the Purchase Agreement. We are filing the registration statement of which this prospectus forms a part pursuant to
the provisions of the Registration Rights Agreement, which we entered into with Lincoln Park on August 7, 2019 concurrently with
our execution of the Purchase Agreement, in which we agreed to provide certain registration rights with respect to sales by Lincoln
Park of the shares of our common stock that have been or may be issued to Lincoln Park under the Purchase Agreement.
Lincoln Park, as the Selling Stockholder,
may, from time to time, offer and sell pursuant to this prospectus any or all of the shares that we have issued or may issue to
Lincoln Park under the Purchase Agreement. The Selling Stockholder may sell some, all or none of its shares. We do not know how
long the Selling Stockholder will hold the shares before selling them, and we currently have no agreements, arrangements or understandings
with the Selling Stockholder regarding the sale of any of the shares.
The following table presents information
regarding the Selling Stockholder and the shares that it may offer and sell from time to time under this prospectus. The table
is prepared based on information supplied to us by the Selling Stockholder, and reflects its holdings as of August 7, 2019. Neither
Lincoln Park nor any of its affiliates has held a position or office, or had any other material relationship, with us or any of
our predecessors or affiliates. Beneficial ownership is determined in accordance with Section 13(d) of the Exchange Act and
Rule 13d-3 thereunder. The percentage of shares beneficially owned prior to the offering is based on 25,591,197 shares of
our common stock actually outstanding as of August 23, 2019.
|
Selling Stockholder
|
|
Shares Beneficially Owned Before this Offering
|
|
Percentage of Outstanding Shares Beneficially Owned Before this Offering
|
|
|
Shares to be Sold in this Offering
|
|
Percentage of Outstanding Shares Beneficially Owned After this Offering
|
|
Lincoln Park Capital Fund, LLC (1)
|
|
2,556,561(2)
|
|
|
9.99(3)
|
|
|
8,125,946(4)
|
|
9.99%(5)
|
____________________
|
|
(1)
|
Josh Scheinfeld and Jonathan Cope, the Managing Members of Lincoln Park Capital, LLC, are deemed to be beneficial owners of
all of the shares of common stock owned by Lincoln Park Capital Fund, LLC. Messrs. Cope and Scheinfeld have shared voting and investment
power over the shares being offered under the prospectus filed with the SEC in connection with the transactions contemplated under
the Purchase Agreement. Lincoln Park Capital, LLC is not a licensed broker dealer or an affiliate of a licensed broker dealer.
|
|
|
(2)
|
Represents (i) 500,000 Commitment Shares of our common stock issued to Lincoln Park upon our execution of the Purchase
Agreement as a fee for its commitment to purchase shares of our common stock under the Purchase Agreement, all of which
shares are covered by the registration statement that includes this prospectus; and (ii) an aggregate of 2,056,561 shares of
our common stock, representing the maximum aggregate number of
shares that may be issued to Lincoln Park as of the date of this
prospectus upon exercise of warrants to purchase our common stock, at certain fixed prices (that may be subject to
adjustment as provided in such warrants), which warrants were
acquired by Lincoln Park in connection with our public offerings of
securities in June 2015, December 2016, April 2018 and October 2018 (collectively, the “LPC Public Offering
Warrants”). We
have excluded
from the number of shares beneficially owned by Lincoln
Park prior to the offering: (a) an aggregate of
1,455,151 shares of our common stock underlying the LPC Public Offering Warrants, which, as of the date of this prospectus,
may not be issued to Lincoln Park under the express terms of such warrants prohibiting us from issuing shares upon exercise
of such warrants if such shares, when aggregated with all other shares of our common stock then beneficially owned by
Lincoln Park and its affiliates, would result in Lincoln Park
and its affiliates having beneficial ownership of more than
9.99% of
the then total outstanding shares of our common stock, as
calculated in accordance with the terms of such warrants; and (b)
all of the additional shares of common stock that Lincoln Park may be required to purchase pursuant to the Purchase
Agreement, because the issuance of such shares is solely at our discretion and is subject to certain conditions, the
satisfaction of all of which are outside of Lincoln Park’s control, including the registration statement of which this
prospectus is a part becoming and remaining effective. Furthermore, under the terms of the Purchase Agreement, issuances and
sales of shares of our common stock to Lincoln Park are subject to certain limitations on the amounts we may sell to Lincoln
Park at any time, including the Exchange Cap and the Beneficial Ownership Cap. See the description under the heading
“The Lincoln Park Transaction” for more information about the Purchase Agreement.
|
|
|
(3)
|
Based on 25,591,197 outstanding shares of our common stock as of August 23, 2019, which includes the 500,000 Commitment Shares
we issued to Lincoln Park on August 7, 2019.
|
|
|
(4)
|
Although the Purchase Agreement provides that we may sell up to $10,000,000 of our common stock to Lincoln Park, only 8,125,946
shares of our common stock are being offered under this prospectus, which represents: (i) 500,000 Commitment Shares issued to Lincoln
Park upon our execution of the Purchase Agreement as a fee for its commitment to purchase shares of our common stock under the
Purchase Agreement; and (ii) an aggregate of 7,625,946 shares of our common stock that may be sold by us to Lincoln Park at our
discretion from time to time over a 30-month period commencing after the satisfaction of certain conditions set forth in the Purchase
Agreement, including that the SEC has declared effective the registration statement that includes this prospectus. Depending on
the price per share at which we sell our common stock to Lincoln Park pursuant to the Purchase Agreement, we may need to sell to
Lincoln Park under the Purchase Agreement more shares of our common stock than are offered under this prospectus in order to receive
aggregate gross proceeds equal to the $10,000,000 total commitment available to us under the Purchase Agreement. If we choose to
do so, we must first register for resale under the Securities Act such additional shares. The number of shares ultimately offered
for resale by Lincoln Park is dependent upon the number of shares we sell to Lincoln Park under the Purchase Agreement.
|
|
|
(5)
|
Percentage represents the maximum aggregate number of shares issuable to Lincoln Park upon exercise of the LPC Public Offering
Warrants under the terms of such warrants, after giving effect to the resale by Lincoln Park of all shares of common stock that
have been or may be issued and sold by us pursuant to the Purchase Agreement and that are covered by this prospectus and referenced
in footnote (4) above.
|
PLAN OF DISTRIBUTION
The common stock offered by this prospectus
is being offered by the Selling Stockholder, Lincoln Park. The common stock may be sold or distributed from time to time by the
Selling Stockholder directly to one or more purchasers or through brokers, dealers, or underwriters who may act solely as agents
at market prices prevailing at the time of sale, at prices related to the prevailing market prices, at negotiated prices, or at
fixed prices, which may be changed. The sale of the common stock offered by this prospectus could be effected in one or more of
the following methods:
|
·
|
ordinary brokers’ transactions;
|
|
|
|
|
·
|
transactions involving cross or block trades;
|
|
|
|
|
·
|
through brokers, dealers, or underwriters who may act solely as agents;
|
|
|
|
|
·
|
“at the market” into an existing market for the common stock;
|
|
|
|
|
·
|
in other ways not involving market makers or established business markets, including direct sales to
purchasers or sales effected through agents;
|
|
|
|
|
·
|
in privately negotiated transactions; or
|
|
|
|
|
·
|
any combination of the foregoing.
|
In order to comply with the securities
laws of certain states, if applicable, the shares may be sold only through registered or licensed brokers or dealers. In addition,
in certain states, the shares may not be sold unless they have been registered or qualified for sale in the state or an exemption
from the state’s registration or qualification requirement is available and complied with.
Lincoln Park is an “underwriter”
within the meaning of Section 2(a)(11) of the Securities Act.
Lincoln Park has informed us that it intends
to use an unaffiliated broker-dealer to effectuate all sales, if any, of the common stock that it may purchase from us pursuant
to the Purchase Agreement. Such sales will be made at prices and at terms then prevailing or at prices related to the then current
market price. Each such unaffiliated broker-dealer will be an underwriter within the meaning of Section 2(a)(11) of the Securities
Act. Lincoln Park has informed us that each such broker-dealer will receive commissions from Lincoln Park that will not exceed
customary brokerage commissions.
Brokers, dealers, underwriters or agents
participating in the distribution of the shares as agents may receive compensation in the form of commissions, discounts, or concessions
from the Selling Stockholder and/or purchasers of the common stock for whom the broker-dealers may act as agent. The compensation
paid to a particular broker-dealer may be less than or in excess of customary commissions. Neither we nor Lincoln Park can presently
estimate the amount of compensation that any agent will receive.
We know of no existing arrangements between
Lincoln Park or any other stockholder, broker, dealer, underwriter or agent relating to the sale or distribution of the shares
offered by this prospectus. At the time a particular offer of shares is made, a prospectus supplement, if required, will be distributed
that will set forth the names of any agents, underwriters or dealers and any compensation from the Selling Stockholder, and any
other required information.
We will pay the expenses incident to the
registration, offering, and sale of the shares to Lincoln Park. We have agreed to indemnify Lincoln Park and certain other persons
against certain liabilities in connection with the offering of shares of common stock offered hereby, including liabilities arising
under the Securities Act or, if such indemnity is unavailable, to contribute amounts required to be paid in respect of such liabilities.
Lincoln Park has agreed to indemnify us against liabilities under the Securities Act that may arise from certain written information
furnished to us by Lincoln Park specifically for use in this prospectus or, if such indemnity is unavailable, to contribute amounts
required to be paid in respect of such liabilities.
Lincoln Park has represented to us that
at no time prior to the Purchase Agreement has Lincoln Park or its agents, representatives or affiliates engaged in or effected,
in any manner whatsoever, directly or indirectly, any short sale (as such term is defined in Rule 200 of Regulation SHO of the
Exchange Act) of our common stock or any hedging transaction, which establishes a net short position with respect to our common
stock. Lincoln Park agreed that during the term of the Purchase Agreement, it, its agents, representatives or affiliates will not
enter into or effect, directly or indirectly, any of the foregoing transactions.
We have advised Lincoln Park that it is
required to comply with Regulation M promulgated under the Exchange Act. With certain exceptions, Regulation M precludes the selling
stockholder, any affiliated purchasers, and any broker-dealer or other person who participates in the distribution from bidding
for or purchasing, or attempting to induce any person to bid for or purchase any security which is the subject of the distribution
until the entire distribution is complete. Regulation M also prohibits any bids or purchases made in order to stabilize the price
of a security in connection with the distribution of that security. All of the foregoing may affect the marketability of the securities
offered by this prospectus.
This offering will terminate on the date
that all shares offered by this prospectus have been sold by Lincoln Park.
Our common stock is quoted on The NASDAQ
Capital Market under the symbol “PHIO”.
Legal Matters
Certain legal matters
relating to the issuance of the securities offered by this prospectus will be passed upon for us by Gibson, Dunn & Crutcher
LLP, San Francisco, California.
Experts
The
consolidated financial statements as of December 31, 2018 and 2017 and for each of the two years in the period ended December 31,
2018 incorporated by reference in this prospectus have been so incorporated in reliance on the report of BDO USA, LLP, an independent
registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
Where You
Can Find More Information
We file annual, quarterly and current reports,
proxy statements and other information with the Securities and Exchange Commission (“SEC”). Our SEC filings are available
to the public over the Internet at the SEC’s website at http://www.sec.gov. Copies of certain information filed by us with
the SEC are also available on our website at www.phiopharma.com. Our website is not a part of this prospectus and is not incorporated
by reference in this prospectus, and you should not consider the contents of our website in making an investment decision with
respect to our common stock.
This prospectus is part of a registration
statement that we filed with the SEC. This prospectus omits some information contained in the registration statement in accordance
with SEC rules and regulations. You should review the information and exhibits in the registration statement for further information
about us and our subsidiaries and the securities we are offering. Statements in this prospectus concerning any document we filed
as an exhibit to the registration statement or that we otherwise filed with the SEC are not intended to be comprehensive and are
qualified by reference to these filings. You should review the complete document to evaluate these statements.
INCORPORATION
OF CERTAIN INFORMATION BY REFERENCE
The
SEC allows us to “incorporate by reference” the information we have filed with them, which means that we can disclose
important information to you by referring you to those documents. The information we incorporate by reference is an important part
of this prospectus, and information that we file later with the SEC will automatically update and supersede this information. The
documents we are incorporating by reference are:
All
documents we file with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, except as to any portion of
any report or document that is not deemed filed under such provisions, (1) on or after the date of filing of the registration
statement containing this prospectus and prior to the effectiveness of the registration statement and (2) on or after the
date of this prospectus until the earlier of the date on which all of the securities registered hereunder have been sold or the
registration statement of which this prospectus is a part has been withdrawn, shall be deemed incorporated by reference in this
prospectus and to be a part of this prospectus from the date of filing of those documents and will be automatically updated and,
to the extent described above, supersede information contained or incorporated by reference in this prospectus and previously filed
documents that are incorporated by reference in this prospectus.
Nothing in this prospectus shall be deemed
to incorporate information furnished but not filed with the SEC pursuant to Item 2.02, 7.01 or 9.01 of Form 8-K.
Upon written or oral request, we will provide
without charge to each person, including any beneficial owner, to whom a copy of the prospectus is delivered a copy of any or all
of the reports or documents incorporated by reference herein (other than exhibits to such documents, unless such exhibits are specifically
incorporated by reference herein). You may request a copy of these filings, at no cost, by writing or telephoning us at the following
address: Phio Pharmaceuticals Corp., 257 Simarano Drive, Suite 101, Marlborough, Massachusetts 01752 Attention: Investor Relations,
telephone: (508) 767-3861. We maintain a website at www.phiopharma.com. You may access our definitive proxy
statements on Schedule 14A, annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on
Form 8-K and periodic amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange
Act with the SEC free of charge at our website as soon as reasonably practicable after such material is electronically filed with,
or furnished to, the SEC. The information contained in, or that can be accessed through, our website is not incorporated by reference
in, and is not part of, this prospectus. We have not authorized any one to provide you with any information that differs from that
contained in this prospectus. Accordingly, you should not rely on any information that is not contained in this prospectus. You
should not assume that the information in this prospectus is accurate as of any date other than the date of the front cover of
this prospectus.
Phio Pharmaceuticals
Corp.
Up to 8,125,946 Shares
of Common Stock
PROSPECTUS
October 1,
2019
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