so as a result of these and any future measures necessary to ensure the safety of our employees and the continuity of our operations. These measures could also lead to reduced efficiency in our
operations.
Several of our subsidiaries are leanly staffed and rely on key personnel to manage operations. The loss of our key scientific
staff, personnel, or other key employees, as a result of illness or otherwise, could negatively impact our business and operations, particularly if we are unable to adequately find or train replacements. Certain of our subsidiaries, such as Trans
Ova and Exemplar, that operate in industries in which remote working is not possible may be particularly at risk.
Given the dynamic
nature of these circumstances, the full impact of the COVID-19 pandemic on our ongoing business, results of operations, and financial performance cannot be reasonably estimated at this time, and it could have
a material adverse effect on our results of operations, cash flows, and financial position, including resulting in impairments to goodwill and long-lived assets and additional credit losses.
The COVID-19 pandemic has created significant volatility, uncertainty, and economic disruption that could have
an adverse effect on the Companys access to capital on favorable terms.
Our operations have consumed substantial amounts of
cash since our inception. We expect to continue to spend substantial amounts to continue the preclinical and clinical development of our current and future programs. We are and will continue to be dependent on public or private financings, new
collaborations or licensing arrangements with strategic partners, or additional debt financing sources to fund continuing operations. As the COVID-19 pandemic continues to negatively impact the economy, our
future access to capital on favorable terms may be materially impacted. We may not be able to raise sufficient additional funds on terms that are favorable to us, if at all. Given the rapid evolution of the
COVID-19 pandemic and the uncertainty surrounding it, its impact to our financial condition, including but not limited to, possible impairment, restructuring, and other changes, cannot be reliably quantified
or estimated.
The ongoing COVID-19 pandemic has caused and could continue to cause disruption of the
development of our product candidates, which could adversely impact our healthcare business.
In response to the COVID-19 pandemic, ActoBio took the initiative to temporarily suspend the last remaining cohort of the Phase1b/2a trial for AG019 as a proactive measure to protect the welfare and safety of patients, caregivers,
clinical site staff, and our employees and contractors. This voluntary suspension was lifted in June 2020, and the study is recruiting patients again. Further, from April to May 2020, enrollment of new patients in our PRGN-3005 Phase 1 trial was
temporarily suspended due to a mandated hold on certain early and late-stage clinical trials at the Fred Hutchinson Cancer Research Center in Seattle that was instituted in light of the COVID-19 pandemic. As
the COVID-19 pandemic continues to evolve, we may experience delays in the development of our product candidates, including as a result of declines in new patient enrollment for new and existing trials,
ability to recruit and retain principal investigators and site staff who, as healthcare providers, may have heightened exposure to COVID-19 if an outbreak occurs in their geography, site closures, reduced
availability of other key personnel, availability of supplies, or for other reasons that may be difficult to anticipate. For example, we received IND clearance in 2020 to initiate, and initiated, a Phase 1/2 trial to study PRGN-2009 in participants
with HPV+ cancers, but our ability to complete this trial may be delayed or impeded by any of the foregoing factors as a result of the COVID-19 pandemic. Similarly, we recently announced that the FDA has
cleared approved our IND application to initiate a Phase 1 clinical trial of PRGN-2012, but our ability to initiate and complete this trial may be delayed or impeded by the COVID-19 pandemic. In addition, the
FDA or other regulatory authorities may have their resources diverted to responding to, or otherwise may be disrupted by, the COVID-19 pandemic, which could result in delays of reviews, approvals, and
communications with regulatory authorities related to our clinical trials and product candidates. As the focus of our business is on healthcare, disruptions to our clinical trials could result in increased costs, delays in advancing product
candidates, or ultimately, termination of clinical trials altogether resulting in a material adverse impact to our overall business.
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