NWBO Filings — Northwest Biotherapeutics Inc

NWBO Filings — Northwest Biotherapeutics Inc - FilingSpy

10-Q · Quarter ended Jun 30, 2026 · SEC filing ↗

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Management's Discussion and Analysis

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and the notes to those statements included with this report. In addition to historical information, this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. The words “believe,” “expect,” “intend,” “anticipate,” and similar expressions are used to identify forward-looking statements, but some forward-looking statements are expressed differently. Many factors could affect our actual results, including those factors described under “Risk Factors” in our Form 10-K for the year ended December 31, 2025 and in Part II Item 1A of this report. These factors, among others, could cause results to differ materially from those presently anticipated by us. You should not rely upon on these forward-looking statements. Overview We are a biotechnology company focused on developing personalized immune therapies for cancer. We have developed a platform technology, DCVax®, which uses activated dendritic cells to mobilize a patient’s own immune system to attack their cancer. Our lead product, DCVax®-L, is designed to treat solid tumor cancers in which the tumor can be surgically removed. We have completed a 331-patient international Phase III trial of DCVax-L for Glioblastoma multiforme brain cancer (GBM), published the results in the JAMA Oncology peer reviewed journal, and on December 20, 2023 we submitted a Marketing Authorization Application (MAA) for commercial approval in the U.K. We plan to conduct clinical trials of DCVax-L for other solid tumor cancers in the future, when resources permit. Our second product, DCVax®-Direct, is designed to treat inoperable solid tumors. A 40-patient Phase I trial has been completed, and included treatment of a diverse range of more than a dozen types of cancers. We plan to work on preparations for Phase II trials of DCVax-Direct as resources permit. During the second quarter of 2026, the Company continued its progress on multiple fronts, including the following: MAA Application. Much of the Company’s time and resources continued to be devoted to active engagement in the MAA review process during the first quarter. The Company continued to work with large teams of consultants on this process. As is typical, and as the Company has previously stated, the Company does not plan to make any interim announcements while its MAA is going through the regulatory process. The Company plans to announce the results when the regulatory review and decision-making is finished. Collaborations. The Company pursued collaboration discussions in certain countries where the Company believes that development and potential commercialization could proceed more rapidly and efficiently with a partner. As previously reported, the Company entered into an MOU for a potential collaboration with one of the largest pharmaceutical companies in the Kingdom of Saudi Arabia. The Company is continuing those discussions with a view to reaching a definitive agreement. The Company is also continuing other discussions. Statistical Analyses and BNOS Presentation. As previously reported, the Company worked closely with a team of independent statisticians to analyze the data from the Phase 3 trial of DCVax-L for glioblastoma, applying multiple statistical methodologies and using individual patient data (IPD) comparators. This had been envisaged in the Statistical Analysis Plan (SAP) for the trial but the Company had been unable to gain access to IPD at the time of the original analysis of the trial results despite extensive efforts. The results of these IPD analyses were all directionally consistent and indicated that the magnitude of the survival extension associated with DCVax-L was substantially greater than the original analysis of the trial results had shown. The Company presented this work at the annual meeting of the British Neuro Oncology Society (BNOS) at the beginning of July 2026. UK Leukapheresis Capacity. The Company continued it efforts to develop expanded capacity for leukapheresis procedures. The Company pursued discussions with certain parties who have existing leukapheresis facilities, to secure further capacity without capital expenditure. In parallel, the Company also continued pursuing the development of its own leukapheresis unit in the London Welbeck Hospital and pursuing the necessary licenses for the operation of that unit. UK Manufacturing Capacity. The Company began exploring the potential for conducting the tumor lysate stage of the manufacturing process in additional facilities to enable an increase in the production capacity in the Sawston facility before the completion of the Grade C lab. The Company continued discussions for a collaboration that could potentially lead to a second DCVax production operation in 23 Table of Contents another region of the UK, using an existing established GMP facility. The Company also pursued a grant funding program for non-dilutive capital for development of capacity in the Sawston facility. US Manufacturing Capacity. The technology transfer process for development of DCVax-L manufacturing capacity in a US company was completed, and the basic engineering runs and validation were undertaken and recently completed. For production of the Kalinski aDC1 products, the Company’s negotiations for lease arrangements for a suitable GMP facility continued. In light of the challenges encountered in reaching suitable lease arrangements for production of the Kalinski products, the Company anticipates making arrangements for a parallel process of technology transfer to the US company to which the technology transfer for production of DCVax-L products has been completed. Development Activity With In-Licensed Technologies. The IND package was further updated and its clinical protocol component has been awaiting review and approval by the Institutional Review Board (IRB) there. The Company anticipates submission to the FDA as soon as the IRB approval is completed. UK Property Development. The Company and its advisers made headway in continuing to work toward the reclassification and increased valuation of the property owned by the Company on the edge of Sawston, UK. The property is now considered to be in an in-between classification, which the Company has been advised has more than doubled the prior value of the property. Litigation Progress. The Company continued vigorously pursuing discovery in its litigation in New York against certain market makers. Among other steps, the Company continued seeking certain trading information and trading algorithms. The Company believes that the Court’s recent order requiring the defendants to produce their trading algorithms is quite significant. The Company plans to continue its vigorous pursuit of the case. See Part II Item 1, Legal Proceedings, below. Critical Accounting Policies and Estimates Our discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect our reported amounts of assets, liabilities, revenues and expenses. On an ongoing basis, we evaluate our estimates and judgments, including those related to derivative liabilities, accrued expenses and stock-based compensation. We based our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the reported amounts of revenues and expenses that are not readily apparent from other sources. Actual results could differ from those estimates. Our critical accounting policies and significant estimates are detailed in our Annual Report on Form 10-K for the year ended December 31, 2025. Our critical accounting policies and significant estimates have not changed substantially from those previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025. Results of Operations Operating costs: Our operating costs and expenses consist primarily of research and development (R&D) expenses. R&D expenses include clinical trial expenses, and increased costs after completion of a Phase III trial, especially for the extensive preparations, and teams of expert consultants, required for an application for product approval and required for ongoing interaction with the regulatory agency while the application undergoes review. In addition to clinical trial and post-trial costs, our operating costs may include ongoing work relating to our DCVax products, including R&D, product characterization, manufacturing process development, quality control process development, and related matters. Additional substantial costs relate to the development and expansion of manufacturing capacity. Our operating costs also include the costs of preparations for the launch of new or expanded clinical trial programs, such as our anticipated trials of combination treatment regimens. The preparation costs include payments to regulatory consultants, lawyers, statisticians, sites and others, evaluation of potential investigators, the clinical trial sites and the CROs managing the trials and other 24 Table of Contents service providers, and expenses related to institutional approvals, clinical trial agreements (business contracts with sites), training of medical and other site personnel, trial supplies and other. Our operating costs also include legal and accounting costs in operating the Company. The foregoing operating costs include the costs for Flaskworks’ ongoing operations and intellectual property filings, and the operations of our subsidiaries in the U.K., the Netherlands and Germany. Research and development: R&D expenses include costs for substantial external scientific personnel, technical and regulatory advisers, and others, costs of laboratory supplies used in our internal research and development projects, travel, regulatory compliance, and expenditures for preclinical and clinical trial operation and management when we are actively engaged in clinical trials. Because we are a pre-revenue company, we do not allocate R&D costs on a project basis. We adopted this policy, in part, due to the unreasonable cost burden associated with accounting at such a level of detail and our limited number of financial and personnel resources. General and administrative: General and administrative expenses include personnel related salary and benefit expenses, cost of facilities, insurance, travel, legal services, property and equipment and amortization of stock options and warrants. Three Months Ended June 30, 2026 and 2025 We recognized a net loss of $9.2 million and $15.4 million for the three months ended June 30, 2026 and 2025, respectively. Research and Development Expense For the three months ended June 30, 2026 and 2025, research and development expenses were $5.7 million and $7.4 million, respectively. The decrease in 2026 was primarily related to a decrease in the costs related to the MAA application and its review by the MHRA, a decrease in stock-based compensation to external consultants and the acquisition of Advent in the 4th quarter in 2025. General and Administrative Expense For the three months ended June 30, 2026 and 2025, general and administrative expenses were $6.7 million and $7.5 million, respectively. The decrease was mainly related to a reduction in legal costs. Change in Fair Value of Derivatives The derivative liability associated with the contingent note payable was zero as of June 30, 2026. We did not recognize any expense related to change in fair value of derivatives during the three months ended June 30, 2026. We recognized a non-cash gain of $0.7 million for the three months ended June 30, 2025. The non-cash revaluation gain was mainly due to the decrease of stock price and remaining life of certain liability classified warrants. We did not recognize any change in fair value of derivatives for the three months ended June 30, 2026. Change in Fair Value of Share Payable We recognized a non-cash gain of $64,000 and a non-cash loss of $0.2 million from the change in fair value of share payable during the three months ended June 30, 2026 and 2025, respectively. The fluctuations were mainly due to the movement of our stock price. 25 Table of Contents Change in Fair Value of Convertible Notes We recognized a non-cash gain of $6.4 million and $2.4 million for the change in fair value of the convertible notes during the three months ended June 30, 2026 and 2025, respectively. The non-cash gains resulted from the decrease of the Company’s stock price. In addition, the increased gain during the three months ended June 30, 2026 was also attributable to a change in certain assumptions used in the valuation of the convertible notes. Debt Extinguishment We recognized approximately $2.2 million and $4.5 million debt extinguishment loss during the three months ended June 30, 2026 and 2025, respectively, from debt redemptions and debt amendments. The decrease during the three months ended June 30, 2026 compared to last year in the same period was due to less volume of debt amendments. Loss from Issuance of Debt We recognized approximately $0.8 million loss from issuance of certain convertible notes, which we elected to account for under the FVO during the three months ended June 30, 2025. The loss was calculated as the difference between the principal amount and the fair value of these convertible notes. Interest Expense During the three months ended June 30, 2026 and 2025, we recognized interest expense of $1.8 million and $1.8 million, respectively. Foreign currency transaction gain (loss) During the three months ended June 30, 2026 and 2025, we recognized foreign currency transaction loss of $0.1 million and a gain of $3.6 million, respectively. The loss was due to the strengthening of the U.S. dollar relative to British pound sterling and vice versa for the loss. Six Months Ended June 30, 2026 and 2025 We recognized a net loss of $12.3 million and $34.7 million for the six months ended June 30, 2026 and 2025, respectively. Research and Development Expense For the six months ended June 30, 2026 and 2025, research and development expenses were $10.6 million and $15.8 million, respectively. The decrease in 2026 was primarily related to a decrease in the costs related to the MAA application and its review by the MHRA, a decrease in stock-based compensation to external consultants and the acquisition of Advent in the 4th quarter in 2025. General and Administrative Expense For the six months ended June 30, 2026 and 2025, general and administrative expenses were $13.2 million and $16.8 million, respectively. The decrease was mainly related to a reduction in legal costs. Settlement Gain During the six months ended June 30, 2026, the Company recognized a $2.25 million gain related to the Delaware litigation settlement. Change in Fair Value of Derivatives We recognized a non-cash gain on the change in fair value of derivatives of $9.4 million and $2.0 million for the six months ended June 30, 2026 and 2025, respectively. The non-cash gain of $9.4 million for the six months ended June 30, 2026, resulted from a fair value adjustment to the contingent note payable. Based on current assessments, the achievement of the underlying performance conditions required for payment was not probable prior to the note’s expiration on May 21, 2026. Consequently, the fair value of the liability was 26 Table of Contents reduced to zero as of May 21, 2026. The gain in the six months ended June 30, 2025 was mainly due to the non-cash revaluation gain for certain warrants that were reclassified as liabilities as of December 2024. Change in Fair Value of Share Payable We recognized a non-cash gain of $0.3 million and a non-cash loss of $0.3 million from the change in fair value of share payable during the six months ended June 30, 2026 and 2025, respectively. Change in Fair Value of Convertible Notes We recognized a non-cash gain of $11.7 million and $6.1 million for the change in fair value of the convertible notes during the six months ended June 30, 2026 and 2025, respectively. The non-cash gains resulted from the decrease of the Company’s stock price. In addition, the increased gain during the six months ended June 30, 2026 was also attributable to a change in certain assumptions used in the valuation of the convertible notes. Debt Extinguishment We recognized approximately $6.9 million and $11.8 million debt extinguishment loss during the six months ended June 30, 2026 and 2025, respectively, from debt redemptions and debt amendments. The decrease during the six months ended June 30, 2026 compared to last year in the same period was due to less volume of debt amendments. Loss from Issuance of Debt We recognized approximately $0.7 and $0.8 million loss from issuance of certain convertible notes, which we elected to account for under the FVO during the six months ended June 30, 2026 and 2025, respectively. The loss was calculated as the difference between the principal amount and the fair value of these convertible notes. Inducement expense We recognized an inducement expense of $87,000 related a convertible note that had an inducement conversion during the six months ended June 30, 2026. Interest Expense During the six months ended June 30, 2026 and 2025, we recognized interest expense of $4.2 million and $3.4 million, respectively. The increase in interest expense in 2026 was mainly related to the issuance costs related to certain convertible notes issued in March 2026, which we elected to account for under the FVO. Foreign currency transaction gain (loss) During the six months ended June 30, 2026 and 2025, we recognized foreign currency transaction loss of $1.5 million and a gain of $5.5 million, respectively. The loss was due to the strengthening of the U.S. dollar relative to British pound sterling and vice versa for the loss. Liquidity and Capital Resources We have experienced recurring losses from operations since inception. We have not yet established an ongoing source of revenues and must cover our operating expenses through debt and equity financings to allow us to continue as a going concern. Our ability to continue as a going concern depends on the ability to obtain adequate capital to fund operating losses until we generate adequate cash flows from operations to fund our operating costs and obligations. If we are unable to obtain adequate capital, we could be forced to cease operations. We depend upon our ability, and will continue to attempt, to secure equity and/or debt financing. We cannot be certain that additional funding will be available on acceptable terms, or at all. Our management determined that there was substantial doubt about our ability to continue as a going concern for at least one year after the annual consolidated financial statements were issued, and management’s concerns about our ability to continue as a going concern within the year following this report persist. 27 Table of Contents Cash Flows Operating Activities During the six months ended June 30, 2026 and 2025, total operating costs and expenses were approximately $23.8 million and $32.6 million, respectively. Net cash outflows from operations were approximately $19.7 million (including payments for prior periods’ accounts payables) and $16.1 million, respectively. The increase in cash used in operating activities was primarily attributable to the strengthening of the British Pound relative to the U.S. Dollar. Investing Activities During the six months ended June 30, 2026 and 2025, cash used in investing activities were approximately $0.3 million and $0.4 million, respectively. Financing Activities We received approximately $3.0 million and $12.4 million from issuance of common shares during the six months ended June 30, 2026 and 2025, respectively. We received approximately $8.4 million and $5.5 million from issuance of convertible notes to individual lenders during the six months ended June 30, 2026 and 2025, respectively. We received approximately $7.0 million and $7.0 million from the issuance of a loan from a commercial lender during the six months ended June 30, 2026 and 2025, respectively. We received approximately $20,000 and $23,000 from the exercise of warrants during the six months ended June 30, 2026 and 2025, respectively. We made aggregate debt payments of $0.5 million and $0.8 million during the six months ended June 30, 2026 and 2025, respectively. We made aggregate payments of approximately $1.3 million to the seller in connection with the Advent acquisition in October 2025 during the six months ended June 30, 2026. Other factors affecting our ongoing funding requirements include the number of staff we employ, the number of sites, number of patients and amount of activity in our clinical trial programs, the costs of further product and process development work relating to our DCVax products, the costs of preparations for Phase II trials, the costs of expansion of manufacturing, and unanticipated developments. The extent of resources available to us will determine which programs can move forward and at what pace. Off-Balance Sheet Arrangements Since our inception, we have not engaged in any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.

Quantitative and Qualitative Disclosures About Market Risk

Market risk represents the risk of loss that may result from the change in value of financial instruments due to fluctuations in its market price. Market risk is inherent in all financial instruments. Market risk may be exacerbated in times of trading illiquidity when market participants refrain from transacting in normal quantities and/or at normal bid-offer spreads. Our exposure to market risk is directly related to derivatives, debt and equity linked instruments related to our financing activities. Our assets and liabilities are overwhelmingly denominated in U.S. dollars. We do not use foreign currency contracts or other derivative instruments to manage changes in currency rates. We do not now, nor do we plan to, use derivative financial instruments for speculative or trading purposes. However, these circumstances might change. The primary quantifiable market risk associated with our financial instruments is sensitivity to changes in interest rates. Interest rate risk represents the potential loss from adverse changes in market interest rates. We use an interest rate sensitivity simulation to assess our 28 Table of Contents interest rate risk exposure. For purposes of presenting the possible earnings effect of a hypothetical, adverse change in interest rates over the 12-month period from our reporting date, we assume that all interest rate sensitive financial instruments will be impacted by a hypothetical, immediate 100 basis point increase in interest rates as of the beginning of the period. The sensitivity is based upon the hypothetical assumption that all relevant types of interest rates that affect our results would increase instantaneously, simultaneously and to the same degree. We do not believe that our cash and equivalents have significant risk of default or illiquidity. The sensitivity analyses of the interest rate sensitive financial instruments are hypothetical and should be used with caution. Changes in fair value based on a 1% or 2% variation in an estimate generally cannot be extrapolated because the relationship of the change in the estimate to the change in fair value may not be linear. Also, the effect of a variation in a particular estimate on the fair value of financial instruments is calculated independent of changes in any other estimate; in practice, changes in one factor may result in changes in another factor, which might magnify or counteract the sensitivities. In addition, the sensitivity analyses do not consider any action that we may take to mitigate the impact of any adverse changes in the key estimates. Based on our analysis, as of June 30, 2026, the effect of a 100+/- basis point change in interest rates on the value of our financial instruments and the resultant effect on our net loss are considered immaterial.

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Legal Proceedings

On December 1, 2022, we filed a Complaint in the United States District Court for the Southern District of New York against certain market makers. The Complaint alleges that the defendants engaged in manipulation of the Company’s stock, in violation of the Securities Exchange Act of 1934 and common law fraud, over a period of years. On March 20, 2023, the defendants filed a Motion to Dismiss the Complaint. On April 10, 2023 we filed an Amended Complaint against Canaccord Genuity LLC, Citadel Securities LLC, G1 Execution Services LLC, GTS Securities LLC, Instinet LLC, Lime Trading Corp., and Virtu Americas LLC (Northwest Biotherapeutics Inc. v. Canaccord, et al., No. 1:22-cv-10185-GHW-GWG). Following defendants’ filing of a new Motion to Dismiss (MTD) and various filings on both sides, an oral argument on defendants’ latest Motion to Dismiss was held on November 14, 2023. The Magistrate Judge issued an 85-page Recommendation and Results Opinion (R&R) for review by the Senior Judge. The Magistrate Judge found that the Company had adequately pled all of the elements of its claim of market manipulation, with the exception of producing enough details for calculating actual damages, known as loss causation. On that basis, he granted defendant’s motion to dismiss without prejudice, subject to the Company’s right to re-plead on just the question of loss causation, finding that such a filing would “not be futile”. On February 14, 2024, the Senior Judge issued an opinion accepting all the recommendations and findings of the R&R, and gave the Company 30 days to file this limited repleading amendment on loss causation and damages no later than March 15, 2024. On March 15, 2024, the Company filed their more detailed repleading on loss causation and damages. At the end of March, defendants asked for the right to object to the Judge’s findings against them on December 29, 2023 and February 14, 2024. This motion was denied. The defendants then asked for leave to file a new MTD. That motion was granted with a 30-day filing requirement for defendants and a 30-day response time for the Company. On May 1, 2024, the defendants’ filed a new MTD the Company’s amended re-pleading complaint, containing the new section on loss causation and damages. On May 31, 2024, the Company responded to the defendants’ new MTD, supporting the Magistrate Judge’s and Senior Judge’s previous opinions, and rejecting the defendants’ objections to the Company’s loss causation repleading and damage formulae. On June 14, 2024, the defendants filed their last response to the Company’s comments on May 31, 2024, concerning the defendant’s latest MTD. They also asked the Court to schedule an oral argument on the issues raised by these last two filings. The Court never answered the defendants’ request for an oral argument. On January 31, 2025, the Magistrate Judge issued his second R&R dismissing in part the defendants latest MTD on the basis of plaintiff’s having met the requirements of dismissal based on short-term damages but did not approve it based on the pleadings to date based on longer-term damages. On February 14, 2025, both Plaintiffs and Defendants filed their respective comments on this latest R&R from the Magistrate Judge and on February 28, 2025, each party filed comments on the other parties February 14, 2025 filings. On March 5, 2025, defendants once again filed a motion seeking an oral argument on the most recent issues raised in the Magistrate Judge’s R&R, and on March 6, 2025, Senior Judge Woods denied the motion in writing without prejudice. On March 26, 2025, Senior Judge Woods issued his opinion adopting Magistrate Stein’s R&R. On April 4, 2025 the Court granted an extension to the defendants to respond to plaintiffs Second Amended Complaint by April 25, 2025. This was followed on April 23, 2025 by an Initial Case Management Conference Order for June 5, 2025, requiring the submission of a Joint Proposed Case Management Plan no later than one week prior to the scheduled Conference. The Case Management Plan was approved by the Court and the parties proceeded into the discovery stage of the case. Since that time, the parties have been engaged in fact discovery, including both document production and answers to Interrogatory questions. The current fact discovery deadline is August 28, 2026. The Court has not set a trial date. The Company is continuing to vigorously pursue documents and information both from the defendants and from third parties in the discovery process. On April 30, 2026, the Company and one of the lesser defendants agreed to resolve the Company’s case against that defendant by settlement. The parties so notified the Court. The settlement is confidential. The funds are being held in escrow while the Company pursues discussions with other lesser defendants about resolution of the case against them. The Company anticipates that the funds will be released from escrow when the discussions with the lesser defendants have been completed. 30 Table of Contents During the second quarter of 2026, the Company continued vigorously pursuing discovery in its litigation in New York against certain market makers. Among other steps, the Company continued seeking certain trading information and trading algorithms. The Company believes that the Court’s recent order requiring the defendants to produce their trading algorithms is quite significant. The Company plans to continue its vigorous pursuit of the case.

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