The management's discussion and analysis of financial condition as of June 30,
2020 and results of operations for the three and six months ended June 30, 2020,
should be read in conjunction with management's discussion and analysis of
financial condition and results of operations included in our Annual Report on
Form 10-K for the year ended December 31, 2019 which was filed with the
Securities and Exchange Commission, or SEC, on February 25, 2020. Our discussion
includes forward-looking statements based upon current expectations that involve
risks and uncertainties, such as our plans, objectives, expectations and
intentions. Actual results and the timing of events could differ materially from
those anticipated in these forward-looking statements as a result of a number of
factors, including those set forth under the "Business" section of our Annual
Report on Form 10-K and elsewhere in this and other reports we file with the
SEC. We use words such as "anticipate," "estimate," "plan," "project,"
"continuing," "ongoing," "expect," "believe," "intend," "may," "will," "should,"
"could," and similar expressions to identify forward-looking statements. All
forward-looking statements included in this report are based on information
available to us on the date hereof and, except as required by law, we assume no
obligation to update any such forward-looking statements. Unless the context
requires otherwise, references in this Quarterly Report on Form 10-Q to
"Iovance," "we," "us" and "our" refer to Iovance Biotherapeutics, Inc. and

our
subsidiaries.

Overview

We are a clinical-stage biopharmaceutical company focused on the development and
commercialization of cell therapies as novel cancer immunotherapy products
designed to harness the power of a patient's own immune system to eradicate
cancer cells. Tumor infiltrating lymphocyte, or TIL, therapy is an autologous
cell therapy platform technology that was originally developed by the National
Cancer Institute, or NCI, which conducted initial clinical trials in diseases
such as metastatic melanoma and cervical cancer. We have developed a new,
shorter manufacturing process for TIL known as Generation 2, or Gen 2, which
yields a cryopreserved TIL product. This proprietary and scalable manufacturing
method is being further investigated in multiple indications. Our lead product
candidates include lifileucel for metastatic melanoma and LN-145 for metastatic
cervical cancer. In addition to metastatic melanoma and metastatic cervical
cancer, we are investigating the effectiveness and safety of TIL for the
treatment of squamous cell carcinoma of the head and neck, non-small cell lung
cancer, and peripheral blood lymphocyte, or PBL, therapy for chronic lymphocytic
leukemia through our sponsored trials, as well as in other oncology indications
through collaborations.

We are conducting a Phase 2 clinical trial, C-144-01, of our lead product
candidate, lifileucel, for the treatment of metastatic melanoma. This
multicenter pivotal trial enrolled patients with melanoma whose disease has
progressed following treatment with at least one systemic therapy, including a
PD-1 inhibitor and if BRAF mutated, a BRAF inhibitor, or a combination of BRAF
and MEK inhibitors. Cohort 4 of the C-144-01 clinical trial is a single-arm
cohort intended to support a biologics license application, or BLA, submission
for lifileucel. The C-144-01 trial uses our proprietary Gen 2 manufacturing
process. We completed and closed enrollment of patients into Cohort 2 of the
C-144-01 trial in 2018. Results from Cohort 2 of the C-144-01 clinical trial
were initially reported at the American Society of Clinical Oncology, or ASCO,
annual meeting on June 1, 2019 and subsequently updated at the ASCO annual
meeting on May 29, 2020, or ASCO 2020. In 66 patients with metastatic melanoma,
treatment with lifileucel resulted in an objective response rate, or ORR, of
36%, as assessed by investigator, with 2 complete responses and 22 partial
responses. The disease control rate, or DCR, was 80.3%. Patients were heavily
pretreated and had a mean of 3.3 prior therapies. The data released at ASCO 2020
disclosed that after a median study follow up of 18.7 months for Cohort 2
patients, the median duration of response, or DOR, has not been reached per
investigator assessment. Furthermore, durable responses have been observed
across a wide age range of metastatic melanoma patients, and among those who
have received prior anti-CTLA-4 and BRAF targeted treatments, regardless of BRAF
mutation status, and equally in patients with PD-L1 high and low status. The
adverse event profile was generally consistent with the underlying advanced
disease and the profile of the lymphodepletion and IL-2 regimens.

Cohort 4 of in the C-144-01 trial was enrolled to evaluate ORR as read out by an
Independent Review Committee, or IRC, as the primary endpoint based on our
interpretation of discussions with the U.S. Food and Drug Administration, or
FDA, as part of an End of Phase 2, or EOP2, meeting held with the FDA in the
third quarter of 2018. In October 2018 and based on the data provided to the FDA
during the EOP2 meeting, we announced that lifileucel had received a
Regenerative Medicine Advanced Therapy, or RMAT, designation from the FDA.

Enrollment in pivotal Cohort 4 in the C-144-01 trial commenced in March 2019 and
patient dosing was completed in January 2020. A total of 89 patients were dosed
in Cohort 4. Initial results from the pivotal Cohort 4 are available for 68
patients with two radiological assessments, as determined by investigator.
Lifileucel shows a 32.4% ORR, including 1 complete response and 21 partial
responses, 2 of which are yet to be confirmed with follow up visits, and a DCR
of 72.1% as of the data cut off of March 16, 2020,

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corresponding to 5.3 months of median study follow up. This data is highly consistent with the Cohort 2 data read out at a similar median duration of study follow up. The ORR of Cohort 2 at a median study follow up of 6 months was 33%.



We are also conducting a Phase 2 clinical trial, C-145-04, which is a
multicenter pivotal trial that will assess the safety and efficacy of LN-145 for
the treatment of patients with recurrent, metastatic or persistent cervical
cancer. In February 2019, LN-145 received Fast Track designation from the FDA
for development in the treatment of cervical cancer with disease progression on
or after chemotherapy. In March 2019, the protocol for this trial was amended to
modify the primary endpoint of ORR to be determined by IRC. In May 2019, LN-145
received Breakthrough Therapy designation, or BTD, from the FDA for the
development in the treatment of cervical cancer. Updated results from the
C-145-04 clinical trial were reported at the ASCO annual meeting on June 1,
2019. In 27 patients with metastatic cervical cancer, treatment with LN-145
resulted in an ORR of 44%. At the time of study data cut, there were 3 complete
responses and 9 partial responses. The DCR was 85%. Patients were heavily
pretreated and had a mean of 2.4 prior therapies. The DOR had not been reached.
The adverse event profile was generally consistent with the underlying advanced
disease and the profile of the lymphodepletion and IL-2 regimens. Based on an
EOP2 meeting held with the FDA in June 2019, we believe that results from the
C-145-04 clinical trial may be sufficient to support registration of LN-145 for
the treatment of patients with metastatic cervical cancer. In accordance with
the FDA's recommendations, the protocol was amended to further define the
patient population. In November 2019, in order to position LN-145 for potential
future use in broader lines of therapy in cervical cancer, we have further
amended the C-145-04 trial to collect additional data on early-line patients as
well as late-line patients by adding additional cohorts, in anticipation of a
changing landscape in this indication, including Cohort 2 for patients that had
previously received anti-PD-1 therapy. These additional cohorts also allow
access to TIL therapy when the pivotal Cohort 1 is completed and we believe may
support expanded access to LN-145. Cohort 2 of the C-145-04 trial continues and
is expected to complete enrollment during the second half of 2020. We intend to
initiate a dialog with the FDA subsequent to such completion to discuss BLA
submission plans.

C-145-03 is our ongoing Phase 2, multicenter trial that we are conducting to
assess the safety and efficacy of LN-145 for the treatment of patients with
recurrent metastatic squamous cell carcinoma of the head and neck. In October
2018, we reported that, to date, preliminary data for 13 patients in the
C-145-03 clinical trial yielded an ORR of 31% with a DOR ranging from 2.8 to 7.6
months. The adverse event profile remained consistent with previous reports. We
continue to enroll patients in this study. We have redesigned our C-145-03 trial
to include multiple cohorts, in order to allow for dosing of TIL therapies
produced by multiple manufacturing methods, including our Gen 2 manufacturing
process, our Generation 3, or Gen 3, manufacturing process, and our PD-1
selected TIL manufacturing process. Our PD-1 selected TIL manufacturing process
is referred to as LN-145-S1.

We are also investigating the potential of our TIL therapies in earlier lines of
treatment and in combination with pembrolizumab, and are studying LN-145 as a
monotherapy in relapsed refractory non-small cell lung cancer, or NSCLC,
patients. IOV-COM-202 is a Phase 2, multicenter trial that is composed of five
cohorts which can enroll up to a total of 75 patients. In May 2019, we reported
that the first patient was dosed in the IOV-COM-202 trial. In Cohort 1A, we are
enrolling unresectable or metastatic melanoma patients who have not received
prior immunotherapy, including checkpoint inhibitors such as
anti-PD-1/anti-PD-L1 therapy. The patients receive lifileucel in combination
with pembrolizumab. In Cohort 2A, we are enrolling advanced, recurrent, or
metastatic head and neck squamous cell carcinoma patients who are naïve to prior
immunotherapy including anti-PD-1/anti-PD-L1 therapy. The patients will receive
LN-145 in combination with pembrolizumab. Cohort 3A is enrolling advanced or
metastatic NSCLC patients who are naïve to prior immunotherapy including
anti-PD-1/anti-PD-L1 therapy. The patients in Cohort 3A will receive LN-145 in
combination with pembrolizumab. In Cohort 3B, we are enrolling NSCLC patients
who have previously received systemic therapy which could include checkpoint
inhibitors. The patients are receiving LN-145. In February 2020, we announced
the addition of Cohort 1B to the IOV-COM-202 trial, for patients with melanoma
whose disease has progressed following treatment with at least one systemic
therapy, including a PD-1 inhibitor and if BRAF mutated, a BRAF inhibitor, or a
combination of BRAF and MEK inhibitors. The patients will receive LN-145-S1. In
addition to its ongoing enrollment in the U.S., the IOV-COM-202 trial has also
received regulatory approval in Canada and in certain European countries.

In November 2019, we announced that our investigational new drug application, or
IND, for our PBL therapy, IOV-2001, was authorized by the FDA and our sponsored
clinical trial using this therapy, IOV-CLL-01, was cleared to proceed. IOV-2001
is a non-genetically modified, polyclonal T cell product that is manufactured
using a nine-day process from 50 mL of patient's blood. IOV-CLL-01 is Phase 1/2
clinical trial evaluating the safety and efficacy of IOV-2001 in patients with
relapsed or refractory chronic lymphocytic leukemia or small lymphocytic
leukemia. The IOV-CLL-01 trial is expected to enroll up to approximately 70
patients.

As part of our collaboration program with the MD Anderson Cancer Center, or
MDACC, two Phase 2 trials were initiated in 2018. Both trials are sponsored by
MDACC. The first trial, NCT03449108, is intended to allow for investigation

of
LN-145

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manufactured by Iovance using our manufacturing processes to treat patients with
soft tissue sarcoma, osteosarcoma and platinum resistant ovarian cancer. A
second trial under the collaboration with MDACC, NCT03610490, is active as well.
This trial is treating patients with platinum resistant ovarian cancer,
pancreatic and colorectal cancer. This trial uses TIL manufactured by MDACC
using urelumab, a 4-1BB agonistic antibody, as part of the manufacturing
process. The data obtained using this manufacturing process may not be
representative of our data using our Gen 2 manufacturing process.

We are also collaborating with Centre hospitalier de l'Université de Montreal,
or CHUM, Yale University, or Yale, and Moffitt on investigator-sponsored
clinical trials of TIL therapies in other indications. The clinical trials
sponsored by CHUM and Moffitt use, or will use, TIL manufactured by different
manufacturing processes, which may not be representative of our data using our
Gen 2 manufacturing process.

Our current product candidate pipeline and selected investigator-sponsored proof-of-concept studies are summarized in the graph below:





                           [[Image Removed: Graphic]]

Components of Operating Results

Revenue



We have not yet generated any revenues since our formation, and we currently do
not anticipate that we will generate any significant revenues from the sale or
licensing of our product candidates during the 12 months from the date these
financial statements are issued. Our ability to generate revenues in the future
will depend on our ability to complete the development of our product candidates
and to obtain regulatory approval for them.

Research and Development Expenses



Research and development expenses include personnel and facility-related
expenses, outside contracted services including clinical trial costs,
manufacturing and process development costs, research costs and other consulting
services. Research and development costs are expensed as incurred. Nonrefundable
advance payments for goods or services that will be used or rendered for future
research and development activities are deferred and amortized over the period
that the goods are delivered, or the related services are performed, subject to
an assessment of recoverability.

Clinical development costs are a significant component of research and
development expenses. We have a history of contracting with third parties that
perform various clinical trial activities on our behalf in connection with the
ongoing development of our product candidates. The financial terms of these
contracts are subject to negotiations and may vary from contract to contract and
may result in uneven payment flow. We accrue and expense costs for clinical
trial activities performed by third parties based upon

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estimates of work completed to date of the individual trial in accordance with
agreements established with contract research organizations and clinical trial
sites. We determine our estimates through discussions with internal clinical
personnel and outside service providers as to the progress or stage of
completion of trials or services and the agreed upon fee to be paid for such
services.

We expect our research and development expenses to increase over the next couple
of years as we prepare for commercial manufacturing of our products and continue
to conduct our clinical trials for other indications. However, it is difficult
to determine with certainty the duration and completion costs of our current or
future preclinical programs and clinical trials of our product candidates.

General and Administrative Expenses



General and administrative expenses consist primarily of salaries, recruiting
fees, sign on, retention and special bonuses and other related costs, including
stock-based compensation, for personnel in executive, finance, accounting,
legal, investor relations, facilities, business development, marketing,
commercial, information technology and human resources functions. Other
significant costs include facility costs not otherwise included in research and
development expenses, legal fees relating to corporate matters and intellectual
property, insurance, public company expenses relating to maintaining compliance
with Nasdaq listing rules and SEC requirements, investor relations costs, and
fees for accounting and consulting services. General and administrative costs
are expensed as incurred, and we accrue for services provided by third parties
related to the above expenses by monitoring the status of services provided and
receiving estimates from its service providers and adjusting its accruals as
actual costs become known.

We anticipate general and administrative expenses will increase in 2020 as we
continue to prepare for commercialization and support an expected increase

in
total headcount.

Interest Income

Interest income results from our interest-bearing cash and short term investment balances.



Results of Operations

Comparison of the Three and Six Months Ended June 30, 2020 and 2019

Revenues

We did not generate any revenues during the three and six months ended June 30, 2020 or June 30, 2019.

Research and Development expenses (in thousands)






                                 Three Months Ended         Increase         Six Months Ended         Increase
                                      June 30,              (Decrease)           June 30,             (Decrease)
                                  2020          2019         $        %      2020         2019         $        %

Research and development       $    49,274    $ 39,298      9,976     25 % $ 106,226    $ 70,203      36,023    51 %
Stock-based compensation
expense included in
research and development
expense                              5,465       2,720      2,745    101 %     9,783       5,421       4,362    80 %




Research and development expense for the three months ended June 30, 2020
increased by $10.0 million, or 25%, compared to the same period in 2019. The
increase was attributable to (i) a $6.9 million increase in clinical trial costs
due primarily to higher costs for the purchase of drugs used in the clinical
trials, specifically IL-2, (ii) a $4.6 million increase in payroll and related
expenses driven by a higher number of full-time research and development
employees, and (iii) a $2.7 million increase in stock-based compensation
expenses. These increases were partially offset by a $3.1 million decrease in
manufacturing costs due to decreased production runs during the three months
ended June 30, 2020.

Research and development expense for the six months ended June 30, 2020
increased by $36.0 million, or 51%, compared to the same period in 2019. The
increase was primarily attributable to (i) a $12.0 million increase in clinical
trial costs due to an increase in enrollment across all the trials, (ii) a $10.0
million increase for the license to further develop IOV-3001 obtained from
Novartis, (iii) a $9.9 million increase in payroll and related expenses driven
by a higher number of full-time research and development employees, and (iv) a
$4.4 million increase in stock-based compensation expenses.

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General and Administrative expenses (in thousands)






                                   Three Months Ended         Increase        Six Months Ended         Increase
                                        June 30,             (Decrease)           June 30,            (Decrease)
                                    2020          2019         $       %      2020         2019         $       %

General and administrative       $    14,353    $ 10,867      3,486    32 % $  28,211    $ 19,948      8,263    41 %
Stock-based compensation
expense included in general
and administrative                     5,072       3,706      1,366    37 %    10,166       6,851      3,315    48 %




General and administrative expenses for the three months ended June 30, 2020
increased by $3.5 million, or 32%, compared to the same period in 2019. The
increase was primarily attributable to a $2.1 million increase in payroll and
related expenses and a $1.4 million increase in stock-based compensation
expenses driven by a higher number of full-time general and administrative
employees and a higher average stock price.

General and administrative expenses for the six months ended June 30, 2020
increased by $8.3 million, or 41%, compared to the same period in 2019. The
increase was primarily attributable to (i) a $3.5 million increase in payroll
and related expenses driven by a higher number of full-time general and
administrative employees and a higher average stock price, (ii) a $3.3 million
increase in stock-based compensation expenses, and (iii) a $1.2 million increase
in director's and officer's insurance premiums.

Interest Income (in thousands)






                                    Three Months Ended            Increase          Six Months Ended           Increase
                                         June 30,                (Decrease)             June 30,              (Decrease)
                                   2020           2019            $         %        2020        2019          $         %
Net interest income              $    609      $     2,614      (2,005)    (77) % $    1,824    $ 5,650      (3,826)    (68) %




Net interest income for the three and six months ended June 30, 2020 and 2019
decreased by $2.0 million or 77% and $3.8 million or 68% respectively, due to
interest income earned on the lower cash balance, and a decrease in interest
rates for the three and six months period ended June 30, 2020 as compared to the
same period in 2019. Interest income earned on the net proceeds received from
the public offering in June 2020 was minimal during the three months ended June
30, 2020 due to the timing of investment.

Net Loss (in thousands)




                               Three Months Ended            Increase           Six Months Ended            Increase
                                     June 30,               (Decrease)              June 30,                (Decrease)
                                2020          2019           $         %       2020           2019           $         %
Net loss                     $ (63,018)    $ (47,551)      (15,467)    33 % $ (132,613)    $ (84,501)      (48,112)    57 %




Net loss for the three and six months ended June 30, 2020 increased by $15.5
million or 33% and $48.1 million or 57% compared to the same periods in 2019.
The increase in our net loss was due to the continued expansion of our research
and development activities, increased clinical trials and manufacturing
activities, and the overall growth of our corporate infrastructure. We
anticipate that we will continue to incur net losses in the future as we further
invest in our research and development activities and commercial preparation
activities.

Liquidity and Capital Resources



We have incurred losses and generated negative cash flows from operations since
inception. We expect to continue to incur significant losses in 2020 and may
incur significant losses and negative cash flows from operations for the
foreseeable future. Historically, we have funded our operations from various
public and private offerings of our equity securities (both common stock and
preferred stock), from option and warrant exercises, and from interest income.
Since 2017, our primary source of funds has been from the public sale of our
common stock.

On December 28, 2017, we filed a shelf registration statement, or the 2017 Shelf
Registration Statement, with the SEC, for the issuance of common stock,
preferred stock, warrants, rights, debt securities and units, which we refer to
collectively as Shelf Securities, up to an aggregate amount of $250 million. The
2017 Shelf Registration Statement was declared effective on January 19, 2018. On
January 29, 2018, we sold 15,000,000 shares of our common stock at a public
offering price of $11.50 per share pursuant to

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the 2017 Shelf Registration Statement. We received gross proceeds of
approximately $172.5 million and net proceeds of approximately $162.0 million,
after deducting underwriting discounts and offering expenses. The 2017 Shelf
Registration Statement was terminated upon effectiveness of the 2018 Shelf
Registration Statement (as discussed below).

On September 7, 2018, we filed a shelf registration statement with the SEC for
the issuance of up to an aggregate amount of $250 million of Shelf Securities,
which we refer to as the 2018 Shelf Registration Statement. The 2018 Shelf
Registration Statement was declared effective on October 3, 2018 and the
aggregate amount of securities we could issue thereunder was subsequently
increased by $50 million through a post-effective amendment that we filed on
October 11, 2018, pursuant to Rule 462(b) under the Securities Act of 1933, as
amended. On October 17, 2018, we sold 25,300,000 shares of our common stock at a
public offering price of $9.97 per share pursuant to the 2018 Shelf Registration
Statement. We received gross proceeds of approximately $252.2 million and net
proceeds of $236.7 million, after deducting underwriting discounts and offering
expenses. The 2018 Shelf Registration Statement is no longer available for
future offerings.

On September 17, 2019, we filed a shelf registration statement with the SEC for
the issuance of up to an aggregate amount of $400 million of Shelf Securities,
which we refer to as the 2019 Shelf Registration Statement. The 2019 Shelf
Registration Statement was declared effective on September 24, 2019. The 2019
Shelf Registration Statement was terminated upon effectiveness of the 2020
Automatic Shelf Registration Statement (as discussed below). No shares were sold
under the 2019 Shelf Registration Statement prior to its termination.

On May 27, 2020, we filed an automatic shelf registration statement with the SEC
for the issuance of an indeterminate amount of Shelf Securities, which we refer
to as the 2020 Automatic Shelf Registration Statement. The 2020 Automatic Shelf
Registration Statement was immediately effective upon filing with the SEC, and
the 2019 Shelf Registration Statement was simultaneously terminated.

On June 2, 2020, we sold 19,475,806 shares of our common stock at a public
offering price of $31.0 per share pursuant to the 2020 Automatic Shelf
Registration Statement. We received gross proceeds of $603.7 million and net
proceeds of approximately $567.0 million, after deducting underwriting discounts
and offering expenses. Following the public offering, the 2020 Automatic Shelf
Registration Statement remains available for the future issuance of an
indeterminate amount of Shelf Securities.

In the future, we may periodically offer one or more of the Shelf Securities in
amounts, prices and terms to be announced when and if the securities are
offered. If any of the Shelf Securities covered by the 2020 Automatic Shelf
Registration Statement are offered for sale, a prospectus supplement will be
prepared and filed with the SEC containing specific information about the terms
of such offering at that time.

We are currently engaged in the development of therapeutics to fight cancer. We
do not have any commercial products and have not yet generated any revenues from
our biopharmaceutical business. We currently do not anticipate that we will
generate any significant revenues from the sale or licensing of any products
during the 12 months from the date these financial statements are issued. We
have incurred a net loss of $132.6 million for the six months ended June 30,
2020 and used $101.9 million of cash in our operating activities for the six
months ended June 30, 2020. As of June 30, 2020, we had $160.6 million of cash
and cash equivalents, $611.3 million of short-term investments, $5.5 million of
restricted cash, $758.3 million of stockholders' equity and had working capital
of $727.7 million.

We expect to continue our research and development activities, initiate
pre-commercial activities and to begin construction on our tenant improvements
to our new production facility, which will increase the amount of cash we will
use during 2020 and beyond. Specifically, we expect continued spending on
clinical trials, research and development activities, higher payroll expenses as
we increase our professional, commercial and scientific staff and continue our
expansion of manufacturing activities including building our own facility. Based
on the funds we have available as of the date of filing of this Quarterly Report
on Form 10-Q, and after consideration of the possible impacts of the COVID-19
Pandemic, we believe that we have sufficient capital to fund our anticipated
operating expenses and capital expenditure for at least the next 12 months from
the date of filing this report.

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The following table summarizes our cash flows for the periods presented from Operating, Investing and Financing Activities (in thousands):






                                                                Six Months Ended June 30,
                                                                   2020             2019
Net cash (used in) provided by:
Operating activities                                          $    (101,927)     $ (62,885)
Investing activities                                               (323,651)         59,716
Financing activities

572,298 3,379 Net increase in cash, cash equivalents and restricted cash $ 146,720 $ 210






Operating Activities

Net cash used in operating activities for the six months ended June 30, 2020 was
$101.9 million compared to $62.9 million for the same period in 2019. The
increase of $38.8 million was primarily due to increased costs in research and
development activities. Included in $38.8 million was the $10.0 million upfront
payment we paid for IOV-3001.

Investing Activities

Net cash used in investing activities for the six months ended June 30, 2020 was
$323.7 million compared to net cash used provided by investing activities of
$59.7 million for the same period in 2019. The increase in cash used in
investing activities of $383.2 million was primarily due to the purchase of
short-term investments to invest the net proceeds from our June 2020 public
offering.

Financing Activities


Net cash provided by financing activities for the six months ended June 30, 2020
was $572.3 million compared to $3.4 million for the same period in 2019. The
increase of $568.5 million was primarily due to net proceeds of $567.4 million
from our June 2020 public offering.

Impact of the CARES Act



The CARES Act, among other things, permits net operating losses, or NOLs,
carryovers and carrybacks to offset 100% of taxable income for taxable years
beginning before 2021. In addition, the CARES Act allows NOLs incurred in 2018,
2019, and 2020 to be carried back to each of the five preceding taxable years to
generate a refund of previously paid income taxes. The CARES Act provides other
reliefs and stimulus measures. We are currently evaluating the impact of the
CARES Act, however, at present we do not expect that any provision of the CARES
Act would result in a material cash benefit to us or have a material impact on
our financial statements or internal controls over financial reporting.

Impact of COVID-19 on our Business



In December 2019, a novel coronavirus known as SARS-CoV-2 was first detected in
Wuhan, Hubei Province, People's Republic of China, causing outbreaks of the
coronavirus disease, known as COVID-19, that has now spread globally. On January
30, 2020, the World Health Organization (WHO) declared COVID-19 a pandemic,
which we refer to herein as the COVID-19 Pandemic. The Secretary of Health and
Human Services declared a public health emergency on January 31, 2020, under
section 319 of the Public Health Service Act (42 U.S.C. 247d), in response

to
the COVID-19 Pandemic.

Operations and Liquidity

The full impact of the COVID-19 Pandemic is unknown and rapidly evolving. While
the potential economic impact brought by and over the duration of the COVID-19
Pandemic may be difficult to assess or predict, the COVID-19 Pandemic has
resulted in significant disruption of global financial markets, which could in
the future negatively affect our liquidity. In addition, a recession or market
volatility resulting from the COVID-19 Pandemic could affect our business. We
have taken proactive, aggressive action throughout the COVID-19 Pandemic to
protect the health and safety of our employees, and expect to continue to
implement these measures until we determine that the COVID-19 Pandemic is
adequately contained for purposes of our business. We may take further actions
as government authorities require or recommend or as we determine to be in the
best interests of our employees. To date, the COVID-19 Pandemic has not had
significant effects on our clinical trial enrollment. Given the nature and

type
of our short-term

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investments in U.S. government securities, we do not believe that the COVID-19 Pandemic will have a material impact on our current investment liquidity.

Outlook



Although there is uncertainty related to the anticipated impact of the recent
COVID-19 Pandemic on our future results, we believe our current cash reserves
leave us well-positioned to manage our business through this crisis as it
continues to unfold. However, the impacts of the COVID-19 Pandemic are
broad-reaching and continuing and the financial impacts associated with the
COVID-19 Pandemic are still uncertain.

The COVID-19 Pandemic is ongoing, and its dynamic nature, including
uncertainties relating to the ultimate geographic spread of the virus, the
severity of the disease, the duration of the pandemic, and actions that would be
taken by governmental authorities to contain the pandemic or to treat its
impact, makes it difficult to forecast any effects on our results for the fiscal
year ending December 31, 2020.

Despite the economic uncertainty resulting from the COVID-19 Pandemic, we intend
to continue to focus on the development of our product candidates. We continue
to monitor the rapidly evolving situation and guidance from international and
domestic authorities, including federal, state and local public health
authorities and may take additional actions based on their recommendations. In
these circumstances, there may be developments outside our control requiring us
to adjust our operating plan. As such, given the dynamic nature of this
situation, we cannot reasonably estimate the impacts of COVID-19 on our
financial condition, results of operations or cash flows in the future.

Off-Balance Sheet Arrangements

At June 30, 2020, we had no obligations that would require disclosure as off-balance sheet arrangements.

Significant Accounting Policies and Recent Accounting Standards

See Note 2 of the financial statements for a discussion of our significant accounting policies, including the discussion of recently issued and adopted accounting standards.



Inflation

Inflation and changing prices have had no effect on our continuing operations over our two most recent fiscal years.

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