This Quarterly Report and other publicly available documents, including any documents incorporated herein and therein by reference, contain, and our officers and representatives may from time to time make, "forward-looking statements," including within the meaning of the safe harbor provisions of theU.S. Private Securities Litigation Reform Act of 1995. When used in the following discussion, the words "anticipates," "intends," "believes," "expects," "plans,"" seeks," "estimates," "likely," "may," "would," "will," and similar expressions, as they relate to us or our management, are intended to identify such forward-looking statements. Examples of forward-looking statements include, among others, statements we make regarding (i) our plans to initiate a randomized clinical trial; and (ii) our estimates of additional funds that may be required to complete our development plan and obtain necessary approvals. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they 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. Our actual results and financial condition may differ materially and adversely from the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: (i) our ability to obtain additional funding to execute our business and clinical development plans; (ii) progress and success of our clinical development program; (iii) the impact of the current COVID-19 pandemic on our ability to conduct our clinical trials; (iv) our ability to demonstrate the safety and effectiveness of our product candidates: ivospemin (SBP-101) and eflornithine (CPP-1X) (v) our reliance on a third party for the execution of the registration trial for our product candidate Flynpovi; (vi) our ability to obtain regulatory approvals for our product candidates, ivospemin (SBP-101) and eflornithine (CPP-1X) inthe United States , theEuropean Union or other international markets; (vii) the market acceptance and level of future sales of our product candidates, ivospemin (SBP-101) and eflornithine (CPP-1X); (viii) the cost and delays in product development that may result from changes in regulatory oversight applicable to our product candidates, ivospemin (SBP-101) and eflornithine (CPP-1X); (ix) the rate of progress in establishing reimbursement arrangements with third-party payors; (x) the effect of competing technological and market developments; (xi) the costs involved in filing and prosecuting patent applications and enforcing or defending patent claims; and (xii) such other factors as discussed in Part I, Item 1A under the caption "Risk Factors" in our most recent Annual Report on Form 10-K, any additional risks presented in our Quarterly Reports on Form 10-Q and our Current Reports on Form 8-K. Any forward-looking statement made by us in this Quarterly Report is based on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement or reasons why actual results would differ from those anticipated in any such forward-looking statement, whether written or oral, whether as a result of new information, future developments or otherwise. OverviewPanbela Therapeutics, Inc. ("Panbela" and together with its direct and indirect subsidiaries, "we," "us," "our," and the "Company") is a clinical stage biopharmaceutical company developing disruptive therapeutics for the treatment of patients with urgent unmet medical needs. OnJune 15, 2022 , Panbela completed the previously announced strategic business reorganization and acquisition ofCancer Prevention Pharmaceuticals, Inc. ("CPP") pursuant to the agreement and plan of merger, dated as ofFebruary 21, 2022 (the "Merger Agreement"), by and among Panbela,CPP and Panbela Research, Inc. (formerly known asPanbela Therapeutics, Inc. , "Panbela Research "), among others. Pursuant to the terms of the Merger Agreement, (i)Canary Merger Subsidiary I, Inc. ("Merger Sub I"), then a wholly-owned subsidiary of Panbela, which was itself a wholly-owned subsidiary ofPanbela Research , merged with and intoPanbela Research (the "First Merger"), withPanbela Research surviving the First Merger, and (ii)Canary Merger Subsidiary II, Inc. , then a wholly-owned subsidiary of Panbela, merged with and into CPP (the "Second Merger" and, together with the First Merger, the "Mergers"), with CPP surviving the Second Merger. As a result of the Mergers, each ofPanbela Research and CPP became a wholly-owned subsidiary of Panbela. In addition, in connection with the consummation of the Mergers, "Panbela Therapeutics, Inc. " was renamed "Panbela Research, Inc. " and "Canary Merger Holdings, Inc. " was renamed "Panbela Therapeutics, Inc. " 16
-------------------------------------------------------------------------------- Our lead candidates are ivospemin (SBP-101) for which we have exclusively licensed the worldwide rights from theUniversity of Florida Research Foundation, Inc. and Flynpovi (eflornithine (CPP-1X) and Sulindac). Flynpovi is delivered in an oral form. The Company has an exclusive license to commercialize Flynpovi from theArizona Board of Regents of theUniversity of Arizona . Ivospemin (SBP-101) In 2015, theU.S. Food and Drug Administration ("FDA") accepted our Investigational New Drug ("IND") application for our ivospemin (SBP-101) product candidate. In May of 2022 we were notified that theUnited States Adopted Names Council (USAN) had adopted ivospemin as a USAN for SBP-101. AfterAugust 1, 2022 , the USAN information on ivospemin will be scheduled for posting on the USAN Web site (www.ama-assn.org/go/usan). We have completed an initial clinical trial of ivospemin (SBP-101) in patients with previously treated locally advanced or metastatic pancreatic cancer. This was a Phase I, first-in-human, dose-escalation, safety study. FromJanuary 2016 throughSeptember 2017 , we enrolled twenty-nine patients into six cohorts, or groups, in the dose-escalation phase of the Phase I trial. No drug-related bone marrow toxicity or peripheral neuropathy was observed at any dose level. In addition to being evaluated for safety, 23 of the 29 patients were evaluable for preliminary signals of efficacy prior to or at the eight-week conclusion of their first cycle of treatment using the Response Evaluation Criteria in Solid Tumors ("RECIST"), the currently accepted standard for evaluating change in the size of tumors. In 2018, we began enrolling patients in our second clinical trial, a Phase Ia/Ib study of the safety, efficacy and pharmacokinetics of ivospemin (SBP-101) administered in combination with two standard-of-care chemotherapy agents, gemcitabine and nab-paclitaxel. A total of 25 subjects were enrolled in four cohorts to evaluate the dosage level and schedule. An additional 25 subjects were enrolled in the expansion phase of the trial. Interim results were presented in January of 2022. Best response in evaluable subjects (cohorts 4 and Ib N=29) was a CR in 1 (3%), PR in 13 (45%), SD in 10 (34%) and PD in 5 (17%). One subject did not have post baseline scans with RECIST tumor assessments. Median Progression Free Survival ("PFS"), now final at 6.5 months may have been negatively impacted by drug dosing interruptions to evaluate potential toxicity. Median overall survival in Cohort 4 + Phase Ib was 12.0 months when data was presented inJanuary 2022 and is now final at 14.6 months. Two patients from cohort 2 have demonstrated long term survival. One at 30.3 months (final data) and one at 33.0 months and still alive. Seven subjects are still alive at this time, one from cohort 2 and six from cohort 4 plus Ib. In January of 2022, the Company announced the initiation of a new clinical trial. Referred to as ASPIRE, the trial is a randomized double-blind placebo-controlled trial in combination with gemcitabine and nab-paclitaxel, a standard pancreatic cancer treatment regimen in patients previously untreated for metastatic pancreatic cancer. The trial will be conducted globally at approximately 95 sites inthe United States ,Europe andAsia - Pacific . The company announced the first patient enrolled in the trial inAustralia in August of 2022. While opening of clinical sites in the US and the rest of the world has been slower than originally anticipated, due in part to resource fatigue in the medical community, the Company expects all countries and sites to be open by early 2023. The trial was originally designed as a phase II/III with a smaller sample size (150) to support the events required for interim analysis based on PFS and a primary endpoint of overall survival. In response to European and FDA regulatory feedback, the study was amended to include the total trial sample size (600) and the design modified to utilize overall survival as the primary endpoint to be examined at interim analysis. PFS will also be analyzed to provide additional efficacy evidence. This amendment was supported by the final data from the phase Ia/b first line metastatic pancreatic trial which completed enrollment in December of 2020. The study will enroll 600 subjects and is anticipated to take 36 months for complete enrollment with the interim analysis available in early 2024. In earlyApril 2022 , the Company announced a poster presentation highlighting the results for ivospemin (SBP-101) as a polyamine metabolism modulator in ovarian cancer at theAmerican Association for Cancer Research Annual Conference The poster concludes that the ivospemin (SBP-101) treatment of C57Bl/6 mice injected with VDID8+ ovarian cancer cells significantly prolonged survival and decreased overall tumor burden. The results suggest that ivospemin (SBP-101) may have a role in the clinical management of ovarian cancer, and the Company intends to continue pre-clinical and clinical studies in ovarian cancer. Additional clinical trials may be required for FDA or other country approvals. The cost and timing of additional clinical trials are highly dependent on the nature and size of the trials. 17 --------------------------------------------------------------------------------
Flynpovi (eflornithine (CPP-1X) and sulindac)
In 2009, the FDA accepted our IND application for the combination product, Flynpovi, product candidate.
In a phase III study, the efficacy and safety of the combination of Flynpovi, as compared with either drug eflornithine (CPP-IX) or sulindac alone, in adults with familial adenomatous polyposis ("FAP") was conducted. A total of 171 patients underwent randomization. Disease progression occurred in 18 of 56 patients (32%) in the Flynpovi, 22 of 58 (38%) in the sulindac group, and 23 of 57 (40%) in the eflornithine (CPP-1X) group, with a hazard ratio of 0.71 (95% confidence interval [CI], 0.39 to 1.32) for Flynpovi as compared with sulindac (P = 0.29) and 0.66 (95% CI, 0.36 to 1.23) for Flynpovi as compared with eflornithine (CPP-1X). In a post-hoc analysis, none of the patients in the combination arm progressed to a need for lower gastrointestinal ("LGI") surgery for up to 48 months compared with 7 (13.2%) and 8 (15.7%) patients in the sulindac and eflornithine (CPP-1X) arms. These data corresponded to risk reductions for the need for LGI surgery approaching 100% between combination and either monotherapy with HR = 0.00 (95% CI, 0.00-0.48; p = 0.005) for combination versus sulindac and HR = 0.00 (95% CI, 0.00-0.44; p = 0.003) for combination versus eflornithine. Given the statistical significance of the LGI group, a new drug application ("NDA") was filed with the FDA. As the study failed to meet the primary endpoint, and the NDA was based on the results of an exploratory analysis, a complete response letter was issued. To address this deficiency concern, the Company must submit the results of one or more adequate and well-controlled clinical trials which demonstrate an effect on a clinical endpoint. InJuly 2021 , CPP entered into a license agreement withOne-Two Therapeutics Assets Limited ("One-Two"). Under the license agreement, One-Two has licensed the North American development and commercialization rights for Flynpovi, as described in the Company's IND application. The Company transferred the IND for the product to the licensing partner as of the date of the agreement. The agreement provided upfront payments which was recognized by CPP in the year endedDecember 31, 2021 . The agreement also calls for CPP to receive a milestone payment upon regulatory approval of Flynpovi by the FDA and royalties on net sales of Flynpovi in the licensed territories. Payment of the milestone payment and net sales royalties shall be reduced on a dollar-for-dollar basis by amounts funded by One-Two for One-Two's direct costs associated with any development activities necessary to secure FDA approval. We also have an ongoing double-blind placebo-controlled trial of Flynpovi to prevent recurrence of high risk adenomas and second primary colorectal cancers in patients with stage 0-III colon or rectal cancer, Phase III - Preventing Adenomas of the Colon With Eflornithine and Sulindac ("PACES"). The purpose of this study is to assess whether the combination of eflornithine (CPP-1X) and sulindac (compared to corresponding placebos) has efficacy against colorectal lesions with respect to high-grade dysplasia, adenomas with villous features, adenomas one cm or greater, multiple adenomas, any adenomas >/= 0.3 cm, total advanced colorectal events, or total colorectal events. The PACES trial is funded by theNational Cancer Institute ("NCI") in collaboration with theSouthwest Oncology Group ("SWOG").
Eflornithine (CPP-1X)/eflornithine sachets (CPP-1X-S)
In 2009 and 2018, the FDA accepted our IND applications for eflornithine (CPP-1X).
There are trials evaluating eflornithine sachets (CPP-1X-S) in relapsed refractory neuroblastoma supported by theChildren's Oncology Group ("COG") /NCI (ongoing) and STK11 mutation patients with non-small cell lung cancer scheduled to begin this year. For eflornithine tablets (CPP-1X), a phase II trial in Type I onset diabetes is scheduled to begin this year in collaboration withIndiana University . Financial Overview OnJune 15, 2022 , Panbela acquired CPP, a private clinical stage company developing therapeutics to reduce the risk and recurrence of cancer and rare diseases, via merger for consideration consisting of (a) 6,587,576 shares of common stock, (b) 731,957 shares of common stock that remained subject to a holdback escrow (as defined in the Merger Agreement), (c) replacement options to purchase up to 1,596,754 shares of common stock at a weighted average purchase price of$0.35 per share, and (d) replacement warrants to purchase up to 338,060 shares of common stock at a weighted average purchase price of$4.10 per share, and post-closing contingent payments up to a maximum of$60 million , subject to satisfaction of certain milestones. The Mergers, which resulted inPanbela Research and CPP becoming wholly owned subsidiaries of Panbela is being accounted for as an asset acquisition. Substantially all of the purchase consideration was used to acquire the single asset, in process research and development ("IPR&D"). At acquisition, IPR&D was valued at approximately 17.1 million. Immediately after the Mergers, an additional$0.6 million of acquisition related expenditures were added to IPR&D and then the full amount of approximately$17.7 million was written off to current period research and development costs. 18 -------------------------------------------------------------------------------- We have incurred losses of$82.0 million since 2011. For the six months endedJune 30, 2022 , we incurred a net loss of$25.8 million . Included in the net loss for the first half of the year was the non-cash write off of approximately$17.7 million from IPR&D acquired as a result of the Mergers. We also incurred negative cash flows from operating activities of approximately$8.7 million for six months endedJune 30, 2022 . We expect to continue to incur substantial losses, which will generate negative net cash flows from operating activities, as we continue to pursue research and development activities and commercialize. Our cash was approximately$2.5 million and$11.9 million as ofJune 30, 2022 andDecember 31, 2021 , respectively. A decrease of$9.4 million in cash for the six months endedJune 30, 2022 was due to negative cash flow from operations which included$2.6 million to fund long term deposits held by the CRO leading our randomized trial. Ivospemin trial. The cash requirements for CPP operations for the balance of 2022 is not considered to be material. This cash balance is expected, with significant reductions made in our payments to vendors, to last until early in our fourth quarter. We will need to raise additional capital to continue our operations and execute our business plan past the fourth quarter of 2022, including completing required future trials and pursuing regulatory approvals inthe United States , theEuropean Union and other international markets. We historically have financed our operations principally from the sale of equity securities and debt. While we have been successful in the past in obtaining the necessary capital to support our operations and we are likely to seek additional financing through similar means, there is no assurance that we will be able to obtain additional financing under commercially reasonable terms and conditions, or at all. This risk would increase if our clinical data were not positive or if economic or market conditions deteriorate. If we are unable to obtain additional financing when needed, we would need to scale back our operations, taking actions which may include, among other things, reducing use of outside professional service providers, reducing staff or staff compensation, significantly modifying or delaying the development of our product candidates, licensing to third parties the rights to commercialize our product candidates for pancreatic cancer or other applications that we would otherwise seek to pursue, or ceasing operations. The Company has not experienced any significant disruptions to our operations as a result of the COVID-19 pandemic. Recruitment and enrollment in our Phase Ia/Ib trial was paused for a brief time in April and May of 2020. Drug product was delayed in early 2022, but we had adequate supply to initiate our randomized clinical trial and experienced no product related disruptions to our clinical trials. While the Company believes that the slower than expected initiation of clinical sites in our current randomized trial may be the result of fatigue in the medical community, plans have been made to still complete the trial within our planned timeline. The Company was not required to change management practices as it was decentralized prior to the COVID-19 pandemic. Results of Operations
Comparison of the results of operations (in thousands):
Three Months Ended June 30, Six Months Ended June 30, Percent Percent 2022 2021 Change 2022 2021 Change Operating Expenses General and administrative $ 1,258$ 1,241 1.4 %$ 3,053 $ 2,391 27.7 % Research and development 20,028 985 1933.3 % 22,236 2,084 967.0 % Total operating expenses 21,286 2,226 856.2 % 25,289 4,475 465.1 % Other expense, net (862 ) (152 ) 467.1 % (554 ) (276 ) 100.7 % Income tax benefit 18 192 -90.6 % 47 308 -84.7 % Net Loss$ (22,130 ) $ (2,186 ) 912.4 %$ (25,796 ) $ (4,443 ) 480.6 % Research and development ("R&D") and general and administrative ("G&A") expenses include non-cash share-based compensation expense resulting from our issuance of stock options. We expense the fair value of equity awards over their vesting periods. The terms and vesting schedules for share-based awards vary by type of grant and the employment status of the grantee. The awards granted throughJune 30, 2022 vest upon performance or time-based conditions. We expect to record additional non-cash share-based compensation expense in the future, which may be significant. 19
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The following table summarizes the stock-based compensation expense in our statements of comprehensive loss:
Six Months Ended June 30, 2022 2021 General and administrative$ 507 $ 514 Research and development 120 102
Total Stock based compensation
Three months ended
General and administrative expense
Our G&A expenses increased 1.4% to$1.3 million in the second quarter of 2022, up from$1.2 million in the second quarter of 2021. The increase is primarily associated with legal and other costs associated with the Company's acquisition of CPP.
Research and development expense
Our R&D expenses increased to$20.0 million in the second quarter of 2022, up from$1.0 million in the second quarter of 2021. Approximately$17.7 million of the increase resulted from the write off of IPR&D. The balance of the increase is due primarily to increased clinical trial costs related to our new ivospemin (SBP-101) randomized trial in the second quarter of 2022. Other expense, net Other expense, net, was approximately$0.9 million for the three months endedJune 30, 2022 and approximately$0.2 million for the three months endedJune 30, 2021 . The net expense in both periods is composed primarily of a foreign currency exchange loss on the intercompany receivable balance. Income tax benefit Income tax benefit decreased to$18,000 for the three months endedJune 30, 2022 down from$192,000 for the three months endedJune 30, 2021 . Our income tax benefit is derived primarily from refundable tax credits associated with our R&D activities conducted inAustralia , these activities are down significantly as we wrap up the Phase Ia/Ib trial.
Six months ended
General and administrative expense
Our G&A expenses increased 27.7% to$3.0 million in the first half of 2022, up from$2.4 million in the first half of 2021. The increase is primarily associated with legal and other costs associated with the Company's acquisition or CPP. 20
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Research and development expense
Our R&D expenses increased 967.0% to$22.2 million in the first half of 2022, up from$1.1 million in the first half of 2021. After considering the write off of approximately$17.7million of IPR&D, the remaining increase is due primarily to increased clinical trial costs related to our new ivospemin (SBP-101) randomized trial in the first half of 2022. Other expense, net Other expense, net, was approximately$0.6 million and$0.3 million for the six months endedJune 30, 2022 andJune 30, 2021 , respectively. The net expense in both periods is composed primarily of a foreign currency exchange loss on the intercompany receivable balance. Income tax benefit Income tax benefit decreased to$47,000 for the six months endedJune 30, 2022 down from$308,000 for the six months endedJune 30, 2021 . The decrease is due to Australian R&D spending being down significantly as we wrap up the Phase Ia/Ib trial.
Liquidity and Capital Resources
The following table summarizes our liquidity and capital resources as ofJune 30, 2022 andDecember 31, 2021 and our cash flow data for the six months endedJune 30, 2022 and 2021. It is intended to supplement the more detailed discussion that follows (in thousands):
Liquidity and Capital Resources
June 30, 2022 December 31, 2021 Cash $ 2,530 $ 11,867 Working capital$ (2,745 ) $ 9,619 Six Months Ended June 30, 2022 2021 Cash Provided by (Used in): Operating Activities$ (8,680 ) $ (3,658 ) Investing Activities (655 ) - Financing Activities - 1,042 Effect of exchange rate changes on cash (2 ) (1 ) Net (decrease) in cash$ (9,337 ) $ (2,617 ) Working Capital Our total cash and cash equivalents were$2.5 million and$11.9 million as ofJune 30, 2022 andDecember 31, 2021 , respectively. We had$6.2 million in current liabilities and negative working capital of$2.7 million as ofJune 30, 2022 , compared to$2.7 million in current liabilities and working capital of$9.6 million as ofDecember 31, 2021 . Working capital is defined as current assets less current liabilities. 21 --------------------------------------------------------------------------------
Cash Flows
Net cash used in operating activities was approximately$8.7 million in the six months endedJune 30, 2022 compared to approximately$3.7 million in the six months endedJune 30, 2021 . The net cash used in each of these periods primarily reflects the net loss for these periods and is partially offset by the effects of changes in operating assets and liabilities. For the six months endedJune 30, 2022 , cash used in operating activities also included$2.6 million to fund long term deposits held by the CRO leading our randomized trial.
No cash was used in Investing activities for the six months ended
Net Cash Provided by Financing Activities
Net cash provided by financing activities for the six months endedJune 30, 2022 was approximately$1.0 million . The cash provided for this period represents the proceeds from the exercise of warrants during the first half. Capital Requirements As we continue to pursue our operations and execute our business plan, including expansion of our randomized clinical trial for our product candidate, ivospemin (SBP-101), in pancreatic cancer, planning for required future trials and pursuing regulatory approvals inthe United States , theEuropean Union and other international markets, we expect to continue to incur substantial and increasing losses, which will continue to generate negative net cash flows from operating activities.
Our future capital uses and requirements depend on numerous current and future factors. These factors include, but are not limited to, the following:
? the progress of clinical trials required to support our applications for
regulatory approvals, including a randomized Phase II/III trial initiated in
January of 2022; ? the impact of the current COVID-19 pandemic on our ability to initiate
enrollment in a future clinical trial and to monitor our current clinical
trial;
? the cost to implement development efforts for ivospemin (SBP-101) in ovarian
cancer; ? the cost to expand development efforts for eflornithine (CPP-1X) and
eflornithine sachets (CPP-1X-S) acquired as the result of the acquisition of
CPP; ? our ability to demonstrate the safety and effectiveness of our product candidates;
? our ability to obtain regulatory approval of our product candidates in the
United States , theEuropean Union or other international markets;
? the cost and delays in product development that may result from changes in
regulatory oversight applicable to our product candidates;
? the market acceptance and level of future sales of our product candidates;
? the rate of progress in establishing reimbursement arrangements with third-party payors; ? the effect of competing technological and market developments; and
? the costs involved in filing and prosecuting patent applications and enforcing
or defending patent claims. To date, we have used primarily equity financings and convertible debt to fund our ongoing business operations and short-term liquidity needs, and we expect to continue this practice for the foreseeable future. As ofJune 30, 2022 , we did not have any existing credit facilities under which we could borrow funds. 22 -------------------------------------------------------------------------------- We will need to obtain additional funds to continue our operations and execute our business plans including completion of required future trials and pursuing regulatory approvals inthe United States , theEuropean Union and other international markets. While we have been successful in the past in obtaining the necessary capital to support our operations, and have similar future plans to obtain additional financing, there is no assurance that we will be able to obtain additional financing under commercially reasonable terms and conditions, or at all. This risk would increase if our clinical data were inconclusive or not positive or economic conditions worsened in the market as a whole or in the pharmaceutical or biotechnology markets individually. If we are unable to obtain additional financing when needed, we will likely need to reduce our operations by taking actions which may include, among other things, reducing use of outside professional service providers, reducing staff size or staff compensation, significantly modifying or delaying the development of, licensing rights to third parties, including the right to commercialize for patients with pancreatic cancer, or other applications that we would otherwise seek to pursue, or discontinuing operations entirely. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the interests of our current stockholders could be diluted, and the terms may include liquidation or other preferences that adversely affect the rights of our current stockholders. If we issue preferred stock, it could affect the rights of our stockholders or reduce the value of our common stock. Specific rights granted to future holders of preferred stock may include voting rights, preferences as to dividends and liquidation, conversion and redemption rights, sinking fund provisions, and restrictions on our ability to merge with or sell our assets to a third party. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. Any of these events could adversely affect our ability to achieve our regulatory approvals and commercialization goals and harm our business. Our future success is dependent upon our ability to obtain additional financing, the success of our ASPIRE global randomized clinical trial for ivospemin (SBP-101), our ability to obtain marketing approval for SBP-101), eflornithine (CPP-1X) and eflornithine sachets (CPP-1X-S) inthe United States , theEuropean Union and other international markets and Flynpovi outside ofNorth America . If we are unable to obtain additional financing when needed, if our ASPIRE clinical trial or additional clinical trials are not successful, if we do not receive regulatory approval or if once these studies are concluded, we do not receive marketing approval for, we would not be able to continue as a going concern and would be forced to cease operations. The interim financial statements included in this report have been prepared assuming that we will continue as a going concern and do not include any adjustments relating to the recoverability or classification of assets or the amounts of liabilities that might result from the outcome of these uncertainties. Indebtedness CPP issued toSucampo GmbH ("Lender") an Amended and Restated Promissory Note (the "Note") onJune 15, 2022 for the principal sum of$6,193,836 (the "Principal"). The note bears simple interest on any outstanding Principal at a rate of 5% per annum. All unpaid Principal, together with any then unpaid and accrued interest is payable as follows: (i)$1.0 million , plus all interest accrued but unpaid on or before each ofJanuary 31,2023 ,January 31, 2024 ,January 31, 2025 andJanuary 31, 2026 ; (ii) all remaining Principal plus accrued but unpaid interest on or beforeJanuary 31, 2027 . If CPP or its parent, Panbela, receives cash proceeds from any issuance or offering of debt or equity beforeJanuary 31, 2023 , then CPP shall be required to make a concurrent mandatory prepayment of this note from such cash proceeds in an amount equal to the lesser of (i)$1.0 million plus all interest accrued but unpaid on this note through the date of payment; and (ii) ten percent of such cash proceeds. The amount payable by CPP onJanuary 31, 2023 will be reduced on a dollar-for-dollar basis by the amount of such prepayment.
Also effective on
As ofJune 30, 2022 , CPP has an outstanding and amended promissory note with a former development partner,Tillotts Pharma AG ("Tillotts"). The principal amount on the note is$650,000 . Interest accrues at a simple interest rate of 5% per year. The note and accrued but unpaid interest is due onDecember 31, 2022 .
Critical Accounting Policies and Estimates
Our significant accounting policies and estimates are set forth in the notes accompanying the condensed consolidated financial statements included in this document. The accounting policies and estimates used in preparing our interim fiscal 2022 condensed consolidated financial statements are the same as those described in our Annual Report on Form 10-K for the fiscal year endedDecember 31, 2021 . 23
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