v3.26.1
Commitments and Contingencies
6 Months Ended
Jun. 30, 2026
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies

6. Commitments and Contingencies

Executive Agreements

Certain executive agreements provide for severance payments in case of terminations without cause or certain change of control scenarios.

Research and Development Agreements

In March 2017, the Company entered into a license agreement with Nerviano Medical Sciences S.r.l. (“NMS”) (the “Agreement”) which granted the Company development and commercialization rights to NMS-1286937, which the Company refers to as onvansertib. Terms of the agreement also provide for the Company to pay development milestones up to an aggregate of $15 million, commercial milestones, and royalties based on sales volume. These potential development milestones include: (a) dosing of the first subject in the first Phase III Clinical Trial for the first Product, a registration enabling Phase II Clinical Trial, or after completion of a Phase II Clinical Trial that is used as the basis for an NDA submission; and (b) upon filing of the first NDA or equivalent for the first product candidate. During the six months ended June 30, 2026, and 2025, no milestone or royalty payments were made.

The Company is a party to various agreements under which it licenses technology on an exclusive basis in the field of oncology therapeutics. These agreements include License fees, Royalties and Milestone payments. For the six months ended June 30, 2026, and 2025, payments have not been material. The Company also has a legacy license agreement in the field of oncology diagnostics under which royalty payments are due to the Company. These royalty payments are calculated as a percent of revenue.

Litigation

From time to time, the Company may become involved in various lawsuits and legal proceedings that arise in the ordinary course of business. Litigation is subject to inherent uncertainties, and an adverse result in matters may arise from time to time that may harm the Company’s business. As of the date of this report, management believes that there are no claims against the Company, which could result in a material adverse effect on the Company’s business or financial condition, except for the following:

License Agreement

On February 24, 2026, the Company received a written notice from NMS alleging that the Company is in material breach of the Agreement because the Company did not name NMS employee Dr. Barbara Valsasina as a joint inventor on the Company’s U.S. Patent Nos. 12,144,813 and 12,263,173 (the “Cardiff Patents”) and did not agree to file a joint invention continuation patent application or, in the alternative, execute a power of attorney so NMS could do so. The Company maintains there was no breach and that the Agreement does not require the Company to name NMS employees on inventions made exclusively by the Company, or to make what the Company believes are false or inaccurate representations regarding inventorship to the U.S. Patent and Trademark Office.

On May 19, 2026, the Company filed a lawsuit against NMS disputing NMS’s allegation that the Company materially breached the Agreement by declining to name NMS employee Dr. Barbara Valsasina as a joint inventor of the Cardiff Patents. The complaint, filed in the United States District Court for the Southern District of California, seeks injunctive relief requiring NMS to continue performing under the Agreement, a declaratory judgment that the Company did not breach the Agreement, and additional relief.

On May 27, 2026, the Company was informed in writing by NMS that NMS was terminating the Agreement pursuant to Section 11.3 of the Agreement. NMS alleges that the Company materially breached the Agreement by failing to correct or give NMS a power of attorney to correct the inventorship of the Cardiff Patents to include NMS employee Dr. Barbara Valsasina as a joint inventor in breach of, inter alia, Section 10.2(c) of the Agreement. In addition, NMS alleges that the Company has failed to use Commercially

Reasonable Efforts (as defined in the Agreement) to conduct development activities and to obtain Regulatory Approvals (as defined in the Agreement) for onvansertib in material breach of Sections 7.3, 7.5 and 7.9 of the Agreement. The Company promptly responded to NMS that the notice of termination is legally ineffective, factually unsupported and procedurally improper, and that the Company will continue to perform under the Agreement.

On June 10, 2026, the Company filed a motion for preliminary injunction requesting the District Court to enjoin NMS from purporting to terminate the Agreement and other interference. NMS opposed the motion on July 17, 2026 and the Company replied in support of the motion on July 24, 2026. The motion is fully briefed and awaiting decision. NMS answered the complaint and filed counterclaims on June 26, 2026, asserting counterclaims for correction of inventorship, declaratory judgments of joint invention and termination, breach of contract, and breach of implied covenant of good faith and fair dealing. The Company moved to dismiss all counts except for NMS’s counterclaim for a correction of inventorship on July 17, 2026. The Company also filed an amended complaint on July 17, 2026, adding additional claims for breach of contract, unjust enrichment, and unfair competition in violation of California Business & Professions Code § 17200 seeking monetary and other relief.

The outcome of litigation is inherently uncertain. There can be no assurance that the Company will prevail on any or all of its claims, that it will obtain the relief it is seeking, or that a court will agree with the Company’s legal interpretation of the Agreement or its characterization of NMS's conduct. If the court determines that NMS's termination was valid, the Company would lose the rights granted under the Agreement, which could have a material adverse effect on its business, financial condition, results of operations, and prospects. At this time, the Company has not recorded an accrual related to this matter, as a loss is not considered probable. Although an unfavorable outcome is reasonably possible, the Company cannot reasonably estimate the amount of any potential loss or range of loss, if any.