Company: HCWB
Filing Date: 2025-04-16
Form Type: 424B3
Source: 0001193125-25-082835
Chunk: 21

Company: HCW Biologics Inc.
Filing Date: 2025-04-16
Form: 424B3
Chunk 21
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 adversely affect our operations and our financial performance. The potential impacts of climate change may also
include increased operating costs associated with additional regulatory requirements and investments in reducing energy, water use and greenhouse gas emissions.

Risks Related to our Financial Position and Need for Additional Capital

We have incurred significant losses since our inception and we expect to incur losses for the foreseeable future. We have no products approved for commercial sale and may never achieve or maintain profitability.

Since our inception, we have devoted most of our financial
resources and all of our efforts to research and development, including preclinical studies and our clinical trials, and have incurred significant operating losses. In addition, the Company and Dr. Wong, our Founder and Chief Executive Officer,
were parties in an extended Arbitration, which was ongoing for over a year, during which time the Company incurred legal fees of nearly $28.4 million for its own defense and the defense of Dr. Wong. For the years ended December 31,
2023 and 2024, we reported a net loss of $25.0 million and $30.3 million, respectively. These losses are inclusive of reserve for credit losses and other expenses of $5.3 million and $1.3 million for the years ended
December 31, 2023 and 2024, respectively. As of December 31, 2024, we had $4.7 million in cash and cash equivalents, in the balance sheet of our audited financial statements included the Annual Report. From inception to
December 31, 2024, we incurred cumulative net losses of $98.1 million. To date, we have financed our operations primarily through the sale of our redeemable preferred stock (all of which converted to Common Stock upon the effective date of
our initial public offering, or IPO); payments received under our Wugen License for certain rights to two of our internally-developed molecules; proceeds from our IPO; a first lien mortgage of $6.5 million; proceeds from a Paycheck Protection
Program (“PPP”) loan obtained through the Coronavirus Aid, Relief and Economic Security Act (which was forgiven); issuance of senior secured notes; and sale of Common Stock and warrants in private placements and direct registered
offerings. Based on our current operating plans, we believe that our cash and cash equivalents as of December 31, 2024, will not be sufficient for the Company to continue as a going concern for at least one year from the issuance date of the
financial statements appearing in the Annual Report.

Our