What changed in this filing

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Item 1A. Risk Factors

2024-08-01 compared with 2024-05-02 · 111 added, 95 removed, 852 unchanged (19% of the section changed)

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In connection with our regulatory approvals in the EU and Great Britain, we are currently providing access to PYRUKYND® on a free of charge basis for eligible patients in those jurisdictions through a global managed access program.

We provide access to PYRUKYND® for adult patients with PK deficiency in other jurisdictions upon request through the global managed access program, on either a free of charge or for charge basis.

Beyond the global managed access program, we continue to evaluate options for the commercialization of PYRUKYND® outside of the United States, including through exploring potential partnership opportunities, such as the NewBridge Agreement.

The development and commercialization of PYRUKYND® could be unsuccessful if:

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If we experience significant delays or an inability to successfully develop and commercialize PYRUKYND® our business would be materially harmed.

We depend heavily on the success of our clinical-stage product candidates, including the potential approval of PYRUKYND® for use in indications other than PK deficiency and in other jurisdictions.

We depend heavily on the success of our clinical-stage product candidates, including the potential approval of PYRUKYND® for use in thalassemia or in indications other than PK deficiency and in other jurisdictions.

Clinical trials of our product candidates may not be successful for a number of important reasons.

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Our ability to generate meaningful product revenue will depend heavily on the successful clinical development and eventual commercialization of our current and any future product candidates, including PYRUKYND®.

While we obtained marketing approval of PYRUKYND® for the treatment of hemolytic anemia in adults with PK deficiency in the United States and marketing authorization of PYRUKYND® for the treatment of adults with PK deficiency in the EU and Great Britain, we cannot be certain that we will obtain marketing approval of PYRUKYND® in indications other than PK deficiency or in other jurisdictions.

While we obtained marketing approval of PYRUKYND® for the treatment of hemolytic anemia in adults with PK deficiency in the United States and marketing authorization of PYRUKYND® for the treatment of adults with PK deficiency in the EU and Great Britain, we cannot be certain that we will obtain marketing approval of PYRUKYND® in thalassemia or in indications other than PK deficiency or in other jurisdictions.

We, and any collaborators, are not permitted to commercialize, market, promote or sell any product candidate in the United States without obtaining marketing approval from the FDA.

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As part of the evolution of our research organization, we plan to prioritize in-licensing or acquiring assets for future pipeline growth.

For example, in July 2023, we entered into a license agreement with Alnylam for the development and commercialization of products containing or comprised of an siRNA development candidate discovered by Alnylam and targeting the TMPRSS6 gene, and we intend to pursue development of a licensed product for the potential treatment of PV.

For example, in July 2023, we entered into a license agreement with Alnylam for the development and commercialization of products containing or comprised of an siRNA development candidate discovered by Alnylam and targeting the TMPRSS6 gene, and we have begun preclinical development of a product candidate for the potential treatment of PV.

Our ability to successfully in-license or acquire assets and develop product candidates following such transactions is unproven.

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We may face delays, disruptions or shortages as a result of such pandemics that may affect our ability to initiate and complete preclinical studies and clinical trials or impact our commercialization efforts.

We have previously experienced disruptions to certain clinical and research activities at our CROs due to the recent COVID-19 pandemic.

We have previously experienced disruptions to certain clinical and research activities at our CROs due to the COVID-19 pandemic.

Any future pandemic or public health emergency could result in delays or pauses in site initiation, participant recruitment and enrollment, participant dosing, distribution of clinical trial materials, study monitoring and data analysis due to changes in hospital or university policies, federal, state or local regulations, diversion of hospital resources or other reasons related to a public health emergency.

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We or our collaborators may not be able to initiate, continue or complete clinical trials for our product candidates if we or they are unable to locate and enroll a sufficient number of eligible patients to participate in these trials as required by the FDA or analogous regulatory authorities outside the United States.

Furthermore, enrollment had previously been particularly challenging in light of the recent COVID-19 pandemic.

Furthermore, enrollment had previously been particularly challenging in light of the COVID-19 pandemic.

Patient enrollment is also affected by other factors including:

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Fulcrum Therapeutics Inc., or Fulcrum, is developing a treatment for SCD;

Geron Corporation, or Geron, is developing imetelstat for the treatment of LR MDS (for which they have a Prescription Drug User Fee Act goal date of June 16, 2024 for their NDA);

Keros Therapeutics, or Keros, is developing KER-050 for the treatment of anemia in LR MDS;

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Competition for eligible patients may make it particularly difficult for us to enroll a sufficient number of patients to complete our clinical trials for our product candidates in a timely and cost-effective manner.

In addition, we have a small number of clinical trial sites for certain clinical trials in the Middle East, including in Lebanon and Israel, that could be affected by the current armed conflict in Israel and the Gaza Strip.

We rely on CROs and clinical trial sites to ensure the proper and timely conduct of our clinical trials and while we have agreements governing their committed activities, we have limited influence over their actual performance.

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The results of clinical trials of PYRUKYND® for the treatment of PK deficiency do not predict that PYRUKYND® will be efficacious in our ongoing clinical trials in other indications, such as thalassemia or SCD.

The results of clinical trials of PYRUKYND® for the treatment of PK deficiency and thalassemia are not predictive of results of our ongoing clinical trials of PYRUKYND® in other indications, such as SCD.

If we fail to receive positive results in clinical trials of our product candidates, the development timeline and regulatory approval and commercialization prospects for our most advanced product candidates, and, correspondingly, our business and financial prospects would be negatively impacted.

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As a result, we may forego or delay pursuit of opportunities with other product candidates or for other indications that later prove to have greater commercial potential.

We have decided to evolve our approach to exploratory research and drug discovery to prioritize investment in advancing our late lead-optimization research, while continuing to progress our registration-enabling clinical programs in thalassemia, SCD and pediatric PK deficiency, our phase 2a trial in LR MDS, our phase 1 trial for AG-181, our PAH stabilizer for the potential treatment of PKU, and our development of a licensed siRNA development candidate under our license agreement with Alnylam.

We are prioritizing investment in advancing our late lead-optimization research, while continuing to progress our registration-enabling clinical programs in thalassemia, SCD and pediatric PK deficiency, our phase 2 trial in LR MDS, our phase 1 trial for AG-181, our PAH stabilizer for the potential treatment of PKU, and our development of a licensed siRNA development candidate under our license agreement with Alnylam.

Our resource allocation decisions may cause us to fail to capitalize on viable commercial medicines or profitable market opportunities.

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We provide access to PYRUKYND® for adult patients with PK deficiency in other jurisdictions upon request through the global managed access program, on either a free of charge or for charge basis.

We may need to further build our sales and marketing infrastructure, either directly or with third-party partners, to maintain our ongoing commercialization efforts and to commercialize PYRUKYND® in other indications or outside of the United States or to commercialize any of our other product candidates for which we obtain marketing approval.

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If we do not establish sales and marketing capabilities successfully, either on our own or in collaboration with third parties, we will not be successful in commercializing PYRUKYND® or any of our product candidates for which we obtain marketing approval.

We provide certain development estimates related to the development of PYRUKYND® and our product candidates.

If we do not achieve our projected development estimates in the timeframes we announce and expect, the commercialization of our products may be delayed and, as a result, our stock price may decline.

We provide certain development estimates related to the development and regulatory approval of PYRUKYND® and our product candidates.

If we do not achieve our projected development or regulatory approval estimates in the timeframes we announce and expect, the commercialization of our products may be delayed and, as a result, our stock price may decline.

From time to time, we provide estimates related to the development of PYRUKYND® and our product candidates.

We also estimate the timing of the anticipated accomplishment of various scientific, preclinical, clinical, regulatory and other product development goals.

These estimates may include the commencement or completion of clinical trials and the submission of regulatory filings.

These estimates may include the commencement or completion of clinical trials, the timing for reporting clinical trial results and the timing of submission of regulatory filings in various jurisdictions.

From time to time, we may publicly announce our estimates, including the timing of certain milestones related to our product candidates.

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For example, Merck and Bristol-Myers Squibb Company, or BMS, are marketing a therapy to treat beta thalassemia and LR MDS and are conducting clinical trials for alpha thalassemia and LR MDS patients that are ESA naïve and non-transfusion dependent;

Geron Corporation recently announced FDA approval of a treatment for adults with LR MDS with transfusion-dependent anemia;

Novartis International AG, or Novartis, Emmaus Life Sciences, and Pfizer are each marketing therapies to treat SCD, with Pfizer continuing to conduct clinical trials for therapies in SCD;

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Fulcrum is conducting clinical trials for a potential treatment for SCD;

Geron and Keros are conducting clinical trials for potential treatments for LR MDS (for which Geron has a Prescription Drug User Fee Act goal date of June 16, 2024 for their NDA);

Keros is conducting a clinical trial for potential treatments for LR MDS;

PTC and Jnana and are conducting clinical trials for potential treatments for PKU;

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There are also a number of product candidates in preclinical or clinical development by third parties to treat rare diseases by targeting similar mechanisms of action or target indications as our product candidates.

These companies include large pharmaceutical companies, such as Novartis, Novo Nordisk, Pfizer, BMS, Merck and Vertex as well as biotechnology companies of various sizes, such as BioMarin, bluebird, PTC and Rocket Pharma.

These companies include large

pharmaceutical companies, such as Novartis, Novo Nordisk, Pfizer, BMS, Merck and Vertex as well as biotechnology companies of various sizes, such as BioMarin, bluebird, PTC and Rocket Pharma.

Our competitors may develop products that are more effective, safer, more convenient or less costly than PYRUKYND® or any product candidates that we are developing or that would render PYRUKYND® or our product candidates obsolete or non-competitive.

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We and any collaborators face a risk of product liability exposure related to our product candidates in human clinical trials and face an even greater risk as we or they commercially sell any medicines, including PYRUKYND®.

If we or any collaborators

cannot successfully defend ourselves or themselves against claims that our product candidates or medicines caused injuries, we or they could incur substantial costs and liabilities.

If we or any collaborators cannot successfully defend ourselves or themselves against claims that our product candidates or medicines caused injuries, we or they could incur substantial costs and liabilities.

Regardless of merit or eventual outcome, liability claims may also result in, among other things, decreased demand for any product candidates or medicines that we may develop, reputational harm and lost revenue.

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We are subject to data privacy and protection laws and regulations that apply to the collection, transmission, storage and use of personally-identifying information, which among other things, impose certain requirements relating to the privacy, security and transmission of personal information, including comprehensive regulatory systems in the United States, EU and United Kingdom.

The legislative and regulatory landscape for privacy and data protection continues to evolve in jurisdictions worldwide, and there has been an increasing focus on privacy and data protection issues with the potential to affect our

Failure to comply with any of these laws and regulations could result in enforcement action against us, including fines, imprisonment of company officials and public censure, claims for damages by affected individuals, damage to our reputation and loss of goodwill, any of which could have a material adverse effect on our business, financial condition, results of operations or prospects.

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In addition to California, a number of other states have passed comprehensive privacy laws similar to the CCPA and CPRA.

These laws are either in effect or will go into effect sometime before the end of 2026.

These laws are either in effect or will go into effect sometime over the next several years.

Like the CCPA and CPRA, these laws create obligations related to the processing of personal information, as well as special obligations for the processing of “sensitive” data (which includes health data in some cases).

Some of the provisions of these laws may apply to our business activities.

There are also states that are strongly considering or are in the process of enacting privacy laws that will go into effect in 2024 and beyond, including New Hampshire and New Jersey.

There are also states that are strongly considering or are in the process of enacting privacy laws that will go into effect in 2024 and beyond.

Other states will be considering these laws in the future, and Congress has also been debating passing a federal privacy law.

There are also states that are specifically regulating health information that may affect our business.

For example, Washington state passed a health privacy law that will regulate the collection and sharing of health information, and the law also has a private right of action, which further increases the relevant

compliance risk.

Connecticut and Nevada have also passed similar laws regulating consumer health data, and more states are considering such legislation in 2024.

These laws may impact our business activities, including our identification of research subjects, relationships with business partners and ultimately the marketing and distribution of our products.

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While we continue to address the implications of the recent changes to data privacy regulations, data privacy remains an evolving landscape at both the domestic and international level, with new regulations coming into effect and continued legal challenges, and our efforts to comply with the evolving data protection rules may be unsuccessful.

It is possible that these laws may be interpreted and applied in a manner that is inconsistent with our practices.

It is possible that these laws

may be interpreted and applied in a manner that is inconsistent with our practices.

We must devote significant resources to understanding and complying with this changing landscape.

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Similarly, failure to comply with federal and state laws in the United States regarding privacy and security of personal information could expose us to penalties under such laws.

Any such failure to comply with data protection and privacy laws could result in government-imposed fines or orders requiring that

we change our practices, claims for damages or other liabilities, regulatory investigations and enforcement action, litigation and significant costs for remediation, any of which could adversely affect our business.

Any such failure to comply with data protection and privacy laws could result in government-imposed fines or orders requiring that we change our practices, claims for damages or other liabilities, regulatory investigations and enforcement action, litigation and significant costs for remediation, any of which could adversely affect our business.

Even if we are not determined to have violated these laws, government investigations into these issues typically require the expenditure of significant resources and generate negative publicity, which could harm our business, financial condition, results of operations or prospects.

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The sale of our oncology business to Servier in 2021, including our approved products at the time of sale, TIBSOVO® and IDHIFA®, has resulted in us being a smaller, less diversified company with a more limited business concentrated on products and product candidates for the treatment of rare diseases.

The success of the rare disease business is subject to various risks and uncertainties, including the possibility that we may not be able to successfully commercialize PYRUKYND®, the possibility of adverse clinical and other developments in respect of PYRUKYND® or our other product candidates of the rare disease business, and unanticipated changes in applicable laws and regulations that may adversely affect the rare disease business.

The success of the rare disease business is subject to various risks and uncertainties, including the possibility that we may not be able to successfully commercialize PYRUKYND®, the possibility that PYRUKYND® is not approved for thalassemia or in indications other than PK deficiency, the possibility of adverse clinical and other developments in respect of PYRUKYND® or our other product candidates of the rare disease business, and unanticipated changes in applicable laws and regulations that may adversely affect the rare disease business.

We may be more susceptible to changing market conditions, including fluctuations and risks particular to the markets for patients with rare diseases, than a more diversified company, which could adversely affect our business, financial condition and results of operations.

In addition, even with the FDA approval of PYRUKYND®, the diversification of our revenues, costs and cash flows has diminished following the sale of our oncology business.

In addition, even with the FDA approval of PYRUKYND® for PK deficiency, the diversification of our revenues, costs and cash flows has diminished following the sale of our oncology business.

Our results of operations, cash flows, working capital and financing requirements may be subject to increased volatility and our ability to fund capital expenditures and investments or satisfy other financial commitments may be diminished.

The amount of contingent consideration we will receive with respect to vorasidenib is subject to various risks and uncertainties.

As part of the sale of our oncology business to Servier, Servier agreed to pay to us:

• $200.0 million in cash if, prior to January 1, 2027, vorasidenib is granted approval for an NDA from the FDA with an approved label that permits vorasidenib’s use as a single agent for the adjuvant treatment of patients with Grade 2 glioma that have an IDH1 or IDH2 mutation (and, to the extent required by such approval, the vorasidenib companion diagnostic test is granted an FDA premarket approval), or the Vorasidenib Milestone Payment;

• a royalty payment of 15% of the U.S.

net sales (as defined in the purchase agreement with Servier) of vorasidenib from its first commercial sale through loss of exclusivity of vorasidenib, or the Vorasidenib Royalty Rights.

In May 2024, we entered into a purchase and sale agreement with Royalty Pharma, pursuant to which we agreed to sell the Vorasidenib Royalty Rights to Royalty Pharma for an upfront payment of $905.0 million in cash, or the Upfront Payment.

The consummation of the sale and payment of the purchase price are subject to approval of vorasidenib by the FDA on or before October 31, 2024, and other customary closing conditions.

Upon the consummation of the sale, Royalty Pharma will acquire 100% of the Vorasidenib Royalty Rights payments made by Servier on account of up to $1.0 billion in net sales for each calendar year.

Any such Vorasidenib Royalty Rights payments made by Servier on account of U.S.

net sales in each calendar year in excess of $1.0 billion will be split, with Royalty Pharma having the rights to a 12% earn-out on those excess payments and Agios retaining the Retained Earn-Out Rights.

We also retained our rights to the Vorasidenib Milestone Payment.

The contingent consideration described above is subject to various risks and uncertainties.

Although the FDA assigned Servier’s NDA for vorasidenib a Prescription Drug User Fee Act action date of August 20, 2024, there is no guarantee that vorasidenib will be approved by the FDA, and that, as such we will receive the Vorasidenib Milestone Payment, the Upfront Payment from Royalty Pharma or any potential royalties on sales of vorasidenib.

If the sale to Royalty Pharma is consummated, we will only be entitled to royalty payments on U.S.

net sales of vorasidenib if such sales are in excess of $1.0 billion in a calendar year.

We cannot predict what success, if any, Servier may have in the United States with respect to future sales of vorasidenib, if approved, or whether Servier will have more than $1.0 billion in net

sales in any calendar year, and, therefore, we cannot predict the amount of royalty payments that we may receive prior to the loss of exclusivity of vorasidenib, if any.

Raising additional capital may restrict our operations, require us to relinquish rights to our technologies or product candidates or cause dilution to our stockholders.

Until such time, if ever, as we can generate substantial product revenue, including from sales of PYRUKYND®, we expect to finance our cash needs primarily through cash on hand, a potential milestone payment and royalties from Servier if a NDA for vorasidenib is approved by the FDA with a label that permits vorasidenib's use as a single agent for the adjuvant treatment of patients with Grade 2 glioma that have an IDH1 or IDH2 mutation, and, potentially, collaborations, strategic alliances, licensing arrangements and other nondilutive strategic transactions.

Until such time, if ever, as we can generate substantial product revenue, including from sales of PYRUKYND®, we expect to finance our cash needs primarily through cash on hand, a potential Upfront Payment from Royalty Pharma if vorasidenib is approved by the FDA, a potential Vorasidenib Milestone Payment from Servier, potential royalty payments with respect to the Retained Earn-Out Rights, and, potentially, collaborations, strategic alliances, licensing arrangements and other nondilutive strategic transactions.

In addition, we may pursue opportunistic debt offerings, and equity or equity-linked offerings.

We do not have any committed external source of funds other than the potential milestone and royalty payments that we are eligible to receive with respect to vorasidenib under our purchase agreement with Servier.

We do not have any committed external source of funds other than the potential Upfront Payment, the Vorasidenib Milestone Payment and the Retained Earn-Out Rights described above.

To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common stockholders.

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• the amount and timing of future revenue received from commercial sales of PYRUKYND® and any of our other product candidates for which we may receive marketing approval;

• the amount of contingent consideration we ultimately receive from Servier;

• whether vorasidenib is approved by the FDA and the sale of the Vorasidenib Royalty Rights to Royalty Pharma is consummated;

• the amount of payments, if any, we may receive on account of the Retained Earn-Out Rights;

• the costs and timing of our ongoing commercialization activities, including product manufacturing, sales, marketing and distribution, for PYRUKYND® for the treatment of adults with PK deficiency in the approved jurisdictions;

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• the costs associated with in-licensing or acquiring assets for pipeline growth, including the amount and timing of future milestone and royalty payments payable to Alnylam pursuant to the license agreement;

• the costs, timing and outcome of regulatory review of our product candidates;

• the costs, timing and outcome of regulatory review of our product candidates, including with respect to our anticipated regulatory submissions for PYRUKYND® for the treatment of thalassemia;

• the costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending intellectual property-related claims;

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• our ability to successfully execute on our strategic plans;

• operational delays due to public health epidemics, including the recent COVID-19 pandemic;

• operational delays due to public health epidemics, including the COVID-19 pandemic;

• operational delays, disruptions and/or increased costs associated with global economic developments, rising global energy prices or energy shortages or rationing.

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We have a history of incurring operating losses.

Our net losses for the three months ended March 31, 2024 and 2023 were $81.5 million and $81.0 million, respectively.

As of March 31, 2024, we had an accumulated deficit of $904.2 million.

Our net losses for the six months ended June 30, 2024 and 2023 were $177.7 million and $164.8 million, respectively.

As of June 30, 2024, we had an accumulated deficit of $1.0 billion.

Prior to the sale of our oncology business to Servier in March 2021, we had generated only modest revenue from sales of TIBSOVO® and, prior to our sale to Royalty Pharma of our royalty rights to IDHIFA®, from royalties on sales of IDHIFA®.

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We are currently providing access to PYRUKYND® free of charge for eligible patients in the EU and Great Britain through a global managed access program, and we provide access to PYRUKYND® for adult patients with PK deficiency in other jurisdictions through the global managed access program on either a free of charge or for charge basis.

PYRUKYND® is the first product we have received marketing approval for following the sale of our oncology business.

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net sales of TIBSOVO® prior to the sale of these royalty rights to Sagard, proceeds from the sale of our rights to the royalty on U.S.

net sales of TIBSOVO® to Sagard, a potential milestone payment and royalties from Servier if a NDA for vorasidenib is approved by the FDA with a label that permits vorasidenib's use as a single agent for the adjuvant treatment of patients with Grade 2 glioma that have an IDH1 or IDH2 mutation, the actual and potential future sales of PYRUKYND® and, potentially, collaborations, strategic alliances, licensing arrangements and other nondilutive strategic transactions.

net sales of TIBSOVO® to Sagard, a potential Upfront Payment from Royalty Pharma if vorasidenib is approved by the FDA, a potential Vorasidenib Milestone Payment from Servier, potential royalty payments with respect to the Retained Earn-Out Rights, and, potentially, collaborations, strategic alliances, licensing arrangements and other nondilutive strategic transactions.

In addition, we may pursue opportunistic debt offerings, and equity or equity-linked offerings.

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• continue our research and preclinical development of our product candidates and seek to identify additional product candidates;

• seek marketing approvals for our product candidates that successfully complete clinical trials;

• seek marketing approvals for our product candidates that successfully complete clinical trials, including our anticipated regulatory submissions for PYRUKYND® for the treatment of thalassemia;

• require the manufacture of larger quantities of product candidates for clinical development and commercialization;

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A decline in the value of our company could also cause our stockholders to lose all or part of their investment.

The amount of contingent consideration we will receive from the sale of our oncology business to Servier is subject to various risks and uncertainties.

Upon closing of the sale of our oncology business to Servier, Servier assumed certain liabilities with respect to the oncology business and paid to us:

approximately $1.8 billion in cash, net of certain adjustments for the working capital of the oncology business at the time of closing of the transaction and amounts for a representation and warranty insurance policy.

In addition, Servier agreed to pay to us:

• a royalty payment of 5% of the U.S.

net sales (as defined in the purchase agreement with Servier) of TIBSOVO® from the completion of the transaction through loss of exclusivity of TIBSOVO®, which we sold to Sagard in October 2022;

• a royalty payment of 15% of the U.S.

net sales (as defined in the purchase agreement with Servier) of vorasidenib from its first commercial sale through loss of exclusivity of vorasidenib.

The contingent consideration described above is subject to various risks and uncertainties.

Prior to the sale to Sagard, we received royalties from Servier on U.S.

net sales of TIBSOVO®.

We cannot however predict what success, if any, Servier may have in the United States with respect to future sales of vorasidenib, if approved, and, therefore, we cannot predict the amount of royalty payments that we can expect to receive from Servier prior to the loss of exclusivity of vorasidenib.

The potential royalty payments with respect to vorasidenib are also subject to deductions and other adjustments under the terms of the purchase agreement, the amounts of which are uncertain as of the date of this report.

Changes in tax laws or in their implementation or interpretation may adversely affect our business and financial condition.

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The Tax Act, among other things, contained significant changes to corporate taxation.

As part of Congress’ response to the recent COVID-19 pandemic, economic relief legislation was enacted in 2020 and 2021.

As part of Congress’ response to the COVID-19 pandemic, economic relief legislation was enacted in 2020 and 2021.

Such legislation contains numerous tax provisions.

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It is possible some of our contractual counterparties could be impacted by this legislation.

If either we or any third parties on which we rely are adversely impacted by restrictions resulting from the recent COVID-19 pandemic, the emergence of another public health epidemic, by rising global energy costs or energy shortages or rationing and/or the impacts of the Russia-Ukraine war, our supply chain may be disrupted, limiting our ability to manufacture our product candidates for our clinical trials and research and development operations and our product for commercialization.

If either we or any third parties on which we rely are adversely impacted by restrictions resulting from the COVID-19 pandemic, the emergence of another public health epidemic, by rising global energy costs or energy shortages or rationing and/or the impacts of the Russia-Ukraine war, our supply chain may be disrupted, limiting our ability to manufacture our product candidates for our clinical trials and research and development operations and our product for commercialization.

Any performance failure on the part of our existing or future manufacturers could delay preclinical development, clinical development, marketing approval or our commercialization efforts.

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If those collaborations are not successful, we may not be able to capitalize on the market potential of these product candidates.

We may seek collaborations for the development and commercialization of our product candidates with large and mid-size pharmaceutical companies and biotechnology companies.

We may seek collaborations for the development and commercialization of our product candidates, such as the NewBridge Agreement, with large and mid-size pharmaceutical companies and biotechnology companies.

We face significant competition in seeking appropriate collaborators.

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If we enter into any such arrangements with collaborators, we will likely have limited control over the amount and timing of resources that our collaborators dedicate to the development or commercialization of our product candidates.

Collaborators may not pursue development and commercialization of our product candidates or may elect not to continue or renew development or commercialization programs based on clinical trial results, changes in the collaborator’s strategic focus or available funding or

external factors such as an acquisition that diverts resources or creates competing priorities.

Collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial or abandon a product candidate, repeat or conduct new clinical trials or require a new formulation of a product candidate for clinical testing, which may result in a need for additional capital to pursue further development or commercialization of the applicable product candidate.

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Disputes may arise between the collaborators and us that result in the delay or termination of the research, development or commercialization of our medicines or product candidates or that result in costly litigation or arbitration that diverts management attention and resources.

In addition, our ability to enter into arrangements with collaborators in specific regions, such as the Middle East, may be affected by localized geopolitical unrest or military conflict, such as the current armed conflict in Israel and the Gaza Strip.

Our ability to generate revenue from these arrangements will depend on our collaborators’ abilities to successfully perform the functions assigned to them in these arrangements.

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If any such licensors fail to maintain such patents, or lose rights to those patents, the rights we have licensed may be reduced or eliminated and our right to develop and commercialize any of our products that are the subject of such licensed rights could be adversely affected.

In addition to the foregoing, the risks associated with patent rights that we license from third parties also apply to patent rights we own.

addition to the foregoing, the risks associated with patent rights that we license from third parties also apply to patent rights we own.

The patent position of biotechnology and pharmaceutical companies generally is highly uncertain, involves complex legal and factual questions and has in recent years been the subject of much litigation.

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Assuming the other requirements for patentability are met, prior to March 2013, in the United States, the first to make the claimed invention was entitled to the patent, while outside the United States, the first to file a patent application was entitled to the patent.

Beginning in March 2013, the United States transitioned to a first inventor to file system in which, assuming the

other requirements for patentability are met, the first inventor to file a patent application will be entitled to the patent.

Beginning in March 2013, the United States transitioned to a first inventor to file system in which, assuming the other requirements for patentability are met, the first inventor to file a patent application will be entitled to the patent.

We may be subject to a third-party pre-issuance submission of prior art to the U.S.

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Our commercial success depends upon our ability and the ability of our collaborators to develop, manufacture, market and sell our product and product candidates and use our proprietary technologies without infringing the proprietary rights and intellectual property of third parties.

We have in the past and may in the future become party to, or threatened with, adversarial proceedings or litigation regarding intellectual property rights with respect to our medicines and technology, including opposition, derivation, revocation, reexamination, post-grant and inter partes review or interference proceedings before the USPTO or other patent offices around the world.

We are not aware of any legal proceedings having been filed against us following the sale of our oncology business to Servier.

We have in the past, are and may in the future become party to, or threatened with, adversarial proceedings or litigation regarding intellectual property rights with respect to our medicines and technology, including opposition, derivation, revocation, reexamination, post-grant and inter partes review or interference

proceedings before the USPTO or other patent offices around the world.

For example, two of the European patents in our mitapivat portfolio, neither being the primary compound patent, have been challenged in opposition proceedings in the European Patent Office.

The revocation of either of these European patents could potentially allow additional competitor drugs, if approved, to enter the European marketplace earlier than anticipated.

Third parties may assert infringement claims against us based on existing patents or patents that may be granted in the future.

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If any of our proprietary technical information and know-how were to be lawfully obtained or independently developed by a competitor or other third party, we would have no right to prevent them from using that technology or information to compete with us.

Moreover, we anticipate that with respect to this platform, at least some of this technical information and know-how will, over time, be disseminated within the industry through independent development, the publication of journal articles describing the methodology, and the movement of personnel skilled in the art from academic to industry scientific positions.

Moreover, we anticipate

that with respect to this platform, at least some of this technical information and know-how will, over time, be disseminated within the industry through independent development, the publication of journal articles describing the methodology, and the movement of personnel skilled in the art from academic to industry scientific positions.

Risks Related to Regulatory Approval of Our Product Candidates and Other Legal Compliance Matters

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For example, should the FDA determine that an inspection is necessary for approval of a regulatory submission and an inspection cannot be completed during the review cycle, and the FDA does not determine a remote interactive evaluation to be adequate, the FDA has stated that it generally intends to issue a complete response letter or defer action on the regulatory submission until an inspection can be completed.

Finally, our ability to develop and market new drug products may be threatened by the results of ongoing litigation challenging the FDA’s approval of another company’s drug.

Specifically, in April 2023, the U.S.

Several significant administrative law cases were decided by the U.S.

Supreme Court in 2024, most notably Loper Bright Enterprises v.

Raimondo , which overruled Chevron U.S.A., Inc.

Natural Resources Defense Council, Inc .

Since 1984, Chevron had required that courts defer to reasonable agency interpretations of statutes and agency action.

In Loper Bright , the Supreme Court held that the U.S.

Administrative Procedure Act requires courts to exercise their independent judgment when

deciding whether an agency has acted within its statutory authority, and that courts may not defer to an agency interpretation solely because a statute is ambiguous.

These decisions may result in additional legal challenges to regulations and guidance issued by federal regulatory agencies, including the FDA and CMS, that we have relied on and intend to rely on in the future.

Any such challenges, if successful, could have an impact on our business, and any such impact could be material.

In addition to potential changes to regulations and agency guidance as a result of legal challenges, these decisions may result in increased regulatory uncertainty and delays in and other impacts to the agency rulemaking process, any of which could adversely impact our business and operations.

Finally, our ability to develop and market new drug products may be impacted if litigation challenging the FDA’s approval of another company’s drug continues.

In April 2023, the U.S.

District Court for the Northern District of Texas invalidated the approval by the FDA of mifepristone, a drug product which was originally approved in 2000 and whose distribution is governed by various measures adopted under a REMS.

In reaching that decision, the district court made a number of findings that may negatively impact the development, approval and distribution of new drug products in the United States.

The Court of Appeals for the Fifth Circuit declined to order the removal of mifepristone from the market, finding that a challenge to the FDA’s initial approval in 2000 is barred by the statute of limitations.

But the Court of Appeals for the Fifth Circuit did hold that plaintiffs were likely to prevail in their claim that changes allowing for expanded access of mifepristone that the FDA authorized in 2016 and 2021 were arbitrary and capricious.

In December 2023, the Supreme Court announced that it will review the appeals court decision.

Depending on the outcome of this litigation and the regulatory uncertainty it has engendered, our ability to develop new drug product candidates and to maintain approval of existing drug products and measures adopted under a REMS is at risk and our efforts to develop and market new drug products could be delayed, undermined or subject to protracted litigation.

The Court of Appeals for the Fifth Circuit declined to order the removal of mifepristone from the market, but did hold that plaintiffs were likely to prevail in their claim that changes allowing for expanded access of mifepristone that the FDA authorized in 2016 and 2021 were arbitrary and capricious.

In June 2024, the Supreme Court reversed and remanded that decision after unanimously finding that the plaintiffs did not have standing to bring this legal action against the FDA.

Depending on the outcome of this litigation, if it continues, our ability to develop new drug product candidates and to maintain approval of existing drug products and measures adopted under a REMS is at risk and our efforts to develop and market new drug products could be delayed, undermined or subject to protracted litigation.

If we or our collaborators experience delays in obtaining approval or if we or they fail to obtain approval of our product candidates, the commercial prospects for our product candidates may be harmed and our ability to generate revenue will be materially impaired.

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In addition, foreign regulatory authorities may change their approval policies and new regulations may be enacted.

For instance, the European Union pharmaceutical legislation is currently undergoing a complete review process, in the context of the Pharmaceutical Strategy for Europe initiative, launched by the European Commission in November 2020.

The European Commission’s proposal for revision of several legislative instruments related to medicinal products (including potentially reducing the duration of regulatory data protection and revising the eligibility for expedited pathways) was published on April 26, 2023.

For instance, EU pharmaceutical legislation is currently undergoing a complete review process, in the context of the Pharmaceutical Strategy for Europe initiative, launched by the European Commission in November 2020.

The proposed revisions remain to be agreed and adopted by the European Parliament and European Council and the proposals may therefore be substantially revised before adoption, which is not anticipated before early 2026.

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Generally, if a product with an orphan drug designation subsequently receives the first marketing approval for the indication for which it has such designation, the product is entitled to a period of marketing exclusivity, which precludes the EMA or the FDA from approving another marketing application for the same product for that time period.

The applicable period is seven years in the United States and ten years in Europe.

The European exclusivity period can be reduced to six years if a product no longer meets the criteria for orphan drug designation or if the product is sufficiently profitable so that market exclusivity is no longer justified.

The applicable period is seven years in the United States and currently ten years in Europe.

The European exclusivity period can be reduced to six years if a product no

longer meets the criteria for orphan drug designation or if the product is sufficiently profitable so that market exclusivity is no longer justified.

Orphan drug exclusivity may be lost if the FDA or EMA determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantity of the product to meet the needs of patients with the rare disease or condition.

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• the federal Anti-Kickback Statute prohibits, among other things, persons from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, order or recommendation or arranging of, any good or service, for which payment may be made under a federal healthcare program such as Medicare and Medicaid;

• the federal False Claims Act imposes criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities for, among other things, knowingly presenting, or causing to be presented, false or fraudulent claims for payment by a federal healthcare program or making a false statement or record material to payment of a false claim or avoiding, decreasing or concealing an obligation to pay money to the federal government, with potential liability including mandatory treble damages and significant per-claim penalties;

or fraudulent claims for payment by a federal healthcare program or making a false statement or record material to payment of a false claim or avoiding, decreasing or concealing an obligation to pay money to the federal government, with potential liability including mandatory treble damages and significant per-claim penalties;

• HIPAA imposes criminal and civil liability for executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters;

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Therefore, our ability, and the ability of any collaborators, to commercialize PYRUKYND® or any of our product candidates will depend in part on the extent to which coverage and reimbursement for these products and related treatments will be available from third-party payors.

Third-party payors decide which medications

they will cover and establish reimbursement levels.

Third-party payors decide which medications they will cover and establish reimbursement levels.

The healthcare industry is acutely focused on cost containment, both in the United States and elsewhere.

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On June 17, 2021, the Supreme Court struck down the lower court rulings, finding that the plaintiffs did not have standing to challenge the ACA’s minimum essential coverage provision at issue in the case.

implementation of any provision of the ACA that would impose a fiscal or regulatory burden on states, individuals, healthcare providers, health insurers, or manufacturers of pharmaceuticals or medical devices.

The Trump Administration also took executive actions to undermine or delay implementation of the ACA, including directing federal agencies with authorities and responsibilities under the ACA to waive, defer, grant exemptions from, or delay the implementation of any provision of the ACA that would impose a fiscal or regulatory burden on states, individuals, healthcare providers, health insurers, or manufacturers of pharmaceuticals or medical devices.

On January 28, 2021, however, President Biden revoked these orders and issued a new executive order which directs federal agencies to reconsider rules and other policies that limit Americans’ access to health care, and consider actions that will protect and strengthen that access.

This Executive Order also directs the HHS to create a special enrollment period for the Health Insurance Marketplace in response to the recent COVID-19 pandemic.

This Executive Order also directs the HHS to create a special enrollment period for the Health Insurance Marketplace in response to the COVID-19 pandemic.

We cannot predict how federal agencies will respond to such executive orders.

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That regulation was challenged in a lawsuit by the Pharmaceutical Research and Manufacturers of America, or PhRMA, but the case was dismissed by a federal district court in February 2023 after the court found that PhRMA did not have standing to sue HHS.

Nine states (Colorado, Florida, Maine, New Hampshire, New Mexico, North Dakota, Texas, Vermont and Wisconsin) have passed laws allowing for the importation of drugs from Canada.

Several states have passed laws allowing for the importation of drugs from Canada.

Certain of these states have submitted Section 804 Importation Program proposals and are awaiting FDA approval.

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Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare (beginning in 2026), with prices that can be negotiated subject to a cap;

imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023);

imposes rebates under Medicare Part B and Medicare Part D to

penalize price increases that outpace inflation (first due in 2023);

and replaces the Part D coverage gap discount program with a new discounting program (beginning in 2025).

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The legislation also requires manufacturers to pay rebates for drugs in Medicare Part D whose price increases exceed inflation.

The new law also caps Medicare out-of-pocket drug costs at an estimated $4,000

a year in 2024 and, thereafter beginning in 2025, at $2,000 a year.

The new law also caps Medicare out-of-pocket drug costs at an estimated $4,000 a year in 2024 and, thereafter beginning in 2025, at $2,000 a year.

In addition, the IRA potentially raises legal risks with respect to individuals participating in a Medicare Part D prescription drug plan who may experience a gap in coverage if they required coverage above their initial annual coverage limit before they reached the higher threshold, or “catastrophic period” of the plan.

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Chamber of Commerce and pharmaceutical companies, also filed lawsuits in various courts with similar constitutional claims against HHS and CMS.

There have been various decisions by the courts considering these cases since they were filed.

We expect that litigation involving these and other provisions of the IRA will continue, with unpredictable and uncertain results.

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To obtain reimbursement or pricing approval in some countries, we or our collaborators may be required to conduct a clinical trial that compares the cost-effectiveness of our product to other available therapies.

If reimbursement of our product is unavailable or limited in scope or amount, or if pricing is set at unsatisfactory levels, our business could be materially harmed.

reimbursement of our product is unavailable or limited in scope or amount, or if pricing is set at unsatisfactory levels, our business could be materially harmed.

We are subject to U.S.

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We can be held liable for the corrupt or other illegal activities of these third-party intermediaries, our employees, representatives, contractors, partners, and agents, even if we do not explicitly authorize or have actual knowledge of such activities.

injunctions, suspension and/or debarment from contracting with certain persons, the loss of export privileges, reputational harm, adverse media coverage, and other collateral consequences.

Noncompliance with such laws could subject us to whistleblower complaints, investigations, sanctions, settlements, prosecution, other enforcement actions, disgorgement of profits, significant fines, damages, other civil and criminal penalties or injunctions, suspension and/or debarment from contracting with certain persons, the loss of export privileges, reputational harm, adverse media coverage, and other collateral consequences.

If any subpoenas, investigations, or other enforcement actions are launched, or governmental or other sanctions are imposed, or if we do not prevail in any possible civil or criminal litigation, our business, results of operations and financial condition could be materially harmed.

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Such litigation would subject us to additional costs, damages and reputational harm, which could lead to lower revenues.

The CREATES Act may enable generic competition with PYRUKYND® and any of our product candidates, if approved, which could impact our ability to maximize product revenue.

The CREATES Act

may enable generic competition with PYRUKYND® and any of our product candidates, if approved, which could impact our ability to maximize product revenue.

If we fail to comply with environmental, health and safety laws and regulations, we could become subject to fines or penalties or incur costs that could have a material adverse effect on the success of our business.

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We have adopted a Code of Business Conduct and Ethics, but it is not always possible to identify and deter employee misconduct, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations.

If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business and results of operations, including the imposition of significant fines or other sanctions.

If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our

rights, those actions could have a significant impact on our business and results of operations, including the imposition of significant fines or other sanctions.

Risks Related to Our Common Stock and Other Matters

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• our success in launching and commercializing PYRUKYND®;

• the decision to focus our efforts on our rare disease business following the sale of our oncology business to Servier;

• the decision to focus our efforts on our rare disease business;

• the evolution of our research organization;

• whether the sale of the Vorasidenib Royalty Rights to Royalty Pharma will be consummated;

• announcements by us or our competitors of significant acquisitions, in-licensing arrangements, strategic partnerships, joint ventures, collaborations or capital commitments;

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• changes in the structure of healthcare payment systems;

• the societal and economic impact of public health epidemics or pandemics, such as the recent COVID-19 pandemic and any recession, depression or sustained market event resulting from such epidemics or pandemics;

• the societal and economic impact of public health epidemics or pandemics, such as the COVID-19 pandemic and any recession, depression or sustained market event resulting from such epidemics or pandemics;

• market conditions in the pharmaceutical and biotechnology sectors;

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Our executive officers, directors and principal stockholders maintain the ability to significantly influence all matters submitted to stockholders for approval.

As of March 31, 2024, our executive officers, directors and principal stockholders, in the aggregate, beneficially owned shares representing a significant percentage of our capital stock.

As of June 30, 2024, our executive officers, directors and principal stockholders, in the aggregate, beneficially owned shares representing a significant percentage of our capital stock.

As a result, if these stockholders were to choose to act together, they would be able to significantly influence all matters submitted to our stockholders for approval, as well as our management and affairs.

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Under Section 382 of the Code and corresponding provisions of state law, if a company undergoes an “ownership change,” generally defined as a greater than 50% change (by value) in its equity ownership by certain stockholders over a three-year period, the company’s ability to use its pre-change net operating loss carryforwards and other pre-change tax attributes (such as research tax credits) to offset its post-change taxable income may be limited.

Our prior equity offerings and other changes in our stock ownership, some of which are outside of our control, may have resulted or could in the future result in an ownership change.

Our prior equity offerings and other changes in our stock ownership, some of which are outside of our control, may have resulted or could in the future result in an ownership

We completed a review of our changes in ownership through December 31, 2023, and determined that we did not have a qualified ownership change since our last review as of December 31, 2022.

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In preparing our financial statements, we estimate the amount of tax that will become payable in each of such places.

Nevertheless, our effective tax rate may be different from previous periods or our current expectations due to numerous factors, including as a result of changes in the mix of our profitability from state to state, the results of examinations and audits of our tax filings, our inability to secure or sustain

acceptable agreements with tax authorities, changes in accounting for income taxes and changes in tax laws.

Any of these factors may result in tax obligations in excess of amounts accrued in our financial statements.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1A. Risk Factors