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In response to the pandemic, on March 13, 2020, the United States declared a national emergency, and federal, state, local and foreign governments have put in place, quarantines, executive orders, shelter-in-place orders and other restrictions in order to control the spread of the disease.
−Removed: During the second quarter of 2020, certain states, countries, and businesses had begun to ease restrictions that were in place earlier.
−Removed: Recently, however, viral infections have begun to increase again, resulting in the resumption of restrictions.
−Removed: Such orders or restrictions, or the perception that such orders or restrictions could occur or re-occur, have resulted in business closures, work stoppages, slowdowns and delays, work-from-home policies, travel restrictions, and cancellation or postponement of events, among other effects that have and may continue to negatively impact productivity and disrupt our operations and those of the healthcare providers with whom we interact, our partners, our CROs, our CMOs and our other vendors.
+Added: The cyclical nature of the pandemic could result in multiple "waves" of the disease and corresponding orders or restrictions, leading to business closures, work stoppages, slowdowns and delays, work-from-home policies, travel restrictions, and cancellation or postponement of events, among other effects.
+Added: These effects have and may continue to negatively impact productivity and disrupt our operations and those of the healthcare providers with whom we interact, our partners, our CROs, our CMOs and our other vendors.
The majority of our office-based employees have been working from home since March 13, 2020 and are not expected to return to the office before the end of 2020.
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In addition, if the pandemic worsens or there is a resurgence of the pandemic in the United States, sales of Auryxia may be impacted, which, in turn, could have a material adverse effect on our business, results of operations, and financial condition.
+Added: The dialysis and non-dialysis CKD patient populations, many of whom rely on our innovative therapies, have been disproportionately impacted by COVID-19 based on the number of cases and hospitalizations, which may significantly negatively impact our product demand, payer mix, and net product revenue in the future.
While most of our office-based operations can be performed remotely, there is no guarantee that we will be as effective while working remotely because our team is dispersed, many employees may have additional personal needs to attend to (such as looking after children as a result of school closures or family members who may become sick), and employees may become sick themselves and be unable to work.
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We may not be successful in finding and integrating suitable successors in the event of key employee loss or unavailability.
−Removed: In addition, the pandemic may result in disruptions to or closures of CMO facilities and other vendors in our supply chain on which we rely for the supply of our product and product candidates, which could lead to delays or disruptions in supply and an impact on our inventory reserves, including an increase in inventory write-offs due to expiry.
−Removed: We continue to expect the top-line data readout of our PRO 2 TECT studies in early September 2020, as previously disclosed;
−Removed: however, the pandemic has resulted in closures of clinical trial sites on which we rely for the completion of certain other clinical trials and may delay enrollment of certain planned and ongoing clinical trials.
−Removed: Further, the pandemic could also potentially affect the business of the U.S.
+Added: In addition, the pandemic or the response efforts to the pandemic may cause disruptions to, closures of or other impacts on our CMOs and other vendors in our supply chain on which we rely for the supply of our products and product candidates.
+Added: These impacts could lead to delays or disruptions in supply of our products and product candidates and have a negative effect on our inventory reserves, which could result in an increase in inventory write-offs due to expiry.
+Added: The pandemic has resulted in closures of clinical trial sites on which we rely for the completion of certain clinical trials and may delay enrollment of certain planned and ongoing clinical trials.
+Added: Further, the pandemic could also potentially affect the
+Added: business of the U.S.
Food and Drug Administration, or FDA, the European Medicines Agency, or the EMA, the Japanese Pharmaceuticals and Medical Devices Agency, or the PMDA, or other governmental authorities, which could result in delays in meetings, reviews and approvals relating to our products or product candidates.
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The pandemic has already caused significant disruptions in the financial markets, and may continue to cause such disruptions, that could impact our ability to raise additional funds and has also impacted, and may continue to impact, the volatility of our stock price and trading in our stock.
−Removed: Moreover, it is possible the pandemic will significantly impact economies worldwide,
−Removed: which could result in adverse effects on our business and operations.
+Added: Moreover, it is possible the pandemic will significantly impact economies worldwide, which could result in adverse effects on our business and operations.
Even after the COVID-19 pandemic has been contained or mitigated, we may continue to experience adverse impacts to our business as a result of any economic recession or depression that has occurred or may occur in the future.
The global impact of COVID-19 continues to rapidly evolve, and we will continue to monitor the situation closely.
−Removed: In particular, areas we are monitoring include possible COVID-related changes in our commercial revenue payer mix, overall product sales, and reserves and allowances, as well as negative trends that could indicate goodwill, intangible assets, and other assets to be impaired.
−Removed: The extent to which COVID-19 impacts our business will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others.
+Added: In particular, areas we are monitoring include possible COVID-related changes in our commercial revenue payer mix, overall product sales, and reserves and allowances, as well as negative trends that could potentially have a significant impact on product demand and, ultimately, product revenue, or could indicate goodwill, intangible assets, and other assets to be impaired.
+Added: The extent to which COVID-19 impacts our business will depend on future developments, which are highly uncertain and the magnitude of which cannot be predicted, including new information that may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others.
Risks Related to our Financial Position and Need for Additional Capital
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Prior to the Merger, we had no products approved for commercial sale and had not generated any revenue from the sale of products.
−Removed: We are not currently profitable and have incurred net losses each year since our inception, including net losses of $236.5 million for the six months ended June 30, 2020.
−Removed: As of June 30, 2020, we had an accumulated deficit of $1.0 billion.
+Added: We are not currently profitable and have incurred net losses each year since our inception, including net losses of $296.5 million for the nine months ended September 30, 2020.
+Added: As of September 30, 2020, we had an accumulated deficit of $1.1 billion.
We cannot guarantee when, if ever, we will become profitable.
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We expect to continue to incur significant expenses if and as we:
−Removed: • conduct our development program of vadadustat for the treatment of anemia due to chronic kidney disease, or CKD, including PRO 2 TECT and other ongoing or planned studies with respect to vadadustat, and develop plans for and conduct the preclinical and clinical development of any other potential product candidates;
+Added: • conduct our development program of vadadustat and develop any other potential product candidates;
• continue our commercialization activities for Auryxia and plan for the commercialization of vadadustat, if approved, and any other product or product candidate, including those that may be in-licensed or acquired;
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Because of the numerous risks and uncertainties associated with pharmaceutical product development and commercialization, we are unable to accurately predict the timing or amount of increased expenses.
−Removed: The net losses we incur may fluctuate significantly from quarter to quarter and year to year, such that a period-to-period comparison of our results of operations may not be a good indication of our future performance.
+Added: The net losses we incur may fluctuate significantly from quarter to quarter and year to year, such that a period-to-period comparison of our results of operations may
+Added: not be a good indication of our future performance.
In any particular quarter, the progress of our clinical development and our operating results could be below the expectations of securities analysts or investors, which could cause our stock price to decline.
−Removed: Even if we succeed in receiving marketing approval for and are able to commercialize vadadustat, we will continue to incur substantial research and development and other expenditures to develop and market, if approved, any other product candidates as well as any costs relating to continued commercialization and post-marketing requirements for Auryxia, vadadustat and any other products or product candidates that may receive marketing approval, including those that may be in-licensed or acquired.
+Added: Even if we succeed in receiving marketing approval for and are able to commercialize vadadustat in the U.S.
+Added: and other regions, we will continue to incur substantial research and development and other expenditures to develop and market, if approved, any other product candidates as well as any costs relating to continued commercialization and post-marketing requirements for Auryxia, vadadustat and any other products or product candidates that may receive marketing approval, including those that may be in-licensed or acquired.
Our prior losses and expected future losses have had and will continue to have an adverse effect on our stockholders’ equity and working capital.
Our expenses could increase beyond expectations if we are required by the FDA, the EMA, or other regulatory authorities, or if we otherwise believe it is necessary, to change our manufacturing processes or assays, to amend or replace our study protocols, to repeat any of our clinical trials, to perform studies in addition to, different from or larger than those currently expected, or if there are any delays in completing our clinical trials or the development of any of our product candidates.
−Removed: Even if our product
−Removed: candidates are approved for commercial sale, we anticipate incurring significant costs associated with commercialization.
+Added: Even if our product candidates are approved for commercial sale, we anticipate incurring significant costs associated with commercialization.
In addition, our ability to generate revenue would be negatively affected if the size of our addressable patient population is not as significant as we estimate, the indication approved by regulatory authorities is narrower than we expect, or the patient population for treatment is narrowed by competition, physician choice, coverage or reimbursement, or payor or treatment guidelines.
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A failure to obtain this necessary capital when needed could force us to delay, limit, reduce or terminate our product development or commercialization efforts.
−Removed: As of June 30, 2020, our cash and cash equivalents and available for sale securities were $295.3 million.
+Added: As of September 30, 2020, our cash and cash equivalents and available for sale securities were $269.3 million.
We expect to continue to expend substantial amounts for the foreseeable future continuing the commercialization of Auryxia and developing and commercializing vadadustat, if approved, and any other products or product candidates, including those that may be in-licensed or acquired.
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Our future capital requirements depend on many factors, including:
−Removed: • significant costs associated with our global Phase 3 development program for vadadustat for the treatment of anemia due to CKD.
−Removed: As of June 30, 2020, we expect the remaining external aggregate contract research organization, or CRO, costs of PRO 2 TECT and INNO 2 VATE, which have enrolled 7,436 patients, to be in the range of $25.0 million to $35.0 million;
−Removed: the estimated costs for PRO 2 TECT could increase significantly due to a number of factors, including detection of unexpected safety signals, modification of clinical trial protocols, performing other studies in support of the Phase 3 program, choosing to add third party vendors to support the program, and any other factor that could delay completion of PRO 2 TECT;
−Removed: we reported top-line data for the INNO 2 VATE studies in the second quarter of 2020, and we continue to incur costs to close out the program;
+Added: • the conduct of our development program for vadadustat, and the development of any other potential product candidates;
• the cost and timing of commercialization activities for Auryxia, vadadustat and any other products or product candidates, including those that may be in-licensed or acquired, if approved for marketing, including product manufacturing, marketing, sales and distribution costs;
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• difficulties or delays in enrolling patients in our clinical trials;
−Removed: • the timing of, and the costs involved in obtaining, and, if approved, maintaining marketing approvals for vadadustat and any other product candidates that we may develop or acquire, including to fund the preparation and filing of regulatory submissions with the FDA, the EMA and other regulatory authorities, if clinical studies are successful, and the costs of maintaining marketing approvals for Auryxia or any other product, including those that may be in-licensed or acquired;
+Added: • the timing of, and the costs involved in obtaining, and, if approved, maintaining marketing approvals for vadadustat and any other product candidates that we may develop or acquire, including to fund the preparation and filing of regulatory submissions, and the costs of maintaining marketing approvals for Auryxia or any other product, including those that may be in-licensed or acquired;
• the cost of conducting clinical studies or any post-marketing approval studies, Phase 4 studies or any other clinical trials for Auryxia;
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Additional lawsuits arising out of the Merger may be filed in the future.
−Removed: We could be forced to expend significant resources in the defense of these lawsuits, including but not limited to, costs associated with the indemnification of Keryx and Akebia directors and officers, and
−Removed: the lawsuits, regardless of outcome, could have a negative effect on our reputation, stock price and results of operations.
+Added: We could be forced to expend significant resources in the defense of these lawsuits, including but not limited to, costs associated with the indemnification of Keryx and Akebia directors and officers, and the lawsuits, regardless of outcome, could have a negative effect on our reputation, stock price and results of operations.
In addition, monetary damages or other adverse judgment would have a material adverse effect on our business and financial position.
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Any potential future impairment of goodwill or intangible assets may significantly impact our results of operations and financial condition.
−Removed: As of June 30, 2020, we had approximately $212.5 million of goodwill and a definite lived intangible asset from the Merger.
+Added: As of September 30, 2020, we had approximately $206.4 million of goodwill and a definite lived intangible asset from the Merger.
In accordance with generally accepted accounting principles, or GAAP, we are required annually, or more frequently upon certain indicators of impairment, to review our estimates and assumptions underlying the fair value of our goodwill and our definite lived intangible assets when indicators of impairment are present.
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In addition, any product or product candidate, if approved and commercialized, may achieve only limited market acceptance or none at all.
−Removed: If any of our approved products is not accepted by the market to the extent that we expect, we may not be able to generate product revenue and our business would suffer.
+Added: If any of our approved products is not accepted by the market to the extent that we expect, we may not be able to generate significant product revenue and our business would suffer.
Generic competitors are seeking approval of generic versions of Auryxia and the market entry of one or more generic competitors would limit Auryxia sales and have an adverse impact on our business and results of operation.
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If we are unable to maintain sales, marketing and distribution capabilities or to enter into additional agreements with third parties, we may not be successful in commercializing any approved product(s).
−Removed: In order to market Auryxia, we intend to continue to invest in sales and marketing, which will require substantial effort and significant management and financial resources.
+Added: In order to market any approved product(s), we intend to continue to invest in sales and marketing, which will require substantial effort and significant management and financial resources.
We will need to devote significant effort, in particular, to recruiting individuals with experience in the sales and marketing of pharmaceutical products.
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As a result, Part D sponsors require a prior authorization for all Auryxia prescriptions for Medicare beneficiaries to ensure that Auryxia is being used for the Part D covered indication.
−Removed: On October 15, 2019, we filed a complaint in the United States District Court for the District of Massachusetts against CMS and the U.S.
−Removed: Department of Health and Human Services, or HHS, challenging the CMS Decisions.
−Removed: On February 4, 2020, the court denied our request for a preliminary injunction.
−Removed: We filed an expedited appeal with the Court of Appeals for the First Circuit challenging the district court’s denial of our motion for a preliminary injunction.
−Removed: The appeal is currently pending.
If we are unsuccessful in our efforts to obtain Part D coverage for the IDA Indication, our ability to commercialize Auryxia for this indication will continue to be adversely impacted.
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As a result, we recorded an impairment charge of $115.5 million to the Auryxia intangible asset during the three months ended June 30, 2020.
−Removed: Even if the CMS Decisions are ultimately reversed, the negative impact that they have had on the growth of sales of Auryxia for the Hyperphosphatemia Indication and the IDA Indication will continue, although less significantly than if the CMS Decisions are not reversed.
+Added: Even if the CMS Decisions are ultimately reversed, the negative impact that they have had on the growth of sales of Auryxia for the
+Added: Hyperphosphatemia Indication and the IDA Indication will continue, although less significantly than if the CMS Decisions are not reversed.
Medicaid reimbursement of drugs varies by state.
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If reimbursement is not available or is limited, we may not be able to commercialize certain of our products.
−Removed: Furthermore, vadadustat was approved in Japan for the treatment of anemia due to CKD and will be marketed by MTPC in Japan under the trade name VAFSEO.
+Added: Furthermore, vadadustat was approved in Japan for the treatment of anemia due to CKD and is being marketed by MTPC in Japan under the trade name VAFSEO.
The pricing and reimbursement strategy is a key component of MTPC's commercialization plans for VAFSEO in Japan.
−Removed: If MTPC is unable to successfully and timely conclude reimbursement, price approval or coverage processes and market VAFSEO in Japan, if coverage and reimbursement for VAFSEO is limited, or if coverage and reimbursement terms change, MTPC may not be able to, or may decide not to, commercialize VAFSEO in Japan.
+Added: If coverage and reimbursement terms change, MTPC may not be able to, or may decide not to, continue commercialization of VAFSEO in Japan.
If we are unable to obtain or maintain contracts with key distribution partners, our business could be materially harmed.
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The license would be effective upon the following:
−Removed: FDA approval of vadadustat for anemia due to CKD in adult patients with the dialysis-dependent CKD, the earlier of CMS’s determination that vadadustat will be reimbursed using the Transitional Drug Add-On Payment Adjustment, or the TDAPA, and inclusion in the bundle, and a milestone payment by Vifor Pharma.
+Added: FDA approval of vadadustat for anemia due to CKD in adult patients with dialysis-dependent CKD, the earlier of CMS’s determination that vadadustat will be reimbursed using the Transitional Drug Add-On Payment Adjustment, or the TDAPA, and inclusion in the bundle, and a milestone payment by Vifor Pharma.
Under this amended license agreement with Vifor Pharma, or the Vifor Agreement, FKC and the Third Party Dialysis Organizations are not obligated to utilize vadadustat in their U.S.
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If vadadustat is approved and we are not able to maintain the Vifor Agreement or enter into a supply agreement with DaVita, our business may be materially harmed.
−Removed: Although we currently believe it is likely that vadadustat, if approved, will be reimbursed using the TDAPA followed by reimbursement via the bundled reimbursement model, if vadadustat is neither reimbursed under the TDAPA nor the bundled reimbursement model, then the Vifor Agreement will not become effective, and patients would access vadadustat through contracts we negotiate with third party payors for reimbursement of vadadustat, which would be subject to the risks and uncertainties described above.
+Added: Although we currently believe it is likely that vadadustat, if approved, will be reimbursed using the TDAPA followed by reimbursement via the bundled reimbursement model, if vadadustat is neither reimbursed under the TDAPA nor the bundled reimbursement model, then the Vifor Agreement will not become effective, and patients would access vadadustat through contracts we negotiate with third party payors for reimbursement of vadadustat, which would be subject to the risks and
+Added: uncertainties described above.
Additionally, if there are updates to the TDAPA rule that decrease the basis for reimbursement or eligibility criteria during the transition period or if the TDAPA is eliminated, then our profitability may be adversely affected.
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In many cases, any approved products that we commercialize will compete with existing, market-leading products.
−Removed: Auryxia is competing in the hyperphosphatemia market in the United States with other FDA-approved phosphate binders such as Renagel ® (sevelamer hydrochloride) and Renvela ® (sevelamer carbonate), both marketed by Genzyme Corporation (a wholly-owned subsidiary of Sanofi), PhosLo ® and Phoslyra ® (calcium acetate), marketed by Fresenius Medical Care North
−Removed: America, Fosrenol ® (lanthanum carbonate), marketed by Shire Pharmaceuticals Group plc, and Velphoro ® (sucroferric oxyhydroxide), marketed by Fresenius Medical Care North America, as well as over-the-counter calcium carbonate products such as TUMS ® and metal-based options such as aluminum, lanthanum and magnesium.
+Added: Auryxia is competing in the hyperphosphatemia market in the United States with other FDA-approved phosphate binders such as Renagel ® (sevelamer hydrochloride) and Renvela ® (sevelamer carbonate), both marketed by Genzyme Corporation (a wholly-owned subsidiary of Sanofi), PhosLo ® and Phoslyra ® (calcium acetate), marketed by Fresenius Medical Care North America, Fosrenol ® (lanthanum carbonate), marketed by Shire Pharmaceuticals Group plc, and Velphoro ® (sucroferric oxyhydroxide), marketed by Fresenius Medical Care North America, as well as over-the-counter calcium carbonate products such as TUMS ® and metal-based options such as aluminum, lanthanum and magnesium.
Most of the phosphate binders listed above are now also available in generic forms.
−Removed: In addition, other agents are in development, including OPKO Health Inc.’s Alpharen ™ Tablets (fermagate tablets) and Ardelyx, Inc.’s tenapanor, that may impact the market for Auryxia.
+Added: In addition, other agents are in development, including Ardelyx, Inc.’s tenapanor (for which an NDA has been submitted to the FDA) and OPKO Health Inc.’s Alpharen ™ Tablets (fermagate tablets), that may impact the market for Auryxia.
Auryxia is competing in the IDA market in the United States with over-the-counter oral iron, ferrous sulfate, other prescription oral iron formulations, including ferrous gluconate, ferrous fumerate, and polysaccharide iron complex, and intravenous iron formulations, including Feraheme ® (ferumoxytol injection), Venofer ® (iron sucrose injection), Ferrlicit ® (sodium ferric gluconate complex in sucrose injection), Injectafer ® (ferric carboxymaltose injection), and Triferic ® (ferric pyrophosphate citrate).
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and AstraZeneca PLC, is currently in global Phase 3 clinical development of its product candidate, roxadustat.
−Removed: The product has launched for the treatment of anemia of CKD in patients on dialysis, or DD-CKD, in Japan and both DD-CKD and for the treatment of anemia of CKD in patients not on dialysis, or NDD-CKD, in China.
+Added: In Japan, roxadustat has launched for the treatment of anemia of CKD in patients on dialysis, or DD-CKD.
+Added: In China, roxadustat has launched for the treatment of anemia of DD-CKD and for the treatment of anemia of CKD in patients not on dialysis, or NDD-CKD.
In January 2020, FibroGen announced the submission of an sNDA for marketing approval for roxadustat for NDD-CKD in Japan.
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GlaxoSmithKline plc is currently in global Phase 3 clinical development of its product candidate, daprodustat.
−Removed: In June 2020, GlaxoSmithKline plc announced that daprodustat’s Japanese NDA has been approved for the treatment of CKD anemia in patients with stages 3-5 CKD, including patients on dialysis and not on dialysis.
−Removed: Bayer HealthCare AG and Japan Tobacco International have submitted NDAs for their product candidates for the treatment of renal anemia in Japan.
−Removed: In addition, certain companies are developing potential new therapies for renal-related diseases that could potentially reduce injectable ESA utilization and thus limit the market potential for vadadustat if they are approved and launched commercially.
+Added: In August 2020, Kyowana Kirin Co., Ltd.
+Added: announced the launch of GlaxoSmithKline plc's Duvroq (daprodustat) in Japan for the treatment of CKD anemia in patients with stages 3-5 CKD, including DD-CKD and NDD-CKD.
+Added: In September 2020, Japan Tobacco International announced the approval of Enaroy (enarodustat) in Japan for the treatment of CKD anemia.
+Added: In addition, Bayer HealthCare AG has submitted an NDA for its product candidate for the treatment of renal anemia in Japan.
+Added: Furthermore, certain companies are developing potential new therapies for renal-related diseases that could potentially reduce injectable ESA utilization and thus limit the market potential for vadadustat if they are approved and launched commercially.
Other new therapies are in development for the treatment of conditions inclusive of renal anemia that may impact the market for anemia-targeted treatment.
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Large and established companies such as Amgen and Roche, among others, compete in the market for drug products to treat kidney disease.
−Removed: In particular, these companies have greater experience and expertise in conducting preclinical testing and clinical trials, obtaining
−Removed: marketing approvals, manufacturing such products on a broad scale and marketing approved products.
+Added: In particular, these companies have greater experience and expertise in conducting preclinical testing and clinical trials, obtaining marketing approvals, manufacturing such products on a broad scale and marketing approved products.
These companies also have significantly greater research and marketing capabilities than we do and may also have products that have been approved or are in late stages of development, and have collaborative arrangements in our target markets with leading companies and research institutions.
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If we are not able to compete effectively against potential competitors, our business will not grow and our financial condition and operations will suffer.
−Removed: The commercialization of Riona in Japan and our current and potential future efforts with respect to the development and commercialization of our products and product candidates outside of the United States subject us to a variety of risks associated with international operations, which could materially adversely affect our business.
+Added: The commercialization of Riona and VAFSEO in Japan and our current and potential future efforts with respect to the development and commercialization of our products and product candidates outside of the United States subject us to a variety of risks associated with international operations, which could materially adversely affect our business.
Our Japanese sublicensee, Japan Tobacco, Inc., or JT, and its subsidiary, Torii Pharmaceutical Co., Ltd., or Torii, commercialize Riona, the trade name for ferric citrate hydrate in Japan, as an oral treatment for the improvement of hyperphosphatemia in patients with CKD, including DD-CKD and NDD-CKD in Japan.
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Ltd., or Otsuka, exclusive rights to commercialize vadadustat in Europe, China and certain other markets, subject to marketing approvals.
−Removed: In Japan and certain other countries in Asia, we granted Mitsubishi Tanabe Pharma Corporation, or MTPC, exclusive rights to commercialize vadadustat, which has been approved in Japan and will be marketed by MTPC in Japan under the trade name VAFSEO.
+Added: In Japan and certain other countries in Asia, we granted Mitsubishi Tanabe Pharma Corporation, or MTPC, exclusive rights to commercialize vadadustat, which has been approved and is being marketed by MTPC in Japan under the trade name VAFSEO.
We are also conducting our global Phase 3 development with respect to vadadustat for the treatment of anemia due to CKD.
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• business interruptions resulting from geopolitical actions, including war and terrorism or natural disasters including earthquakes, typhoons, floods and fires.
+Added: In addition, we receive revenues from royalty payments converted to U.S.
+Added: dollars based on net sales of Riona and VAFSEO in Japanese yen.
+Added: The exchange rates between the Japanese yen on the one hand, and the U.S.
+Added: dollar, on the other hand, have changed substantially in recent years and may fluctuate substantially in the future.
+Added: Our results of operations could be adversely affected over time by certain movements in exchange rates, particularly if the Japanese yen depreciates against the U.S.
Any of these factors may, individually or as a group, have a material adverse effect on our business and results of operations.
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Further, the results of preclinical studies and early clinical trials of our product candidates may not be predictive of the results of later-stage clinical trials, interim results of a clinical trial do not necessarily predict final results, and results of Phase 3 clinical trials for one indication may not be predictive of results of Phase 3 clinical trials for another indication.
−Removed: For example, our positive INNO 2 VATE Phase 3 data do not ensure that PRO 2 TECT will demonstrate similar results.
+Added: For example, while we announced positive top-line results from INNO 2 VATE and vadadustat achieved the primary and key secondary efficacy endpoint in each of the two PRO 2 TECT studies, the PRO 2 TECT program did not meet the primary MACE safety endpoint.
Moreover, preclinical and clinical data are often susceptible to varying interpretations and analyses, and many companies that have believed their product candidates performed satisfactorily in preclinical studies and clinical trials have nonetheless failed to obtain marketing approval of their product candidates.
It is impossible to predict when or if any of our product candidates will prove effective or safe in humans or will receive marketing approval.
−Removed: We may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to receive or maintain marketing approval or commercialize our product candidates.
+Added: We may experience numerous unforeseen events during, or as a result of, clinical trials that could delay, prevent or make more challenging our ability to receive or maintain marketing approval or commercialize our product candidates.
+Added: For example, the PRO 2 TECT program did not meet the primary MACE safety endpoint, and we remain appropriately cautious in our outlook for potential approval of vadadustat for the treatment of anemia due to CKD in adult non-dialysis dependent patients.
Our clinical trials may take longer to complete than currently anticipated, or may be delayed, suspended, required to be repeated, prematurely terminated or may not successfully demonstrate safety and/or efficacy for a variety of other reasons, such as:
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• changes in governmental regulations or administrative actions.
−Removed: Although we continue to expect the top-line data readout of our PRO 2 TECT studies in early September 2020 as previously disclosed, the COVID-19 pandemic has resulted in closures of clinical trial sites on which we rely for the completion of certain other clinical trials and may delay enrollment of certain planned and ongoing clinical trials.
−Removed: If we are unable to successfully complete clinical trials of our product candidates or other studies, if the results of those trials and studies are not positive or are only modestly positive, or if there are concerns with the profile due to efficacy or safety, or if any of the factors listed above occur, the following may occur:
+Added: The COVID-19 pandemic has resulted in closures of clinical trial sites on which we rely for the completion of certain clinical trials and may delay enrollment of certain planned and ongoing clinical trials.
+Added: We may be unable to successfully complete clinical trials of our product candidates or other studies, if the results of those trials and studies are not positive or are only modestly positive, or if there are concerns with the profile due to efficacy or safety.
+Added: For example, the PRO 2 TECT program did not meet the primary MACE safety endpoint, and we remain appropriately cautious in our outlook for potential approval of vadadustat for the treatment of anemia due to CKD in adult non-dialysis dependent patients.
+Added: If any of the foregoing occurs, the following may occur:
• regulators may require that we conduct additional clinical trials, repeat clinical trials or conduct other studies of our product candidates beyond those that we currently contemplate;
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• we may obtain approval with labeling that includes significant use or distribution restrictions or safety warnings that would reduce the potential market for our products or inhibit our ability to successfully commercialize our products;
+Added: • a Risk Evaluation and Mitigation Strategies, or REMS, or FDA-imposed risk management plans that use risk minimization strategies to ensure that the benefits of certain prescription drugs outweigh their risks, may be required;
• we may be subject to additional post-marketing restrictions and/or requirements;
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The timing of our clinical studies depends, in part, on the speed at which we can recruit patients to participate in testing our products and product candidates.
−Removed: Patients may be unwilling to participate in our clinical studies because of concerns about
−Removed: adverse events observed with the current standard of care, competitor products and/or other investigational agents, in each case for the same indications and/or similar patient populations.
+Added: Patients may be unwilling to participate in our clinical studies because of concerns about adverse events observed with the current standard of care, competitor products and/or other investigational agents, in each case for the same indications and/or similar patient populations.
In addition, in the case of clinical studies of our product candidates, patients currently receiving treatment with the current standard of care or a competitor product may be reluctant to participate in a clinical trial with an investigational drug.
19 unchanged sentences
We and our collaboration partners currently expect to seek marketing approval of vadadustat for the treatment of anemia due to CKD in markets outside the United States, including the EU.
−Removed: Our ability to successfully initiate, enroll and complete a clinical study in any country outside of the United States is subject to numerous additional risks unique to conducting business in jurisdictions outside the United States, including:
+Added: Our ability to successfully initiate, enroll and complete a clinical
+Added: study in any country outside of the United States is subject to numerous additional risks unique to conducting business in jurisdictions outside the United States, including:
• difficulty in establishing or managing relationships with qualified CROs, physicians and clinical trial sites;
13 unchanged sentences
Due to these and other differences between our global Phase 3 development program for vadadustat and our prior trials, our positive results from preclinical and clinical studies may not be replicated in our global Phase 3 development program for vadadustat.
−Removed: For example, our positive INNO 2 VATE Phase 3 data do not ensure that PRO 2 TECT will demonstrate similar results.
+Added: For example, while we announced positive top-line results from INNO 2 VATE and vadadustat achieved the primary and key secondary efficacy endpoint in each of the two PRO 2 TECT studies, the PRO 2 TECT program did not meet the primary MACE safety endpoint.
Many companies in the biopharmaceutical industry have suffered significant setbacks in late-stage clinical trials after achieving positive results in early stage development, and we may face similar setbacks.
If the results of our ongoing or future clinical trials for vadadustat or any other product candidates are inconclusive with respect to efficacy, if we do not meet our clinical endpoints with statistical significance, or if there are safety concerns or adverse events, we may be prevented from or delayed in obtaining marketing approval for vadadustat or any other product candidates.
+Added: For example, the PRO 2 TECT program did not meet the primary MACE safety endpoint, and we remain appropriately cautious in our outlook for potential approval of vadadustat for the treatment of anemia due to CKD in adult non-dialysis dependent patients.
We may not be successful in our efforts to identify, acquire, discover, develop and commercialize additional products or product candidates, which could impair our ability to grow.
15 unchanged sentences
The success of this strategy depends partly upon our ability to identify, select, and acquire promising product candidates and products.
−Removed: The process of proposing, negotiating and implementing a license or acquisition of a product candidate or an approved product is lengthy
+Added: The process of proposing, negotiating and implementing a license or acquisition of a product candidate or an approved product is lengthy and complex.
Other companies, including some with substantially greater financial, marketing and sales resources, may compete with us for the license or acquisition of a product candidate or an approved product.
7 unchanged sentences
Auryxia, vadadustat or any other products and product candidates may cause undesirable side effects or have other properties that delay or limit their commercial potential, or in the case of our product candidates, prevent their marketing approval.
−Removed: Undesirable side effects caused by our product or product candidates or competing commercial products or product candidates in development that utilize a common mechanism of action could cause us or regulatory authorities to interrupt, delay or halt clinical trials, could result in a more restrictive label or the delay, denial or withdrawal of marketing approval by the FDA or other regulatory authorities, and could lead to potential product liability claims.
+Added: Undesirable side effects caused by or other undesirable properties of our product or product candidates or competing commercial products or product candidates in development that utilize a common mechanism of action could cause us or regulatory authorities to interrupt, delay or halt clinical trials, could result in a more restrictive label or the delay, denial or withdrawal of marketing approval by the FDA or other regulatory authorities, and could lead to potential product liability claims.
Results of our clinical trials could reveal a high and unacceptable severity and prevalence of side effects or unexpected characteristics.
−Removed: If we or others identify undesirable side effects caused by Auryxia, vadadustat, or any other products or product candidates, either before or after receipt of marketing approval, a number of potentially significant negative consequences could result, including:
+Added: If we or others identify undesirable side effects caused by or other undesirable properties of Auryxia, vadadustat, or any other products or product candidates, either before or after receipt of marketing approval, a number of potentially significant negative consequences could result, including:
• our clinical trials may be put on hold;
2 unchanged sentences
• regulatory authorities may require warnings on the label such as the warning on Auryxia’s label regarding iron overload;
−Removed: • Risk Evaluation and Mitigation Strategies, or REMS, or FDA-imposed risk management plans that use risk minimization strategies to ensure that the benefits of certain prescription drugs outweigh their risks, may be required;
+Added: • REMS or FDA-imposed risk management plans that use risk minimization strategies to ensure that the benefits of certain prescription drugs outweigh their risks, may be required;
• we could be sued and held liable for harm caused to patients;
5 unchanged sentences
In our clinical studies of vadadustat, adverse events were reported.
−Removed: For example, in our Phase 2b study of vadadustat in non-dialysis patients with anemia due to CKD, one subject with multiple co-morbidities and concomitant medications, including
−Removed: chlorthalidone, had a serious adverse event of liver function test abnormal, considered a case of drug induced liver injury meeting the biochemical criteria of Hy’s Law, which was assessed as probably related to vadadustat.
+Added: For example, in our Phase 2b study of vadadustat in non-dialysis patients with anemia due to CKD, one subject with multiple co-morbidities and concomitant medications, including chlorthalidone, had a serious adverse event of liver function test abnormal, considered a case of drug induced liver injury meeting the biochemical criteria of Hy’s Law, which was assessed as probably related to vadadustat.
+Added: With respect to the global INNO 2 VATE Phase 3 program, the incidence of treatment emergent adverse events during the incident dialysis patient study ( Correction and Conversion ) in vadadustat treated patients was 83.8% and 85.5% in darbepoetin alfa treated patients.
+Added: During the study, the most common treatment emergent adverse events reported in vadadustat/darbepoetin alfa treated patients were hypertension (16.2%/ 12.9%) and diarrhea (10.1%/ 9.7%).
+Added: Serious treatment emergent adverse events were lower in vadadustat treated patients at 49.7% compared to 56.5% for darbepoetin alfa treated patients.
+Added: The incidence of treatment emergent adverse events during the prevalent dialysis patient study ( Conversion ) in the vadadustat treated patients was 88.3%, and 89.3% in darbepoetin alfa treated patients.
+Added: During the study, the most common treatment emergent adverse events reported in vadadustat/darbepoetin alfa treated patients were diarrhea (13.0%/ 10.1%), pneumonia (11.0%/ 9.7%), hypertension (10.6%/ 13.8%), and hyperkalemia (9.0%/ 10.8%).
+Added: Serious treatment emergent adverse events were slightly lower for vadadustat treated patients at 55.0% and 58.3% for darbepoetin alfa-treated patients.
+Added: With respect to the global PRO 2 TECT Phase 3 program, the incidence of treatment emergent adverse events during the erythropoiesis stimulating agent, or ESA,-untreated patients study ( Correction ) in the vadadustat-treated patients was 90.9%, and 91.6% in darbepoetin alfa-treated patients.
+Added: During the study, the most common treatment emergent adverse events reported in vadadustat/darbepoetin alfa-treated patients were end-stage renal disease (34.7%/ 35.2%), hypertension (17.7%/ 22.1.%), hyperkalemia (12.3.%/ 15.6%), urinary tract infection (12.9%/ 12.0%), diarrhea (13.9%/ 10.0%), peripheral oedema (12.5%/ 10.5%), fall (9.6%/ 10%) and nausea (10%/ 8.2%).
+Added: Serious treatment emergent adverse events were 65.3% for vadadustat-treated patients and 64.5% for darbepoetin alfa-treated patients.
+Added: The incidence of treatment emergent adverse events during the ESA-treated patients study ( Conversion ) in vadadustat treated patients was 89.1% and 87.7% in darbepoetin alfa-treated patients.
+Added: During the study, the most common treatment emergent adverse events reported in vadadustat/darbepoetin alfa-treated patients were end-stage renal disease (27.5%/ 28.4%), hypertension (14.4%/ 14.8%), urinary tract infection (12.2%/ 14.5%), diarrhea (13.8.%/ 8.8.%), peripheral oedema (9.9%/ 10.1%) and pneumonia (10.0%/ 9.7%).
+Added: Serious treatment emergent adverse events were 58.5% for vadadustat-treated patients and 56.6% for darbepoetin alfa-treated patients.
Serious adverse events considered related to vadadustat and any other product candidates could have a material adverse effect on the development of such product candidates and our business as a whole.
2 unchanged sentences
Gastrointestinal adverse reactions were the most common reason for discontinuing Auryxia (14%) in clinical trials for the Hyperphosphatemia Indication.
−Removed: The most commonly reported adverse reactions in the clinical trials that supported the approval of Auryxia in the United States for the IDA Indication included discolored feces (22%), diarrhea (21%), constipation (18%), nausea (10%), abdominal pain (5%) and hyperkalemia (5%).
+Added: The most commonly reported adverse
+Added: reactions in the clinical trials that supported the approval of Auryxia in the United States for the IDA Indication included discolored feces (22%), diarrhea (21%), constipation (18%), nausea (10%), abdominal pain (5%) and hyperkalemia (5%).
Diarrhea was the most common reason for discontinuing Auryxia (2.6%) in clinical trials for the IDA Indication.
11 unchanged sentences
Risks Related to Regulatory Approval of Our Product Candidates
+Added: We may not be able to obtain marketing approval for, or successfully commercialize, vadadustat, or we may experience significant delays in doing so, any of which would materially harm our business.
+Added: The clinical trials of our product candidates are, and the manufacturing and marketing of our product candidates will be, subject to extensive and rigorous review and regulation by numerous governmental authorities in the United States, and in other countries where we and our collaborators intend to test and, if approved, market any product candidates.
+Added: Before obtaining marketing approval for the commercial sale of any product candidate, we must demonstrate through extensive preclinical testing and clinical trials that the product candidate is safe and effective for use in each target indication.
+Added: This process can take many years and marketing approval may never be achieved.
+Added: Of the large number of drugs in development in the United States and in other jurisdictions, only a small percentage successfully complete the FDA’s and other jurisdictions’ marketing approval processes and are commercialized.
+Added: Accordingly, even if we are able to obtain the requisite capital to continue to fund our development programs, we may be unable to successfully develop or commercialize vadadustat or any other product candidates.
+Added: We and Otsuka, our collaboration partner, are not permitted to market vadadustat in the United States until we receive approval from the FDA, in the EU until we receive approval from the EMA, or in any other jurisdiction until the requisite approval from regulatory authorities in such jurisdiction is received.
+Added: As a condition to receiving marketing approval for vadadustat, we must complete Phase 3 studies and any additional preclinical or clinical studies required by the FDA, the EMA, the PMDA or other regulatory authorities.
+Added: Vadadustat may not be successful in clinical trials or receive marketing approval.
+Added: We plan to submit to the FDA an NDA for vadadustat for the treatment of anemia due to CKD in adult dialysis-dependent and non-dialysis dependent patients as early as possible in 2021.
+Added: However, as vadadustat did not meet the primary safety endpoint of the
+Added: PRO 2 TECT program, we remain appropriately cautious in our outlook for potential approval of vadadustat for the treatment of anemia due to CKD in adult non-dialysis dependent patients.
+Added: Further, vadadustat may not receive marketing approval even if it is approved in other countries.
+Added: For example, although vadadustat is approved in Japan for the treatment of anemia due to CKD, such approval does not guarantee approval in the United States by the FDA.
+Added: Obtaining marketing approval in the United States and other jurisdictions is a complex, lengthy, expensive and uncertain process that typically takes many years and depends upon numerous factors, including the substantial discretion of the regulatory authorities.
+Added: Even if our product candidates demonstrate safety and efficacy in clinical studies, the regulatory agencies may not complete their review processes in a timely manner, or we may not be able to obtain marketing approval.
+Added: Furthermore, approval of a drug does not ensure successful commercialization.
+Added: For example, on September 23, 2015, the European Commission, or EC, approved Fexeric for the control of hyperphosphatemia, in adult patients with CKD.
+Added: Pursuant to the sunset clause under EU law, the EC’s approval of Fexeric in the EU was contingent on, among other things, our commencing marketing of Fexeric within three years;
+Added: although we successfully negotiated an extension to December 23, 2019, we did not commence marketing Fexeric by such date and therefore the Fexeric approval in the EU has ceased to be valid.
+Added: In February 2020, we entered into a letter agreement, or the Letter Agreement, with Vifor Pharma relating to Vifor Pharma’s agreement with a third party to purchase a Priority Review Voucher issued by the FDA, or the PRV, subject to satisfaction of customary closing conditions, or the PRV Purchase.
+Added: Although a PRV entitles the holder to priority review of an NDA or a Biologics License Application for a new drug, which reduces the target FDA review time to six months after official acceptance of the submission, the utilization of a PRV does not ensure a faster review or faster approval compared to products considered for approval under conventional FDA procedures, and in any event does not assure ultimate approval by FDA.
+Added: Furthermore, even if utilization of the PRV enables a faster approval of vadadustat, it may not result in faster commercialization of vadadustat.
+Added: For more information on risks related to commercialization of vadadustat, see “Risks Related to Commercialization”.
+Added: In addition, pursuant to the Letter Agreement, we paid Vifor Pharma $10.0 million in connection with the closing of the PRV Purchase.
+Added: Vifor Pharma is obligated to retain all rights to, and maintain the validity of, the PRV until we and Vifor Pharma (a) enter into a definitive agreement setting forth the financial and other terms by which Vifor Pharma will assign the PRV to us for use with our planned NDA for vadadustat for the treatment of anemia due to CKD in both dialysis-dependent and non-dialysis dependent patients, or (b) make a mutual decision to sell the PRV and share the proceeds based on certain terms.
+Added: We may not come to terms with Vifor Pharma on assigning the PRV to us, and even if we do, we and Vifor Pharma may decide not to use the PRV for vadadustat and, instead, resell it.
+Added: In the event of resale of the PRV at a price lower than the purchase price, our share of the proceeds from the resale would be lower than our $10.0 million contribution.
+Added: In addition, the safety concerns associated with the current standard of care for the indications for which we are seeking marketing approval for our product candidates may affect the FDA’s, the EMA’s, the PMDA’s or other regulatory authorities’ review of the safety results of our compounds in development.
+Added: Further, the policies or regulations, or the type and amount of clinical data necessary to gain approval, may change during the course of a product candidate’s clinical development and may vary among jurisdictions.
+Added: It is possible that vadadustat and any other product candidates will never obtain marketing approval.
+Added: The FDA may delay, limit or deny approval of vadadustat or any other product candidates for many reasons including, among others:
+Added: • we may not be able to demonstrate that vadadustat is safe and effective in treating anemia due to CKD or that any other product candidate is safe and effective for its proposed indication(s) to the satisfaction of the FDA;
+Added: • the results of our clinical trials may only be modestly positive, or there may be concerns with the profile due to efficacy or safety;
+Added: • the results of our clinical trials may not meet the level of statistical or clinical significance required by the FDA for marketing approval;
+Added: • the FDA may disagree with the number, design, size, conduct or implementation of our clinical trials;
+Added: • the FDA may not approve the formulation, labeling or specifications we request for vadadustat or any other product candidate;
+Added: • the FDA may approve vadadustat or any other product candidate for use only in a small patient population or for fewer or more limited indications than we request;
+Added: • the FDA may require that we conduct additional clinical trials or repeat one or more clinical trials;
+Added: • the FDA may grant approval contingent on the performance of costly post-marketing clinical trials;
+Added: • we, or our CROs or other vendors, may fail to comply with GXP;
+Added: • the CROs that we retain to conduct our clinical trials may not perform effectively or take actions that adversely impact our clinical trials, or we may fail to communicate effectively or provide the appropriate level of oversight of our CROs;
+Added: • we or our third party manufacturers may fail to perform in accordance with the FDA’s cGMP requirements and guidance;
+Added: • the FDA may disagree with inclusion of data obtained from certain regions outside the United States to support the NDA for potential reasons such as differences in clinical practice from United States standards;
+Added: • the FDA may disagree with our interpretation of data from our preclinical studies and clinical trials;
+Added: • the FDA could deem that our financial relationships with certain principal investigators constitute a conflict of interest, such that the data from those principal investigators may not be used to support our applications;
+Added: • an FDA Advisory Committee or other regulatory advisory group or authority could recommend non-approval or restrictions on approval;
+Added: • the FDA’s decision-making regarding vadadustat and any other product candidates may be impacted by the results of competitors’ clinical trials and safety concerns of marketed products used to treat the same indications as the indications for which vadadustat and any other product candidates are being developed;
+Added: • the FDA may not approve the manufacturing processes or facilities of third party manufacturers with whom we contract;
+Added: • the policies or regulations of the FDA may significantly change in a manner that renders our clinical data insufficient for approval, or requires us to amend or submit new clinical protocols.
+Added: In addition, similar reasons may cause the EMA or the PMDA or other regulatory authorities to delay, limit or deny approval of vadadustat or any other product candidate outside the United States.
+Added: If we experience delays in obtaining approval, or if we fail to obtain approval of our product candidates, the commercial prospects for our product candidates may be harmed and our ability to generate revenues will be materially impaired, which could have a material adverse effect on our business.
We may be delayed in obtaining, or be unable to obtain, marketing approval or reimbursement for vadadustat or any other product candidate in certain countries outside of the United States.
4 unchanged sentences
Approval by the FDA does not ensure approval by regulatory or reimbursement authorities outside the United States, and approval by one regulatory or reimbursement authority outside the United States does not ensure approval by the FDA or any other regulatory or reimbursement authorities.
−Removed: the failure to obtain approval or reimbursement in one jurisdiction may negatively impact our ability to obtain approval or reimbursement in another jurisdiction.
+Added: However, the failure to obtain approval or reimbursement in one jurisdiction may negatively impact our ability to obtain approval or reimbursement in another jurisdiction.
The marketing approval process in countries outside of the United States may include all of the risks associated with obtaining FDA approval and, in some cases, additional risks.
4 unchanged sentences
Following protracted negotiations, the United Kingdom left the European Union on January 31, 2020.
−Removed: Under the withdrawal agreement, there is a transitional period until December 31, 2020 (extendable up to two years).
+Added: Under the withdrawal agreement, there is a transitional period until December 31, 2020 (extendable for up to two years).
Discussions between the United Kingdom and the European Union have so far mainly focused on finalizing withdrawal issues and transition agreements but have been extremely difficult to date.
6 unchanged sentences
Products approved for marketing are subject to extensive post-marketing regulatory requirements and could be subject to post-marketing restrictions or withdrawal from the market, and we may be subject to penalties if we fail to comply with regulatory requirements or if we experience unanticipated problems with our products, or product candidates, when and if any of them is approved.
−Removed: Marketing approvals may be subject to limitations on the approved indicated uses for which the product may be marketed or other conditions of approval, or contain requirements for potentially costly post-marketing studies and surveillance to monitor the safety and efficacy of the product, including REMS, or registries or observational studies.
+Added: Marketing approvals may be subject to limitations on the approved indicated uses for which the product may be marketed or other conditions of approval, or contain requirements or commitments for potentially costly post-marketing studies and surveillance to monitor the safety and efficacy of the product, including REMS, or registries or observational studies.
For example, in connection with the FDA approvals of Auryxia, we initially committed to the FDA to conduct certain post-approval pediatric studies of Auryxia under the Pediatric Research Equity Act of 2003, or PREA.
With regard to the Hyperphosphatemia Indication, we committed to completing the post-approval pediatric study and submitting a final report to the FDA by December 31, 2019.
−Removed: With regard to our IDA Indication, we committed to completing the post-approval pediatric study and submitting a final report to the FDA by January 2023.
+Added: With regard to our IDA Indication, we initially committed to completing the post-approval pediatric study and submitting a final report to the FDA by January 2023.
We cannot guarantee that we will be able to complete these studies and submit the final reports in a timely manner.
2 unchanged sentences
With regard to the IDA Indication, we did not meet a milestone relating to the post-approval pediatric study of Auryxia in a timely manner and received a notification from the FDA.
+Added: Subsequently, the FDA agreed to extend the pediatric clinical study timelines for the IDA Indication.
If we are unable to complete these studies successfully, we will need to inform the FDA, have further discussions, and if the FDA finds that we failed to comply with pediatric study requirements, it could initiate proceedings to seize or enjoin the sale of Auryxia, which would have a material adverse impact on our ability to commercialize Auryxia and our ability to generate revenues from Auryxia.
1 unchanged sentence
These requirements and guidance include manufacturing processes and procedures (including record keeping), the implementation and operation of quality systems to control and assure the quality of the product, submissions of safety and other post-marketing information and reports, as well as continued compliance with cGMPs and GCPs for any clinical trials that we conduct post-approval.
−Removed: If we or our CMOs fail to adhere to such regulatory requirements and guidance, we could suffer significant consequences, including product seizures or recalls, loss of product approval, fines and sanctions, reputational damage, shipment delays, inventory shortages, inventory write-offs and other product-related charges and increased manufacturing costs, and our development or commercialization efforts may be materially harmed.
+Added: If we, our CMOs or other third parties we engage fail to adhere to such regulatory requirements and guidance, we could suffer significant consequences, including product seizures or recalls, loss of product approval, fines and sanctions, reputational damage, shipment delays, inventory shortages, inventory write-offs and other product-related charges and increased manufacturing costs, and our development or commercialization efforts may be materially harmed.
Moreover, the FDA and other regulatory authorities closely regulate the post-approval marketing and promotion of drugs to ensure drugs are marketed only for the approved indications and in accordance with the provisions of the approved labeling.
11 unchanged sentences
• injunctions or the imposition of civil or criminal penalties.
−Removed: For example, in the second quarter of 2020, we initiated a limited, voluntary recall of specific lots of Auryxia because it was determined that these lots were not manufactured in conformance with the FDA's GMP guidance relating to validation.
−Removed: In addition, we recorded a write-down of inventory associated with affected lots during the second quarter of 2020.
−Removed: While the costs of this recall were immaterial, should another recall occur in the future, it could result in material costs and have a material adverse effect on our business and results of operations.
+Added: For example, in the second quarter of 2020, we initiated a limited, voluntary recall of specific lots of Auryxia because it was determined that certain lots were not manufactured in conformance with the FDA's GMP guidance relating to validation.
+Added: In addition, we recorded write-downs of inventory associated with affected lots during the second and third quarters of 2020.
+Added: While the costs of the recall were immaterial, should another recall or quality issues occur in the future, they could result in material costs, have a material adverse effect on our business and results of operations, and may impact our ability to supply Auryxia, VAFSEO in Japan or vadadustat for commercial and clinical use.
Non-compliance with FDA, the EMA, the PMDA and other regulatory authorities’ requirements regarding safety monitoring or pharmacovigilance can also result in significant financial penalties.
2 unchanged sentences
If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or are not able to maintain regulatory compliance, we may lose any marketing approval that we may have obtained and we may not achieve or sustain profitability, which would materially adversely affect our business.
−Removed: Even if we obtain favorable clinical results in our Phase 3 studies, we may not be able to obtain marketing approval for, or successfully commercialize, vadadustat, or we may experience significant delays in doing so, any of which would materially harm our business.
−Removed: The clinical trials of our product candidates are, and the manufacturing and marketing of our product candidates will be, subject to extensive and rigorous review and regulation by numerous governmental authorities in the United States, and in other countries where we and our collaborators intend to test and, if approved, market any product candidates.
−Removed: Before obtaining marketing approval for the commercial sale of any product candidate, we must demonstrate through extensive preclinical testing and clinical trials that the product candidate is safe and effective for use in each target indication.
−Removed: This process can take many years and marketing approval may never be achieved.
−Removed: Of the large number of drugs in development in the United States and in other jurisdictions, only a small percentage successfully complete the FDA’s and other jurisdictions’ marketing approval processes and are commercialized.
−Removed: Accordingly, even if we are able to obtain the requisite capital to continue to fund our development programs, we may be unable to successfully develop or commercialize vadadustat or any other product candidates.
−Removed: We and Otsuka, our collaboration partner, are not permitted to market vadadustat in the United States until we receive approval from the FDA, in the EU until we receive approval from the EMA, or in any other jurisdiction until the requisite approval from regulatory authorities in such jurisdiction is received.
−Removed: As a condition to receiving marketing approval for vadadustat, we must complete Phase 3 studies and any additional preclinical or clinical studies required by the FDA, the EMA, the PMDA or other regulatory authorities.
−Removed: Vadadustat may not be successful in clinical trials or receive marketing approval.
−Removed: Further, vadadustat may not receive marketing approval even if it is successful in clinical trials or if it is approved in other countries.
−Removed: For example, although vadadustat is approved in Japan for the treatment of anemia due to CKD, such approval does not guarantee either positive PRO 2 TECT data or approval in the United States by the FDA.
−Removed: Obtaining marketing approval in the United States and other jurisdictions is a complex, lengthy, expensive and uncertain process that typically takes many years and depends upon numerous factors, including the substantial discretion of the regulatory authorities.
−Removed: Even if our product candidates demonstrate safety and efficacy in clinical studies, the regulatory agencies may not complete their review processes in a timely manner, or we may not be able to obtain marketing approval.
−Removed: Furthermore, approval of a drug does not ensure successful commercialization.
−Removed: For example, on September 23, 2015, the European Commission, or EC, approved Fexeric for the control of hyperphosphatemia, in adult patients with CKD.
−Removed: Pursuant to the sunset clause under EU law, the EC’s approval of Fexeric in the EU was contingent on, among other things, our commencing marketing of Fexeric within three years;
−Removed: although we successfully negotiated an extension to December 23, 2019, we did not commence marketing Fexeric by such date and therefore the Fexeric approval in the EU has ceased to be valid.
−Removed: If the results of our global Phase 3 studies for vadadustat are positive, we plan to file for regulatory approval in the United States and other regions.
−Removed: In February 2020, we entered into a letter agreement, or the Letter Agreement, with Vifor Pharma relating to Vifor Pharma’s agreement with a third party to purchase a Priority Review Voucher issued by the FDA, or the PRV, subject to satisfaction of customary closing conditions, or the PRV Purchase.
−Removed: Although a PRV entitles the holder to priority review of an NDA or a Biologics License Application for a new drug, which reduces the target FDA review time to six months after official acceptance of the submission, the utilization of a PRV does not ensure a faster review or faster approval compared to products considered for approval under conventional FDA procedures, and in any event does not assure ultimate approval by FDA.
−Removed: Furthermore, even if utilization of the PRV enables a faster approval of vadadustat, it may not result in faster commercialization of vadadustat.
−Removed: For more information on risks related to commercialization of vadadustat, see “Risks Related to Commercialization”.
−Removed: In addition, pursuant to the Letter Agreement, we paid Vifor Pharma $10.0 million in connection with the closing of the PRV Purchase.
−Removed: Vifor Pharma is obligated to retain all rights to, and maintain the validity of, the PRV until we and Vifor Pharma (a) enter into a definitive agreement setting forth the financial and other terms by which Vifor Pharma will assign the PRV to us for use with our planned NDA for vadadustat for the treatment of anemia due to CKD in both dialysis-dependent and non-dialysis dependent patients, or (b) make a mutual decision to sell the PRV and share the proceeds based on certain terms.
−Removed: We may not come to terms with Vifor Pharma on assigning the PRV to us, and even if we do, we and Vifor Pharma may decide not to use the PRV for vadadustat and, instead, resell it.
−Removed: In the event of resale of the PRV at a price lower than the purchase price, our share of the proceeds from the resale would be lower than our $10.0 million contribution.
−Removed: In addition, the safety concerns associated with the current standard of care for the indications for which we are seeking marketing approval for our product candidates may affect the FDA’s, the EMA’s, the PMDA’s or other regulatory authorities’ review of the safety results of our compounds in development.
−Removed: Further, the policies or regulations, or the type and amount of clinical data necessary to gain approval, may change during the course of a product candidate’s clinical development and may vary among jurisdictions.
−Removed: It is possible that vadadustat and any other product candidates will never obtain marketing approval.
−Removed: The FDA may delay, limit or deny approval of vadadustat or any other product candidates for many reasons including, among others:
−Removed: • we may not be able to demonstrate that vadadustat is safe and effective in treating anemia due to CKD or that any other product candidate is safe and effective for its proposed indication(s) to the satisfaction of the FDA;
−Removed: • the results of our clinical trials may only be modestly positive, or there may be concerns with the profile due to efficacy or safety;
−Removed: • the results of our clinical trials may not meet the level of statistical or clinical significance required by the FDA for marketing approval;
−Removed: • the FDA may disagree with the number, design, size, conduct or implementation of our clinical trials;
−Removed: • the FDA may not approve the formulation, labeling or specifications we request for vadadustat or any other product candidate;
−Removed: • the FDA may approve vadadustat or any other product candidate for use only in a small patient population or for fewer or more limited indications than we request;
−Removed: • the FDA may require that we conduct additional clinical trials or repeat one or more clinical trials;
−Removed: • the FDA may grant approval contingent on the performance of costly post-marketing clinical trials;
−Removed: • we, or our CROs or vendors, may fail to comply with GXP;
−Removed: • the CROs that we retain to conduct our clinical trials may not perform effectively or take actions that adversely impact our clinical trials, or we may fail to communicate effectively or provide the appropriate level of oversight of our CROs;
−Removed: • we or our third party manufacturers may fail to perform in accordance with the FDA’s cGMP requirements and guidance;
−Removed: • the FDA may disagree with inclusion of data obtained from certain regions outside the United States to support the NDA for potential reasons such as differences in clinical practice from United States standards;
−Removed: • the FDA may disagree with our interpretation of data from our preclinical studies and clinical trials;
−Removed: • the FDA could deem that our financial relationships with certain principal investigators constitute a conflict of interest, such that the data from those principal investigators may not be used to support our applications;
−Removed: • an FDA Advisory Committee or other regulatory advisory group or authority could recommend non-approval or restrictions on approval;
−Removed: • the FDA’s decision-making regarding vadadustat and any other product candidates may be impacted by the results of competitors’ clinical trials and safety concerns of marketed products used to treat the same indications as the indications for which vadadustat and any other product candidates are being developed;
−Removed: • the FDA may not approve the manufacturing processes or facilities of third party manufacturers with whom we contract;
−Removed: • the policies or regulations of the FDA may significantly change in a manner that renders our clinical data insufficient for approval, or requires us to amend or submit new clinical protocols.
−Removed: In addition, similar reasons may cause the EMA or the PMDA or other regulatory authorities to delay, limit or deny approval of vadadustat or any other product candidate outside the United States.
−Removed: If we experience delays in obtaining approval, or if we fail to obtain approval of our product candidates, the commercial prospects for our product candidates may be harmed and our ability to generate revenues will be materially impaired, which could have a material adverse effect on our business.
Risks Related to Government Regulation and Compliance
29 unchanged sentences
We intend to engage in these discussions and communicate with healthcare providers, payors and other constituencies in compliance with all applicable laws, regulatory guidance and industry best practices.
−Removed: Although we believe we have put in place a robust compliance program and processes designed to ensure that all such activities are performed in a legal and compliant manner, Auryxia is our first commercial product so our implementation of our compliance program in connection with commercialization activities is still relatively new.
+Added: Although we believe we have put in place a robust compliance program and processes designed to ensure that all such activities are performed in a legal and compliant manner, Auryxia is our first commercial product in the United States, so our implementation of our compliance program in connection with commercialization activities is still relatively new.
In addition, if a company’s activities are determined to have violated the federal Anti-Kickback Statute, this can also give rise to liability under the federal False Claims Act and such violations can result in significant fines, criminal and civil remedies, and exclusion from Medicare and Medicaid.
1 unchanged sentence
Common industry activities, such as speaker programs, insurance assistance and support, relationships with foundations providing copayment assistance, and relationships with patient organizations and patients are receiving increased governmental attention.
−Removed: If any of our relationships or activities is determined to violate applicable federal and state anti-kickback laws, false claims laws, or other
−Removed: laws or regulations, the company and/or company executives, employees and other representatives could be subject to significant fines and criminal sanctions, imprisonment, and potential exclusion from Medicare and Medicaid.
+Added: If any of our relationships or activities is determined to violate applicable federal and state anti-kickback laws, false claims laws, or other laws or regulations, the company and/or company executives, employees and other representatives could be subject to significant fines and criminal sanctions, imprisonment, and potential exclusion from Medicare and Medicaid.
Efforts to pursue regulatory reform may limit the FDA’s ability to engage in oversight and implementation activities in the normal course, and that could negatively impact our business.
27 unchanged sentences
A broad range of legislative measures also have been introduced at the federal level.
−Removed: Accordingly, failure to comply with current and any future federal and state laws regarding privacy and security of personal information could expose us to fines and penalties.
+Added: Accordingly, failure to comply with current and any
+Added: future federal and state laws regarding privacy and security of personal information could expose us to fines and penalties.
We also face a threat of potential consumer class actions related to these laws and the overall protection of personal data.
12 unchanged sentences
• the federal Physician Payments Sunshine Act (renamed the Open Payments Act) requires applicable manufacturers of covered drugs to report payments and other transfers of value to physicians and teaching hospitals;
−Removed: • analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws and gift ban and transparency statutes, may apply to sales or marketing arrangements and claims involving healthcare
−Removed: items or services reimbursed by state Medicaid or other programs, or non-governmental third party payors, including private insurers, and which are not preempted by federal laws and often differ from state to state, thus complicating compliance efforts;
+Added: • analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws and gift ban and transparency statutes, may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by state Medicaid or other programs, or non-governmental third party payors, including private insurers, and which are not preempted by federal laws and often differ from state to state, thus complicating compliance efforts;
state laws restricting interactions with healthcare providers and other members of the healthcare community or requiring pharmaceutical manufacturers to implement certain compliance standards, which vary from state to state.
53 unchanged sentences
Additionally, on January 22, 2018, the President signed a continuing resolution on appropriations for fiscal year 2018 that delayed the implementation of certain ACA-mandated fees, including the so-called “Cadillac” tax on certain high cost employer-sponsored insurance plans, the annual fee imposed on certain health insurance providers based on market share, and the medical device excise tax on non-exempt medical devices.
−Removed: Further, the Bipartisan Budget Act of 2018, among other things, amended the ACA, effective January 1, 2019, to increase from 50% to 70% the point-of-sale discount that is owed by pharmaceutical manufacturers who participate in Medicare Part D and
−Removed: close the coverage gap in most Medicare drug plans, commonly referred to as the “donut hole”.
+Added: Further, the Bipartisan Budget Act of 2018, among other things, amended the ACA, effective January 1, 2019, to increase from 50% to 70% the point-of-sale discount that is owed by pharmaceutical manufacturers who participate in Medicare Part D and close the coverage gap in most Medicare drug plans, commonly referred to as the “donut hole”.
Additionally, while the ACA temporarily restrained, for the years from 2014 to 2019, the growth rate for the threshold at which the Medicare Part D catastrophic coverage phase begins, in 2020, the threshold reverted to the amount that would have applied for 2020 if the growth rate had not been temporarily restrained.
25 unchanged sentences
On June 25, 2020, the current administration and a coalition of 18 states asked the court to strike down the entirety of the ACA.
+Added: Oral argument is scheduled in the case for November 10, 2020.
It is unclear how such litigation and other efforts to repeal and replace the ACA will impact the ACA and our business.
9 unchanged sentences
For example, on May 11, 2018, the current administration issued a plan to lower drug prices.
−Removed: Under this blueprint for action, the current administration indicated that HHS will take steps to end the gaming of regulatory and patent processes by drug makers to unfairly protect monopolies, advance biosimilars and generics to boost price competition, evaluate the inclusion of prices in drug makers’ ads to enhance price competition, speed access to and lower the cost of new drugs by clarifying policies for sharing information between insurers and drug makers, avoid excessive pricing by relying more on value-based pricing by expanding outcome-based payments in Medicare and Medicaid, work to give Medicare Part D plan sponsors more negotiation power with drug makers, examine which Medicare Part B drug prices could be negotiated by Medicare Part D plans, improve the design of the Medicare Part B Competitive Acquisition Program, update Medicare’s drug-pricing dashboard to increase transparency, prohibit
−Removed: Medicare Part D contracts that include “gag rules” that prevent pharmacists from informing patients when they could pay less out-of-pocket by not using insurance, and require that Medicare Part D plan members be provided with an annual statement of plan payments, out-of-pocket spending, and drug price increases.
−Removed: In addition, on December 23, 2019, the current administration published a proposed rulemaking that, if finalized, would allow states or certain other non-federal government entities to submit importation program proposals to FDA for review and approval.
−Removed: Applicants would be required to demonstrate their importation plans pose no additional risk to public health and safety and will result in significant cost savings for consumers.
−Removed: At the same time, FDA issued draft guidance that would allow manufacturers to import their own FDA-approved drugs that are authorized for sale in other countries (multi-market approved products).
+Added: Under this blueprint for action, the current administration indicated that HHS will take steps to end the gaming of regulatory and patent processes by drug makers to unfairly protect monopolies, advance biosimilars and generics to boost price competition, evaluate the inclusion of prices in drug makers’ ads to enhance price competition, speed access to and lower the cost of new drugs by clarifying policies for sharing information between insurers and drug makers, avoid excessive pricing by relying more on value-based pricing by expanding outcome-based payments in Medicare and Medicaid, work to give Medicare Part D plan sponsors more negotiation power with drug makers, examine which Medicare Part B drug prices could be negotiated by Medicare Part D plans, improve the design of the Medicare Part B Competitive Acquisition Program, update Medicare’s drug-pricing dashboard to increase transparency, prohibit Medicare Part D contracts that include “gag rules” that prevent pharmacists from informing patients when they could pay less out-of-pocket by not using insurance, and require that Medicare Part D plan members be provided with an annual statement of plan payments, out-of-pocket spending, and drug price increases.
The current presidential administration’s budget proposal for fiscal year 2021 includes a $135 billion allowance to support legislative proposals seeking to reduce drug prices, increase competition, lower out-of-pocket drug costs for patients, and increase patient access to lower-cost generic and biosimilar drugs, and has issued five executive orders intended to lower the costs of prescription drug products.
+Added: More recently, the President has issued five executive orders that are intended to lower the costs of prescription drug products.
At the state level, individual states are increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access, marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.
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If we do not meet our obligations in a timely manner, or if we otherwise breach the terms of our license agreement, Panion could terminate the agreement, and we would lose the rights to Auryxia.
−Removed: For example, following announcement of the Merger, Panion notified Keryx in writing that Panion would terminate the license agreement on November 21, 2018 if Keryx did not cure the breach alleged by Panion, specifically, that Keryx failed to use commercially reasonable best efforts to commercialize Auryxia outside the United States.
+Added: For example, following announcement of the Merger, Panion notified Keryx in writing that Panion would terminate the license agreement on November 21, 2018 if Keryx did not cure the breach alleged by Panion,
+Added: specifically, that Keryx failed to use commercially reasonable best efforts to commercialize Auryxia outside the United States.
Keryx disagreed with Panion’s claims, and the parties entered discussions to resolve this dispute.
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We do not have the ability to independently conduct preclinical and clinical trials.
−Removed: We are currently relying, and expect to continue to rely, on third parties, such as CROs, clinical data management organizations, medical institutions and clinical investigators, to conduct our current and future preclinical studies and our clinical trials, including our global Phase 3 development program for vadadustat.
+Added: We are currently relying, and expect to continue to rely, on third parties, such as CROs, clinical data management organizations, medical institutions and clinical investigators, to conduct our current and future preclinical studies and our clinical trials.
The third parties on whom we rely may fail to perform effectively, or terminate their engagement with us, for a number of reasons, including the following:
7 unchanged sentences
Even though we do not directly control the third parties on whom we rely to conduct our preclinical and clinical trials and therefore cannot guarantee the satisfactory and timely performance of their obligations to us, we are nevertheless responsible for ensuring that each of our clinical trials is conducted in accordance with the applicable protocol, legal and regulatory requirements, including GXP requirements, and scientific standards, and our reliance on these third parties, including CROs, will not relieve us of our regulatory responsibilities.
−Removed: If we or any of our CROs, their subcontractors, or clinical trial sites fail to comply with applicable GXP requirements, the clinical data generated in our clinical trials may be deemed unreliable or insufficient, our clinical trials could be put on hold, and/or the FDA, the EMA or other regulatory authorities may require us to perform additional clinical trials before approving our marketing applications.
+Added: If we or any of our CROs, their subcontractors, or clinical trial sites fail to comply with applicable GXP requirements, the clinical data generated in our clinical trials may be deemed unreliable or
+Added: insufficient, our clinical trials could be put on hold, and/or the FDA, the EMA or other regulatory authorities may require us to perform additional clinical trials before approving our marketing applications.
In addition, our clinical trials must be conducted with drug product that meets certain specifications and is manufactured under applicable cGMP regulations.
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We rely on third parties to conduct all aspects of our product manufacturing.
−Removed: The loss of these manufacturers, their failure to supply us on a timely basis, or their failure to successfully carry out their contractual duties or comply with regulatory requirements could cause delays in our current and future capacity and substantially harm our business.
+Added: The loss of these manufacturers, their failure to supply us on a timely basis, or their failure to successfully carry out their contractual duties or comply with regulatory requirements or guidance could cause delays in or disruptions to our supply chain and substantially harm our business.
We do not have any manufacturing facilities and do not expect to independently manufacture any product or product candidates.
−Removed: We currently rely on third party manufacturers to produce all of our commercial, clinical and preclinical material supply.
+Added: We currently rely on third party manufacturers to produce all of our commercial, clinical and preclinical material supply, including the commercial drug product that we supply to our collaboration partner, MTPC, for the Japanese market.
We expect to continue to rely on existing or alternative third party manufacturers to supply our ongoing and planned preclinical and clinical trials and for commercial production.
−Removed: Our reliance on third party manufacturers increases the risk that we will not have sufficient quantities of our product and product candidates or the ability to obtain such quantities at an acceptable cost or quality, which could delay, prevent or impair our development or commercialization efforts.
−Removed: We currently have two suppliers of Auryxia’s drug substance, one of them with two approved sites, and one supplier with three approved sites for the supply of Auryxia drug product.
−Removed: If any of our suppliers were to limit or terminate production, or otherwise fail to meet the quality or delivery requirements needed to supply Auryxia at adequate levels, we could experience losses of revenue that could materially and adversely impact our results of operations.
+Added: Our reliance on third party manufacturers increases the risk that we will not have sufficient quantities of our product and product candidates or the ability to obtain such quantities at an acceptable cost or quality, which could delay, prevent or impair our and our partners' development or commercialization efforts.
+Added: We currently have two suppliers of Auryxia drug substance, one of them with two approved sites, and one supplier with three approved sites for the supply of Auryxia drug product.
+Added: If any of our suppliers were to limit or terminate production, or otherwise fail to meet the quality or delivery requirements needed to supply Auryxia or VAFSEO in Japan at adequate levels, we could experience losses of revenue that could materially and adversely impact our results of operations.
We have entered into supply agreements with Esteve Química, S.A.
−Removed: and STA Pharmaceutical Hong Kong Limited, a subsidiary of Wuxi AppTec, for the manufacture of vadadustat drug substance and Patheon Inc.
−Removed: for the manufacture of vadadustat drug product, each, for commercial use.
−Removed: While we intend to put additional supply arrangements in place for commercial manufacturing of vadadustat, we may be unsuccessful in doing so or achieving sufficient redundancy due to a number of factors, including that we may not be able to negotiate binding agreements at commercially reasonable terms.
+Added: and STA Pharmaceutical Hong Kong Limited, a subsidiary of Wuxi AppTec, for the commercial manufacture of vadadustat drug substance and Patheon Inc.
+Added: for the commercial manufacture of vadadustat drug product.
+Added: While we intend to put an additional supply arrangement in place for commercial manufacturing of vadadustat drug product, we may be unsuccessful in doing so or achieving sufficient redundancy due to a number of factors, including that we may not be able to negotiate binding agreements at commercially reasonable terms.
For example, a contract manufacturer may require a substantial financial commitment, including a commitment to fund the purchase of a new facility or equipment.
−Removed: If we are unsuccessful in implementing redundant supply arrangements for commercial quantities of vadadustat, if our commercial supply arrangements for Auryxia or vadadustat are terminated, or if any of our third party manufacturers is unable to fulfill the terms of their agreements with us, are subject to regulatory review, or cease their operations for any reason, it could result in delays to our marketing approval for vadadustat and risk that we would not have sufficient quantities of our product candidates and products for clinical trials and commercialization.
−Removed: Even if we are ultimately successful in entering into redundant supply arrangements for commercial manufacturing of vadadustat, the timing of such additional arrangements is uncertain.
−Removed: If any of our third party manufacturers cannot or do not perform as agreed, including a misappropriation of our proprietary information, if they terminate their engagements with us, if we terminate our engagements with them, or if there is a significant disagreement, we may be forced to manufacture the materials ourselves, for which we currently do not have the capabilities or resources, or enter into agreements with other third party manufacturers, which we may not be able to do on favorable or reasonable terms, if at all.
−Removed: In some cases, there may be a limited number of qualified replacement manufacturers, or the technical skills, or equipment required to manufacture a product or product candidate may be unique or proprietary to the
−Removed: original manufacturer and we may have difficulty transferring such skills or technology to another third party or a feasible alternative may not exist.
−Removed: These factors would increase our reliance on such manufacturer or require us to obtain a license from such manufacturer in order to have another third party manufacture Auryxia or our product candidates.
−Removed: If we are required to change manufacturers for any reason, we will be required to verify that the new manufacturer maintains facilities and procedures that comply with quality standards and with all applicable regulations and guidelines.
−Removed: The delays associated with the verification of a new manufacturer could negatively affect our ability to continue to commercialize or satisfy patient demand for Auryxia or any other product candidate for which we receive marketing approval, or develop and receive marketing approval for our product candidates in a timely manner or within budget.
+Added: We could experience delays to our marketing approval for vadadustat and may not have sufficient quantities of our product candidates and products for clinical trials and commercialization if any of the following occur:
+Added: • we are unsuccessful in implementing redundant supply arrangements for commercial quantities of vadadustat;
+Added: • our commercial supply arrangements for Auryxia or vadadustat are terminated;
+Added: • any of our third party manufacturers is unable to fulfill the terms of their agreements with us or is unable or unwilling to continue to manufacture on the manufacturing lines included in our regulatory filings;
+Added: • any of our third party manufacturers breaches our supply agreements, does not comply with quality or regulatory requirements and guidance, is subject to regulatory review or ceases its operations for any reason.
+Added: Even if we are ultimately successful in entering into an additional supply arrangement for commercial manufacturing of vadadustat drug product, the timing of such additional arrangements is uncertain.
+Added: If any of our third party manufacturers cannot or do not perform as agreed or expected, including a misappropriation of our proprietary information, if they terminate their engagements with us, if we terminate our engagements with them, or if there is a significant disagreement, we may be forced to manufacture the materials ourselves, for which we currently do not have the capabilities or resources, or enter into agreements with other third party manufacturers, which we may not be able to do in a timely manner or on favorable or reasonable terms, if at all.
+Added: In some cases, there may be a limited number of qualified replacement manufacturers, or the technical skills, or equipment required to manufacture a product or product candidate may be unique or proprietary to the original manufacturer and we may have difficulty transferring such skills or technology to another third party or a feasible alternative may not exist.
+Added: These factors would increase our reliance on our current manufacturers or require us to obtain a license from such manufacturer in order to have another third party manufacture Auryxia, VAFSEO in Japan or our product candidates.
+Added: If we are required to change manufacturers for any reason, we will be required to verify that the new manufacturer maintains facilities and procedures that comply with quality standards and with all applicable regulations
+Added: and guidelines.
+Added: The delays associated with the verification of a new manufacturer could negatively affect our ability to continue to commercialize or satisfy patient demand for Auryxia, VAFSEO in Japan or any other product candidate for which we receive marketing approval, or develop and receive marketing approval for our product candidates in a timely manner or within budget.
Each of our third party manufacturers must comply with cGMP and other stringent regulatory requirements and guidance enforced by the FDA and other regulatory authorities.
1 unchanged sentence
The facilities and processes used by our third party manufacturers to manufacture Auryxia may be inspected by the FDA and other regulatory authorities at any time, and the facilities and processes used by our third party manufacturers to manufacture our product candidates will be inspected by the FDA, the EMA, PMDA and other regulatory authorities prior to or after we submit our marketing application.
−Removed: We do not control the manufacturing processes of, and have little control over, our third party manufacturers' compliance with cGMP requirements and guidance for the manufacture of certain starting materials, drug substance and finished drug product.
+Added: We do not control the manufacturing processes of, and have little control over, our third party manufacturers, including, without limitation, their compliance with cGMP requirements and guidance for the manufacture of certain starting materials, drug substance and finished drug product.
In addition, we have little control over the ability of our third party manufacturers to maintain adequate quality control, quality assurance and qualified personnel.
1 unchanged sentence
We may also encounter difficulties relating to our own quality processes and procedures, including regulatory compliance, lot release, quality control and quality assurance, as well as shortages of qualified personnel.
−Removed: If our third party manufacturers cannot successfully manufacture material that conforms to our specifications and regulatory requirements and guidance or if we or our third party manufacturers experience manufacturing, operations and/or quality issues, we may not be able to supply patient demand or maintain marketing approval for Auryxia or secure and/or maintain marketing approval for our product candidates.
+Added: If our third party manufacturers cannot successfully manufacture material that conforms to our specifications and regulatory requirements and guidance or if we or our third party manufacturers experience manufacturing, operations and/or quality issues, including an inability or unwillingness to continue manufacturing our products at all, in accordance with agreed-upon processes or on currently validated manufacturing lines, we may not be able to supply patient demand or maintain marketing approval for Auryxia or secure and/or maintain marketing approval for our product candidates.
If the FDA, the EMA or other regulatory authorities do not approve the facilities being used to manufacture our product candidates, or if they withdraw any approval of the facilities being used to manufacture Auryxia or any other product candidates for which we receive marketing approval, we may need to find alternative manufacturing facilities, which would significantly impact our ability to continue commercializing Auryxia or develop, obtain marketing approval for or market our product candidates, if approved.
−Removed: Moreover, the failure of us or our third party manufacturers to comply with applicable regulations or guidance, or our failure to oversee or facilitate such compliance, could result in sanctions being imposed on us, including clinical holds, fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, license revocation, seizures or recalls of Auryxia or our product candidates operating restrictions, receipt of a Form 483 or warning letter, or criminal prosecutions, any of which could significantly and adversely affect the supply of Auryxia or our product candidates.
+Added: Moreover, our failure or the failure of our third party manufacturers to comply with applicable regulations or guidance, or our failure to oversee or facilitate such compliance, could result in sanctions being imposed on us, including clinical holds, fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, license revocation, seizures or recalls of Auryxia or our product candidates operating restrictions, receipt of a Form 483 or warning letter, or criminal prosecutions, any of which could significantly and adversely affect the supply of Auryxia, VAFSEO in Japan or our product candidates.
For example, in the second quarter of 2020, we initiated a limited, voluntary recall of specific lots of Auryxia because it was determined that these lots were not manufactured in conformance with the FDA's GMP guidance relating to validation.
−Removed: In addition, we recorded a write-down of inventory associated with affected lots during the second quarter of 2020.
−Removed: While the costs of this recall were immaterial, should another recall occur in the future, it could result in material costs and have a material adverse effect on our business and results of operations.
+Added: In addition, we recorded a write-down of inventory associated with affected lots during the second and third quarters of 2020.
+Added: While the costs of this recall were immaterial, should another recall or quality issues occur in the future, they could result in material costs, have a material adverse effect on our business and results of operations, and may impact our ability to supply Auryxia, VAFSEO in Japan or vadadustat for commercial and clinical use.
Also, if our starting materials, drug substance or drug product are damaged or lost while in our third party manufacturers’ control, it may impact our ability to supply our products or product candidates and we may incur significant financial harm.
−Removed: In addition, Auryxia and our product candidates may compete with other products and product candidates for access to third party manufacturing facilities.
−Removed: A third party manufacturer may also encounter delays brought on by sudden internal resource constraints, labor disputes, or shifting regulatory protocols.
+Added: In addition, Auryxia, VAFSEO in Japan and our product candidates may compete with other products and product candidates for access to third party manufacturing facilities.
+Added: A third party manufacturer may also encounter delays or operational issues brought on by sudden internal resource constraints, labor disputes, shifting priorities or shifting regulatory protocols, including, in each case, relating to the COVID-19 pandemic.
Certain of these third party manufacturing facilities may be contractually prohibited from manufacturing our product candidates or products, due to exclusivity provisions in agreements with our competitors.
There are a limited number of manufacturers that operate under cGMP regulations and guidance and are capable of manufacturing Auryxia and our product candidates for us.
−Removed: Our current and anticipated future dependence on third parties for the manufacture of Auryxia and our product candidates may adversely affect our ability to continue to commercialize Auryxia or any product candidates that receive marketing approval on a timely and competitive basis and any future profit margins.
−Removed: Third party manufacturers may be unable to manufacture our product and product candidates in sufficient quality and quantity, which would delay or prevent us from commercializing approved products and developing our product candidates.
−Removed: As a result of the large quantity of materials required for Auryxia production and the large quantities of Auryxia tablets that are required for our commercial success, the continued commercial viability of Auryxia depends on adequate supply of starting materials that meet quality, quantity and cost standards and the ability of our contract manufacturers to continually produce
−Removed: drug substance and finished drug product that meets all manufacturing requirements on a commercial scale.
−Removed: Failure to achieve and maintain these levels of supply can jeopardize and prevent the successful continued commercialization of Auryxia.
−Removed: Moreover, issues that may arise in any scale-up and technology transfer of Auryxia and continued commercial scale manufacture of Auryxia may lead to significant delays in our development and commercial timelines and negatively impact our financial performance.
+Added: Our current and anticipated future dependence on third parties for the manufacture of Auryxia, VAFSEO in Japan and our product candidates may adversely affect our and our partners' ability to continue to commercialize Auryxia, VAFSEO in Japan or any product candidates that receive marketing approval on a timely and competitive basis and any future profit margins.
+Added: Third party manufacturers may be unable to manufacture our products and product candidates in sufficient quality and quantity, which would delay or prevent us from commercializing approved products and developing our product candidates.
+Added: As a result of the large quantity of materials required for the production of Auryxia and VAFSEO for Japan and the large quantities of tablets that are required for our commercial success, the continued commercial viability of Auryxia and VAFSEO for Japan depends on adequate supply of starting materials that meet quality, quantity and cost standards and the ability of our
+Added: contract manufacturers to continually produce drug substance and finished drug product that meets all manufacturing requirements on a commercial scale.
+Added: Failure to achieve and maintain these levels of supply can jeopardize and prevent the successful continued commercialization of Auryxia and VAFSEO in Japan.
+Added: Moreover, issues that may arise in any scale-up and technology transfer and continued commercial scale manufacture of our products may lead to significant delays in our development and commercial timelines and negatively impact our financial performance.
For example, a production-related issue resulted in an interruption in the supply of Auryxia in the third and fourth quarters of 2016.
This supply interruption negatively impacted Keryx’s revenues in 2016.
−Removed: Although this supply interruption was resolved and actions designed to prevent future interruptions in the supply of Auryxia have been taken, any future supply interruptions for Auryxia or any of our product candidates for which we receive marketing approval would negatively and materially impact our reputation and financial condition.
−Removed: In addition, in order to complete our development of and commercialize, if approved, vadadustat and any other product candidates, we will need to work with third party manufacturers to manufacture them in large quantities.
+Added: Although this supply interruption was resolved and actions designed to prevent future interruptions in the supply of Auryxia have been taken, any future supply interruptions for Auryxia, VAFSEO in Japan or any of our product candidates for which we receive marketing approval would negatively and materially impact our reputation and financial condition.
+Added: In addition, in order to complete our development of and commercialize, if approved in regions beyond Japan, vadadustat and any other product candidates, we will need to work with third party manufacturers to manufacture them in large quantities.
Our current and future third party manufacturers may be unable to successfully achieve commercial scale production of vadadustat or increase the manufacturing capacity of any other product candidates for the conduct of clinical trials and commercialization in a timely or cost-effective manner, if at all.
4 unchanged sentences
It may be difficult for us to assess their ability to timely meet our demand in the future based on past performance.
−Removed: While our current third party manufacturers have generally met our demand for their products on a timely basis in the past, they may subordinate our needs in the future to their other customers.
−Removed: We depend on collaborations with third parties for the development and commercialization of vadadustat and Auryxia.
−Removed: If our collaborations are not successful or if our collaborators terminate their agreements with us, we may not be able to capitalize on the market potential of Auryxia and vadadustat, and our business could be materially harmed.
+Added: While our current third party manufacturers have generally met our demand for their products on a timely basis in the past, they may subordinate our needs in the future to their other customers, including as a result other customers' demands with respect to the COVID-19 pandemic.
+Added: We depend on collaborations with third parties for the development and commercialization of our products and product candidates.
+Added: If our collaborations are not successful or if our collaborators terminate their agreements with us, we may not be able to capitalize on the market potential of our products and product candidates, and our business could be materially harmed.
We sublicensed the rights to commercialize Riona to JT and Torii in Japan.
2 unchanged sentences
In addition, we have a license agreement with Vifor Pharma pursuant to which we granted an exclusive license to sell vadadustat to FKC and the Third Party Dialysis Organizations, approved by us, in the United States, which license would become effective only upon the satisfaction of certain conditions.
−Removed: We may form or seek other strategic alliances, joint ventures, or collaborations, or enter into additional licensing arrangements with third parties that we believe will complement or augment our commercialization efforts with respect to Auryxia and our development and commercialization efforts with respect to vadadustat and any other product candidates.
+Added: We may form or seek other strategic alliances, joint ventures, or collaborations, or enter into additional licensing arrangements with third parties that we believe will complement or augment our and our partners' commercialization efforts with respect to Auryxia, Riona and VAFSEO in Japan, and our and our partners' development and commercialization efforts with respect to vadadustat and any other product candidates.
Our likely collaborators for any collaboration arrangements include large and mid-size pharmaceutical companies, regional and national pharmaceutical companies and biotechnology companies.
2 unchanged sentences
• collaborations may be terminated in accordance with the terms of the collaborations and, if terminated, may make it difficult for us to attract new collaborators or adversely affect how we are perceived in scientific and financial communities, and may result in a need for additional capital and expansion of our internal capabilities to pursue further development or commercialization of the applicable products and product candidates;
−Removed: • if permitted by the terms of the collaborations, collaborators may elect not to continue or renew development or commercialization programs based on clinical trial results, changes in their strategic focus, availability of funding or other external factors such as a business combination that diverts resources or creates competing priorities;
+Added: • if permitted by the terms of the collaborations, collaborators may elect not to continue or renew development or commercialization programs based on clinical trial results, changes in their strategic focus, availability of
+Added: funding or other external factors such as a business combination that diverts resources or creates competing priorities;
• if permitted by the terms of the collaborations, collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial, abandon a product candidate, repeat or conduct new clinical trials or require a new formulation of a product candidate for clinical testing;
• a collaborator with marketing and distribution rights to our products may not commit sufficient resources to their marketing and distribution;
−Removed: • if permitted by the terms of the collaboration, we and our collaborator may have a difference of opinion regarding the development or commercialization strategy for a particular product, and our collaborator may have ultimate decision making authority;
−Removed: • disputes may arise between a collaborator and us that cause the delay or termination of activities related to research, development or commercialization of Auryxia, vadadustat and any other product candidates, or that result in costly litigation or arbitration that diverts management attention and resources;
+Added: • if permitted by the terms of the collaboration, we and our collaborator may have a difference of opinion regarding the development or commercialization strategy for a particular product or product candidate, and our collaborator may have ultimate decision making authority;
+Added: • disputes may arise between a collaborator and us that cause the delay or termination of activities related to research, development or commercialization of Auryxia, VAFSEO in Japan, vadadustat and any other product candidates, or that result in costly litigation or arbitration that diverts management attention and resources;
• collaborations may not lead to development or commercialization of products and product candidates in the most efficient manner or at all;
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Risks Related to our Business and Industry
−Removed: If we fail to attract, keep and motivate senior management and key personnel, we may be unable to successfully develop vadadustat and commercialize Auryxia.
+Added: If we fail to attract, keep and motivate senior management and key personnel, we may be unable to successfully develop and commercialize any product candidates and approved product(s).
Recruiting and retaining qualified scientific, clinical, medical, manufacturing and sales and marketing personnel is critical to our success.
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In addition, we may encounter difficulties in managing the expanded operations of a larger and more complex company following the Merger as well as challenges associated with managing an increasingly diversified business.
−Removed: We have strategic collaborations for the commercialization of Riona and the development and commercialization of vadadustat.
+Added: We have strategic collaborations for the commercialization of Riona and the development and commercialization of vadadustat, which is now being marketed under the trade name VAFSEO by our collaboration partner, MTPC, in Japan.
As our operations expand, we expect that we will need to manage additional relationships with various strategic collaborators, consultants, vendors, suppliers and other third parties.
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The stock market in general and the market for similarly situated pharmaceutical and biotechnology companies have experienced extreme volatility that has often been unrelated to the operating performance of particular companies.
−Removed: Since our initial public offering in March 2014, the price of our common stock as reported on The Nasdaq Global Market has ranged from a low of $2.99 on November 13, 2019 to a high of $31.00 on June 20, 2014.
+Added: Since our initial public offering in March 2014, the price of our common stock as reported on The Nasdaq Global Market has ranged from a low of $2.09 on October 30, 2020 to a high of $31.00 on June 20, 2014.
The market price of shares of our common stock could be subject to wide fluctuations in response to many risk factors listed in this section, developments related to and results of our clinical studies, developments related to our regulatory submissions, developments related to our ability to commercialize Auryxia and any other approved product candidates, announcements by us or our competitors of significant mergers, acquisitions, licenses, strategic collaborations, joint ventures, collaborations or capital commitments, negative publicity around Auryxia, vadadustat or any other product or product candidate, the results of competitive clinical trials, products or technologies, regulatory or legal developments in the United States and other countries, developments or disputes concerning patent applications, issued patents or other proprietary rights, the recruitment or departure of key personnel, the level of expenses related to Auryxia, vadadustat or any other product or product candidate or clinical development programs, actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts, variations in our financial results or those of companies that are perceived to be similar to us, changes in the structure of healthcare payment systems, market conditions in the pharmaceutical and biotechnology sectors, general economic, industry and market conditions and others beyond our control.
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These sales, or the perception in the market that the holders of a large number of shares intend to sell such shares, could reduce the market price of our common stock.
−Removed: According to the most recent filings made under Section 13(d) and 13(g) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, Baupost Group Securities, L.L.C., or Baupost, beneficially owned approximately 12% of our outstanding common stock, and our former director Muneer Satter, beneficially owned approximately 2% of our outstanding common stock.
−Removed: Subject to certain restrictions, Baupost and Mr.
−Removed: Satter are able to sell their shares of common stock in the public market from time to time without registering them, subject to certain limitations on the timing, amount and method of those sales imposed by Rule 144 under the Securities Act of 1933, as amended.
−Removed: In addition, pursuant to our registration rights agreement with Baupost and our Fourth Amended and Restated Investors’ Rights Agreement, as amended, with Mr.
−Removed: Satter, Baupost and Mr.
−Removed: Satter have the right, subject to certain conditions and with certain exceptions, to require us to file registration statements covering the shares common stock they own or to include their shares in registration statements that we may file or in public offerings of our shares of common stock.
+Added: According to the most recent filings made under Section 13(d) and 13(g) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, our former director, Muneer Satter, beneficially owned approximately 2% of our outstanding common stock.
+Added: Subject to certain restrictions, Mr.
+Added: Satter is able to sell his shares of common stock in the public market from time to time without registering them, subject to certain limitations on the timing, amount and method of those sales imposed by Rule 144 under the Securities Act of 1933, as amended.
+Added: In addition, pursuant to our Fourth Amended and Restated Investors’ Rights Agreement, as amended, with Mr.
+Added: Satter, he has the right, subject to certain conditions and with certain exceptions, to require us to file registration statements covering the shares common stock he owns or to include his shares in registration statements that we may file or in public offerings of our shares of common stock.
Following their registration and sale under the applicable registration statement, those shares would become freely tradable.
−Removed: By exercising their registration rights and selling a large number of shares of common stock, Baupost and Mr.
+Added: By selling a large number of shares of common stock, State Street or Mr.
Satter could cause the price of our common stock to decline.
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Insiders and significant stockholders could cause us to take actions that may not be, or refrain from taking actions that may be, in our best interest or in the best interest of all of our stockholders.
−Removed: As of June 30, 2020, we believe that our directors and executive officers, together with their affiliates, beneficially owned, in the aggregate, approximately 2% of our outstanding common stock.
−Removed: In addition, we have certain significant stockholders, including Baupost, which beneficially owned approximately 12% of our outstanding common stock according to the most recent filings made under Section 13(d) and 13(g) of the Exchange Act.
−Removed: As a result, if certain significant stockholders were to choose to act together, they would be able to control all matters submitted to our stockholders for approval, as well as our management and affairs, such as:
+Added: As of September 30, 2020, we believe that our directors and executive officers, together with their affiliates, beneficially owned, in the aggregate, approximately 2% of our outstanding common stock.
+Added: In addition, we have certain significant stockholders, including State Street, which beneficially owned approximately 11% of our outstanding common stock according to the most recent filings made under Section 13(d) and 13(g) of the Exchange Act.
+Added: If they were to choose to act together, they would have significant influence on all matters submitted to our stockholders for approval, as well as our management and affairs, such as:
• the composition of our Board of Directors;
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As a public company, and particularly on and after December 31, 2019 when we ceased to be an “emerging growth company”, we will continue to incur significant legal, accounting and other expenses.
−Removed: The Sarbanes-Oxley Act of 2002, or the SOX Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the listing requirements of The Nasdaq Global Market and
−Removed: other applicable securities rules and regulations impose various requirements on public companies, including establishment and maintenance of effective disclosure and financial controls and corporate governance practices.
+Added: The Sarbanes-Oxley Act of 2002, or the SOX Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the listing requirements of The Nasdaq Global Market and other applicable securities rules and regulations impose various requirements on public companies, including establishment and
+Added: maintenance of effective disclosure and financial controls and corporate governance practices.
Our management and other personnel will need to continue to devote a substantial amount of time to these compliance initiatives.
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During fiscal 2020, we are enhancing our system of internal controls over financial reporting to remediate this material weakness.
−Removed: As the revised and enhanced controls need to be in operation for a sufficient period of time and be tested to ensure that the controls are operating as designed, management has concluded that the material weakness cannot be considered remediated as of June 30, 2020.
+Added: As the revised and enhanced controls need to be in operation for a sufficient period of time and be tested to ensure that the controls are operating as designed, management has concluded that the material weakness cannot be considered remediated as of September 30, 2020.
Even if this material weakness is remediated, our internal control over financial reporting could in the future have material weaknesses, deficiencies or conditions that could require correction or remediation.
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On December 12, 2018, we completed the Merger, which we believe has resulted in an ownership change under Section 382.
−Removed: In addition, the Tax Cuts and Jobs Act, including amendments made by the Coronavirus Aid, Relief, and Economic Security Act which was enacted on March 27, 2020, includes changes to U.S.
+Added: In addition, the Tax Cuts and Jobs Act, including amendments made by the CARES Act, includes changes to U.S.
federal tax rates and the rules governing net operating loss carryforwards that may significantly impact our ability to utilize our net operating losses to fully offset taxable income in the future.
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Our Charter provides that, subject to limited exceptions, the state and federal courts located in the State of Delaware will be the sole and exclusive forum for (1) any derivative action or proceeding brought on our behalf, (2) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders, (3) any action asserting a claim against us arising pursuant to any provision of the Delaware General Corporation Law, our Charter or our Amended and Restated By-Laws, or (4) any other action asserting a claim against us that is governed by the internal affairs doctrine.
−Removed: Under our Charter, this exclusive forum provision will not apply to claims that are vested in the exclusive jurisdiction
−Removed: of a court or forum other than the Court of Chancery of the State of Delaware, or for which the Court of Chancery of the State of Delaware does not have subject matter jurisdiction.
+Added: Under our Charter, this exclusive forum provision will not apply to claims that are vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery of the State of Delaware, or for which the Court of Chancery of the State
+Added: of Delaware does not have subject matter jurisdiction.
For instance, the provision would not apply to actions arising under federal securities laws, including suits brought to enforce any liability or duty created by the Securities Exchange Act of 1934, as amended, or the rules and regulations thereunder.
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Sales of Unregistered Securities
−Removed: During the quarter ended June 30, 2020, we did not have any sales of unregistered securities.
+Added: During the quarter ended September 30, 2020, we did not have any sales of unregistered securities.
Defaults Upon Senior Securities.
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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.