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You should carefully consider the risks and uncertainties described below, together with all of the other information contained in this Quarterly Report on Form 10-Q, including "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the financial statements and the related notes.
−Removed: If any of the following risks actually occur, it could harm our business, prospects, operating results and financial condition and future prospects.
+Added: If any of the following risks actually occur, it could harm our business, prospects, results of operations and financial condition and future prospects.
In such event, the market price of our common stock could decline and you could lose all or part of your investment.
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This Quarterly Report on Form 10-Q also contains forward-looking statements that involve risks and uncertainties.
−Removed: Our actual results could differ materially from those anticipated in the forward-looking statements as a result of factors that are described below and elsewhere in this Quarterly Report.
+Added: Our actual results could differ materially from those anticipated in the forward-looking statements as a result of factors that are described below and elsewhere in this Quarterly Report on Form 10-Q.
Risk Factor Summary
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Our business is heavily dependent on the successful development, regulatory approval and commercialization of our product candidates, which are in early stages of clinical development.
−Removed: Public health crises such as pandemics or similar outbreaks could materially and adversely affect our preclinical and clinical trials, business, financial condition and results of operations.
+Added: Public health crises such as pandemics or similar outbreaks have, and could in the future, materially and adversely affect our preclinical and clinical trials, business, financial condition and results of operations.
Research and development of biopharmaceutical products is inherently risky.
We cannot give any assurance that any of our product candidates will receive regulatory approval, which is necessary before they can be commercialized.
−Removed: Adverse events or undesirable side effects caused by, or other unexpected properties of, any of our products could halt their clinical development, delay or prevent their regulatory approval, limit their commercial potential or result in significant negative consequences.
+Added: Adverse events or undesirable side effects caused by, or other unexpected properties of, any of our product candidates could halt their clinical development, delay or prevent their regulatory approval, limit their commercial potential or result in significant negative consequences.
We rely on third-party suppliers to manufacture our product candidates, and we intend to rely on third parties to produce commercial supplies of any approved product.
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We have had significant operating losses since our inception.
−Removed: Our net loss for the years ended December 31, 2021 and 2020 was approximately $130.3 million and $63.4 million, respectively, and our net loss for the three and nine months ended September 30, 2022 was approximately $35.1 million and $107.6 million, respectively.
−Removed: As of September 30, 2022, we had an accumulated deficit of $403.9 million.
+Added: Our net loss for the years ended December 31, 2022 and 2021 was approximately $141.9 million and $130.3 million, respectively, and our net loss for the three months ended March 31, 2023 was approximately $38.7 million.
+Added: As of March 31, 2023, we had an accumulated deficit of $476.9 million.
Substantially all of our losses have resulted from expenses incurred in connection with our research and development programs and from general and administrative costs associated with our operations.
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Because the outcome of any preclinical study or clinical trial is highly uncertain, we cannot reasonably estimate the actual amounts necessary to successfully complete the development and commercialization of our product candidates or any future product candidates.
−Removed: As of September 30, 2022, we had capital resources consisting of cash and cash equivalents and short-term investments of approximately $269.5 million.
−Removed: We expect our existing capital resources to fund our planned operating expenses into the second half of 2025.
+Added: As of March 31, 2023, we had capital resources consisting of cash and cash equivalents and short-term investments of approximately $228.2 million.
+Added: We expect our existing capital resources to fund our planned operating expenses into 2025.
However, our operating plans may change as a result of many factors currently unknown to us, and we may need to seek additional funds sooner than planned through public or private equity offerings or debt financings or other sources, such as strategic collaborations.
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Our future capital requirements depend on many factors, including:
−Removed: the scope, progress, results and costs of researching and developing our current product candidates or any other future product candidates we choose to pursue, conducting preclinical studies and clinical trials, and delays related to the COVID-19 pandemic;
+Added: the scope, progress, results and costs of researching and developing our current product candidates or any other future product candidates we choose to pursue, conducting preclinical studies and clinical trials;
the timing of, and the costs involved in, obtaining regulatory approvals for our product candidates or any future product candidates;
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the timing, receipt and amount of sales of any future approved products.
−Removed: the impact of the COVID-19 pandemic, which may exacerbate the magnitude of the factors discussed above.
Additional funds may not be available when we need them, on terms that are acceptable to us, or at all.
−Removed: Our ability to raise additional capital may be adversely impacted by potential worsening global economic conditions and the recent disruptions to and volatility in the credit and financial markets in the United States and worldwide resulting from the ongoing COVID-19 pandemic.
+Added: Our ability to raise additional capital may be adversely impacted by potential worsening global economic conditions , macroeconomic factors, including recent and potential bank failures, increasing inflation and interest rates, exchange rate fluctuations and supply chain disruptions, and the recent disruptions to and volatility in the credit and financial markets in the United States and worldwide resulting from the COVID-19 pandemic.
If adequate funds are not available to us on a timely basis, we may be required to:
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We do not expect to realize revenue from sales of products or royalties from licensed products in the foreseeable future, if at all, and unless and until our product candidates are clinically tested, approved for commercialization and successfully marketed.
−Removed: To date, we have primarily financed our operations through the sale of equity securities.
+Added: To date, we have primarily financed our operations through the sale of equity securities and warrants to purchase our equity securities.
We will be required to seek additional funding in the future and currently intend to do so through public or private equity offerings or debt financings, credit or loan facilities, collaborations or a combination of one or more of these funding sources.
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However, due to the significant resources required for the development of our product candidates, we must focus on specific diseases and disease pathways and decide which product candidates to pursue and the amount of resources to allocate to each such product candidate.
−Removed: Our decisions concerning the allocation of research, development, collaboration, management and financial resources toward particular product candidates or therapeutic areas may not lead to the development of any viable commercial product and may divert
−Removed: resources away from better opportunities.
+Added: Our decisions concerning the allocation of research, development, collaboration, management and financial resources toward particular product candidates or therapeutic areas may not lead to the development of any viable commercial product and may divert resources away from better opportunities.
Similarly, any decision to delay, terminate or collaborate with third parties in respect of certain programs may subsequently also prove to be suboptimal and could cause us to miss valuable opportunities.
−Removed: If we make incorrect determinations regarding the viability or market potential of any of our programs or product candidates or misread trends in the autoimmune or neurodegenerative or pharmaceutical, biopharmaceutical or biotechnology industry, our business, financial condition and results of operations could be materially adversely affected.
+Added: If we make incorrect
+Added: determinations regarding the viability or market potential of any of our programs or product candidates or misread trends in the autoimmune or neurodegenerative or pharmaceutical, biopharmaceutical or biotechnology industry, our business, financial condition and results of operations could be materially adversely affected.
As a result, we may fail to capitalize on viable commercial products or profitable market opportunities, be required to forego or delay pursuit of opportunities with other product candidates or other diseases and disease pathways that may later prove to have greater commercial potential than those we choose to pursue, or relinquish valuable rights to such product candidates through collaboration, licensing or other royalty arrangements in cases in which it would have been advantageous for us to invest additional resources to retain development and commercialization rights.
−Removed: Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations.
−Removed: Our quarterly and annual operating results may fluctuate significantly, which makes it difficult for us to predict our future operating results.
+Added: Our results of operations may fluctuate significantly, which makes our future results of operations difficult to predict and could cause our results of operations to fall below expectations.
+Added: Our quarterly and annual results of operations may fluctuate significantly, which makes it difficult for us to predict our future results of operations.
These fluctuations may occur due to a variety of factors, many of which are outside of our control and may be difficult to predict, including:
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the level of demand for our product candidates, if approved, which may vary significantly over time.
−Removed: The cumulative effects of these factors could result in large fluctuations and unpredictability in our quarterly and annual operating results.
−Removed: As a result, comparing our operating results on a period-to-period basis may not be meaningful.
+Added: The cumulative effects of these factors could result in large fluctuations and unpredictability in our quarterly and annual results of operations.
+Added: As a result, comparing our results of operations on a period-to-period basis may not be meaningful.
Investors should not rely on our past results as an indication of our future performance.
This variability and unpredictability could also result in our failing to meet the expectations of industry or financial analysts or investors for any period.
−Removed: If our revenue or operating results fall below the expectations of analysts or investors or below any forecasts we may provide to the market, or if any forecasts we provide to the market are below the expectations of analysts or investors, the price of our common stock could decline substantially.
+Added: If our revenue or results of operations fall below the expectations of analysts or investors or below any forecasts we may provide to the market, or if any forecasts we provide to the market are below the expectations of analysts or investors, the price of our common stock could decline substantially.
Such a stock price decline could occur even when we have met any previously publicly stated revenue or earnings guidance we may provide.
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The success of our business, including our ability to finance our company and generate revenue in the future, will primarily depend on the successful development, regulatory approval and commercialization of our product candidates and, in particular, the advancement of our current clinical-stage product candidates.
−Removed: However, given the stage of development of our product candidates, it may be many years, if we succeed at all, before we have demonstrated the safety, purity, potency and/or efficacy of a product candidate sufficient to warrant
−Removed: approval for commercialization.
+Added: However, given the stage of development of our product candidates, it may be many years, if we succeed at all, before we have demonstrated the safety, purity, potency and/or efficacy of a product candidate sufficient to warrant approval for commercialization.
We cannot be certain that our product candidates will receive regulatory approval or be successfully commercialized even if we receive regulatory approval.
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The clinical and commercial success of our product candidates and future product candidates will depend on a number of factors, including the following:
−Removed: the COVID-19 pandemic, which may result in clinical site closures, delays to patient enrollment, patients discontinuing their treatment or follow up visits or changes to trial protocols;
our ability to raise any additional required capital on acceptable terms, or at all;
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the willingness of physicians, operators of clinics and patients to utilize or adopt any of our product candidates or any future product candidates, if approved;
−Removed: the willingness of patients to enroll or continue to participate in a clinical trial during the COVID-19 pandemic;
patient demand for our product candidates, if approved, including the willingness of patients to pay out-of-pocket for any approved products in the absence of coverage and/or adequate reimbursement from third-party payors;
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Public health crises such as pandemics or similar outbreaks have, and could in the future, materially and adversely affect our preclinical and clinical trials, business, financial condition and results of operations.
−Removed: In March 2020, the World Health Organization declared COVID-19 a global pandemic and the United States declared a national emergency with respect to the COVID-19 pandemic.
−Removed: In response to the COVID-19 pandemic and in connection with the spread of the Omicron variants, “shelter in place”
−Removed: orders and other public health guidance measures were implemented across much of the United States and Europe, including in the locations of our offices, clinical trial sites, key vendors and partners.
−Removed: We expect that our clinical development program timelines will continue to be negatively affected by the COVID-19 pandemic, which could materially and adversely affect our business, financial condition and results of operations.
−Removed: For instance, we experienced interruption in clinical trial activities in Bangladesh due to quarantines, shortages in clinical site staff, longer timelines for clinical site initiation and temporary shortages in lab kits and supplies.
−Removed: Additionally, the COVID-19 pandemic has adversely impacted hospitals and medical facilities where we are currently conducting our clinical trials and has resulted in increased competition for more limited hospital resources among companies conducting clinical trials.
−Removed: Further, due to public health guidance measures, we maintain a work-from-home policy for all staff members excluding those necessary to maintain minimum basic operations.
−Removed: Our increased reliance on personnel working from home has, and may continue to, negatively impact productivity, or disrupt, delay or otherwise adversely impact our business.
−Removed: For example, with our personnel working from home, some of our research activities that require our personnel to be in our laboratories have been delayed.
−Removed: As a result of the COVID-19 pandemic, or similar pandemics, and related “shelter in place”
+Added: As a result of public health crises, including the COVID-19 pandemic and related “shelter in place”
orders and other public health guidance measures, we have experienced, and may in the future experience, disruptions that could materially and adversely impact our clinical trials, business, financial condition and results of operations.
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delays or difficulties in initiating or expanding clinical trials, including delays or difficulties with clinical site initiation and recruiting clinical site investigators and clinical site staff;
−Removed: increased rates of patients withdrawing from our clinical trials following enrollment as a result of contracting COVID-19 or other health conditions or being forced to quarantine;
+Added: increased rates of patients withdrawing from our clinical trials following enrollment as a result of health conditions or being forced to quarantine;
interruption of key clinical trial activities, such as clinical trial site data monitoring and efficacy, safety and translational data collection, processing and analyses, due to limitations on travel imposed or recommended by federal, state or local governments, employers and others or interruption of clinical trial subject visits, which may impact the collection and integrity of subject data and clinical study endpoints;
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limitations on employee or other resources that would otherwise be focused on the conduct of our clinical trials and pre-clinical work, including because of sickness of employees or their families, the desire of employees to avoid travel or contact with large groups of people, an increased reliance on working from home, school closures or mass transit disruptions;
−Removed: changes in regulations as part of a response to the COVID-19 pandemic which may require us to change the ways in which our clinical trials are conducted, which may result in unexpected costs, or to discontinue such clinical trials altogether;
+Added: changes in regulations as part of a response to the COVID-19 pandemic or similar outbreaks, which may require us to change the ways in which our clinical trials are conducted, which may result in unexpected costs, or to discontinue such clinical trials altogether;
delays in necessary interactions with regulators, ethics committees and other important agencies and contractors due to limitations in employee resources or forced furlough of government or contractor personnel;
refusal of the FDA to accept data from clinical trials in affected geographies outside the United States.
−Removed: These and other factors arising from the COVID-19 pandemic could worsen or could return in countries where the COVID-19 pandemic has been partially contained, each of which could further adversely impact our ability to conduct clinical trials and our business generally, and could materially and adversely affect our business, financial condition and results of operations.
−Removed: The COVID-19 pandemic continues to evolve.
−Removed: The extent to which the outbreak may continue to affect our clinical trials, business, financial condition, results of operations, and clinical development timelines and plans will depend on future developments, which are highly uncertain and cannot be predicted at this time, such as the duration of the outbreak, the emergence of new variants, rates of infection in the locations in which we and our CROs, third-party manufacturers, regulatory authorities and other third parties with whom we do business operate, travel restrictions and actions to contain the outbreak or treat its impact, such as social distancing and quarantines or lock-downs in the United States and other countries, business closures or business disruptions and the effectiveness of actions taken in the United States and other countries to contain and treat the disease.
+Added: The extent to which any future outbreak may affect our clinical trials, business, financial condition, results of operations and clinical development timelines and plans will depend on factors including the duration of the outbreak, the emergence of new variants, rates of infection in the locations in which we and our CROs, third-party manufacturers, regulatory authorities and other third parties with whom we do business operate, travel restrictions and actions to contain the outbreak or treat its impact, such as social distancing and quarantines or lock-downs in the United States and other countries, business closures or business disruptions and the effectiveness of actions taken in the United States and other countries to contain and treat the disease.
Future developments in these and other areas present material uncertainty and risk with respect to our clinical trials, business, financial condition and results of operations.
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Any clinical studies that we may conduct may not demonstrate the efficacy and safety necessary to obtain regulatory approval to market our product candidates.
−Removed: If the results of our ongoing or future clinical studies are inconclusive with respect to the efficacy of our product candidates, if we do not meet the clinical endpoints with statistical significance or if there are safety
−Removed: concerns or adverse events associated with our product candidates, we may be prevented or delayed in obtaining marketing approval for our product candidates.
+Added: If the results of our ongoing or future clinical studies are inconclusive with respect to the efficacy of our product candidates, if we do not meet the clinical endpoints with statistical significance or if there are safety concerns or adverse events associated with our product candidates, we may be prevented or delayed in obtaining marketing approval for our product candidates.
The FDA or other regulatory agencies may not agree with our clinical development plan and require that we conduct additional clinical trials to support our regulatory submissions, including the FDA may require that we conduct more than one pivotal trial in order to gain approval.
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We may also be required to perform additional or unanticipated clinical trials to obtain approval or be subject to additional post-marketing testing requirements to maintain approval.
−Removed: In addition, regulatory authorities may withdraw their approval of a product or impose restrictions on its distribution, such as in the form of a Risk Evaluation and Mitigation Strategy, or REMS.
+Added: In addition, regulatory authorities may withdraw their approval of a product or impose restrictions on its distribution, such as
+Added: in the form of a Risk Evaluation and Mitigation Strategy, or REMS.
The failure to obtain timely regulatory approval of product candidates, any product marketing limitations or a product withdrawal would negatively impact our business, results of operations and financial condition.
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Clinical trials can be delayed or terminated for a variety of reasons, including delays or failures related to:
−Removed: the COVID-19 pandemic, which may result in clinical site closures, delays to patient enrollment, patients discontinuing their treatment or follow up visits or changes to trial protocols;
generating sufficient preclinical, toxicology or other in vivo or in vitro data to support the initiation or continuation of clinical trials;
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have the product removed from the market after obtaining marketing approval.
−Removed: In addition, disruptions caused by the COVID-19 pandemic may increase the likelihood that we encounter such difficulties or delays in initiating, enrolling, conducting or completing our planned and ongoing clinical trials.
−Removed: For instance, we have experienced interruption in clinical trial activities in Bangladesh due to quarantines, shortages in clinical site staff, longer timelines for clinical site
−Removed: initiation and temporary shortages in lab kits and supplies.
+Added: For example, we believe that we will be able to seek FDA approval of ANX005 for the treatment of patients with GBS based on the results from a single pivotal trial.
+Added: However, the FDA may not agree that the data from one pivotal trial are sufficient to warrant approval of ANX005, even if we believe the results are sufficiently positive.
+Added: In such an event, we would be required to conduct one or more additional clinical trials before seeking FDA approval of ANX005 for patients with GBS, if ever, which would increase our expenses and could delay or prevent commercialization of ANX005 in GBS.
We could also encounter delays if a clinical trial is suspended or terminated by us, by the IRBs of the institutions in which such trials are being conducted, by the Data Safety Monitoring Board, or DSMB, for such trial or by the FDA or other regulatory authorities.
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In addition, many of the factors that cause, or lead to, a delay in the commencement or completion of clinical trials may also ultimately lead to the denial of regulatory approval of our product candidates.
−Removed: If one or more of our product candidates proves to be ineffective, unsafe or commercially unviable, our business, financial condition, results of operations and prospects may be materially and adversely affected.
+Added: If one or more of our product candidates proves to be
+Added: ineffective, unsafe or commercially unviable, our business, financial condition, results of operations and prospects may be materially and adversely affected.
If we encounter difficulties enrolling patients in our clinical trials, our clinical development activities could be delayed or otherwise adversely affected.
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patient referral practices of physicians;
−Removed: risk that enrolled subjects will drop out before completion of the trial, including as a result of contracting COVID-19 or other health conditions or being forced to quarantine;
+Added: risk that enrolled subjects will drop out before completion of the trial, including as a result of health conditions or being forced to quarantine;
ability to monitor patients adequately during and after treatment;
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and preliminary data should be viewed with caution until the final data are available.
−Removed: From time to time, we also disclose interim, “top-line”
−Removed: or preliminary data from our clinical studies.
+Added: From time to time, we also disclose interim data from our clinical studies.
Interim data from clinical trials that we may complete are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient data become available.
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In addition, the information we choose to publicly disclose regarding a particular study or clinical trial is based on what is typically extensive information, and you or others may not agree with what we determine is the material or otherwise appropriate information to include in our disclosure.
−Removed: Any information we determine not to disclose may ultimately be deemed significant by you or others with respect to future decisions, conclusions, views, activities or otherwise regarding a particular product candidate or our business.
+Added: Any information we determine not to disclose may ultimately be deemed significant by you or others with respect to
+Added: future decisions, conclusions, views, activities or otherwise regarding a particular product candidate or our business.
If the “top-line,”
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Although we may seek Orphan product designation for some or all of our other product candidates, we may never receive such designations.
−Removed: Under the Orphan Drug Act, the FDA may designate a drug or biologic product as an Orphan Drug if it is intended to treat a rare disease or condition, defined as a patient population of fewer than 200,000 in the United States, or a patient population greater than 200,000 in the United States where there is no reasonable expectation that the cost of developing the drug will be recovered from sales in the United States.
+Added: Under the Orphan Drug Act, the FDA may designate a drug or biologic product as an Orphan Drug if it is intended to treat a rare disease or
+Added: condition, defined as a patient population of fewer than 200,000 in the United States, or a patient population greater than 200,000 in the United States where there is no reasonable expectation that the cost of developing the drug will be recovered from sales in the United States.
Orphan Drug designation must be requested before submitting a biologics license application, or BLA, or new drug application, or NDA.
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Further, even if we obtain Orphan Drug exclusivity for a product candidate, that exclusivity may not effectively protect the product from competition because different drugs can be approved for the same condition.
−Removed: Even after an Orphan Drug is approved, the FDA can subsequently approve the same drug for
−Removed: the same condition if the FDA concludes that the later drug is clinically superior in that it is safer, more effective or makes a major contribution to patient care.
+Added: Even after an Orphan Drug is approved, the FDA can subsequently approve the same drug for the same condition if the FDA concludes that the later drug is clinically superior in that it is safer, more effective or makes a major contribution to patient care.
Orphan Drug designation neither shortens the development time or regulatory review time of a drug or biologic nor gives the drug or biologic any advantage in the regulatory review or approval process.
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A Fast Track designation by the FDA, even if granted for any of our product candidates, may not lead to a faster development or regulatory review or approval process, and does not increase the likelihood that our product candidates will receive marketing approval.
−Removed: The FDA has granted Fast Track designation for ANX005 in GBS and for ANX007 in GA, and, in the future, we may seek Fast Track designation for other of our product candidates.
+Added: The FDA has granted Fast Track designation for ANX005 in GBS and for ANX007 in GA, and, in the future, we may seek Fast Track designation for our product candidates.
If a drug or biologic is intended for the treatment of a serious or life-threatening condition and the drug or biologic demonstrates the potential to address unmet medical needs for this condition, the sponsor may apply for Fast Track designation.
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Any failure to comply with ongoing regulatory requirements may significantly and adversely affect our ability to commercialize and generate revenue from our products.
−Removed: If regulatory sanctions are applied or if regulatory approval is withdrawn, the value of our company and our operating results will be adversely affected.
+Added: If regulatory sanctions are applied or if regulatory approval is withdrawn, the value of our company and our results of operations will be adversely affected.
Moreover, the policies of the FDA and of other regulatory authorities may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates.
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government has shut down several times and certain regulatory agencies, such as the FDA, have had to furlough critical FDA employees and stop critical activities.
−Removed: Separately, in response to the COVID-19 pandemic, in March 2020, the FDA postponed most inspections of foreign and domestic manufacturing facilities.
−Removed: Subsequently, in July 2020, the FDA resumed certain on-site inspections of domestic manufacturing facilities subject to a risk-based prioritization system.
−Removed: The FDA utilized this risk-based assessment system to assist in determining when and where it was safest to conduct prioritized domestic inspections.
−Removed: Additionally, on April 15, 2021, the FDA began conducting voluntary remote interactive evaluations of certain drug manufacturing facilities and clinical research sites, among other facilities, in circumstances where the FDA determines that such remote evaluation would be appropriate based on mission needs and travel limitations.
−Removed: In July 2021, the FDA resumed standard inspectional operations of domestic facilities.
−Removed: Since that time, the FDA has continued to monitor and implement changes to its inspectional activities to ensure the safety of its employees and those of the firms it regulates as it adapts to the evolving COVID-19 pandemic.
−Removed: Regulatory authorities outside the United States may adopt similar restrictions or other policy
−Removed: measures in response to the COVID-19 pandemic.
+Added: Separately, in response to the COVID-19 pandemic, the FDA postponed most inspections of domestic and foreign manufacturing facilities at various points.
+Added: Even though the FDA has since resumed standard inspection operations of domestic facilities where feasible, the FDA has continued to monitor and implement changes to its inspectional activities to ensure the safety of its employees and those of the firms it regulates as it adapts to the evolving COVID-19 pandemic, and any resurgence of the virus or emergence of new variants may lead to further inspectional delays.
+Added: Regulatory authorities outside the United States may adopt similar restrictions or other policy measures in response to the COVID-19 pandemic.
If a prolonged government shutdown occurs, or if global health concerns continue to prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA or other regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.
We conduct, and in the future plan to conduct, clinical trials for product candidates outside the United States, and the FDA and comparable foreign regulatory authorities may not accept data from such trials.
−Removed: We conduct clinical trials of our product candidates outside the United States, and plan to continue to do so in the future for reasons including the relative impact of the COVID-19 pandemic on trial sites in the United States.
−Removed: For example, we conducted our Phase 1b clinical trial of ANX005 in Bangladesh.
+Added: We conduct clinical trials of our product candidates outside the United States, and plan to continue to do so.
+Added: For example, we conducted our Phase 1b GBS clinical trial of ANX005 in Bangladesh, and are conducting our Phase 3 clinical trial of ANX005 in patients with GBS exclusively at sites outside the United States.
The acceptance of study data from clinical trials conducted outside the United States or the applicable jurisdiction by the FDA and comparable foreign regulatory authorities may be subject to certain conditions, or may not be accepted at all.
−Removed: For example, where data from foreign clinical trials are intended to serve as the sole basis for marketing approval in the United States, the FDA will not approve the application on the basis of foreign data alone unless those data are applicable to the United States population and United States medical practice, the trials were performed by clinical investigators of recognized competence and the data are considered valid without the need for an on-site inspection by the FDA or, if the FDA considers such an inspection to be necessary, the FDA is able to validate the data through an on-site inspection or other appropriate means.
+Added: For example, where data from foreign clinical trials are intended to serve as the sole basis for marketing approval in the United States, regardless of whether such trials were conducted under an IND, the FDA will not approve the application on the basis of foreign data alone unless those data are applicable to the United States population and United States medical practice, the trials were performed by clinical investigators of recognized competence and the data are considered valid without the need for an on-site inspection by the FDA or, if the FDA considers such an inspection to be necessary, the FDA is able to validate the data through an on-site inspection or other appropriate means.
For trials that are conducted only at sites outside of the United States and not subject to an IND, the FDA requires the clinical trial to have been conducted in accordance with good clinical practice, or GCP, requirements, and the FDA must be able to validate the data from the clinical trial through an on-site inspection if it deems such inspection necessary.
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Neither we nor our third-party manufacturers may successfully complete any required increase to existing manufacturing capacity in a timely manner, or at all.
−Removed: If our manufacturers or we are unable to purchase the raw materials necessary for the manufacture of our product candidates on acceptable terms, at sufficient quality levels or in adequate quantities, if at all, the commercial launch of our product candidates would
−Removed: be delayed or there would be a shortage in supply, which would impair our ability to generate revenues from the sale of such product candidates, if approved.
+Added: If our manufacturers or we are unable to purchase the raw materials necessary for the manufacture of our product candidates on acceptable terms, at sufficient quality levels or in adequate quantities, if at all, the commercial launch of our product candidates would be delayed or there would be a shortage in supply, which would impair our ability to generate revenues from the sale of such product candidates, if approved.
We rely on third parties in the conduct of all of our preclinical studies and clinical trials.
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Many of the third parties with whom we contract may also have relationships with other commercial entities, including our competitors, for whom they may also be conducting clinical trials or other drug development activities that could harm our competitive position.
−Removed: If the third parties conducting our preclinical studies or our clinical trials do not adequately perform their contractual duties or obligations, experience significant business challenges, disruptions or failures, do not meet expected deadlines, terminate their agreements with us or need to be replaced, or if the quality or accuracy of the data they obtain is compromised due to their failure to adhere to our protocols or to GLPs or GCPs, or for any other reason, we may need to enter into new arrangements with alternative third parties.
+Added: If the third parties conducting our preclinical studies or our clinical trials do not adequately perform their contractual duties or obligations, experience significant business challenges, disruptions or failures, do not meet expected deadlines, terminate their agreements with us or need to be replaced, or if the quality or accuracy of the data they obtain is compromised due to their failure to
+Added: adhere to our protocols or to GLPs or GCPs, or for any other reason, we may need to enter into new arrangements with alternative third parties.
This could be difficult, costly or impossible, and our preclinical studies or clinical trials may need to be extended, delayed, terminated or repeated.
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a product candidate may not be accepted as safe and effective by physicians and patients.
−Removed: We therefore cannot provide any assurance that we will be able to successfully identify or acquire additional product candidates, advance any of these additional product candidates through the development process, successfully commercialize any such additional product candidates, if approved, or assemble sufficient resources to identify, acquire, develop or, if approved, commercialize additional
−Removed: product candidates.
+Added: We therefore cannot provide any assurance that we will be able to successfully identify or acquire additional product candidates, advance any of these additional product candidates through the development process, successfully commercialize any such additional product candidates, if approved, or assemble sufficient resources to identify, acquire, develop or, if approved, commercialize additional product candidates.
If we are unable to successfully identify, acquire, develop and commercialize additional product candidates, our commercial opportunities may be limited.
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Furthermore, currently approved products could be discovered to have application for the intended indication of our product candidates, which could give such products significant regulatory and market timing advantages over any of our product candidates.
−Removed: Our competitors also may obtain FDA, European Medicines Agency, or EMA, or other regulatory approval for their products more rapidly than we may obtain approval for ours and may obtain orphan product exclusivity from the FDA for indications our product candidates are targeting, which could result in our competitors establishing a strong market position before we are able to enter the market.
−Removed: For additional information regarding our competition, see the section of our Annual Report on Form 10-K for the year ended December 31, 2021 captioned “Business—Competition.”
+Added: Our competitors also may obtain FDA, European Medicines Agency, or EMA, or other regulatory approval for their products more rapidly than we may obtain approval for ours and may obtain orphan product exclusivity from the FDA for indications our product
+Added: candidates are targeting, which could result in our competitors establishing a strong market position before we are able to enter the market.
+Added: For additional information regarding our competition, see the section titled “Business—Competition”
+Added: of our Annual Report on Form 10-K for the year ended December 31, 2022.
The successful commercialization of our product candidates will depend in part on the extent to which governmental authorities and health insurers establish adequate coverage, reimbursement levels and pricing policies.
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These payors may deny or revoke the reimbursement status of a given product or establish prices for new or existing marketed products at levels that are too low to enable us to realize an appropriate return on our investment in our product candidates.
−Removed: If reimbursement is not available or is available only at limited levels, we may not
−Removed: be able to successfully commercialize our product candidates and may not be able to obtain a satisfactory financial return on our investment in the development of product candidates.
+Added: If reimbursement is not available or is available only at limited levels, we may not be able to successfully commercialize our product candidates and may not be able to obtain a satisfactory financial return on our investment in the development of product candidates.
There is significant uncertainty related to the insurance coverage and reimbursement of newly approved products.
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We will need to increase the size of our organization, and we may experience difficulties in managing growth.
−Removed: As of September 30, 2022, we had 83 full-time employees.
−Removed: We will need to continue to expand our managerial, operational, finance and other resources in order to manage our operations and clinical trials, continue our development activities and commercialize
−Removed: our product candidates or any future product candidates.
+Added: As of March 31, 2023, we had 80 full-time employees.
+Added: We will need to continue to expand our managerial, operational, finance and other resources in order to manage our operations and clinical trials, continue our development activities and commercialize our product candidates or any future product candidates.
Our management and personnel, systems and facilities currently in place may not be adequate to support this future growth.
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We may not be able to attract and retain quality personnel on acceptable terms, or at all.
−Removed: In addition, to the extent we hire personnel from competitors, we may be subject to allegations that they have been improperly solicited or that they have divulged proprietary or other confidential information, or that their former employers own their research output.
+Added: In addition, to the extent we hire personnel from competitors, we may be subject to allegations that they have
+Added: been improperly solicited or that they have divulged proprietary or other confidential information, or that their former employers own their research output.
If product liability lawsuits are brought against us, we may incur substantial liabilities and may be required to limit commercialization of our current or future product candidates.
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We currently carry product liability insurance covering our clinical trials.
−Removed: Although we maintain such insurance,
−Removed: any claim that may be brought against us could result in a court judgment or settlement in an amount that is not covered, in whole or in part, by our insurance or that is in excess of the limits of our insurance coverage.
+Added: Although we maintain such insurance, any claim that may be brought against us could result in a court judgment or settlement in an amount that is not covered, in whole or in part, by our insurance or that is in excess of the limits of our insurance coverage.
Our insurance policies also have various exclusions and deductibles, and we may be subject to a product liability claim for which we have no coverage.
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sales and marketing activities or other operations may not be in compliance with applicable laws resulting in civil or criminal proceedings.
−Removed: Unfavorable global economic or political conditions could adversely affect our business, financial condition or results of operations.
+Added: Unfavorable global and macroeconomic or political conditions could adversely affect our business, financial condition or results of operations.
Our business is susceptible to general conditions in the global economy and in the global financial markets.
−Removed: A global financial crisis or a global or regional political disruption has caused, and could in the future cause, extreme volatility in the capital and credit markets.
−Removed: A severe or prolonged economic downturn, including a recession or depression, the current inflationary economic environment, rising interest rates, debt and equity market fluctuations, diminished liquidity and credit availability, increased unemployment rates, decreased investor and consumer confidence, supply chain challenges, natural catastrophes, the effects of climate change, regional and global conflicts and terrorist attacks or political disruption or turmoil could result in a variety of risks to our business, including weakened demand for our product candidates or any future product candidates, if approved, and our ability to raise additional capital when needed on acceptable terms, if at all.
+Added: Global financial crises and global or regional political disruptions have caused, and could in the future cause, extreme volatility in the capital and credit markets.
+Added: A severe or prolonged economic downturn, including a recession or depression, recent and potential bank failures, the current inflationary economic environment, rising interest rates, debt and equity market fluctuations, diminished liquidity and credit availability, increased unemployment rates, decreased investor and consumer confidence, supply chain challenges, natural catastrophes, the effects of climate change, regional and global conflicts and terrorist attacks or political disruption or turmoil could result in a variety of risks to our business, including weakened demand for our product candidates or any future product candidates, if approved, and our ability to raise additional capital when needed on acceptable terms, if at all.
A weak or declining economy or political disruption could also strain our manufacturers or suppliers, possibly resulting in supply disruption, or cause our customers to delay making payments for our potential products.
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Compliance with applicable environmental laws and regulations may be expensive, and current or future environmental laws and regulations may impair our research, product development and manufacturing efforts.
−Removed: In addition, we cannot entirely eliminate the risk of accidental injury or contamination from hazardous materials or wastes.
+Added: In addition, we cannot entirely eliminate the risk
+Added: of accidental injury or contamination from hazardous materials or wastes.
Although we maintain workers’
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Our commercial success depends on our ability to develop, manufacture and market our current and any future product candidates that may be approved for sale, and to use our proprietary technology without infringing the patents and other proprietary rights of third parties.
−Removed: Intellectual property disputes can be costly to defend and may cause our business, operating results and financial condition to suffer.
+Added: Intellectual property disputes can be costly to defend and may cause our business, results of operations and financial condition to suffer.
We operate in an industry with extensive intellectual property litigation.
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Regardless of whether claims that we are infringing patents or other intellectual property rights have merit, such litigation can be time consuming, divert management attention and financial resources and are costly to evaluate and defend.
−Removed: There can be no assurance with respect to the outcome of any current or future litigation brought by or against us, and the outcome of any such litigation could have a material adverse impact on our business, operating results and financial condition.
+Added: There can be no assurance with respect to the outcome of any current or future litigation brought by or against us, and the outcome of any such litigation could have a material adverse impact on our business, results of operations and financial condition.
Litigation is inherently unpredictable, and outcomes are uncertain.
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As a result of such litigation, we may be required to stop treating certain conditions, obtain licenses or modify our products and features while we develop non-infringing substitutes, or may result in significant settlement costs or royalty obligations.
−Removed: For example, litigation can involve substantial damages for infringement, and if the court finds that the
−Removed: infringement was willful, we could be ordered to pay treble damages and the patent owner’s attorneys’
+Added: For example, litigation can involve substantial damages for infringement, and if the court finds that the infringement was willful, we could be ordered to pay treble damages and the patent owner’s attorneys’
We may also be prohibited from selling or licensing our products unless the third-party licenses rights to us, which it is not required to do at a commercially reasonable price or at all.
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Thus, we cannot guarantee that our activities related to their product candidates, or our commercialization, do not and will not infringe any third party’s intellectual property.
−Removed: In addition, patent applications in the United States and many other jurisdictions are typically not published until 18 months after the filing of certain priority documents (or, in some cases, are not published until they issue as patents), and publications in the scientific literature often lag behind actual discoveries.
+Added: In addition, patent applications in the United States and many other jurisdictions are typically not published until 18 months after the filing of certain priority documents (or, in some cases, are not published until they issue as patents), and publications in the scientific
+Added: literature often lag behind actual discoveries.
Therefore, we cannot be certain that others have not filed patent applications or made public disclosures relating to our technology or our contemplated technology.
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We seek to obtain and maintain patents and other intellectual property rights to restrict the ability of others to market products that misappropriate our technology and/or infringe our intellectual property to unfairly and illegally compete with any future products.
−Removed: If we are unable to protect our intellectual property and proprietary rights, including due to the impact of the COVID-19 pandemic on our business operations, our competitive position and our business could be harmed, as third parties may be able to make, use or sell products that are substantially the same as any future products we may sell without incurring the sizeable development and licensing costs that we have incurred, which would adversely affect our ability to compete in the market.
+Added: If we are unable to protect our intellectual property and proprietary rights, our competitive position and our business could be harmed, as third parties may be able to make, use or sell products that are substantially the same as any future products we may sell without incurring the sizeable development and licensing costs that we have incurred, which would adversely affect our ability to compete in the market.
We use a combination of patents, trademarks, know-how, confidentiality procedures and contractual provisions to protect our proprietary technology.
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We have not pursued or maintained, and may not pursue or maintain in the future, patent protection for our product candidates in every country or territory in which we may sell our products.
−Removed: In addition, we cannot be sure that any of our pending patent applications or pending trademark applications will issue or that, if issued, they will issue in a form that will provide adequate protection for our
+Added: In addition, we cannot be sure that any of our pending patent applications or pending trademark applications will issue or that, if issued, they will issue in a form that will provide adequate protection for our products.
The USPTO, patent offices in other jurisdictions, or judicial or other bodies in any jurisdiction may deny or significantly narrow claims made under our patent applications, and claims in our issued patents may be invalidated, may be designed around or may otherwise be unable to provide us with protection for our products.
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The USPTO and various patent agencies in other jurisdictions require compliance with a number of procedural, documentary, fee, annuity payment and other provisions to maintain patent applications and issued patents.
−Removed: Although an inadvertent lapse, including due to the effect of the COVID-19 pandemic on us or our patent maintenance vendors, can in many cases be cured by payment of a late fee or by other means in accordance with the applicable rules, there are situations in which noncompliance with these requirements can result in abandonment or lapse of a patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction.
+Added: Although an inadvertent lapse, can in many cases be cured by payment of a late fee or by other means in accordance with the applicable rules, there are situations in which noncompliance with these requirements can result in abandonment or lapse of a patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction.
In addition, we have a number of patents and patent applications outside of the United States and expect to continue to pursue patent protection in many of the significant markets in which we intend to do business.
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Costly and time-consuming litigation could be necessary to enforce and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret protection could adversely affect our competitive business position.
−Removed: Furthermore, the laws of some other jurisdictions do not protect proprietary rights to
−Removed: the same extent or in the same manner as the laws of the United States.
+Added: Furthermore, the laws of some other jurisdictions do not protect proprietary rights to the same extent or in the same manner as the laws of the United States.
As a result, we may encounter significant problems in protecting and defending our intellectual property both in the United States and in other jurisdictions.
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In addition, under certain of such agreements, we are or may become required to diligently pursue the development of products using the licensed technology.
−Removed: If we fail to comply with these obligations including due to the impact of the COVID-19 pandemic on our business operations or our use of the intellectual property licensed to us in an unauthorized manner, and fail to cure our breach within a specified period of time, the licensor may have the right to terminate the applicable license, in which event we could lose valuable rights and technology that are material to our business, harming our ability to develop, manufacture and/or commercialize our platform or product candidates.
+Added: If we fail to comply with these obligations and fail to cure our breach within a specified period of time, the licensor may have the right to terminate the applicable license, in which event we could lose valuable rights and technology that are material to our business, harming our ability to develop, manufacture and/or commercialize our platform or
+Added: product candidates.
If the licensor retains control of prosecution of the patents and patent applications licensed to us, we may have limited or no control over the manner in which the licensor chooses to prosecute or maintain its patents and patent applications and have limited or no right to continue to prosecute any patents or patent applications that the licensor elects to abandon.
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We or our licensors may have relied on third-party consultants or collaborators or on funds from third parties, such as national governments, such that we or our licensors are not the sole and exclusive owners of the patents we in-licensed.
−Removed: If other third parties have ownership rights or other rights to our patents, including in-licensed patents, they may be able to license such patents to our competitors, and our competitors could market competing products and technology.
+Added: If other third parties have
+Added: ownership rights or other rights to our patents, including in-licensed patents, they may be able to license such patents to our competitors, and our competitors could market competing products and technology.
This could have a material adverse effect on our competitive position, business, financial conditions, results of operations, and prospects.
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Consequently, we may not be able to prevent third parties from practicing our inventions in all countries outside the United States, or from selling or importing products made using our inventions in and into the United States or other jurisdictions.
−Removed: Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products, and may export otherwise infringing products to territories where we have patent protection but
−Removed: enforcement is not as strong as that in the United States.
+Added: Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products, and may export otherwise infringing products to territories where we have patent protection but enforcement is not as strong as that in the United States.
These products may compete with any future products we may sell, and our patents or other intellectual property rights may not be effective or sufficient to prevent them from competing.
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Any failure to comply with ongoing regulatory requirements may significantly and adversely affect our ability to commercialize and generate revenue from any future products.
−Removed: If regulatory sanctions are applied or if regulatory approval is withdrawn, the value of our company and our operating results will be adversely affected.
+Added: If regulatory sanctions are applied or if regulatory approval is withdrawn, the value of our company and our results of operations will be adversely affected.
Moreover, the policies of the FDA and of other regulatory authorities may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates.
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federal and state levels that seek to reduce healthcare costs and improve the quality of healthcare.
−Removed: For example, in March 2010, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, or collectively the ACA, was enacted, which substantially changed the way healthcare is financed by both governmental and private insurers.
+Added: For example, in March 2010, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, or collectively the ACA, was enacted, which substantially changed the way
+Added: healthcare is financed by both governmental and private insurers.
Among the provisions of the ACA, those of greatest importance to the pharmaceutical, biopharmaceutical and biotechnology industries include the following:
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It is unclear how other healthcare reform measures will impact our business.
−Removed: In addition, other legislative changes have been proposed and adopted in the United States since the ACA was enacted.
+Added: Other legislative changes have been proposed and adopted in the United States since the ACA was enacted.
On March 11, 2021, the American Rescue Plan Act of 2021 was signed into law, which eliminates the statutory Medicaid drug rebate cap, currently set at 100% of a drug’s average manufacturer price, or AMP, beginning January 1, 2024.
+Added: Moreover, payment methodologies may be subject to changes in healthcare legislation and regulatory initiatives.
+Added: For example, CMS may develop new payment and delivery models, such as bundled payment models.
+Added: In addition, recently there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products, which has resulted in several U.S.
+Added: Congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to drug pricing, reduce the cost of prescription drugs under government payor programs, and review the relationship between pricing and manufacturer patient programs.
Most recently, on August 16, 2022, the Inflation Reduction Act of 2022, or IRA, was signed into law.
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and replaces the Part D coverage gap discount program with a new discounting program (beginning in 2025).
−Removed: The IRA permits the Secretary of the Department of Health and Human Services (HHS) to implement many of these provisions through guidance, as opposed to regulation, for the initial years.
+Added: The IRA permits the Secretary of the Department of Health and Human Services to implement many of these provisions through guidance, as opposed to regulation, for the initial years.
For that and other reasons, it is currently unclear how the IRA will be effectuated.
−Removed: Moreover, payment methodologies may be subject to changes in healthcare legislation and regulatory initiatives.
−Removed: For example, CMS may develop new payment and delivery models, such as bundled payment models.
−Removed: In addition, recently there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products, which has resulted in several U.S.
−Removed: Congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to drug pricing, reduce the cost of prescription drugs under government payor programs, and review the relationship between pricing and manufacturer patient programs.
We expect that additional U.S.
−Removed: federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that the U.S.
+Added: federal healthcare
+Added: reform measures will be adopted in the future, any of which could limit the amounts that the U.S.
federal government will pay for healthcare products and services, which could result in reduced demand for our product candidates or additional pricing pressures.
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Under the Drug Price Competition and Patent Term Restoration Act of 1984, or the Hatch-Waxman Act, a pharmaceutical manufacturer may submit an abbreviated new drug application, or ANDA, seeking approval of a generic version of an approved, small molecule innovator product.
−Removed: Under the Hatch-Waxman Act, a manufacturer may also submit a NDA under section 505(b)(2) of the Federal Food, Drug, and Cosmetic Act that references the FDA’s prior findings of safety and effectiveness of the small molecule innovator product.
+Added: Under the Hatch-Waxman Act, a manufacturer may also submit an NDA under section 505(b)(2) of the Federal Food, Drug, and Cosmetic Act that references the FDA’s prior findings of safety and effectiveness of the small molecule innovator product.
For example, a 505(b)(2) NDA product may be for a new or improved version of the original innovator product.
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known as the Orange Book.
−Removed: there are patents listed in the Orange Book for a product, a generic or 505(b)(2) applicant that seeks to market its product before expiration of the patents must include in their applications what is known as a “Paragraph IV”
+Added: If there are patents listed in the Orange Book for a product, a generic or 505(b)(2) applicant that seeks to market its product before expiration of the patents must include in their applications what is known as a “Paragraph IV”
certification, challenging the validity or enforceability of, or claiming non-infringement of, the listed patent or patents.
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We may not be successful in securing or maintaining proprietary patent protection for products and technologies we develop or license.
−Removed: Moreover, if any of our owned or in-licensed patents that are listed in the Orange Book are successfully challenged by way of a Paragraph IV certification and subsequent litigation, the affected product could immediately face generic competition and its sales would likely decline rapidly and materially.
+Added: Moreover, if any of our owned or in-licensed patents that are listed in the Orange Book are successfully challenged by way of
+Added: a Paragraph IV certification and subsequent litigation, the affected product could immediately face generic competition and its sales would likely decline rapidly and materially.
Our business operations and current and future relationships with investigators, healthcare professionals, consultants, third-party payors, patient organizations and customers will be subject to applicable healthcare regulatory laws, which could expose us to penalties.
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federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers;
−Removed: Physician Payments Sunshine Act and its implementing regulations, which require certain manufacturers of drugs, devices, biologics and medical supplies that are reimbursable under Medicare, Medicaid or the Children’s Health Insurance Program to report annually to the government information related to certain payments and other transfers of value to physicians, as defined by such law, certain non-physician providers such as physician assistants and nurse practitioners, and
−Removed: teaching hospitals, as well as ownership and investment interests held by the physicians described above and their immediate family members;
+Added: Physician Payments Sunshine Act and its implementing regulations, which require certain manufacturers of drugs, devices, biologics and medical supplies that are reimbursable under Medicare, Medicaid or the Children’s Health Insurance Program to report annually to the government information related to certain payments and other transfers of value to physicians, as defined by such law, certain non-physician providers such as physician assistants and nurse practitioners, and teaching hospitals, as well as ownership and investment interests held by the physicians described above and their immediate family members;
analogous U.S.
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Risks Related to Our Common Stock
−Removed: Our stock price has been volatile, and in the future, may be volatile and you may not be able to resell shares of our common stock at or above the price you paid.
−Removed: The trading price of our common stock has been, and in the future, may be subject to substantial volatility and wide fluctuations in response to various factors, some of which are beyond our control.
−Removed: In particular, the trading prices for pharmaceutical, biopharmaceutical and biotechnology companies have been highly volatile as a result of extreme volatility and disruptions in the global economy, including rising inflation and interest rates, declines in economic growth, the conflict between Russia and Ukraine, the COVID-19 pandemic and uncertainty about economic stability.
+Added: Our stock price has been volatile, and could in the future be volatile, and you may not be able to resell shares of our common stock at or above the price you paid.
+Added: The stock price of our common stock has been, and could in the future be, subject to substantial volatility and wide fluctuations in response to various factors, some of which are beyond our control.
+Added: In particular, the stock prices for pharmaceutical, biopharmaceutical and biotechnology companies have been highly volatile as a result of extreme volatility and disruptions in the global economy, including rising inflation and interest rates, declines in economic growth, the war between Russia and Ukraine and uncertainty about economic stability, including a potential recession.
These factors include those discussed in this “Risk Factors”
section and others such as:
−Removed: results from, and delays in, our clinical trials for our product candidates or any other future clinical development programs, including delays related to the COVID-19 pandemic;
+Added: results from, and delays in, our clinical trials for our product candidates or any other future clinical development programs;
announcements of regulatory approval or disapproval of our current or any future product candidates;
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market conditions in the pharmaceutical, biopharmaceutical and biotechnology sectors;
−Removed: general economic conditions in the United States and abroad, including as a result of an economic recession or depression and market volatility related to the COVID-19 pandemic, the current inflationary economic environment, rising interest rates and global health concerns;
+Added: general economic conditions in the United States and abroad, the current inflationary economic environment, rising interest rates and global health concerns;
sales of our common stock, including sales by our officers, directors and specific existing stockholders;
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In addition, the stock markets in general, and the markets for pharmaceutical, biopharmaceutical and biotechnology stocks in particular, have experienced extreme volatility that may have been unrelated to the operating performance of the issuer.
−Removed: These broad market fluctuations may adversely affect the trading price or liquidity of our common stock.
+Added: These broad market fluctuations may adversely affect the stock price or liquidity of our common stock.
An active, liquid and orderly market for our common stock may not develop, and you may not be able to resell your common stock at or above the price you paid.
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Our management and other personnel needs to devote a substantial amount of time to ensure that we comply with all of these requirements.
−Removed: Moreover, these reporting requirements, rules and regulations increase our legal and financial compliance costs
−Removed: and make some activities more time-consuming and costly.
+Added: Moreover, these reporting requirements, rules and regulations increase our legal and financial compliance costs and make some activities more time-consuming and costly.
These reporting requirements, rules and regulations, coupled with the increase in potential litigation exposure associated with being a public company, could also make it more difficult for us to attract and retain qualified persons to serve on our board of directors or board committees or to serve as executive officers, or to obtain certain types of insurance, including directors’
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Pursuant to Section 404(a), we are required to file with the SEC an annual management assessment of the effectiveness of our internal control over financial reporting.
−Removed: Because we re-qualified as a smaller reporting company and we have less than $100 million in annual revenue, at the end of this fiscal year, we will be a non-accelerated filer and will no longer be required to comply with the auditor attestation requirements regarding the effectiveness of our internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act until we become an accelerated filer or large accelerated filer.
+Added: Because we re-qualified as a smaller reporting company and we have less than $100 million in annual revenue, as of December 31, 2022, we are a non-accelerated filer and are no longer be required to comply with the auditor attestation requirements regarding the effectiveness of our internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act until we become an accelerated filer or large accelerated filer.
Our management’s assessment needs to include disclosure of any material weaknesses identified by our management in our internal control over financial reporting.
A material weakness is a deficiency or combination of deficiencies in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual and interim financial statements will not be detected or prevented on a timely basis.
−Removed: If we identify one or more material weaknesses in our internal control over financial reporting, we will be unable to assert that our internal controls are effective.
+Added: If we identify one or more material weaknesses in our internal control
+Added: over financial reporting, we will be unable to assert that our internal controls are effective.
The effectiveness of our controls and procedures may be limited by a variety of factors, including:
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Our principal stockholders and management own a significant percentage of our stock and will be able to exert significant control over matters subject to stockholder approval.
−Removed: As of September 30, 2022, our executive officers, directors, holders of 5% or more of our capital stock and their respective affiliates beneficially owned a majority of our outstanding voting stock.
+Added: As of March 31, 2023, our executive officers, directors, holders of 5% or more of our capital stock and their respective affiliates beneficially owned a majority of our outstanding voting stock.
In addition, in our July 2022 private placement, certain of the holders of 5% or more of our capital stock acquired pre-funded warrants to purchase shares of our common stock (which are immediately exercisable and have an exercise price of $0.001 per share) and common warrants to purchase shares of our common stock (which are immediately exercisable and have an exercise price of $5.806875 per share).
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If such holders exercise their warrants, then the shares of our capital stock beneficially owned by our executive officers, directors, holders of 5% or more of our capital stock and their respective affiliates would increase significantly.
−Removed: Therefore, these stockholders will have the
−Removed: ability to influence us through this ownership position.
+Added: Therefore, these stockholders will have the ability to influence us through this ownership position.
These stockholders may be able to determine all matters requiring stockholder approval.
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In addition, as opportunities present themselves, we may enter into financing or similar arrangements in the future, including the issuance of debt securities, preferred stock or common stock.
−Removed: For example, in August 2021, we entered into a sales agreement with Cowen, as sales agent, pursuant to which we may issue and sell shares of our common stock for an aggregate maximum offering price of $100.0 million under an at-the-market offering program.
+Added: For example, in August 2021, we entered into a sales agreement with Cowen, as sales agent, pursuant to which we may issue and sell shares of our common stock for an aggregate maximum offering price of $100.0 million under an at-the-market offering program under which we have sold approximately $18.0 million of shares of our common stock.
In addition, in July 2022, we closed a private placement which included the sale of pre-funded warrants and common warrants to purchase shares of our common stock.
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Sales of a substantial number of shares of our common stock in the public market could cause our stock price to fall.
−Removed: If our existing stockholders sell, or indicate an intention to sell, substantial amounts of our common stock in the public market, the trading price of our common stock could decline.
−Removed: As of September 30, 2022, the number of shares of our common stock outstanding was 47,626,503.
+Added: If our existing stockholders sell, or indicate an intention to sell, substantial amounts of our common stock in the public market, the stock price of our common stock could decline.
+Added: As of March 31, 2023, the number of shares of our common stock outstanding was 53,080,673.
This number does not include 22,113,062 shares of common stock issuable upon the exercise of pre-funded warrants or 8,427,508 shares of common stock issuable upon the exercise of common warrants.
−Removed: We agreed to file a resale registration statement with the SEC to register the shares of common stock and the shares of common stock issuable upon exercise of the pre-funded warrants and the common warrants sold in the July 2022 private placement.
−Removed: Sales of a substantial number of shares of our common stock in the public market, or the perception that these sales might occur, may reduce the trading price of our common stock.
+Added: We filed a resale registration statement with the SEC to register the shares of common stock and the shares of common stock issuable upon exercise of the pre-funded warrants and the common warrants sold in the July 2022 private placement.
+Added: Sales of a substantial number of shares of our common stock in the public market, or the perception that these sales might occur, may reduce the stock price of our common stock.
Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited.
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Under Section 203, a corporation may not, in general, engage in a business combination with any holder of 15% or more of its capital stock unless the holder has held the stock for three years or, among other exceptions, the board of directors has approved the transaction.
−Removed: As a California-domiciled public company, we are required to have a certain number of women and directors from underrepresented communities on our board of directors on certain timeframes, depending on the size of our board at the time.
−Removed: Our success depends in part on our continued ability to attract, retain and motivate highly qualified individuals to our board of directors.
−Removed: As a public company headquartered in California, we were required to have three women and at least one director from an underrepresented community on our board of directors by the end of 2021 and two or three directors from an underrepresented community on our board of directors by the end of 2022, depending on the size of our board of directors at the time.
−Removed: We had one woman on our board of directors at the end of 2021, and we may be fined for failure to meet the California requirements.
−Removed: While we currently have two women and four directors from underrepresented communities on the board of directors, recruiting and retaining board members carries uncertainty, and failure to comply with these California requirements will result in financial penalties.
Claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to us.
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certificates of incorporation has been challenged in legal proceedings, and it is possible that a court could find these types of provisions to be inapplicable or unenforceable.
−Removed: While the Delaware courts have determined that such choice of forum provisions are facially valid, a stockholder may nevertheless seek to bring a claim in a venue other than those designated in the exclusive forum provisions, and there can be no assurance that such provisions will be enforced by a court in those other jurisdictions.
+Added: While the Delaware courts have determined that such choice of forum provisions are facially valid, a stockholder may nevertheless seek to bring a claim in a venue other than those designated in the exclusive forum provisions, and there
+Added: can be no assurance that such provisions will be enforced by a court in those other jurisdictions.
If a court were to find the choice of forum provision that will be contained in our amended and restated certificate of incorporation and amended and restated bylaws to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business and financial condition.
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Consequently, we may not be able to prevent third parties from practicing our inventions in all countries outside the United States, or from selling or importing products made using our inventions in and into the United States or other jurisdictions.
−Removed: Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and
−Removed: may export otherwise infringing products to territories where we have patent protection, but enforcement is not as strong as that in the United States.
+Added: Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and may export otherwise infringing products to territories where we have patent protection, but enforcement is not as strong as that in the United States.
These products may compete with any future products we may sell, and our patents or other intellectual property rights may not be effective or sufficient to prevent them from competing.
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Anti-corruption laws are interpreted broadly and prohibit companies and their employees, agents, contractors and other collaborators from authorizing, promising, offering or providing, directly or indirectly, improper payments or anything else of value to recipients in the public or private sector.
−Removed: We may engage third parties to sell our products outside the United States, to conduct clinical trials and/or to obtain necessary permits, licenses, patent registrations and other regulatory approvals.
+Added: We may engage third parties to sell our products outside the United
+Added: States, to conduct clinical trials and/or to obtain necessary permits, licenses, patent registrations and other regulatory approvals.
We have direct or indirect interactions with officials and employees of government agencies or government-affiliated hospitals, universities and other organizations.
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Any violations of the laws and regulations described above may result in substantial civil and criminal fines and penalties, imprisonment, the loss of export or import privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm and other consequences.
−Removed: Significant disruptions of information technology systems, breaches of data security and other incidents could materially adversely affect our business, results of operations and financial condition.
+Added: Information technology system failures, security breaches, cyberattacks, or deficiencies in our cybersecurity could materially adversely affect our business, results of operations and financial condition.
We collect and maintain information in digital and other forms that is necessary to conduct our business, and we are increasingly dependent on information technology systems and infrastructure to operate our business.
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We have also outsourced elements of our information technology infrastructure, and as a result a number of third-party vendors may have access to our confidential information.
−Removed: Our internal information technology systems and infrastructure, and those of any future collaborators and our contractors, consultants, vendors and other third parties on which we rely, are vulnerable to attack, damage and interruption from computer viruses, malware (e.g., ransomware), natural disasters, terrorism, war, telecommunication and electrical failures, cyber-attacks, denial or degradation of service attacks, hacking, sophisticated nation-state and nation-state supported actors, phishing and other social
−Removed: engineering attacks, attachments to emails, fraud, employee theft or misuse, and unauthorized access or use by persons inside our organization or persons with access to systems inside our organization.
−Removed: The risk of a security breach or disruption, particularly through cyber-attacks, including by computer hackers, foreign governments and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased.
+Added: Our information technology systems and infrastructure, and those of any future collaborators and our contractors, consultants, vendors and other third parties on which we rely, are vulnerable to attack, damage and interruption from computer viruses, malware (e.g., ransomware), natural disasters, terrorism, war, telecommunication and electrical failures, cyberattacks, denial or degradation of service attacks, hacking, sophisticated nation-state and nation-state supported actors, phishing and other social engineering attacks, attachments to emails, fraud, employee theft or misuse, and unauthorized access or use by persons inside our organization or persons with access to systems inside our organization.
+Added: The risk of a security breach or disruption, particularly through cyberattacks, including by computer hackers, foreign governments and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased.
The prevalent use of mobile devices that access confidential information also increases the risk of lost or stolen devices, security incidents and data security breaches, which could lead to the loss of confidential information or other intellectual property.
Attacks upon information technology systems are increasing in their frequency, levels of persistence, sophistication and intensity, and are being conducted by sophisticated and organized groups and individuals with a wide range of motives and expertise.
−Removed: As a result of the COVID-19 pandemic, we may also face increased risks of a security breach or disruption due to our reliance on internet technology and the number of our employees who are working remotely, which may create additional opportunities for cyber criminals to exploit vulnerabilities.
+Added: As a result of any global health crisis such as the COVID-19 pandemic, we may also face increased risks of a security breach or disruption due to our reliance on internet technology and the number of our employees who are working remotely, which may create additional opportunities for cyber criminals to exploit vulnerabilities.
Furthermore, because the techniques used to obtain unauthorized access to, or to sabotage, systems change frequently and often are not recognized until launched against a target, we may be unable to anticipate these techniques or implement adequate preventative measures.
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Even if identified, we may be unable to adequately investigate or remediate incidents or breaches due to attackers increasingly using tools and techniques that are designed to circumvent controls, to avoid detection, and to remove or obfuscate forensic evidence.
−Removed: We and certain of our service providers are from time to time, subject to cyber-attacks and security incidents.
−Removed: While we do not believe that we have experienced any significant system failure, accident or security breach to date, if such an event were to occur and cause interruptions in our operations or our critical third parties’
−Removed: operations, it could result in a material disruption of our product development programs, and ultimately, our financial results.
+Added: We and certain of our service providers are from time to time, subject to cyberattacks and security incidents.
+Added: For example, one of our third-party drug component suppliers experienced a significant cyber attack, which could potentially lead to delays in supply and/or increased costs to us associated with obtaining an alternative supply.
+Added: Any significant system failure, accident or security breach and resulting interruptions in our operations or our critical third parties’
+Added: operations could result in a material disruption of our product development programs, and ultimately, our financial results.
For example, the loss of clinical trial data from completed or ongoing or planned clinical trials could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data.
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We would also be exposed to a risk of loss, governmental investigations or enforcement, or litigation and potential liability, which could materially adversely affect our business, results of operations and financial condition.
−Removed: Actual or perceived failure to comply with applicable data protection laws, regulations, standards and other requirements could lead to government enforcement actions and civil or criminal penalties, private litigation or adverse publicity and could negatively affect our operating results and business.
+Added: We maintain cyber liability insurance;
+Added: however, this insurance may not be sufficient to cover the financial, legal, business or reputational losses that may result from an interruption or breach of our systems.
+Added: Actual or perceived failure to comply with applicable data protection laws, regulations, standards and other requirements could lead to government enforcement actions and civil or criminal penalties, private litigation or adverse publicity and could negatively affect our results of operations and business.
We and our current and future collaborators are or may become subject to federal, state and foreign data protection laws and regulations governing data privacy and security.
−Removed: In the United States, numerous federal and state laws and regulations, including data breach notification laws, health information privacy laws and consumer protection laws, including Section 5 of the Federal Trade Commission Act, which govern the collection, use, disclosure and protection of health-related and other personal information, may apply to our operations and the operations of current and future collaborators.
+Added: In the United States, numerous federal and state laws and regulations, including data breach notification laws, health information privacy laws and consumer protection laws, which govern the collection, use, disclosure and protection of health-related and other personal information, may apply to our operations and the operations of current and future collaborators.
In the United States, the Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 and its implementing regulations, or collectively, HIPAA, imposes, among other things, certain standards relating to the privacy, security, transmission and breach reporting of individually identifiable health information.
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The CCPA may increase our compliance costs and potential liability.
−Removed: Further, the California Privacy
−Removed: Rights Act, or the CPRA, recently passed in California.
−Removed: The CPRA significantly amends the CCPA and will impose additional data protection obligations on covered businesses, including additional consumer rights processes, limitations on data uses, new audit requirements for higher risk data, and opt outs for certain uses of sensitive data.
−Removed: It will also create a new California data protection agency authorized to issue substantive regulations and could result in increased privacy and information security enforcement.
−Removed: The majority of the provisions will go into effect on January 1, 2023, and additional compliance investment and potential business process changes may be required.
−Removed: Similar laws have passed in Virginia, Colorado, Connecticut, Utah, and have been proposed in other states and at the federal level, reflecting a trend toward more stringent privacy legislation in the United States.
+Added: Further, the California Privacy Rights Act, or the CPRA, passed in California and it significantly amends the CCPA.
+Added: The CPRA imposes additional data protection obligations on covered businesses, including additional consumer rights processes, limitations on data uses, new audit requirements for higher risk data, and opt outs for certain uses of sensitive data.
+Added: It also creates a new California data protection agency authorized to issue substantive regulations and could result in increased privacy and information security enforcement.
+Added: The majority of the provisions went into effect on January 1, 2023, and additional compliance investment and potential business process changes may be required.
+Added: Similar laws have passed in Virginia, Colorado, Connecticut, Iowa and Utah, and have been proposed in other states and at the federal level, reflecting a trend toward more stringent privacy legislation in the United States.
The enactment of such laws could have potentially conflicting requirements that would make compliance challenging.
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however, this new EU-US Data Privacy Framework has not been implemented beyond an executive order signed by President Biden on October 7, 2022 on Enhancing Safeguards for Untied States Signals Intelligence Activities.
−Removed: The restrictions on use of SCCs include a requirement for companies to carry out a transfer impact assessment which, among other things, assesses the laws governing access to personal data in the recipient country and considers whether supplementary measures that provide privacy protections additional to those provided under SCCs will need to be implemented to ensure an essentially equivalent level of data protection to that afforded in the EEA.
−Removed: The European Commission issued revised SCCs on June 4, 2021 to account for the decision of the CJEU and recommendations made by the European Data Protection Board.
−Removed: The revised SCCs must be used for relevant new data transfers from September 27, 2021;
−Removed: existing standard contractual clauses arrangements must be migrated to the revised clauses by December 27, 2022.
−Removed: The new SCCs apply only to the transfer of personal data outside of the EEA and not the UK.
−Removed: The UK’s Information Commissioner’s Office has published new data transfer standard contracts for transfers from the UK under the UK GDPR.
−Removed: This new documentation will be mandatory for relevant data transfers from September 21, 2022;
−Removed: existing standard contractual clauses arrangements must be migrated to the new documentation by March 21, 2024.
−Removed: There is some uncertainty around whether the revised clauses can be used for all types of data transfers, particularly whether they can be relied on for data transfers to non-EEA entities subject to the GDPR.
+Added: European court and regulatory decisions subsequent to the CJEU decision of July 16, 2020 have taken a restrictive approach to international data transfers.
As supervisory authorities issue further guidance on personal data export mechanisms, including circumstances where the SCCs cannot be used, and/or start taking enforcement action, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we provide our services, the geographical location or segregation of our relevant systems and operations, and could adversely affect our financial results.
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The UK GDPR mirrors the fines under the GDPR, i.e., fines up to the greater of €20 million (£17.5 million) or 4% of global turnover.
−Removed: The relationship between the UK and the EU in relation to certain aspects of data protection law remains unclear, and it is unclear how UK data protection laws and regulations will develop in the medium to longer term, and how data transfers to and from the United Kingdom will be regulated in the long term.
−Removed: The European Commission has adopted an adequacy decision in favor of the United Kingdom, enabling data transfers from EU member states to the United Kingdom without additional safeguards.
−Removed: However, the UK adequacy decision will automatically expire in June 2025 unless the European Commission re-assesses and renews or extends that decision.
−Removed: In September 2021, the UK government launched a consultation on its proposals for wide-ranging reform of UK data protection laws following Brexit and the response to this consultation was published in June 2022.
−Removed: There is a risk that any material changes which are made to the UK data protection regime could result in the European Commission reviewing the UK adequacy decision, and the UK losing its adequacy decision if the European Commission deems the UK to no longer provide adequate protection for personal data.
+Added: As we continue to expand into other foreign countries and jurisdictions, we may be subject to additional laws and regulations that may affect how we conduct business.
The EU has also proposed a Regulation on Privacy and Electronic Communications, or ePrivacy Regulation, which, if adopted, would impose new obligations on the use of personal data in the context of electronic communications, particularly with respect to online tracking technologies and direct marketing.
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This regulation imposes new obligations on the use of data generated from clinical trials and enables European patients to have the opportunity to access information about clinical trials.
−Removed: Failure or perceived failure to comply with the
−Removed: GDPR, the UK GDPR, the ePrivacy Regulation, the EU Clinical Trials Regulations, and other countries’
+Added: Failure or perceived failure to comply with the GDPR, the UK GDPR, the ePrivacy Regulation, the EU Clinical Trials Regulations, and other countries’
privacy or data security-related laws, rules or regulations could result in significant regulatory penalties and fines, and affect our compliance with contracts entered into with our partners, collaborators and other third parties.
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ability to operate in certain jurisdictions.
−Removed: Any actual or perceived failure to comply by us or our employees, representatives, contractors, consultants, collaborators, or other third parties could result in government investigations and/or enforcement actions, fines, civil or criminal penalties, private litigation or adverse publicity and could negatively affect our operating results and business.
+Added: Any actual or perceived failure to comply by us or our employees, representatives, contractors, consultants, collaborators, or other third parties could result in government investigations and/or enforcement actions, fines, civil or criminal penalties, private litigation or adverse publicity and could negatively affect our results of operations and business.
If securities or industry analysts do not publish research or reports about our business, or if they issue an adverse or misleading opinion regarding our stock, our stock price and trading volume could decline.
The trading market for our common stock is influenced by the research and reports that industry or securities analysts publish about us or our business.
−Removed: If any of the analysts who cover us issue an adverse or misleading opinion regarding us, our business model, our intellectual property or our stock performance, or if our clinical trials and operating results fail to meet the expectations of analysts, our stock price would likely decline.
+Added: If any of the analysts who cover us issue an adverse or misleading opinion regarding us, our business model, our intellectual property or our stock performance, or if our clinical trials and results of operations fail to meet the expectations of analysts, our stock price would likely decline.
If one or more of these analysts cease coverage of us or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.
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Regardless of the merits or the ultimate results of such litigation, securities litigation brought against us could result in substantial costs and divert our management’s attention from other business concerns.
−Removed: Recent Sales of Unregister ed Securities and Use of Proceeds.
−Removed: (a) Sales of Unregistered Securities
−Removed: As described above, on July 11, 2022, we sold in a private placement an aggregate of 9,013,834 shares of common stock, pre-funded warrants to purchase up to 24,696,206 shares of our common stock and accompanying common warrants to purchase up to 8,427,508 shares of our common stock.
−Removed: Please see our Current Report on Form 8-K filed with the SEC on July 8, 2022 and Note 6—
−Removed: Stockholders’
−Removed: Equity to our unaudited condensed consolidated financial statements for additional information regarding the pre-funded warrants and the common warrants.
−Removed: (b) Use of Proceeds from Public Offering of Common Stock
−Removed: On July 23, 2020, our registration statement on Form S-1, as amended (Registration No.
−Removed: 333-239647), was declared effective in connection with our IPO.
−Removed: There has been no material change in the planned use of proceeds from our IPO as described in the registration statement on Form S-1.
−Removed: We invested the funds received in cash equivalents and other marketable securities in accordance with our investment policy.
−Removed: (c) Issuer Purchases of Equity Securities
+Added: Unregister ed Sales of Equity Securities and Use of Proceeds.
Defaults Upo n 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.